The political

economy of the
Soviet Union
today
Albert
Szymanski
 ls the Red Flag
Flying?
1

1111 111
3 1

The Political Economy of

the Soviet Union

Albert Szymanski

To my parents, Al and Verna, and sister Judy.

Zed Press, 57 Caledonian Road, London Nl 9DN

.e! o 1048
 ontents

11111
3 ,

Acknowledgements 1
ls the Red Rag Rying? was fust published lntroduction 4
by Zed Press, 57 Caledonian Road, London l11e Nature of the Soviet Union: A Crucial Question 4
NI 9DN in June 1979. 1\.ssumptions and Motivations Underlying This Book 6
Summary of This Book 8
Copyright ©Albert Szymanski A Note on Sources 10
2. What is a Socialist Society? 13
ISBN Hb O 905762 35 5 Criteria for Categorizing Social Formations 13
Pb O 905762 36 3 Capitalism 16
Ownerslup, Control and Day-to-Day Operation 20
Printed by Redwood Bum Ltd., Class and Social Class 22
Trowbridge and Esher Rullng Classes and Power Elites 24
Typeset by Lyn Caldwell Mechanisms of Popular Control 25
Designed by Mayblin/Shaw Forms of Socialism 32
Transformation of Socialist Societies 34
A11 rights reserved J. The Role of Market Forces 36
Profit and the Plan 37
Commodity Markets and Prices 41
Producer Goods Markets 43
The Labour Market 46
Conclusion 59
4. Social Classes 62
The Distribu tion of Material Rewards 63
Tendencies Towards the Formation of Social Classes 69
Conclusion 76
S. Political Processes 80
The Formal Political Structure 81
Public Debate and Public Opinion Formation 83
Popular Participation in Srate Bodies 87
Other Books by Albert Szymanski The Communist Party 88
Social Background of the Leaders 91
The Capitalist Sta te and the Politics o[ Qass (Boston: Structural Determinants of State Policies 94
W~nthrop Publishing Co., 1977) Summary and Conclusion 95
Qass, Consciousness, and Contradictions: An lntroduction 6. Soviet Foreign Relations: The Logic of Trade :md the
to Sociology (Jointly with Ted Goertzel) (New York: Van
Uses of the Military 101
Nostrand, 1978)
 Deftnitions
Soviet Foreign Trade
101
104
Acknowledgements
The Soviet Military 110
7. Soviet Relations with Eastem Europe 120
Trade Relations 120
111111 127
3 1 Economic Assistance
Co-ordinated Planning 128
Joint Enterprises Today 130
Economic Growth 131
Economic Relations Before and After the Mid·1950s 134
The Break with Yugoslavia 137
lntervention in Czechoslovakia 139
146
""Y lntcllectual work is a coUective product. An author such as myself
Hungary, 1956 Julllt•ly manifests the various intellectual currents and social forces of his
The Autonomy of Eastem Europe Today 147 111m• rhe chief socíal force leading me to write this book was the debate in
8. Soviet Relations with the Non-socialist Third World 151 tlu Amenean 'new communist movement' which had grown up out of the
Economic Assistance 151 11 llr• of the Students for Democratic Society (S.D.S.) in the early 1970s. The
Economic Assistance: The Case of India 157 11c rulion of American radica1s formed in the movemen ts of the 1960s were
Ownership and Control of Enterprises 159 vt111 much attracted to the Vietnamese, Cuban and Chinese revolutions. We
Trade: The Case of India 161 wou nttracted to the fust two because of their heroic resistance to the
Politicallnterventions in Third World Countries 164 hnpcnalism of our own country and to the latter because it seemed, during
Military Assistance 165 lhc years of the ' Great Proletarian Cultural Revolution', to be building a form
Bangladesh 167 ul soctalism true to the Communist idea] (and thus qualitatively different
Carnbodia 168 lr11111 what we lhought was the Soviet betrayal of socialist ideals). Accepting
Angola 170 lhc antt·Sovie t notions current amongst all those who grew up in the U.S. in
The Hom of Africa 172 1hr. 1950s, it was natural for us to accept the analysis offered of the Soviet
Conclusion 178 llniun by the Chinese. Although the Chinese began caUing the Soviet Union
9. Soviet Relations with the Socialist Third World 183 1 tpltnllst as early as 1967 it was not until around 1972-73 lhat those
China 183 "mnunts of S. D.S. which had taken a Marxist·Leninist path began seriously
Cuba 187 hl dlscuss and digest their analysis. In 1974 two influential works appeared:
Conclusions 194 U1 el Papers No. 7: How Capitalism has been Restored in the Soviet Union,
1O.The Soviet Union: Retrospect and Prospect 199 published by the Revolutionary Union (now the Revolutionnry Communist
The Class Nature of the U.S.S.R. 199 l'.trly), und Martín Nicolaus's Restoration o[ Capitalism in the U.S.S.R,
Stalin 201 apnnsored at the time by the October League (now the Communist Party
The Origins of Soviet Hegemonism 211 IMnrxist-Leninist] ). They sparked off considerable discussion within the new
The Future of the Soviet Union 220 American Marxist· Leninist left and led to many groups and individuals
Implications for the World Struggle 222 cepting the thesis of these two works.
Bibliography 225 Al the time 1 was in a politically independent collective within which
Soviet Domestic Political Economy and Social Structure 225 many individual members were lending to accept the Chinese thesis. Under
Soviet Foreign Relations 229 p1essure of the debates within this group, in tum a reflection of the larger
Index· 232 th~ussion in the U.S. left in 1973·74, 1 began to investigate the question of
lhe class nature of Lhe Soviet Union, both in order to resolve it in my own
nund and to con tribute to the discussion. Thus, more than anything else, it is
lhe Anna Louise Strong Collective, the broader U.S. left (especiaUy the
Revolutionary Union and Martin Nicolaus) and ftnally the Communist Party
uf China wluch must be ack.nowledged as the primary stimuli for undertaking
 A cknowlt•dgcmc·llts

this work. líl'll 11 111 has made incumbent on that role) and the cnticism and attacks of
1 owe a great deal to Jerry Lcmbcke, also a member of the CoUective at 1 th 1 (11 ogres~rveforces around the world (not just the Chinese and their
the time we began our discussion of the Chinese thesis. Jerry and 1 simuJ- "I'Jl"llcrs) who, holding too high an ideal about what can be accomplished
taneously undertook the study ofSoviet society for the same reasons In lh hort run and having an insufficient understanding of social forces

11 1~
reaching essentially the same conclusion . In the course of our separa te invest- nd lu tnrical possibilities, have added lo the dlfficuJties faced by the Soviets.
igations we provided each other with considerable assistance. This work 11 111 not been for the considerable, however tmperfect, Soviet achievements
3 1 consequently owes more to Jerry than to any other individual. In hullthng a socialist society and the world-wide controversies thls effort
1 must also thank those who taught me social science, above all Juan linz h 1 p1 uvoked, it ts quite obvious that this work wouJd not exist.
and Terry Hopkins. Without the effort they invested in me this work wouJd
not have been.
My friends during the period in whlch this work took shape are partially lh rl Szymanski
responsible for it, having provided both emotional support and inteUectual 1 crnber 1978
stimuJation. 1 especially would like to thank Bert Knorr, Sue Jacobs, Peter
Dreier, Harry Humphries, Gail Lemberger and Madeleine MacDonald .
My parents Al and Verna as well as my sister Judy have given me consistent
support on alllevels. In a very real sense 1 owe most to them.
As always the research librarians al the University of Oregon, my typist
Doris Boylan, copy editor Miranda Davies, and all those who did the physical
work of typesetting, printing and distributing the book must be thanked for
the essential contnbutions they have made.
Those Soviet sociologists of the last decade or so who have produced
empirical studies of their society and also the less hysterical Westem
Sovietologists who have produced reasonably objective empirical studies of
aspects of the Soviet Union must also be thanked for providing most of the
data on which this study has been based. Special thanks must be given to
Murray Yanowich, Paul Gregory and Robert Stuart, Robert Osbom, David
Parkin, 0.1. Shkaraton, T.H. Rigby and H. Gordon Skilling. Also, to those
who read earlier drafts of either the en tire manuscript or particular chapters
submitted as articles to various U.S. teftjoumals, namely the reviewers for
the Review of Radical Political Economics (for chapter three), Social Science
Quarterly (for chapter four), Science and Society {for chapter five) and The
Berkeley Joumal o!Sociology (for chapter six). Roger van Zwanenberg and
Robert Molteno of Zed Press must be especially thanked for their helpful
comments which have made the manuscript considerably stronger.
My inteUectual debt to Paul Sweezy (in spite of our complete disagreement
on this issue) and to the Monthly Review tradi tion of which he has been the
principal representative, is considerable, as is the debt of our entire generation
of radical scholars. Sweezy must be especially thanked because of the debates
which were published in Monthly Review in the late I960s and early l970s
around the question of the Soviet Union. Although 1 eventually carne to
reject both the positions of Bettelheim and of Sweezy in their famous debate,
the issues they raised clearly had a major impact on the outcome of my
investigation.
Finally 1 wish to acknowledge the Soviet people and the Communist Party
of the Soviet Union who for too long have had lobear the double burden of
being the world's first sociallst country (with all the pain and hardship world

2 3
 Jntroduction

l. lntroduction llus (state capitalist] economy, now fairly weU established, althougb still in
t h · process of evolution, is not based on serving the needs of the broad
rll •es of the Soviet work:ing people. lt is in no respect controlled by them.
lt 1 an economy based on the principie of the exploitation of man by man ;
un the extraction of surplus value from the workers by a new ruling class of
5
11 te monopoly capithlists.
1.11
3
lur llome time the October Le ague endorsed Martin Nicolaus's (one of its
luuner leaders) booklet The Restoration o[Capitalism in the U.S.S.R , whlch
IJ'IICc.J.

l 1he Soviet leadership] erected an out-and-out capitalist economic

Since the October Revolution of 1917 there has been considerable debate of a state monopoly capitalist type. Tt is today a consolidated
~ tru c ture
among both socialists and enemies of socialism on the class nature of the r-co nomic system that conforms in all essential features to tbe classical
Soviet Union. This debate waxes and wanes over time in good measure as a .annlysis of irnperialism given by Lenin.6
function of the intemational policies of the Soviet Un ion and its enernies. The
last few years have seen a great reviva! of interest in the question among sympa In many ways the Chinese analysis of the Soviet Union is unfortunate be-
thlzers of the People's Republic of China, wlúch since 1967 has claimed that has led sorne progressive forces around the world to oppose revolut-
t,;I IISC 1t
capitalism has been restored in the Soviet Union. Many of the issues and unary movements in Latín America and Africa because of their acceptance of
arguments raised by various branches of the Trotskyist movemen~ in the 1 tance from the Soviet Union. The Chlnese analysis has also spread division
1930s and 1940s are once again being discussed in response to this debate. On 1111d c.Jemoralization among Marxist forces. The facts of the matter would seem
the other hand defenders of the Soviet Un ion continue to claim that the lu speak so clearly against the claim that there has been a significan t increase
country is socialist. 1 In rhc role of capitalist forces in the Soviet economy in the last 25 years.
Nnverthcless, because of the great prestige of the Chinese Revolution and tbe
cnnstdcrable accomplishment in building socialism achleved by tbe Chinese
The Nature of the Soviet Union: A Crucial Question ( ummunlst Party. it is necessary to treat thc Chinese clairns wilh respect. 1t is
therefore necessary for those of us who disagree with these claims to attempt
Since 1967 the Communist Party of China has been arguing that capitalism •unscientiously to refute their arguments.
has been re~stablished in the Soviet Union.l Segrnents of the radicalleft The question of the class na tu re of the Soviet Un ion is by no means an
around the world have echoed the Chinese claim. ln the United S tates the m:adernic one, fit mainly for university serninars and the like. As the arguments
most important groups which have attempted to defend the Chinese thesis md policies of the Chinese have made clear, one's analysis of the nature of the
have been the Revolutionary Communist Party (formerly the Revolutionary '\oviet Union affects how one relates to this most powerful socialist country
Union), the Communist Party (Marxist-Leninist) (formerly the October In the world, a country whlch is also the world's most rapidly growing econornic
League), and the joumal Monthly Review which has published numerous tnd rnilitary power. Whether one accepts its leadershlp, or works closely with
articles since 1967 by Paul Sweezy, Charles Bettelheim and others wbo ti freely accepting the aid it offers, or merely forms a guarded alliance with it,
defend the Cbinese thesis. ur in contrast holds it at arms length or even develops hostile relations to it,
The Chinese have argued : 'Thls "new stage in the development of the tll'pends on what one sees as the results of such a relationshlp. What do the
Soviet society on the way to communism" so much advertised by the Soviet Soviets want? Do they offer aid and advice only to become new masters? Are
3
leading group is nothing but total and complete restoration of capitalism.' lhey really interested in revolutionary change and national independence? Are
Olairman Mao has added tbat the newly restored capitalism in the Soviet lhey reliable allies? These are questions whlch face the entire world revolut-
Union is further a capitalism of the 'fasclst type' . 'The Soviet Union toda y is tunary and progressive movement. They are especially acule for the revolut-
under the dictatorship of the bourgeoisie, a dictatorship of the big bourgeoisie, wnary and anti-imperialist movements of the Third World. ls the course of the
a dictatorship of the German fascist type, a dictatorship of the Hitler type."' C'uban revolution whlch accepts Sovietleadership valid for other countries? ls
The Revolutionary Communist Party, one of the two principal claimants lhe course followed by the M.P.LA., Vietnam and the Ethlopian Dergue, all
to 'Maoist' ortbodoxy in the US., follow.s suit by arguing: of which accept the support of the Soviets, correct? Should, in tum, the
C'hmese leadershlp be trusted? These questions and many more are rooted in

4 S
 /ntroducflon

one's nnalysis of the Soviet Union . ll is thus imperative for revolutionaries 1 llvt 1, joirung the Students for Democratic Soclety in 1961 . As lhe S.D.S.
thtoughout the world todo a careful and scientific analysis of the class nature 11•1thr American student movemenl moved left during the !960s 1 moved
of Soviet society in order to have a finn theoretical base on which to build 111t 11 t begnn to call myself a Marxist in 1964, and after a thorough reading
revolutionary strategies. And these strategies, given the growing Soviet role ni 1ht l l.to;sics of Marxism-Leninism, a Leninist in 1966. As a graduate studen t
in the Third World, necessitate taking a position on Soviet Jeadershlp and u( •Kiulogy ot Columbia University from 1964 to 1970, l became involved
assistance. No serious revolutionaries can avoid taking these decisions. 111 thc \IUdent rebellion of 1968. This experience and its aftennath had a
1111 A serious problem in attempting objectively to determine the class nature vuJIIIrrnble impact on my consciousness.
of the Soviet Union is the obvious political implications of such an analysis. 1lk1· most members of S.D.S. in the late 1960s, 1 carne to see Vietnam,
Few if any issues since 1917 ha ve been of greater political consequence than { ul•11 und China as the three revolutionary beacons of the world, and to regard
this one. In almost all cases one's adherence to one or other view of the ti.. u1otlcl of 'the old left', the Soviet Union, with considerable scepticism. As
nature of the Soviet social fonnation is detennined by one's prior ideological 1 utw toa Marxist consciousness my conception of the Soviet Union changed
commitments. It is no accident that ideological commitments largely deter- hui llllle over what it had been before l was a socialist. 1 regarded itas sorne
mine positions on the Soviet Union, for much is at stake. As the first country ltntl uf 'Stalinist' .• or at least heavily bureaucratic society, little better than
in the world to make a revolu tion which proclaimed itself the instrument of '"' tilan capitalism, although- il had to be conceded- a society which
the working class, and as the most powerfuJ country in the world today which 11f1r n played a progressive role in the world. Our identification with China
makes the claim of being socialist (i.e. a society in which the working class 1 l w1c especially strong during the Cultural Revolution which highlighted
rules), all those with a stake one way or the other in the question of the 111 1111 ferences between the Soviet and Chinese models of socialism. We in the
viability of socialism must take a position on its nature. On the one hand, N w L.tft enthusiastically endorsed the Chinese development of what seemed
many feel that to make a socialist revolution (particularly in the West) we tH 1h•cen tralized, participatory and non-authoritarian socialism. This led us
must demonstrate both the viability and superiority of the socialist way of tn ltwe great respect for the Chinese leadership, especially Mao Tse-tung. It
life by pointing toa concrete example which has endured for over 60 years "'~~ CJIIIte natural for us, therefore, to accept what the Chinese were saying
and which has made continuous progress towards the communist goal in spite '"'"' the Soviet Union, not only because of our respect for them, but
of incredible odds. Other socialists, in contrast, feel that the interests of a l uusc 1t fitted in so well with what most Americans brought up in the
socialist revolution can best be served by distancing themselves as far as I'J~O:J had been so thoroughly conditioned lo believe about the U.S.S.R. lt
possible from the Soviet Union because of its public image (again particularly ,, tnsy to become a revolutionary on the basis of identification with China
in the West) ofbeing a 'Stalinist dictatorship', a 'State Capitalism' ora 11 wte did not have to re-evaluate and reject all that one had been taught
'Bureaucratic Collectivism'. Of course, all anti-communists must discredit the ahnul the 'evils of communism' in the Soviet Union . The Chinese were, we
Soviet claim to be a country where the working class rules, in order to dis- hclu·ved, qualitalively different from the Soviets. All we had been taught
credit the very idea that socialism is possible. Capitalist apologists who argue huu t 'Stalinism', bureaucracy, terror, lack of freedom etc. as the corcel ates
that in spite of its problems capilalism is the system which best serves the ,,¡ c;ummunism, were in fact corre! ates only of Soviet communism and not of
Westem and Third World working class have to show that, even when the 't· 1' communism as typified by the Chinese. lt was a tempting analysis, and
working class makes a revolulion, a new elite inevitably arises to oppress the , , rptcd by most of us.
workers, i.e. that 'it ls not worth the bother to change the government'. Neverlheless, although the Chinese had been calling the Soviet Union
11pltalist since J 967, few of us too k them literally at lhat time. We had not
el come mechanically to accept everything the Chinese (or Albanian)
Assumptions and Motivations Underlying This Book Ir dership said as literal truth. lt was not unlil the early 1970s, 1973 beiflg
tlt• pivota! year, that the Marxist-Leninist rernnants of the New Left seriously
The reader may wish to know where l have come from. As a third generation unfronted the actual Chinese position that capitalism had literally been
American of Polish-Italian ancestry 1 grew up in a small New England factory r• tored in the Soviet Union . While the major 'Maoist' groups, including the
town in the 1950s, which was a period of in tense anti-communism both Hr volulionary Union (now the Revolutionary Communist Party) and the
within my family and within American society at large. My early interest in 1" tober League (now the Communist Party [Mariist-Leninist]) dutifully
history and science ficlion, as well as a strong residue of Catholicism, led me •·lupted the Chinese position, many more independent American Marxist
in the late l950s lo identify with socialism asan abstract principie (an identlfi- 1 111pathizers of China, including myself, baulked.
cation achieved solely through reading since 1 never met a socialist until my l;eellng something was basically wrong with the Chinese analysis, now
sophomore year in college), and also in the early 1960s to identify with the llvely promoted by the leading 'Maoist' groups in the U.S., but not feeling
growing civil rights and peace movements in the U .S.A. J became a student th.tl the Soviet Union was sociallst, 1 began to study carefully the question of

6 7
Js tire Red Flag Flying? Introduction

its nature in order to figure out to my own satisfaction what kind ofa society lutl'lhgcntsia (lfld the working class, can be distinguished with the former
it was. havmg somewhat more prerogatives than the socia1ist ideal would seern to
When 1 began my study 1 was incUned to believe that the Soviet Union was
11 ttly
nelther capitalist nor socialist, but a unlque ' thlrd thlng' somewhat along the 1he conventional wisdom of many Weste m radicals as well as of the
lines of the Bureaucratic CoUectivism described by Max Schachtman (albeit a ~estern establishment which tells us that the Soviet Union is not a dernocratic
bit more humane and progressive than he suggested). 1 was thus quite swprised lcty IS challenged in Chapter Five. 1 exantine recently availabl~ empírica!
to ftnd through my reading of mostly pro-capitalist and anti.Soviet, but more d tfl on political processes in the Soviet Union, including on pubhc _d_ebates,
or less scholarly sources, that the Soviet Union was a far different type of pLtlllical participation, support for the regime, the role and composttion_ of
society than 1 had imagined. tilO C'ommunist Party and patterns of social mobility arnongst top decis10n
rultkers. The theory of the 'relative autonomy of the state' is aiso applied to
thr SoVIet Union. The conclusion is that democratic processes, albelt somewhat
Surnmary of This Book ,11 torted, are very real in the Soviet Union. Also, the locus of poli tical power
th , more with the highly sk:illed workers, experts, scientists, engineers and
The Uterature on the class nature of the Soviet Union is dlfficult to digest and 11, hnicians of various kinds than with eíther an elite of bureaucrats and
evaluate because of considerable divergencies in terminology and frames of mmagers, or with the manual section of the working class. .
reference arnong the various wríters who have addressed the question. Not Chnpters Six, Seven, Eight and Nine try to resolve the question ofwhether
only does academic Anglo.Saxon Sovietology differ more or less completely lhc U.S.S.R is essentially 'social imperialist', or 'hegemonic', or 'proletarian
in terrninology and frame of reference from Marxism, but withín the Marxist tntcrnntionalist' (i.e. benevolent and progressive) in its foreign relations. The
tradltion itself there is considerable disagreement about the uses of terms and 1• 1111 'social imperialism' used by China agamst the Soviet Union is defmed
the criteria to be applied in categorizing social formations. ln the next chapter •1111 aggrega te economic relations between the Sovie t Union and Easte~
l try to untangle what is meant by 'capitalism' and 'socialism', and 1 develop lurope, and the Soviet Union and the Third World, are carefuUy e~ed
a classificatory schema of the main types of society by setting out reasonable hu evidence of such a phenomenon. The Soviet foreign trade orgaruzations
criteria of what a socialist society can be expected lo loo k Like. Concepts Like 1u· analysed, as is the composition of, trends in, and terrns of trade between
ownership, control and class are carefuUy scrutinized, as are the various thr Soviets and other countries. Soviet economic and mllitary assistance to
possible mechanisms ofpopular control, in an attempt to develop the concep- l•nlh Eastem Europe and the Third World are exarnined. The Council of
tual tools prerequisite lo an empirical investigation of the question. Mutual Economic Assistance is also looked at for evidence of Soviet domin·
The thlrd chapter examines recent studies by Westem econornists on the 11 u:c and Soviet gain. Joint economic enterprises participated in by the Soviet
role of commodity, capital and labour markets in the Soviet Union. The role 1Jnion and other countries, and the trends in such institutions, are studied.
of the state plan, profits, the law of value, investment, inflation, unemploy- 1he e ffec t of clase economic relations with the Soviet Union on the rate of
ment and economic cycles are all examined, as are tlte Uebennan-Kosygin ~· nwth and industrialization of Eastern Europe is discussed. The motives and
Reforms. Whether there are any tendencies for the rate ofprofit to fall (or tr cngth of the Soviet military are also exarnined, as are specifi~ Soviet
rote of surplus to rise) is also evaluated. The chapter concludes that the tnv()lvements in the affairs ofvarious Eastem European and Third World
Soviet Union is not dominated by the laws of markets, as is the case under 1 uun tries. Here 1 focus on the Soviet role in !hose countries where the
capitalism. e hinese and their supporters have most often dlrec ted their accusations:
Chapter Four examines recent empirical research by both Soviet and l1.echoslovakia, India, Bangladesh, Cambodia, Cuba, Angola, Ethiopia and
Westem social scientists on different aspects of soctal stratification in the 1 hinn (before 1961 ).
Soviet Union. lt addresses the question of whether or not social classes, My overall conclusion is that the Soviet Union cannot be considered a
similar to those in the West, exist. Data are carefully examined on income ' I)Ctal imperialist' country, although there are ele ments ofhegemonism in its
inequality and its trends, the role of the 'social wage', conditions oflabour hu the most part progressive foreign economic and political relations.
3:l•ong the various groups, the altitudes of different strata, patterns of friend- i\lthough the Soviet Union sometimes pressures other countries to conform
ship and inter-marriage, inter-generational carryovers in status, and access to lntts concepts of socialist development, it can in no reasonable sense be
education. 1 conclude that, although there are important dlfferences in status •~·~;.used of 'social imperialism', a concept which implies alding the forces of
and income between groups in the Soviet Union, these differences are sub- p«1htica1 reaction and holding back the growth of socialism in order to pursue
stantlally less than in the West, show no tendency to increase, and are not lf-serving economic and mllitary galns for the Soviet Union (or, more
sufficlent to categorize the different status groups as consolidated social tl.lrticularly, for sorne ruling class within the Soviet Unlon). .
classes. However, two distinctive social groups, the technical and professlona1 The last chapter looks at the Soviet Union in retrospect, attempting to

8 9
 ls the Red Flag Flying? In troduction

account for how it has become what it is. 1t summarizes the arguments of the look like the U.S.,evidence found to the contrary in their writin~ is likely to
earlier chapters to reach a conclusion on the class nature of Soviet society be valid.
and makes a project:ion about the future development of the Soviet Union. 1 have also to a lesser degree used unofficial studies done by Soviet socio-
The questions of 'Stalin' and the development of Soviet hegemonism in the l(lt;~HS now available in the West. Soviet leaders have considerable interest in
world communist movement are treated at sorne length. 1 conclude that the knnWUlg more about Soviet social structure and the attltudes of the Soviet
11 Soviet Union is a socialist society, albeit a technocrat:ic state socialism in fM!orlc,just as the lcaders of the U.S. have in knowing about theirs. Such
3
whlch a new petty bourgeoisie of scientists, economists, technicians and other lulurma tion is a prerequisite on whlch to base policies. Since both countries
professionals play a disproportionate role in comparison with the manual nret.l the scientific information-gathering techntques of modem sociology,
working class. The U.S.S .R. is then a society in whlch a coalition of this new tlu' discipline has developed in both. J ust as we trust information gathered by
technical petty bourgeoisie rules together with the manual .working class. ln Wt• tcm social scientists for their leaders, we must also generally trust that
the fmal section of the chapter 1 suggest that the smooth progress over the f~l here d by Soviet social scientists for the same reason. Decision makers •
last generation towards more and more equality and greater and greater e mnot afford to base their decisions on fabrication or unreliable information;
popular participat:ion might be halted by the resistance of the technical thcy nced true facts if their decisions are to be the right ones. Such data
inteUigentsia , and a cultural revolution of the Chinese type consequently p•·ncrally needs onl~ to be reconceptualized to fit the questions asked by
occur in which the working class may finally subordina te thls stratum. • llt lcal researchers.
Rccently the empiricalliterature available on the Soviet Union has also
ex panded because of the increasing need of the dominant interests in the U.S.
A Note on Sources tu unt.lerstand the U.S.S.R better.This need has been met by such organs of
thc capitalist class as the Ford Foundation, RockefeUer Foundation and U.S.
The empirical investigation in this book tries to stay as close to the facts St ate Department whlch fund much of U.S. research on Soviet society. This
generally accepted by Anglo..Saxon sovietologists as possible. Except for hnuk is thus obviously indebted to such institutions whlch have so generously
sorne unofficial sociological studies produced by Soviet sociologists, I rely (uf c.:ourse unwittingly) provided support!
mostly on information and data accepted by these authors as valid . Because
of the strong political commitments in the various statements produced by
China, Albania and their supporters on the one side, and by the Soviet Union References
and its supporters on the other, such polemics - however useful they might
otherwise be - are rnostly ignored in thls analysis. To do otherwise would l. For two of the most deve1oped arguments in defence of the Chinese
open my argument to the criticism that m y sources were so biased asto make position that capitalism has been restored in the Soviet Union, see
my case unconvincing to all those who are not already convinced of the Martín Nico1aus, Restoration of Capitalism in the U.S.S.R., (Chlcago:
correctness of my conclusion. A basic principie of scientific historiography is Liberator Press, 1975); and the Revolutionary Unlon, How Capitalism
that evidence gathered in favour of a hypothesis, from those observers whose has been restored in the Soviet Union and What tllis means [or the
bias is obviously unsympathetic to it, is far more reliable than that from those World Strugg/e, (Chicago: The Revolutionary Unlon, 1974).
For what is probab1y the best statement of the same argument within
who are sympathetic. This is because those hostile to a hypothesis can always the Trotskyist tradition see Tony Cliff· State Capitalism in Russia,
be expected to bend reality a bit in order to support their prejudices; thus if (London: Pluto Press, 1974). An important statement in defence of the
a bent reality still supports a conclusion opposite to what the author wants lhesis that the Soviet Union ís capitalist is contained in the essays by
us to believe, then the quality of the eVIdence is likely lo be pretty good. A Pau1 Sweezy and Charles Bettelheim,On the Transition to Socialism,
basic, and for the most part unquestioned , premise ofWestem sovietology is (New York: Monthly Review, 1971 ).
that the productive classes are not in power in the Soviet Union (i.e. that it is For sorne of the better statements of Trotsky's position that the Soviet
not socialist by the classical defmition) and that there is considerably more Uttion ís a 'deformed worker's state' see Leon Trotsky, The Revo/ution
freedom , democracy, public debate, activity by trade unions, etc. in the West Betrayed, (New York: Pioneer Publishers, 1945); Emest Mandel,
than in the Soviet Union. Another popular, but not completely universal, Marxist Economic Theory, (New York: Monthly Review Press, 1968),
Ch. 1S; and Isaac Deutscher, The Unfinished Revolution, (New York:
position among sovietologists is that there is a convergence between the Oxford, 1967).
Soviet Union and the U.S . Since, therefore, the bias of sovietologists is to Another brancb of Trotskyism, represented by lhe lntemational
convince their readers that socialism is not a reality in the Soviet Union, that Socialists in the U.S.A., defends the thesis that both the Soviet Union
authentic democracy and freedom do not exist there, that market Corees are and tbe People's Republic of China are 'bureaucratic collectivist'. For
playing an increasing role and that the country is coming more and more to the c1assical statement of this position see Max Schachtman, The

10 11
 ls tire Red Flag Flymg'

Bure~ucra~~ Revolution, (New York: The Donald Press, 1962). Related

to this posttion are the arguments of Kar1 Wittfoge1 in his Oriental
2. What is a Socialist
Despotism_. {~ew Haven : Yale University Press,1957) ; and James
Bu~am ~ his _The Managerlal Revolution, (B1oomington, indiana:
Indlalla Uruvemty Press, 1966). Thi.s 1atter school argues that the Soviet
Society?
Union is a social formation that is neither capitalist nor socialist but
rather a 'third thlng'. '
Fo~ defence of the position that the Soviet Union is now a socialist
soctety, see any of a number of recent publications by the Soviets them-
se1ves. For examp1e, M. Perfilyev, Soviet Democracy and Bourgeois
Sovietology, (Moscow: Progress Publishers, n.d.); Progress Publishers
The Soviet Form of Popular Government, (Moscow: Progress Publishers
197~); Progress Publishers, The Soviet Union Today, (Moscow: Progress'
Publishers, 1975); G. Shahnazarov, Socialist Democracy, (Moscow: In tlús chapter 1 will try to clarify the basic terms relevant toa d.íscussion of
Progress Publishers, 1974).
2. the nature of the Soviet Union. Before we can scientifically analyse whether
For statements of the officia1 Chinese position see: How the Soviet
Revisiontsts Carry Out A/1-Round Rettoration of Capitalism in the
the Soviet Union is capitalist, socialist or sorne other form of society, we must
U.S..S .R., (Peking: Foreign Languages Press, 1968); Yenan Books, (ed.), agree on how the terms we use are to be employed, since much of the dis-
Soc¡aflmperialism: Reprints from Peking Revtew, (Berke1ey, California: ugreement on this question stems either from mi.sunderstand.íngs about the
Yenan Books, n.d.); Yenan Books, (ed .), Sociallmperialism: The Soviet meaning of words or from the inconsistent application of terms. Thus, the
Union Today, (Berke1ey, California: Yenan Books 1977) (reprints from specification of our terms in this chapter i.s an essentlal preliminary step
the Pelting Review). ' before underta.king the empírica! investigation which is tackled in the follow-
3. Hsinhua, 29 October 1967, reprinted in How the Soviet Revisionists IJlg chapters.
Carry Out All·Round Restoration, op. cit., p.7.
4. Peldng Review, 30 January 1976. Reprinted in Sociallmperialism : The
Soviet Union Today, op. cit., p. l.
5. Revolutionary Union, op. cit., p.34.
Criteria for Categorizing Social Fonnations
6. Martin Nicolaus, op. cit., p.5. 1 have 1aid out a systematic critique of the
The Marxist trad.ítion distinguishes relations of production, mode of produc-
arguments of Martín Nico1aus and the Revo1utionary Communist Party
(formerly the Revolutionary Union) in a review essay of Restorat llon and social formation. The terms- capitalist, feudal, slave and socialist
of Capitalism in the U.S.S .R . and Red Papers 7: How Capitalism has can be applied to each of these three concepts. Relations o[production
been Restored in the Soviet Union and What this Means {or the World refer to the way in which the producing and controlling classes relate to one
Struggle. SeeScience and Society, 41 :3, Fall 1977. .1nother in the production process. Mode o[ production refers to the mode or
7. For a good discussion of the validity of statistics collected by ruling way in whlch production takes place. This concept lncludes the relations of
c1ass agencies, see the North American Congress on Latín America - production as weU as the techniques of production. Automated production,
NACLA Research .Methodology Guide, (New York, 1970). ' lhe factory system, agriculture, horticulture, hunling and gathering, as
fundamental forms of the productive forces or techniques of production, are
:1 part of the mode of production. We can thus refer to industrial capitalism,
tgrarian capitalism, industrial slavery, agricultura! feudalism etc. as modes of
production. While there is a historlcal coincidence between capitalist relations
of production and industrial technique, and between si ave and feudal relations
of production and agricultura! technique, there is no necessary association of
lhese techniques with these relations of production. Industrial slavery as well
.a agricultura! capitalism have existed as important modes of production
though perhaps neveras the dominant mode of production. There i.s,
however, an economic reason why feudal and slave relations of production
hecome associated with agricultura! production while capitalist relations
hecome associated with industrial technology; thls reason has todo with
max.imizing the rate of exploitation. The term social [ormation refers to the

12 13
 ls the Red Flag Flying? What is a Socialist Society'

aggregate of modes of production that make up a given economy. lt is quite whcre the producing class is free to sell its labour power to any one who will
possible for slave labour to exist alon~ide free labour and serfdom, as well as huy it, the producing class not having any significant rights in the means of
simple commodity production (as was clearly the case in the South of the productiOn.
U.S.A. before 1865, for example). But nonnally one set ofproductive We thus have four basic types of class society (or social fonnations) and
relations is dominant in any given social formation. This dominant set of lwo basic type~ of non-class society. AJJ fonns of class society ha ve two major
1111 relatlons of production determines the fundamental logic of that social cl.t\Ses, one which owns and controls the means of production, but does not
fonnation as a whole. clo most of the actual production, and another which does not own or control
A social fonnation can therefore be defrned in tenns of its dominant lhe means of production, but works for those that do in such a manner that
relations of productlon. This need not mean the relations of productlon in •llows tbe owning/controlling class to appropriate the surplus labour of the
which the largest number of producers are involved, nor the set of productlve p1 uductive class for disposal by the dominant class.
relations that produce the greatest amount of surplus value (not necessarily There seem to be two basic varlants of non-class society : household and
the same thing). The dominant relations of production, rather, are those cullec tive production. ln lrousehold produclion, each family is an econornic
relatlons whose basic logic structures the form and movement of the whole unit (Marx's simple comrnodity production, his Germanic mode of production,
social fonnation. Thus, for example, the U.S. was a capitalist social fonnatlon uuJ the earliest phase of bis Ancient Mode of Production). Collective
in 1860 despite there being more slaves, freeholding farmers and artisans than fWJduction in tum can be divided in lo five sub-types according to the leve! of
there were industrial workers. The very existence of slavery in the U.S. was a trc hnology, the role of the state and the division of labour. First tbere is
product of industrial capitalism's need for raw materials, while the prevalence t•rlmitive communism, as described by Engels in his Origins ofPriva te
of freehold production was likewise conditioned by the rapidly growing food l'roperty, the Family and the State, which in turn is divided into 'savagery'
and raw material needs of the capitalist mdustries and their workers. lt is ur hunting and gathering society, and 'barbarism' or horticultural society.
likewise possible to have a socialist society in which the majoriry of the llten there is post-capitalist society which can be divided into socialism
producing classes are not working in collectively owned and controlled enter- (where a state and division oflabour persist) and communism (where they do
prises, provided that the Jogic of such enterprises structures the rest of the llt.lt). Socialism can be divided into two basic types according to lhe location
economy . uf initiative in overall strategic decision making and in the locus of day-to-
The mode ofproduction must be kept analytically distinct from the mode llay operational decision making. In state socialism ownership and funda-
o! distribution. Major modes of distrlbution include: (a) communal distri- mental control is collective, but initiative and operational decision making is
butlon according to need; (b) redistributive networks from producers toa cuncentrated in the hands of state officials. ln decentralized socilllism on the
chief and then back to the producers; (e) market or barler distribution of ulher hand, ownership and control is in the hands of the collective producers
commodities according to income or wealth , with production units being self- who maintain the initlative, and make the day-to-day operational decisions.
sufficient; and(d) socialist distribution according lo work. !he. four basic fonns of class society - slavery, serfdom, peasantry and
Marx..ists have traditionally categorized societies in tem1S of those relations L 1p1talism - can in tumbe divided by the dominant fonn of ownership and

of production dominant in a social formation. Often cntegorization is based t c>ntrol of productive property within each. l11e key difference here is
on the dominant mode of production, but this is defined primarily in tenns of wh~~er or not ownership and control is in the hands primarily of priva te
the relations of productlon within that mode. 1 will categorize societies by lndivtdual~ or of the s~te burea~cracy. Wlúle important in deterrnining the
their dominant relations of production . uveralllog¡c of the social formation, the fonn of ownersJúp and control is not
1 see six fundamentally different types of relations of production (of course lmportant as ~e basic relations ofproduction . We thus have eigbt basic
there are intennediate and mixed cases): (a) collective production, where all lorms of clas~ soc1ety : (1) state slavery (as existed in the Ancient Greek City
adults are producers, there is no exploiting class and labour is done in common; ta tes; (2) pnvate slavery (as was prevalentin the Caribbean area from the
(b) household production, where all adults are producers, there is no exploit- 17th to 19th cent~es); (3~ state serfdom. a major fonn in pre~mancipation
ing class, but labour is done by individual families controlling their own means f(u~Ja; (4) ~onal feud/1/rsm, the dominant social fonn in Westem Europe
of production; (e) slavery, where the bodies of the producing class are the dunng the nuddle ages; (5) state peasantry, the dominant fonn in the Near
property of the exploiting class , and disposable by them nt will; (d) serfdom, 1 t and South Asia from ~e beginning ofclass society until the 19th century;
where the producing class is tied to the means of production (typically the (6) l'!"dl_ord peasantry, which was the dominan! fonn in Europe between the
land), but cannot be bought and sold, nnd in addition has rights in its own rhrrunation of serfdom and the rise of capitalism and also in most of the
labour and in sorne of the means of production ; (e) peasantry, where the lllir~ World in the 20th century; (7) market capitalism (in both its com-
producing class is not tied to the land , maintains rights to the land, but is pehtive. and mon~poly forms), which has been predominant in the European
exploited through rents and laxes by the exploiting class; {f) capitalism, world smce the nud 19th century;and (8)srate capitalism, where the state

14 15
 A Categorization of Social Formations in terms of their Basic Relations of Production

Relations of Production De¡ree of Centnliurlon of Buje lrutiatins and Day-to-Day Decislon Maklna
Centrallud (CollectiYe Control) Decentrallz.ed (Family Control)

'Prlmltlve' Socletles
'Primftfve' ClaslltJII Socfeties: 'Prlmrtive • Communlsm ('Slavonle Household Productlon : Simple Comm·
Absence or exploiting class. All Mode of Productlon') odity Productlon, the 'German Mode
producers e55entially equal. Tech· (a)Savagery (Hunt111g and Gathering) of Production', the early phase of the
ruques of producuon primJtive. (b)Barbarism (Hortlcul tu re) 'Ancient Mode of Produchon'.
Societies small. The household is the basic unit of
production and distribution. There
may or may not be markets

Ous Socielies Control111 the Hands of the S tale Control in the Kands of Priva te
lndividuals

Slavery. The bodles of lhe produCID& Srau SJJZvery: e 1 Ancíent Greek City Privare Slavery. e.g. the Caríbbean
class are property of explo1ting class. States. l'eiPOn in the 17th-19th centuries.
The producíng class has no nghts in Predominante of markets includin¡
means of production. markets in human be111gs.

FtudaliJm ( 1) Str{dom: The produc111g Sta te Serfdom. e.g. A mljor forro ID Manorial FeudaliJm . The dominant
class tied to the land but eannot be Ruma prior to emancipallon. form durina the middle ages in Western
bought and sold. lt m1111tains sorne Europe and perhaps in pre-19th
rights in means of production. century Japan.
Production for use. Manors largely
self-tufficient economic and polltical
units.

Ftudalilm (2) Ptasanrry: The Statt Peasantry: The 'Oriental Mode lAndford Peasantry: The dominant
producing clas.s is free (not tied to the of Production'. The dominant form in form in pre-20th century China, 19th
land) but is exploited through rents the Near East and South Asia until and 20th century Latin Americe,
_.~~llllllllllllll.iaoidil~iiqiiwi~i
·iiiiiiiiiln.hi
'iiBilto~~ll..~~~~~h¡¡ce¡n¡t¡u¡ryÍ.IIIIIIII~IIIIII~~So¡ulhADa,
91
E~u~r~opeil,llllllllllllllli..

1::4 b'IO'I o! ~u
a) Co'"¡ntwrr Ct~plta/u'" :
Predommanee of small compel·
itive fliTTis
b) Monopoly Cap1talism: Predom111·
ance of a few corporahons in each
market. Distortion of many laws of
eompetltlve markets.
Adnnced Classless Soclet.iea
.Soc1alism: The producing class(es) State Sociali1m : Basic initiatives and Decentralized Sociai/Jm: Basic initia·
own and control means of production day-to-day control with state officials. tives and day-to-day operational
and the state. Divislon of labour exists This form of socialism has a 'power control in hands of the producers.
but there is no cxploiting elas.s which elite' which is fundamentally under a) Decentralizld Market Socialum:
domina tes and benefits from the the control of the producing class. Yugoslav1a (predominant role of
exploitation of thc: Labour power of There are deUrruted commodity markets with deciSion making by
tbe producers. Advanced industrial markets. producers' collectives).
tecbniques of production. Societies a) Charismat1c Soclalism · e.g. Cuba b) Communal Socialum e.g Chrna
are large. 1961·197S. Predominant role of durina the Cultural Rcvolution.
leaders. Predolllllllnt role of collective
b) Bureaucratic SociDlism . Predomtn· decJSion makln& w1thout rebanee
ant role or bureaucracy (deformed on markets.
111 favour of elite stnta).
e) S tate Market SociDium: Predomin·
ant role of markeB with day-to-
day decision makmg by managers
rather than producers
d) Technocratic Socialum : Leadin¡
role of cxperts, scientists, etc., who
do not especially galn a t expense
of producers.

Advanced C,ommunism: No s~te, no division of Labour, no markets. Basic írutiatives and doy-to-day operational
control are 111 hands of lhe produeers who own and control all the means of production and operate them and share lhe
product of their labour collectively on the principie of ' from each accordíng to their ability, to each aecordlng to thelr needs'.
 ls tire Red Flag Flying? What is a Soc1alist Soclety?

owns and controls the means of production and so replaces the operation of control of enterprises in the enterprises themselves, coordlnation
the Jaws of the market by central planning. While clear examples of partiaJ lhrougb the market, and rctiance on material incentives - these three
state capitalism exist wherever there is constderable state ownership of the lactors, taken together, make inevitable a strong tendency toward an
means of production, whether or not any countries of the world today can be economic order which, whatcver one may choose to call it, functions
rnore and more like capitalism.
categorized as fundamentaUy state capltaJist is in good part the subject of this
lf enterprises are run by small groups with a view to maximizing profits
111 investiga tion. through production of commodities for the market you have the
In market capitaJism another major distinction is between monopoly and cssential production and class relations of capitalis~. 1
competitive capitaJism according to the scope given to the operation of
commodlty markets.ln competitive capiralism there are no significant
restraints on free commodity markets, while under monopoly capitalism a Martin NicoJaus, in bis booklet which argues that capitalism has been
handful of giant corporations are able in good part to set major commodity u: tored in the U.S.S. R., likewise defmes capitalism in terms of the existence
prices at levels above their value, either through coUusion or by sympathetic uf markets in general, and not in terms of the exploitatlon of the labouring
state reguJation. The establishment of monopoly pricing results in the mod.i- dn~s through labour markets:
fication of many of the laws of competitive markets, su eh as the form,
frequency and character of economic cycles, the falling rate of profit, the (lñe power to fire workers) implies that labor power is a commodity to
long-term movement of prices, etc., but monopoly pricing does not alter the be bought and sold tike any other; or, to pul it the other way around,
fundamental character of a market economy being determined by forces wherever labor power has the character of a commodity, there the owner
beyond the control of the owning class. Thus both competitive and monopoly of the means of production has the right to throw the workers out onto
the street.
capitalism differ in a fundamental respect from state capitaJism where the
The necessary mate and comparuon to this right is the owner's right to
laws of markets have been contained by the existence of state planning in
sell (~r buy) means of production also like any other commodity, e.g., by
both production and distribution. •hutting down unprofitable divisions, discontinuing one type of production
ln favor of another, etc ...
1t is precisely the exercise of these two powers, ... that convert the
Capitalism own~r of the means _of ~roduction into a capitatist and convert a society's
relahons of production mto relations of a capitaJist character. 3
The classicaJ Marxist defmition of capitalism in terms of the exploitation of
the labouring class by the class that owns and controls the means of produc- The trad.itional Marx.ist definition of capitalism, on the other hand, was
tion through labour markets {i.e. labour power is a commodity) is clear. But u¡1held by both Maurice Dobb and Charles Bettelheim in their debates with
among contemporary radlcals there is no consensus about the precise 'iweezy. Similar!y, Ernesto Lacia u systematically criticized Andre Gunder
defmitlon of capitalism. Consequently, when the issue is raised of whether or f<rank, and Robert Brenner, Alex Dupuy and Paul Fitzgcrald have Jikewise
not capitalism has been restored in the Soviet Union, sorne participants in the lriticize d Immanuel Wallersteln , for deftning capitalism in terms of the
debate mean something very different from others. lll'gemony of market forces generally.4 ln this book the term 'capltalísm' 1s
Authors associated with the joumal Monthly R eview, in particular Paul tmployed strictly in the classical Marxist sense.
Sweezy and Gunder FranJe, as well as those associated with the 'World The so/e defining characteristic, therefore, of whether a social formation
Systems Theory', notably lmmanuel Wallerstein, define capitalism in terms 1 capitalist is whether wage labour is the primary form by which the
of the hegemony of markets in general, not in terms of the existence specifi- producing population is exploited by the owrung and controlling cla.ss. The
cally of wage labour markets (i.e. where labour power is a commodity). u1stence and role of commodity and capital markets, and their laws, is thus
Sweezy took this position in his classicaJ debate with Maurice Dobb over the nota defming characteristic of capitalism. A society can be capttalist and not
transition from feudalism to capitalism. Gunder Frank did likewise in his l~t• determined by any other aspect of the laws of the market except the laws
influential book Capitalism and Underdeve/opment in Latin America, as did uf the labour market. State capitaJism then is not necessarily subject to tlte
lmmanuel Wallerstein in his 111e Modem World System. 1 Paul Sweezy, in his law of vaJue, under-consumption, inflation, equaliz.ation of the rate of profit,
argument that capitalism has been restored in the U.S.S.R. defmes capitalism 11 falling rate of profit or any other laws which are a product of the operation
as: uf capital and commodity markets. These and al! other related laws of market
~ap1talism (w~ether monopoly or competitive) stem from the logic of capital
.1nd co~od.ity m~kets, and need not apply lo every society where wage
l.1bour 1s a commod.ity. Consequently, to demonstrate that a soctety is

18 19
 ls the Red Flag Flying? What is a Socialist Sociery?

capitalíst, it is necessary only to show two things : (l) that an exploiting class ' Operation' refers to the day-to-day running of the means of production.
exists, which appropriates the surplus labour of the producing population and 11 is possible that a group that does not control the means of production
disposes of it accord.ing to its own interests; and (2) that the predominant may exercise day-to-day decision making power. For example, the slock-
mode of exploitation is through wage labour. While the first is the defuúng holders of a major corporation may own it, a financia! interest group based
characteristic of all forms of class society, the second is the specific charact- 111 a rnajor bank may control basic decisions such as investrnents and overall
111 eristic of all forms of capitalist society. production and distribution plans, but managers may exercise the day-to-
A demonstration that the laws of commodity and capital markets structure day operational decision making. Much of the Jiterature, therefore, on which
the social formation, shows only that such a society is a marker society of of these groups control corporations is relevant toa discussion of the class
which there are at least five basic types, only one of which is capitalist: nature of the Soviet Union.
(1) simple commodity production with exchange; (2) private slavery (where The differences between control and ownership can perhaps be illustrated
human bodies are commodities as weU as everything else); (3) landlord wilh the examples of the military and the Catholic Church. The top prelates
peasantry with commodity production; (4) market capitalism; and (5) uf the Church, as well as mllitary commanders in an army dictatorship, have
market socialism (where although the producing classes own and control the fnirly fundamental control over their institutions as well as day-to-day
rneans of production, the laws of the market nevertheless opera te). Failure uperational decision rnaking powers. But they do nol have the power to
to distinguish between market econornies of various types and capitalism is a ullenate their control orto pass it on to their descendants. Attempts to do so
source of much confusion in the debate about whether or not the Soviet would most probably be met by massive resistance on the part of both the
Union is capitalist. It is essential to understand that market societies need hierarchy and rank and me of these institutions, so strong are the prohibitions
not be capitalist, and capitalist societies need not necessarily be govemed by u¡~linst such actions. In other words their (delirnited) control is considered to
capital and commodity markets. lt should be noted , however, that it is he fully legitimate - e.g. the Pope's rule is Jaw. But full ownership rights
probably the case that all forms of market societies tend to evolve towards lncluding the right to aLiena te his position in favour of another of his choosing
market capitalism. und the righl to pass it on to relatives is denied, both de [acto and de jure. 1t
could be argued that, although top military officers and prelates cannot pass
r.heir posts on lo their children or nephews, nevertheless collectively (not indi-
Ownership, Control and Day-to-Day Operation vidually) they do have ownership rights in the armed forces or Church because
their children or nephews are more likely to go to mllitary academies or
Usage ofthe terms 'ownership', 'control' and 'operation' must be made clear. religious training schools and become officers and prelates in tum, than are
Control means the power to decide how physical resources will be used and the children of the common people. This would be the case if there was a
expanded, what is to be produced, and how labour is to be allocated. lt significan Uy higher probabillty of top officlals being the chlldren of other
includes the ability to see that decisions are implemented, even against the top officials than being the children of members of other social groups. Thus
will of others. Ownership means legitimate control, i.e. control that is a notion of coUective, as opposed to individual, ownership and con troJ by a
recognized and accepted by the exploited class. Ownership also implies that class must be entertained as a real possibillty. Consequently it is not sufficient
the dominant class can dispose of what they control in any manner they like, to demonstrate that officials cannot aliena te posts or property to specific
including selling it lo others and passing it on lo their children after their other indlviduals, to demonstrate that they do not have full control or even
deaths. It follows that a group may have full power to control property ownership as a class over the means of production. To demonstrate the
throughout their lifetimes, but not have power lo transfer it to others either existence of control without ownership, it must be shown that most top state
through sale or inheritance (i.e. they do nol have ownership rights). Ora set officials did not achieve their position because of their ancestors' similar
of individuals may have full power lo control property, but only for a lirnited status.
time. While there may be a tendency for control to transform itself into These distinctions between ownership, control and operation are very
ownership over time, the two concepts must be kept distinct. The most important in defming exactly what we mean by socialism. Socialism and
important concept in defining social formations is control, not ownership. communism are those types of society where the means of production are
Thus a society must be considered capitalist if a group of people control the owned and controUed by the producing classes, and where produc tion is done
means of production, whether or not they have a legitimate right to them , collectively rather than in households. The distinction between socialism and
and whether or not they have the power to dispose of property as they wish. communism lies in the mode of distribution (respectively, according to wo rk
The defining characteristic of a capitalist society is only that an exploiting und according to need), the existence or otherwise of a state, and the
group appropriates the surplus labour of the producing class through wage existence or otherwise of a division of labour between manual and mental
labour and disposes of it in its own interest. work. The difference between socialism and commurusm does not lie in

20 21
ls tire Red Flag Flying ? What is a Socialist Society?

the basic character of the relations of production . In both cases the producmg duues or the owningfcontrolling classes 1mean all those classes thatlive off
classes co-opera te among themselves to produce, and exploitation does not the labour of other classes (without themselves making an equivalent contri-
exist. But socialism may or may not in vol ve the collective operation of the hu tton lo the needs ofsociety), such as rentiers, 'coupon clippers', heirs of
means of production. The immediate producers may or may not make the fo rtunes, landlords and the rich in general, as well as those engaged prirnarily
day-to-day production decisions. As long as they authentically determine the in lugher level supervision designed to ensure exploitation and domination,
fundamental decisions - such as the nature of the product, the basic structure e.p top corporate managers, most higher level state officials in class society,
of the production process, the fundamental distribution of the product, etc. md higher leve) milltary officers.
- the society is socialist. For example, it is certainly as conceivable for the In different types of society the producing classes have very different
working class, as for the capitalist class, to hire managers to direct the day-to- compositions, with one class normally being pre-eminent. In contemporary
day operation of a factory while fundamental control remains in the hands of capitalist society the largest component of the producing classes is the
those that hired them. It is as possible for there to be a socialist society proletariat or working class. This class Uves by selling its Jabour power to those
where the immediate producers do not exercise day-to-day control, as it is thut own the means ofproduction; they do not control the conditions of
possible for there to be a capitalist society where they do (e.g. collective thetr labour. The working class has a number of sectors, the largest and most
labour contracts to perform a given job in a manner determined by those that hnportant of which ís the industrial proletariat - those who mainly work
do the contracting, such as harvesting a crop, building a house, planting trees), wtlh their hands in faetones, mines, construction sites, transport and
just so long as a few basic output critena are met. In sum we must not communicalion. The industrial working class, together with farrn and service
confuse the question of 'operation' of the means of production with the workers compose the manual working class. Other sectors of the working
question of 'control', any more than we can afford ~o ~onfuse ~e. que~tion of class include service workers who work in su eh places as restaurants or
deterrninatioo by markets with the exislence of capttalism. Soctahsm like Jaundries, clerical and office workers, and sales workers. The petty bourgeoi-
capitalism is defmed in terrns of what class of people fundarnentally control .te in advanced capitalist countries is a secondary class within the producing
(not necessarily own or operate) the means of production (as well as the state). c:Jasses. 1t is composed of its traditional or independent sector {'the old petty
hourgeoisie') comprising independent artisans and professionals, and small
husmessmen and farmers (all of whom have considerable control over the
Oass and Social C1ass conditions of their labour); and the em¡ioyed or salaried 'new petty
bourgeoisie' comprising lower Jevel managers, salaried professionals, teachers,
Parallel to the differences between ownerslup and control are the differences engineers, scientists, etc. The new petty bourgeoisie can in lum be divided
between class and social class. 8oth the notions, control and class, are based Jnto its managerial strata composed of those engaged primarily in supervision
solely on the idea of power, while the notions of ownership ~~d social class . (whether employed by enterprises or by the state), and lts technical or
add such ideas as legitimacy , consciousness, culture and lradttions. By class IS professlonal strata composed of those who make a more direct con tribution
meant solel y a set of people who have an essentially similar relation to the lo providing goods and services. These latter two categories- the managerial
means of production, Le. slaves or slave-owners, feudal lords or serfs, strata and the technical and professional strata - are especially important in
capitalists or proletariariS, petty bourgeois independent p_roducers, etc. By_ the analysis of societies su eh as the Soviet Union where they will be referred
social class is meant a class which has a consciousness of 1tself as a class, wtth to respectively as the managerial intelligentsia (or stratum) and the profess-
distinctive traditions and social customs mamfested in high rates of inter- ional (or technical) intelligentsia (or stratum).
marriage within the class, and a high probabilily of passing one's class position 1t rnay be the case that the manual worldng class and the intelligentsia
on lo one's children . To demonstrate that a sociely is a class society, it is (managerial and professional) in socialist countries (but not, of course, in
sufficient lo demonstrate that it has exploiting and exploited classes. 1t is nol communist societies) bave differences in their respective degrees of control
necessary to demonstrate that these classes have crystallized and coTISoli- uvcr the conditions of their own labour comparable to those whtch exist in
dated into social classes. However, it should be noled that there is a universal capttalist socicties. However, in socialist societies the difference between the
tendency for such crystallization and consolidation of classes to take place. It petty bourgeoisie of salaried managers, officials, professionals and experts
follows that evidence of the existence of social classes, su eh as high rates of on the one hand, and the working class on the other, must be defmed in
inter-marriage and close inter-generationallinkages of social position where terms of the character of the work done, and not in terms of whether they
there are inequalities in income and decision making, can serve to indicate the receive awage ora salary, or in terms of the varying degree of control of the
existence of classes. two classes over the conditions of their Jabour. Thus in a socialist society
By producíng classes or the working people 1 mean all those classes which . we can speak of the following classes and sectors: the mdustrial sectors of
primarily produce the goods and services required by society. By non-producmg the working class who work mostly with their hands in faetones, mines,

22 23
 ls the Red Flag Flying? What is a Socia/ist Society?

construction, transport and cornmunications; the white coUar sectors of the where initiative and day-to-day decision maklng are in the hands of the
working class who do the menial work in offices and shops; the farm workers ptuducing classes themselves. Whether or nota society is in fac t soc~alist
who do manuallabour on the state farms ; the highly educated technicaJ l .mnot be determined at the political leve! by whether or not there 1s a power
sectors of the petty bourgeoisie (the technical or professional intelligentsia) rhte which initiates policies and makes day-to-day decisions. 1t must be
who develop and disseminate knowledge and skills and who provide profes· 1te tcrmined, instead, on the basis of whether or not the decisions made are in
lll sional services ; the managerial sector of the petty bourgeoisie , or intelli·
gentsia, who are engaged primarily in supervision, planning and the overall
1llr interests of the producing classes, and whether or not the decision makers
uuld ha ve made any other decisions and still remained in their positions
guidance of institutions (e.g. enterprise managers, state officials and party ( 1 e whether or not the producing classes exercise effective control over
leaders); and the peasants who either work on colJective farms or for them· thr m). lf decisions are made in the interests of the producing classes, but the
selves. puwer elite could have gone against them and kept their positions, then the
pr oducing classes cannot be said to exercise control over the power elite.
lhus, even if such a power elite can be considered to be humane and weU
Ruling Classes and Power Elites tnlentioned, the society cannot be a socialist society since the producing
dusses cannot be considered to have power. Consequently, to prove that a
FoUowing a paraUel discussion by G . William Domhoff in his Who Rules """iety is not socialist, it is not sufficient to prove that lt has a power elite
America, 1 will define a 'power elite' as made up of those individuals who wlllch takes the lnitiative in policy fonnation and whlch makes day-to-day
occupy command positions in the lending instltutions of a society and who ll··c.lsions. It must be further demonstrated that there is a ruling class which
exercise day-to-day decision making power. A 'ruling class ', on the other n ploits the surplus labour of the producing class and uses it in its own
hand, refers to that class which controls the means of production (whether or tnterests.
not it owns them) and which domina tes the state apparatus (whether or not
it has a leg¡timate right todo so, and wheUter or not it exercises day-to-day
operational decision making). There may be a coincidence between the ruling Mechanisms of Popular Control
class and the power elite. On the other hand, the power elite may consist of
individuals who are for the most part not members of the ruling class, but In the ideal model of fully decentralized socialism, a11 working people govem
who are in the most fundamental seose under their control , and heoce serve lhemselves through participation in workers' councils, selection of allleaders
their interests. This could conceivably be the case in any type of class society, lhrough frequent elections (with provision for immediate recaU) and referenda
as welJ as in a socialist society. Logically, it is just as possible for a producing m other votes on aU the basic questions facing the society and its constituent
class to hire state officials both to run day-to-day matters and to take the parts. Further, the initiative in the decision making processes, as well as day·
initiative in fonnulating major policies, as it is possible for the owners of tc'l-day operational control, in both the economic enterprises and in state
capltalist industry to secure officials to do exactly the same things. If one has hud.les resides with the masses of working people. The existence of such
power, one need not necessarily ha ve to worry either about day·to-da~ detall •tructures and decentralized processes, however, is nota necessary condition
or about coming up with policy proposals. One need only accept or reJect lor the rule of the working class, i.e. sociallsm can exist under much less
basic policies and benefit from them. i.e. lt is not necessary for a ruling class trlngent political conditions. . ..
actuaUy to be Ute first to come up with new ideas or policy proposals. 1t is The existence of councils in which the members of the rubng class partiCI·
only necessary for Ute policies that are implemented to be in Utis class's p.1te, and plebiscites or even elections for lending officials, are not necessary
interests and for it to have the power to affirm or veto such policies. Ruling ~:onditlons for the rule of a given class; their existence is nota necessary test
classes m aU fonns of class society have hired inteiJectuals, scientists, engin· uf whether or not a given class controls the power elite. This can easily be
eers, and experts of aU kinds as weU as officials, managers and top govemment lltmonstrated by an exarnination of capitalist and especially pre-capitalist
leaders to come up with new ideas as weU as carry Utem out. In fact most dnss societies. The lending officials of si ave and feudaJ societies, for example,
new ideas and policies in such societies come from people outside of the wcre not generally elected. Heredity and occasional conquests and upris_ings
ruling class, e.g. U .S. Secretary of S tate Ilenry Kissinger's foreign policies were the mechanisms by which membership of the power elite of such
dunng the 1970s. But such ideas and polic1es are always stamped with Ute ncieties was determined. Nevertheless, the lending state officials in feudal
interests of the class that controls the means of production and the state, and slave societies did generally represent the interest of the classes which
and for whom these hirelings work. Thus state socialism , where the initiative controlled the means of production in these societies. Ukewise, in capitalist
as well as day-to-day operational decision maklng is in the hands of state ~ociety, the rule of various fascist regimes in Europe and the widely prevalent
officials, is justas mucha socialist society as decentralized socialism, mllitary regimes in Asia, Africa and Latín America (which rely marginaUy, if

24 15
 ls the Red Flag Flymg? What is a Socialist Society?

at all, on elections) must also be considered, in most cases, to exemplify •11 forms of class society, demonstrates the considerable strength of the ideo-
bourgeois and Jandlord control over the state. Clearly, there must be other luwcnl commitments of officials and their loyalty to the people from whom
channels by which a given class can exercise control over a power elite and llll'y hnve emerged. The original revolution can thus be considered a valid
thus constitute a ruling class. lurm of election, at Jeast for a generation or so after the event, and perhaps
Of course, even the selection of members of the power elite through lllnsiderably longer, provided, early in the history of the new regime an
111 elections and general votes on issues of public policy does not guarantee lu\lltutionalization of leadership selection is accomplished that can ensure the
democracy for the productive classes. The example of plebiscites in pumtotion and selection of individuals of a similar mould to those first
Napoleon's France or Hitler's Germany, as well as the frequent elections in ··lccted by the wor.king people in the act of revolution.
capitalist countries today, illustrates that merely holding elections does not A power elite in a state socialist society is also not under the same pressures
provide real control over a power elite. There are numerous works that tu become self-serving as is a power elite in a class society. The very survival
demonstrate the mechanisms of capitalist class control over the state in md expansion of capitalists, and the promotion of corporate managers, lies in
spite of popular elections. 5 Control, to be real, must be exercised through lhelr securing the greatest surplus from the workers. Failure todo so means
considerably more substantial channels than elections. tlower rate of profit, eventual bankruptcy, or demotion. The case is similar
Justas it is possible for the capitalist class to exercise real control over wllh slave owners or feudal lords. The inherent logic of these modes of
the"state in the absence of elections (or in spite of elections in which the production requires them to act in such a way as to maximize the rate of
number of its own votes is miniscule), so it is possible for the producing r ~tploitation. This includes utili.zing the state which they control to realize
classes in a socialist society to exercise real control in the absence of such thetr economic ends. Because of the class nature of production, this na tu rally
formal structures of control. The most important of such informal mech- hnphes that the state will be used in the interests of one class against the
anisms include: (1) the original revolution by which the working people hllerests of another, since the very nature of slave, serf, peasant or capitalist
overthrew the old order and selected a revolutionary leadership; (2) the u·lutlons is based on conflicting class interests, (i.e. what is in the interests of
economic logic of the socialist mode of production which requires Ieaders to the ruling class is contrary to the interests of the producer class and vice-
respond to the needs of the working people in order to promote production; versa).
(3) the threat of massive resistance and even another revolution in the event No such logic applies in the case of non-class societies. The motive force
of a betrayal of the socialist ideal; (4) the effect of the recruitment of ll tmg on a power elite in a socialist society moving it towards consolidating

leaders from work:ing class backgrounds; (5) the effect of the leaders' social lh power, and advancing its own interests at the expense of the producing
integration into the work:ing class by such means as participation in manual dasses would appear to be a diffuse psychologically based desire to get
labour, living in working class neighbourhoods and taking part in popular u1ure and more power for its own sake. This has nothing todo with any
activities; and (6) participation in a discipl.ined party which is predominantly rrquisites inherent in the mode of production, such as clearly exist in class
work:ing class. Let us examine each of these mechanisms in tu m. "x.iety. Any such psychological pressure must either be biologically deter-
The ongoing importance of the original revolution , in which the masses of lllined or be a residue of conditioning inherited from class society. Given the
oppressed producers overthrew the old ruling classes and put new leaders and rvldence of anthropology, the first altemative seems untenable. As for any
a new organization (e.g., a comrnunist party) in power, should not be lightly lrumed propensities for power and privilege on the part of a revolutionary
dismissed. There is considerable inertia in people's altitudes, commitments lr.adership, these are likely to be counteracted by the leadership's conception
and loyalties and -in the absence of such temptations as the old class nf ilSelf as performing a revolutionary duty and its own belief in the revo-
society offered to, for example, trade union leaders- the revolutionary lutíonary ideas by which it achieved its position. There would seem to be
leadership can well be expected (at least for a considerable time) to remain httle structural pressure to underrnine these ideals except that which comes
loyal to the class which elevated it to power. Not only inertia, but also its lrom the necessity to increase production, build social unity and defend the
conception of i tself as a revolutionary leadership and sen se of worth and 1rvolution. Nevertheless there may be resistance to day-to-day operational
accomplishment, are tied to its ongoing pursuit of the revolutionary idea. tlccisions being made by the masses anda desire to keep the ínitiative in
The so-called 'iron law of oligarchy', developed in its most sopbisticated the leadership's own bands which stems from a feeling thal it is best equipped
form by Roberto Michels, is too easily accepted by cynics who believe that lo make decisions and from the feeling of self-esteem when they are proved
anyone in a position of power will more or less immediately and completely tlght. In times of crisis, such as the 1920s and 1930s in tbe Soviet Un ion, this
be corrupted by its exercise. While this·may be true of many trade union leellng may well be valid.
officials in capitalist society, there is only scanty evidence that this 'law' can While state socialism might well degenerate into state capitalism or even a
be more widely applied. On the contrary, the experiences of the Catholic lnrm of industrial state serfdom, the pressure for such a transformation
Church and of military establishments, as well as of govemment officials in ~:annot be found in sorne inevitable biological or structural wisb for power

26 27
/s the Red Flag Flying? What is a Socia/in Society?

amongst the revolutionary power elites, but must rather be sought in the 1.\ the threat of another revolution or uprising, or simply massive resistance and
structurallogic of the social fonnation, such as may well occur ata low leve) non-compliance in the event of the power elite moving towards becoming a
of the development of the productive forces, or under extreme extemal or ruling class. Such becomes a real possibility if arms are widely distributed
internal threats. A revolutionary power elite has no inherent interest in under- und most of the worldng people have received military training. With revo-
mining the position of the productive classes for its own salce. lndeed its lutaonary traditlons alive from the recent revolution that installed the regirne
feelings of accomplishment and self-esteem are best realized when greater 111 power, and with the vitality and irnmediacy of the revolutionary ideology,
popular participation and egalitarianism are achieved. This is not to say that thts mechanism is far more real than in Westem capitalist countries where
a power elite does not attempt to achieve special privileges in the forrn of hourgeois revolutionary traditions are ancient history and egalitarian ideol-
material benefits, as well as to secure political prerogatives in its hands. But ug~es are not used to legitimate the state. The clairn that the power elite's
it does not experience the same pressures to exploit the producing classes ptl!lttion rests on its attaining progress towards communism can easily be
as do power elites in class societies. To the extent that the power elite 111 redited in the absence of such progress. Self-serving decision ma.king and
succeeds in advancing the productive forces to the point where it need not 1wcurnulated privilege among the power elite might be expected to result
suffer and the revolution is consolidated, and to the extent that it needs to vrry soon in the delegitimation of any re gime which bases its legitirnacy on
validate the socialist ideology of the regime, a revolutionary power elite can ~twolutionary egalitarianism and the achlevement of communism, and would
at least be as much expected to move in the direction of communism, as Ir .ad lo massive resistance (at first passive but eventually probably actual
towards state capitalism. The actual movement of the society will follow the uprhings). The Chlnese Cultural Revolution is a leading case in point.
structurallogic of the social forrnation, not the subjective desires of its Socialist regimes must rely on massive grass roots participation if they are
power elite. tu work, especially since the control functions of markets do not operate.
Justas class societies have a logic of their own, independent of the will of 1he productive classes must be mobilized and politically active. And such
their power elites, so does socialist society. (Only communist society is free ma-.~ave and authentic participation creates great pressures from below on
of such a logic.) The capitalist state must act to maxirnize and guarantee thr ,election of officials (with or without real elections) and on policy form-
profits and ensure the process of capitalist accumulation, regardless of atlon (with or without formal voting on policies). In such a situation, blatant
whether representatives of the capitalist class ora proletarian party are mnnipulation and lack of consideration for the sentirnents and interests of
occupying governmental positions. To act otherwise would result in a general th~ masses is ruled out since it would result in demoralization and depoliti-
econornic collapse because of withdrawal of co-operation by the capitalist ( tnllon, a radical decline in productivity, the decay of the moral fabric of
class (the so<alled underrnining of 'business confidence'). Thus, unless a au' icty anda general social breakdown.
socialist revolution is on the agenda, capitalist policies must be followed. Sc:holars who have analysed the mechanisms by which the capitalist class
There is a very lirnited number of options for the leadership of a capitalist l!ununates the political process in forrnally democratic capitalist countries
state, as well as for the managers of capitalist enterprises, which in spite of 1 • 1 ~rcifically G. William Domhoff and C. Wright Milis) have argued that two
appearances are not generally free to decide one thing or another. ln practice, ,,f thc most important ways in whlch the forrnally democratic structures are
the laws of capitalist economic relations largely determine the decisions made hurl ·circuited are: (a) the sources of recruitment of the decision makers,
and the probability of their successful irnplementation. Likewise, in a socialist 1111 (b) their contemporary social networks. Analogous processes also operate
society surrounded by a capitalist world; the necessity to develop industrially, n , socialist society as mechanlsrns of control, albeit in this case by the
to feed the people, to protect itself and catch up with the Jeading capitalist wm~tng people not the capitalists. Justas the capitalist class in bourgeois
countries, irnposes a fairly lirnited set of options on a socialist power elite. .... 1ety can domínate the state by providing the personnel for top positions
On a wide range of questions the decisions made by a socialist power elite lltulantegrating the brightest individuals from other classes through elite
or by the people as a whole would be much the same, since they are dictated 11' houls, so can the working class in a socialist society domina te the state by
by the situation. thl'lnselves providing the incumbents of the power elite and integrating the
There is no guarantee, however, that a power elite, once installed by the luldren of other classes via the educational process. Justas the capitalist
producing classes, will uphold its commitment to socialism indefmitely. A la•. can domínate the state by integrating the power elite into the ruling
degeneration to state capitalism is a real possibility. S tate capitalism which ( ha·\ through social clubs, resorts, directorships, exclusive neighbourhoods
does not rely on popular mobillzation and enthusiasm to guarantee produc- uul common leisure time activities, work life and friendship networks, so
tion is a real altemative to the necessity for such mobillzation required by e'" the working class in a socialist society domínate the state by integrating
socialism. To prevent this degeneration there must be mechanisms by which llh· power elite through its participation in physicallabour ,living in working-
the producing classes can exercise ongoing control over the power elite. One ll11' netghbourhoods and apartments, participation m working<lass leisure
of the most irnportant of these mechanisms, whether or not there are elections, 11• ttvtties, participation in grass roots political meetings, especially those of a

28 29
Is the Red Flag Flying? What is a Socialist Sociery ?

disciplined pa.r ty, and common friendship networks. Especially important is 1 pnwer elite has the political initiative and decislon making is centralized, to
the role of a disciplined paity which guides the process of the selection of 1 111te capitalism where the elite uses its initiative and decision making rights
leaders, using political criterla designed to ensure socialist policies, and which 111 lh own interests without being controlled by the working people, is both
socially integrates the power elite with the working people, providing a nntlnuous and without distinctive markers. Whether or nota socialist
channel through which the needs and ideas of common working people can ac~~.lcty travels down it is a product of the objective material condi tions of the
be transmitted to the leadership. The question of the social composition of ' "' iety: e.g. externa! threats, the leve! of the productive forces, the extensive-
such a party, the degree of respect its working-class members have among ur · ~ of popular enthusiasm for the system and the degree of interna! oppo-
other working people, and the degree of in te mal party democracy (formal ltton to socialism.
and informal) are thus of central importance to the question of how mucb We cannot rule out the very real possíbility of a degeneration of socialism
power the common working people have. htht state capitalism. There is, of course, no a priori process by which we can
The various informal mechanisms discussed above are possible ways in tldcrmine whether or nota given society that clairns to be socialist, e.g. the
which the working people can exercise real control over a power elite. They •.uviet Union in the 1930s, Cuba in the 1960s, China from 1955 to 1965,
have their parallels in mechanisms used by owning classes to control feudal Jtumania in the 1970s, the Democratic People's RepubUc of Korea in the
and capitalist societies , and can be expected to be real channels of power in tW/Os, etc., is in fact socialist, or state capitalist, or state feudalist or yet
socialist societies as well. , uno o ther social form. Only a scientific study of its concrete reality can
We can categorize a number of degrees of direct democracy through which te olve such questions.
the working people can impose their will on a power elite within socialist l11e Marxist argument about the function of a vanguard class is relevant
society. The most d.irectly democratic socialism would be one in which tu this discussion. Marx argued that the bourgeoisie during the period of the
policies were initiated by the masses, full discussion of the policies resulted 1 trnch Revolution served the general interest of all classes (except tbe old
in the formation of a popular will and the power elite merely passively lruda]lords) because its interests coincided with the general interest. Similar
implemented that will. The next most directly democratic would be where tnttuments were made by Marx and Engels in relation to the ruling class of
a power elite initiated most policies, but after full popular debate the e cry fonn of class society during its early period. The proletaria!, according
working people passed, either positively or negatively , on them before they ,., Marxist-Leninist theory, plays a similar role even in societies where it is a
were implemented. The next most directly democratic would be where the '"'·'11 minority such as in most Third World countries. lts interests represent
power elite initiated most new policies and implemented them without a full thl' lnterests of lumpen elements, peasantry, petty bourgeois ande ven national
popular debate, policy by policy, but where the leading members of the hcmrgeois. The vanguard class serves the interests of other classes indepen-
power elite were selected and dismissed by the working people on the basis of ,¡ nt of any formal or even informal mechanism of control by the other
their politics and class stand. Finally, in the absence of any of these tluee • 1"ses over the leading class. lt is purely a matter of the interest of lhe
formal mechanisms for controlling decision mak:ing, a society can still be wnrklng class coinciding with the in terest of the ruling class at a given leve! of
socialist so long as any of the infonnal mechanisms outlined above ensure tltt· development of the productive forces.6
real control over the power elite by the working people. Whether any or all lhus even if it were demonstrated thal the Sóviet Union were not socialist,
of the formal or informal mechanisms, or sorne combination of them, in fact lt that the producing classes did not exercise formal or informal control
opera te to guarantee real control over the power elite by the productive "~l'f the power elite and the state, il would not necessarily fo!Jow that the
masses in any given country is an empirical question which can only be l'"llctes pursued by the power elite {which must in such a case be considered
resolved by concrete investigation . 1 tuling class, whether or not it was also a crystallized social class) are to the
The various mechanisms by whích a socialist power elite can be effectively .L·triment of the producing classes (even if the latter were being exploited).
controlled by the working people can be negated by the tendency for a new 1,trx and Engels justified the exploitation of si aves, serfs and proletarians
state bourgeoisie to emerge oot of such an elite. Material conditions might be 1lu11ng the early phase of slave, feudal and capitalist society as being in the
such that those who are selected by the revolutionary masses to occupy •• .ti interest of the slaves, serfs and workers (e.g. Engels argued that lhe
power elite positions are gradually transformed into the controllers {and tllrrnative to slavery for war captives, who were the source of slaves, was
eventually owners) of the means of production and come to control the state •l••.llh by torture).7 Thus it could well be the case that a ruJing class of the
{becoming the beneficiarles of sucb control al the expense of the working '•t~VIet Union could be serving the authentic interests of the producing
people) . Both political ideology and behaviour can cometo adapt themselves . ) ,,~ses. Consequently, proof that the producing classes benefit (but not
to one's social position. Thus those who are in the command posts of society whcU1er or not they benefit relative to the power elite) is not evidence that
can gradually, under the proper conditlons, without admitting it to themselves. tlu•y rule, and thus not support for the thesis that a society is socialist.
slip into objectively bourgeois roles. The road from a state socialism, where 1h1wever, if it can be demonstrated that the producing classes do not benefit,

30 31
ls the Red Flag Flying? What is a Socialist Society?

then this would seem to be sufficient proof that they do not rule. likewise, 1ll~tlnguish four sub-types of state socialism: (a) State Market Socialism where
if it can be shown that the power elite does not b~nefit, but that the 1l y to-day operational decision making resides with managers (ultimately
producing classes do, this would appear to be substantial evidence in favour untrolled by the producing classes) and where the enterprises relate to one
of the hypothesis that the producing classes rule and that such a society is •nuther through markets (perhaps it could be argued that Hungary is becom·
socialist. 1111! un example); (b) Charismatic State Socialism, where day-to-day decision
There is thus a possibility of a society which, while not socialist, would nr11k10g power and overall initiative resides with a small body ofleaders such
serve the interests of the wo'rking class along with those of a ruling class. We lhe political bureau ofthe Communist Party, but where real ultimate
might call such a society a benevolent bureaucratism which must be cate· unlrol rests with the producing classes (sorne would argue that Cuba is, or
gorized as capitalist (although of a most peculiar variety), if wage labour is ha\ bcen, an example of such a type of society, others would argue that
the predominant forro by which the ruling class appropriates the economic 1 luna during the 1950s, or the Soviet Union from the 1920s until the 1950s
surplus (which it then dispenses in such a fashion asto benefit the masses of w• re other examples); (e) Bureaucratic State Socialism, here although
producers). Calling such a society capitalist, however, stretches this concept ullimate control resides in the hands of the producing class, a rather large
to its outer limits since, because of the absence of both markets and self· luuly of state and party officials maintain the initiative and day-to·day
interested exploitation, it would bear almost no resemblance to contempor· ''lll.'rnlional decision making, and use their position toa considerable degree
ary Westem capitalism. Such a benevolenl form of state capitalism might even 111 thcir own interests (this is similar to Trotsky's view of the Soviet Union in
have the inherent possibility of transforming itself into a forro of socialism lhc late l920s and J930s); and (d) Technocratic Socialism, where a sizeable
without a revolution if the power elite was required to m ove in the direction ~wup of people with scientific and technical training motivated largely by
of increasing popular involvement in order to justify and legitima te its position nnce ms for efficiency, science and progress maintain both the initiative and
(e.g. the need to make credible an egalitarian ideology which justifies the •lay·to-day decision making power.
leading role of the elite). Whether or not such a society could exist in the real Socialism means the collective ownership and control of the means of
world must be decided by empirical investigation. pwduction by the working people or producing classes (these two terros are
u ed lnterchangeably). Since there are a number of different producing classes,
Wi; can al so define a number of types of socialism in terms of their specific
Fonns of Socialism duss nature. Traditionally Marxists have talked primarily about proletarian
wialism, where the industrial worldng class owned and controlled the means
There are many different types of socialism. Perhaps the most fundamental 111 production and dominated the state. But Marx and Engels (e.g. in the
distinction between the forms of socialism Ues in the degree of collective t mmnunist Manifesto and in Socialism: Utopian and Scientific) discussed a
operation of the means of production and the locus of initiative in decision number of other forms of socialism such as 'Christian Socialism', 'petty
making. We will use the terro 'decentralized socialism' to refer basically h«~urgeois socialism', and 'utopian socialism'. Beside proletarian socialism it
to all those varieties of socialism where the producers exercise direct rlllf\hltoday be most useful to distinguish peasant socialism and petty
day-to-day operation of the means of production and tend to bourgeois socialism: they are lhose fom1s ofsocialism in which the centre
initiate decision making processes. 'Decentralized sociaUsm' may o1l y,ravity ofpolitical power and control over productive enterprises resides
be considered to have two basic sub-cases: (a) market socialism, where the " pectively in the hands of the peasants who control the land through
collectives of producers who make the day-to-day decisions relate to one cullcctives or communes or in the hands of petty bourgeois engineers, pro-
another primarily through markets ; and (b) communal socialism, where the lenionals, scientists, econornists, lower leve! managers, etc. employed by the
producers' collectives eschew market relations in favour of collective agree- ata te or collectives. Any actual socialist society may well contain significant
ments and understandings motivated by a consciousness of the interest of the nrnponents of allthree types. The main question here is which of the three
whole. Perhaps Yugoslavia comes the closest of any presently existing society pwducing classes plays the leading role in a given socialist social forroation .
to lhe first, while 1967-76 China comes the closest to the second. A given society of course need not fully correspond to any of the various
We will use the terro 'state socialism' to refer to those social formations 1) pes of societies laid out in the above schema. Societies can be in terroediate
where the means of production are not operated directly by the producing '" lween two or even three ofthe forms. Societies may also be in relatively
class (although they may well play an important secondary role) and where r.lpid transition from one form to another. Nothing in the schema is meant
therefore state officials typically play the leading role in initiating decisions. tu rule out any of these possibilities. Yugoslavia for example may weU be a
It has been claimed by many sympathizers that the Soviet Union - for sorne • .rse of a society intermedia te between market socialism and market
until the mid-1920s, for others until the mid-1950s, and for still others until • .rpi talism, and in transilion from the former to the latter.
today - is the prototype of such a social forroation . We may usefully

32 33
Js the Red Flag Flying? What i.r a Socialist Society?

Transfonnation of Socialist Societies une or another type of socialism for either regression back to market or state
cap1talism or for moving forward to comrnunism. The Chinese in the late
There is a stroog tendeocy for competitive capitalism to evolve into monopoly l'lbOs put forth a very different model of transition from the Soviets. The
capitalism, for mooopoly capitalism to evolve into state capitalism and for n · t of this investigation wil1 attempt to throw sorne light on a majar aspect
the contradictions of monopoly capitalism to explode and a socialist society c•l this general problem.
of one or another type to develop out of its ashes. Either charismatic
socialism or communal socialism would seem to be the most likely immediate
forros. Communal socialism has a tendency in tum to evolve either into state
socialism with initiative and day-to-day decision making passing to state H~ferences
officials, or into communism. Communal socialism may evolve either towards
bureaucratic or towards technocratic state socialism depending on whether See Paul Sweezy's contribution in Ronald Hilton, (ed.), The Transition
state officials or technical experts come to assume more and more of the from FeudaiiSm to Capitalism, (London: New Left Review, 1976);
initiative in response to the serious problems of industrialization , protection Andre Gunder Frank, Capitalism and Underdevelopment in Latín
A merica, (New York: Monthly Review Press, 1967); and Immanuel
from foreign and domestic enemies, etc. 0\aósmatic socialism, as revolut- Wallerstein, The Modern Wor/d System, (New York : Academic Press,
ionary energies become institutionalized, tends to evolve towards any of the 1974).
other forros of socialism, depending on the leaders' evaluation of the domestic l See Paul Sweezy in Paul Sweezy and Charles Bettelheim, (eds.), On the
and local situation. Transition to Socialism, (New York: Mont.hly Review Press, 1971 ), p.4.
Decentralized market socialism tends to evolve towards state market Martín Nicolaus, Restoration o[Capítali.rm in the U.S.S.R., (Chícago:
socialism because the imperatives ofprofit making imposed by markets force Liberator Press, 1975), pp.97-98.
the producers to give up their autonomy in arder to survive in the competitive 41 See Maurice Dobb's contribution to Ronald Hilton, (ed.), op. cit.;
struggle. S tate market socialism in tu m also has a tendency to regress to Charles Bettelheim in Paul Sweezy a.nd Charles Bettelheim, (eds.), On
the Transition to Sociali.rm, op. cit.; Ernesto Laclau, 'Feudalism and
priva te capitalism for the same reason. Managers who were oóginally given
CapitaltSm in Latin America', New Left Rev1ew, No. 67, (May-June
authority by the workers in arder to make a profit for the collective tend to 1971 ); Al ex Dupuy and Paul Fitzgerald, 'A Contribution to the Critique
accrue more and more power and prerogatives to themselves until they of the World System Perspective', lnsurgent Sociologút, Vll :2, (Spring
eventually nave de [acto control over both production and the state. 1977); and Robert Brenner 'The Origins of Capitalist Development',
Bureaucratic state socialism has a tendency to regress to state capitalism New Left Review, No. 104 (Ju1y-August 1977).
as state and party officials, under pressure from domestic and intemal oppo- S See for example G. William Domhoff, Who Rules Amerlca, (Englewood
sition, as well as the logic of industrialization, accrue more and more prerog- Cliffs: Prentice Hall, 1967); and Ralph Miliba.nd, The State in Capitalist
atives to themselves until eventually it can be said that they forro an exploitin¡ Society, (New York : Basic Books, 1969).
class with de [acto control over both the means of productlon and the state, (, See for example the discussion of capitalism's progressive role in Karl
control that they are able to exercise securely even against the interests and Marx and Frederick Engels, The Communist Manifesto, Part l.
wil1 of the producing classes. The smoothest road to communism (a stateless 7 Engels discusses the progressive role of slavery in Anti·Duhring, Part 11,
social forroation without a fundamental division oflabour) is clearly from Ch.4.
comrnunal socialism. Roads to comrnunism from either vaóety of market
socialism and from bureaucratic state socialism would appear to have majar
roadblocks because of the degenerative forces inherent in these forros.
The other two possible roads to communism would appear to be through
charismatic and technocratic socialism. Since it appears that not very long
after the revolution charisma is inevitably routinized, it does not seem that
the life of this forro would ever be sufficient for the full transition to com·
munism . Whether or not technocratic socialism can give birth to comrnunism
is still an open question, although the lack of initiative and day-to-day
decision making powers on the part of the masses raises real questions about
the probability of such a path without an intervening cultural revolution of
the Chinese type.
The greatest question of our time may well be the relative potentials of

34 35
 The Role o{ Market Forces

3. The Role of Market l'tufit and the Plan

Forces The essence of the 'new system' being pushed ahead so vigorously by the
Soviet revisionistleading group under the cloak of 'economic reform' is to
practise in an all around way capitalist management in all fields of the
national economy, completely disrupt the socialist relations of production
and thoroughly break up the socialist economic base. The enforcement of
the 'new system' has resulted in abolishlng the former system of unified
economic planning by the state and setting profit above all. It authorizes
the enterprises to decide independently on theu production and manage-
ment plans and gives them free rein to seek high profits as in capitalist
enterprises. lt provides the leaders of the enterprises with more and
bigger prlvileges and endows them with the power to deal freely with
ln both the principal defmitions of capitalism given in the previous chapter matters concerning production, finance and personnel in the enterprises.
markets are considered central. By one definition, capítalism is essentially (llsinhua, 29 October 1967)
equated with a market economy (i.e. the predominance of capital, labour and
commodity markets) while in the other, the predominance of wage labour Contrary to thls Chinese claim, in the Soviet Union today the most impor-
markets together with the existence of an exploiting class, is considered to t.anl production and allocation decisions are still made through the central
be the deftning characteristic. This chapter will examine the extent to which ¡llan. The inHiative for the goals of the plan comes from the Central Commit·
markets, especially wage labour markets, predominate in the U.S.S.R. 1hls lc'l! of the Communist Party which establishes the basic priori líes. The Sta te
will help answer the question of whether the country is capitalist (by either l,anrung Commission (GOSPLAN) then formulates control statistics for
deftnition). ubout 250 product groups which fulfll these priorities. GOSPLAN negotiates
In this chapter 1 wiiJ systematically look at: (1) the relative role ofprofits wtlh the various industrial ministries and sends the tentalive annual target
and the central plan in guiding the Soviet economy, examining especially the hgures to the enterprises. Enterprises evaluate the GOSPLAN proposals and
signíficance of the Uberman-Kosygin reforms; (2) the role of commodity communicate back to the central agencies the extent to whlch they feel
markets and the factors determining commodity prices; (3) the role of they can fulftl the annual plan. GOSPLAN then puts it all together, checking
capital (or producer) goods markets; (4) the role of labour markets; and (5) the consistency of the various inputs and outputs lo ensure a 'material
any tendencies generated through the operation of markets to produce balance' (e.g. that the amount of steel that the steel industry is targeted to
either a declinlng rate of profit oran increasing surplus. produce in fact equals the demand from steel consurrúng industries). Finally,
Since, of all these points, the question of the existence of labour markets lt scnds lhe modified plan to the Council of Min.isters for approval and then
is the most important (because the traditional Marxist defirútion of capitalism \c nds the fmalized annual production targets to individual enterprises. OnJy
centres on the concept of labour power as a commodity, along with tb.e the basic commodities are fu Uy planned In thls way. Large numbers of minar
existence of a controlling and exploiting class), three separa te aspects of this ~ommodities are not explicitly planned by the central planning agencies, but
question are examined: (a) the allocation oflabour power; (b) the remuner- llCcause their production depends on the output of the basic planned
ation of workers , especially the role (if any) of unemployment in setting wages; •ommodilies, the plan greatly influences their produclion as well. Each
and (e) the extent to which workers' self-management of enterprises exists. cnterprise is presented with about 14 annual targets to fulftl, the most impor-
lf it can be shown that labour is fundamentally allocated by , and wages lant of which is the total output actually sold. 1 Enterprises are controlled
detem1ined by, unemployment and the reserve army of labour (operating by the central authorities not only through the phys1cal plan from which they
openly or in a hidden form through the plan), and that workers are treated •cce1ve the1r necessary material inputs, but also through the fmancial plan. This
merely as labour power in the faetones (Le. have no real control over the con trols their wages bill, credit, planned cost reductions, etc. And, to the extent
conditions of their labour), then the hypothesis that labour markets do the enterprises have to borrow from the central bank to finance investment , tbey
predominate tn the Soviet Union (a necessary, but not sufficient, condition •re controlled through the central state banking sys tem as well.2 The state
for the existence of capitalism) will have been demonstrated. bank oversees enterprises in their fulftlment of the plan, and audits their
uperations in order to check on any deviations from the tasks assigned by the
planning authorities. While it is true that the intermedia te leve! five year
plans often embody only general targets rather than fuUy worked out goals
ror each enterprise, over the en tire five year period it is certainly also true that

36 37
Is the Red Flag Flying? Tlle Role o[ Market Forces

planning is the dominant force. This planning takes the fonn of the annual lnstead he argued only for a decrease in the number of targets gjven by the
establishment of targets and the central allocation of resources, as well as the central planning authorities to the enterprises, in order to increase their
central establishment of prices and wages and centralized investment decisions. llcxibihty and initiative, and also for lhe use of profitabUity as one indicator
As a result, very little actual autonomy Hes with individual enterprises or l'f the efficient use of resources.6 He never proposed that baste decisions
associations.3 cuncerníng the quantity, composition and prices of output should devolve
Contrary to sorne people's preconceptions, profit in the Soviet Union, twm the central planners.
whlle it is one of the planned targets of enterprises and a criterion on which
the central planning commission evaluates performance, is not in command. All the basic Jevers of centralized planning - prices, finances, budget,
Profit, rather than being the sole determinant of production and distribution uccounting, large capital investments - and f~ally :ut the value, labour
decisions (as it is in private capitalist economies) is in the Soviet Union and major natural índices of rates and proporhons m the sphere of
merely a lever by which the central planning authorities attempt to increase production, distribution and consumption will be determined entirely
productivity, efficiency and compliance with planned production targets. at the centre.
Gross realized (sold) output is the primary indicalor of managerial success, Their fulfillment will be assured and guaranteed because obligatory annual
control figures on all important índices will be presented to the economi~
not profits.4
councits (and to the executive committees of local Soviets). The econom1c
A number of differences between profits in the Soviet Union and profits council would no longer be just an intermedia te agency ... but a centre
in market capitalist societies should be pointed out: (1) Profits cannot be or hub at which all the lines of planning converge. 7
increased in the Soviet Union by restricting production since a1l prices are
centrally determined. (2) Profits are not owned or even very much controlled
by private persons. Profits are shared out by the state and the enterprises The actual reforrns irnplemented in 1965 (referred toas the Kosygin
according lo criteria established by the stale. Only a very, very small propor- rtforrns) were actually considerably less far reaching than even those actually
tion accrues lo the managers in the form ofbonuses. Thus, unlike in the West, proposed by Uberman. These Kosygin reforms were quite modest and
the profits of an enterprise do not lead to great differences in people's social amounted to no fundamental change in the Soviet system of planning, enter-
positions. (3) Profits are not necessarily an objective measure of efficiency prise management or incentives. The reforms were implemented in an .
since the state very often fixes prices below their values (in the case of many ,,ttempt lo reverse the lagging performance of the economy by countenng
basic necessities) or above their values (in the case of many luxury goods). trndencies of the enterprises to board, become self-sufficient in inputs and
(4) Differences in profits do nol necessarily determine the distribution of he particularistic in outlook. They were an attempt to use resources more
investment since basic investment decisions are centrally determined on the rfficiently, improve the quality of oulput, get enterprises to adopt higher
basis of complex criteria. These depend on the state's decisions as to the plan targets, introduce new technology, increase pro~uctivity and d~crease
relative priority of competing long-term goals, such as emphasis on heavy , osts. They used the traditional Soviet method of rehance on matenal
induslry, building up the military, decreasing inequality, raising consurnption Incentives while decreasing the complexity of drawing up and implementing
levels and, recently,promoting agriculture. (5) The flow of Soviet capital to the central plan, a lask which had been made all the more difficult by the
foreign countries is not determined by profil maximizatlon or the inability growing complexity of the advanced Soviet economy. 8
lo invest profits at borne (under-consumption). 5
.. conditions must be created under which the enterprises will be able to
The Liberman/Kosygin Reforms: solve their problems of irnproving production independently, and that they
Much of the Chinese argument thal capilalism was restored in the Soviet will be interested in utilizing to the utmost the fixed assets assigned to
Union in the 1960s rests on an inlerpretation of the 1965 Uberman/ them for increasing output and the amount of profit they receive ...
Kosygin reforms. The Chinese argue that these reforrns transferred funda- . . on the basis of the cost accounting system, it is necessary to provide
mental control over the economy lo the individual enterprise managers who material incentives for the entire coUective and every shop and section of
the enterprise to make them interested in fulfilling not only their own
now essentially relate lo one another through markets. Such an inlerpretation mdividual assignments but also in improving lhe overall results of the
cannot be substantiated. enterprise. In doing this, incentives must be organized so that enterprises
The debate aboul the proposals put forward by Uberman in the early will be interested in working out and fulfilling higher planned
1960s, proposals which called for an increasing reliance on markets and 9
assignments, and in the better utilization of intemal resources.
decentralization ofeconomic decision making, gained central attention
because of the sJowing down in Soviet growth rates al that time. Liberman The 1965 Kosygjn Reforms reduced the number of planned targets
never called for giving enterprises autonomy (as is the case in Yugoslavia). assigned to enterprises from between 20 and 30 to eight. These were: (1) the

38 39
 ls the Red Flag Flying? Tlle Role o[ Market Forces

total quantity of goods to be produced and sold, (2) the main assortment of ..u much greater use of computers, with a resultant increased ability to use
these goods, (3) the size of the wage fund, (4) thé amount and rate of profit, u nned statistical indicators to evaluate and monitor enterprise performance,
(5) the payment to and allocation from the state budget, (6) the volume of 1 well as to establish output targets.
13 1n sum, the Soviet economy today is
investment and exploitation of fJXed assets, (7) the main assignment for 1 c.lcpendent on centrallzed planning of inputs and outputs, central admin-

1 improving technology, and (8) the allocation of material and technical

supplies. In addition it should be remembered that all wage rates and prlces,
as weU as interest rates and 'the main distribution of credit, remained centrally
1 tration of prices and wages, and centralizad allocation of investments, as it
1111\ cver been. Commodity and capital markets play as little role today as
1he y ha ve at any time since the late 1920s.
determined. The number one indicator of success by which managers were Another refonn occurred in 1973 which coincided with the re-centraliz-
judged (and so their bonuses decided and their future careers detennined) atlon of authority over enterprises and which was probably its coroUary.
was 'realized output' Le. the actual material quantity of goods sold. 10 luc.ing the continuing problem of the geometrically growing complexity of
The other main aspects of the 1965 refonns were: (1) The introduction H lltral planning and the problems of decentraliz.ing authority, individual
of an interest rate on borrowed capital and an increased reliance on the central enterprises are being consolidated into multi-enterprise associations. Each
bank for flnancing investments. (2) The establishment of a production develop- ¡t · ~ociation either links enterprises which perform similar functions or links
ment fund which received a share of enterprise profits and money from sales !hose that are closely integrated economically with each other (typically they
of redundant equipment. (lnvestment funds, bonuses for managers and bonus 11rt' in close physical proximity). Thus considerable decision making power
payments for workers were all tied to this fund, and thus to enterprise 1 now vested in this middle level between the enterprise and the ministry.
profits.) (3) lncreased bonuses for managers tied to fulftllment of planned t c:ntrally planned targets are now given only to the association which in tum
targets for sales, profits, profitability and physical output. (4) Price reforms tllocates its responsibilities to its various constituent units, thereby consider-
that allowed many more enterprises to be profitable under normal conditions .1hly simplifying the job of the centre withoutlosing any fundamental control.
of operation. (5) Increased reliance on accounting and enforcing contracts 1he average number of enterprises per association is three to five with
among enterprises. 11 u\ ually around 4,000 employees per association.
Umited as the Kosygin reforms were, they were in any case Jargely The objects of establishing these intermedia te leve! associations were to
rescinded in favour of increased centralization in the early 1970s. Because of lmprove industrial performance by increasing productivity and quality,
undesirable enterprise behaviour under the somewhat more flexible and hu.: reasing specialization and concentration of production, developing
decentralized conditions, a series of new reforms were implementad between rtllable supplier-customer ties, increasing co-ordination between research
1971 and 1973 that restored a number of the previously d ropped planned .lllc.l production, speeding up the introduction of technical improvements,
targets for enterprises, raising the total from eight to fourteen or ftfteen. ·.lrnplifying the administrative structure, achieving economies of operation,
Rigid regulations were instituted which govemed the size and use ofthe •k-creasing the cost of management, decreasing the incentive to hoard, and
enterprise incentive fund , thereby making decent,alized investment more l.1dlitating the transfer of knowledge among flrms. 14
difficult. The size of the incentive fund is now centrally determined and is a
function of the enterprise's fulftllment of the output, profitability and pro-
ductivity targets, as weU as of the overall plan for consumer goods and plans Commodity Markets and Prices
to change product quality and what products are produced. Things are now
structured so that the higher the targets for output, profitability and labour Tbe core of this 'new system' is to use every means to encourage the enter-
productivity, the better off is the enterprise. Limits ha ve been placed on the prises to seek profit and to promote production by material incentives. It
cate of growth of managerial bonuses which themselves have been tied to means expanding tbe autonomous power of the management of enterprises,
sales, profitability and the product mix plan. The percentage ofprofits to be energetlcally carrying out the practica of adjusting production according
aiJocated by each enterprise for various uses is now al so set by the ministry. to market prices . .. (Renmin Ribao, 8 November 1967)
The centrally planned enterprise targets which have been added are in the In th.is period, the Soviet revisionist clique also lifted al1 restriction on the
prices of agricultura! produce and livestock products in the free markets
fields of: (1) labour productivity, (2) gross output, (3) consumer goods,
and vigorously developed capitalist free markets and free competition,
(4) quality, (5) economy in the use ofmaterial and fiscal resources, and (6) leaving the door wide open for priva te merchants. (Hsinhua, 29 October 1967)
the size of the incentive fund. 12 lnOation and soaring prices have brought more difficulties to working
Since 1971 then , there has been a move, away from the use of 'levers' to people in the lower in come category. (Peking Review, 16 May, 1975, p. l9)
motívate managers to fulftll the plan, and back towards direct state tutelage
over enterprises to improve economic performance. This change of direction In spite of statements like these, commodity markets are not hegemonic in
coincided with improved methods of central planning which have been based the Soviet Union. Their logic does not exert any appreciable influence on the

40 41
ls tire Red Flag Flying? The Role of Market Forces

Soviet economy. The central plan, however, does utllize sorne devices C'\.Onomy. The index for retail prices for all commodities barely changed
developed fust in market economies in order to secure compliance by enter- from 1955 to 1975. There was a s1igbt tendency for food prices to rise during
prises and consumers with the goals of the plan. Consumption goods are tlus period. but at the same time there was an equivalent tendency for non-
allocated through markets, but markets which are structured by the central lood commodities to decrease in price. This suggests that there has been a
plan and state regulations, rather than by the laws of commodity production movement away from state subsidization of necessities such as food and also
and autonomous market forces. .rway from artificially high prices on non-necessities such as washing machines
In all market economies, the law ofvalue operates autonomously to und television sets (see Table 3.1 ).
determine the leve! of prices. Even in monopoly capitalist econornies, the
law ofvalue is only distorted in its operation. ln planned economies- luble3. 1
whether of the state capitalist, state socialist or decentralized socialist types lndices of Soviet Retail Prices, 1955-1975 (1955=100)
- the extent that the law of value opera tes is determined by the planners who
may or may not elect to make prices reflect the labour time that goes into (iunmodity Group 1955 1958 1962 1963 1967 1971 1975
producing them. All Commodities 100 103 103 103 101 101 101
ln the Soviet Union retail prices are set by the state to clear the market. lf l·ood 100 104 107 107 106 107 108
there is too much demand for a commodity, its price is raised; if too little, it Non-Food 100 99 98 96 93 93 92
is lowered.lf the govemment wants to encourage consumption, as is the
case with basic consumption goods, it sets their price artificially low; retail Sources: Morris Bomstein, 'Soviet Price Theory and Policy' in Morris Bom-
prices for food, for example, are maintained ata fairly low level to ensure a stcin and Daniel Gusfeld (eds.), The Soviet Economy (4th edition),(Home-
low cost of living for industrial workers. 15 On the other hand, if the state wood, lllinois, Richard Irwin lnc., 1974)1 p.l09¡ and United Nations,
wants to discoura¡e consumption, as in the case of luxury goods, it sets Stacistical Yearbook, 1976, Table 181.
prices very high. 1 As in the West the state subsidizes agricultura} production,
but unlike in the West it does this to lower, rather than raise the price of
food. 17 There is normally a considerable difference between the wholesale Producer Goods Markets
and retail prices of a commodity, the difference going to the state as a form
of tu mover tax which represents a major source of state income (until the [Managers and d.irectors] are entitled to ' talce possession, use and dispose
mid 1960s the largest single source of state funds). Wholesale and retail prices or the property of the enterprises, bu y or sell the means of production.
thus often move in opposite directions from one another. To encourage the fix plans for production and sales and freely produce goods that can bring
production and consumption of a commodity, the state m ay raise its whole- in hlgh profits... (Peking Review, 18 July 197 5).
sale price while at the same time cutting its retail price in order to stimulate The 1965 measures, in sum, wiped out the legal and financia! barriers that
had kept the emerging market in means of production underground during
both production and consumption. Such a phenomenon is most unlikely to the Khrushchev years. The exchange of means of production as commodities
occur in a market economy. Wholesale prices in the Soviet Union thus do not - hard to finance, illegal, but widespread under Khrushchev- becarne
perform ailocation functions; they are primarily accounting prices which respectable, universal and amply supplied with liquidity. (Martín Nicolaus,
serve as a means of control and evaluation of enterprise performance, wh.íle Restoration of Capitalism. p.22).
retail prices serve primarily to allocate consumption goods. 18 The central This stagnant economy reflects the moribund dying nature of Soviet social-
planning body attempts to meet consumers' private preferences up to the tmperialism and all irnperialism ... the anarchlc development of production
point where they do not interfere with what it considers to be the overall, under capitalism me3IIS that sorne products are always, in effect, over-
long term interest of society.19 The only rationing of consumer goods is for produced while others are shortchanged. Not only do these factors produce
automobiles, housing and certain consumer durables. These relatively few the period.ic crises of capitalism, they also tend to permanently depress the
consumer goods are rationed in order to keep their prices lower than what rate of profit, stagnating economic development. Thus, all imperialists are
driven by the intemallogic - the fundamentallaws of their system- to
they would be in a free market (in which those with the most money would
seek new markets for their commodities, but, more important, for the
bid their prices up to where only the better off could afford them). This also investment of their capital. (Revolutionary Union, How Capitalism Has
makes their distribution fairer than would be the case if they were distributed Been Restored, p.57.)
to those with the greatest purchasing power.20 The laws of comrnodity
markets clearly do not opera te to determine the distribution of goods. Just as comrnodity markets are nota leading force in determining produc-
The fact that the laws of commodity markets do not prevail in the Soviet Uon and allocation of goods, so capital markets are not the leading force in
Union is shown by the absence of inflation and erratic price movements in the determining investment. Basic investment decisions are made outside of the

42 43
ls the Red Flag Flying? The Role of Market Forces

enterprise by central agencies on a co-ordinated and planned basis. Neither Table 3.2
rates of interest nor profit are allowed to deterrrune the si.ze and broad Fluctuations in Rate of Growth of Net Material Product and Gross Fixed
distribution ofaccumulation, although since 1965 both have become impor- Caoital Formation, 1958-1975
tant measures of efficiency. Enterprise funds for investment come from three
sources: (1) the state budget, (2) loans from the state bank, and (3) the US.S.R U S.A.
enterprise's own production fund to which a share of its profits are allocated. Annua/ &te of Growth Annual Gross Fíxed Annual Rote o/
Funds are allocated from tlie state budget for investment on the basis of in N.MP. Capital Fomwtion/ Growth in
numerous rules including the capital/output ratio, the productivity of labow, N.MP.* G.N.P. •••
the profitability of the enterprise, the importance of the product for the 1958 11.7% 26.8% -1.1%
economy and the political goals of the planners. The enterprise's own produc- 1959 6.2 28.5 6.0
tion fund is also rather strictly guided by the central authoritles. Not only is 1960 6.1 28.9 2.4
the amount of profit planned, but the share of profits that must be allocated 1961 5.2 28.6 1.9
to the production fund and the proportion of the production fund which 1962 7.1 27.9 6.2
must be reallocated to investment is also centrally deterrnined. Since most 1963 2.5 28.6 3.8
capital goods are allocated centrally and since most means of production 1964 7.4 29.0 5.2
cannot be bought nor labour recruited outside of planning channels, these 1965 6.7 29.5 5.9
constitute another set of restrictions on the managers' ability to reinvest out
of the production fund. lt should be noted that managers have the right to 1958-1965 6.6 {.36)** 28.5 {. 027)** 3.8 {.63)*•
sell surplus equipment and allocate much of the proceeds to the enterprise Average
production fund, but that the total of such sales each year represents less than
one per cent of the total transfer of productive equipment in the Soviet 1966 7.2 29.4 6.1
economy .21 Additional funds for reinvestment can be obtained from the state 1967 8.7 29.3 2.4
bank which not only monitors the enterprises' fulfillment of the plan and the 1968 8.2 29.2 4.7
overall efficiency of the enterprise but requires repayment atan interest rate 1969 7.3 28.1 2.5
centrally determined by the state (between one and five per cent). Not only 1970 10.7 28.3 -.4
the rate of interest charged by the state bank (charged in order to promote 1971 5.2 28.9 3.2
the efficient use ofscarce resources), but also the broad distribution ofbank 1972 2.8 30.1 5.8
investments are centrally determined (in order to realize the investment 1973 7.5 29.2 5.6
priorities of the state plan). As the Soviet economy becomes more complex 1974 5.0 28.7 -1.6
the banks are coming to play an increasingly important role in relation to the 1975 2.5 27.7 - 1.6
ministries and GOSPLAN .22
The absence of market forces in determining capital allocations is reflect~d 1966-1975 6.5 {.38)** 28.9 {.023) .. 2. 7 ( 1.05)••
in the data reported in Tab1e 3.2 on the annual rates of economic growth and Average
capital accumulation(See Table 3.2).
From Table 3.2 it can be seen that, in the ten year period 1966-75, the
Soviet rate of economic growth was 2.4 times that of the American (while in • The figures for Gross F"lxed Capital Forrnation for the U.S.S.R. from 1958
the 1958-65 period it had been 1.7 times more). ln the 1966-75 period the to 1962 were adjusted to make them compatible with the comparable figures
annual fluctuations in the American rate of growth were 280 per cent that of for the period 1963 to 1975.
the Soviet Union's (while in 1958-65 the American annual fluctuations were •• Standard deviations of the annual rates of growth for the period divided
175 per cent that of the Soviet Union's). These figures show that: (1) the by the mean rate of growth for the period.
Soviet economy is growing considerably more rapidly than that of the U.S.A.; ••• Gross National Product is approximate1y the same as Net Material
(2) the differential in performance of the two econornies is increasingly in Product plus the cost of'services'and depreciation.
favour of the Soviets; and (3) the Soviet economy is considerably 1ess subject
to market-like fluctuations than the American. ln sum the contrast with the Sources: UN Yearbook ofNational Account Statistics, 1967 and 1976, Vol 11,
U.S. economy is so great that it is most unlikely that market forces can be (tables 2A, 2B, 4B).
predorninant in the U.S.S.R.

44 45
/s tire Red Flag FIYillg' The Role of Market Forces

11 is also interesting to examine the differences between the 1958-65 and When we examine what life is like for workers in the Soviet Union today
the 1966-75 perlods. According to many of those who claim that the Soviet a very different picture emerges. One of its 'highllghts' is the re-emergende
Union is now a market capitalist country, the Kosygin reforms in 1965 mark of the free labor market ... (Revolutionary Union, op cit., pp.l O, 48).
the mtroduction of market principies and 'putting profits in command.' If
the Kosygin reforms resulted in a significant modification of the Soviet Labour power, like consumption goods, is distributed througb markets,
economy in the direction of giving market forces and pursuH of profits free hut markets which are structured by the plan, rather than by their own
rein, we should expect to see a considerable difference between the pre- and 1111lonomous logic, l.e. the price and allocation of labour power 1s centrally
post-1965 perlods in the size of the fluctuations in growth rate of the Soviet el termined rather than determined by the operation of a reserve army of
economy. There should be a similar difference in the size and fluctuations of l.tbour, the differential productivity oflabour and the rate of exploitation.
gross fLXed capital formation (since enterprise managers now allegedly have Wage Jabour is the overwhelm.ingly predominant forrn of employment in the
considerable authorlty over investrnent decisions). Yet as Table 3.2 shows, Soviet Union. Peasants on collective farms still share in their collective product
rather than a great increase after 1965 in the fluctuations in the rates of growth r.tther than receiving a wage (although the difference in this regard is
and gross fLXed capital formation as a percentage of Net Mat~rlal Product dlmln1shing as the differences between state farms and coUectives decrease),
(N .M .P.), whlch we wouJd expect if market forces were given greater rein, •nd a very small number of artisans continue to work for themselves. Workers
there was actually no significant change in either the fluctuations in the rate .1re free to quit and seek new employment any time they like (with a few
of growth or in the rate of gross fLXed capital formation between the earlier mlnor and not rlgorously enforced restrictions). The great Jabour shortage in
and later perlods. Iikewise the ratio of gross fixed capital formation and rate the Soviet Union makes fmding altemative employment very easy. No one,
of economic growth was more or less the same during tbe two perlods. tnduding the state, has any rights of ownership in their bodies nor are they
Consequently, there is no empirical evidence that the Kosygin reforms in llcd lo the land or their place of work or residence (although, again, there are
fact 'put profits in command' or installed market forces as the guiding H)me restrictions on moving toa few over-popuJated areas). 23 The predom-
principie of the Soviet economy. lt wouJd thus seem that the plan, not the lnance of the wage form is compatible with capitalism as well as with the
pursuit of profit in markets, remains the guiding principie of Soviet haSJc kinds of socialist social formation. But it is incompatible with any form
economics. nf slave or feudal society (the Soviet Union being a restoration of 'oriental
dcspotism', as Wittfogel claimed or Schactman suggests, is thus ruJed out);
lor the same reason it is equally clear that the U.S.S.R. is not a communist
The Labour Market •Ucial formation. Whether the Soviet Union is capitalist or socialist then
must hinge on whether wage labour is exploited by and in the inte;est of a
Since one of the two essential components of the traditional Marxist defmition non-producing class or whether wages are mere! y the form in which the
of capitalism is the existence of wage labour markets in whlch Jabour power producing class assigns itself to jobs, motivates the economic performance
is sold by a proletariat (the other componen! being the existence of an nf lndividuals and allocates consumption goods to its members (according to
exploiting class which controls the means of production), the question of the ~rxist principie 'from each according to their ability, to each according
whether or not a wage labour market exists in the Soviet Union in the same lo theu work').
sense as it does in the Westem capitalist countries must be examined very The Soviet Union has had an endemic and increMingly severe labour
closely. In thls section 1 willlook in tu m at the mechanisms of labour allo- o,hortage, or (conversely) job surplus for years. As a result there is no significan!
cation, the payment oflabour and the role ofworkers in determining what unemployment. 24 Anyone can easily get a job or change jobs and be
happens in the enterprises. rctrained. The amount of labour required is largely decided outside of enter-
pnses, by the central planning agencies which also establish the industrial wage
The Allocation of Labour Power rates. Basic rates are established for each type of industry, each type of
acupation within each industry, and for different regions of the U.S.S.R.
Unemployment in the capitalist world is caused mainly by the capitalists' Standard incremental scales are also set for each. The various scales are
insatiate desire for profits and massive layoffs. This is also the case in the r.stablished and modified in order:(l) to cbannellabour into those industries,
Soviet Union (Peking Rt!Vlew, 20 February 1976). uccupations, job training programmes and regions where it is most required
The conversion of labour power into a commodity has . . . brought about a nnd (2) to realize the planner's conceptions of social justice.25 The total '
large-scale labor market from one end of the country to the other ... wage payments for the economy, as weU as their dlstrlbution by reg¡on,
(Nicolaus, op c1t., p.ll3). tndustry and occupation, are determined by the central plan rather than by
Under the 'reform, the Soviet workers are reduced exactly to the position
tite enterprlse managers, the trade unions or collective agreements between
of sellers of their labour power to capitalist exploilers.

46 47
Is the Red Flag Flying? The Role o[ Market Forces

them. Thus the decisions ofwho gets what are made centrally according to freedom of job seeking has traditionally been the requirement that graduates
the plan rather than through an ad hoc process where the stronger bargaining from institutions of higher education must work for three years ata job
groups get more and the weaker unions gets less, and with the most profitable dc terrnined by the state (to be selected by the candidate from a list of
enterprises paying higher wages than the least profitable. The process of positions that need filling). In fact, however, even this requirement is not
central wage deterrnination also allows a balance to be struck between total stric tly enforced and it is quite common for recent graduates to refuse their
consumer purchasing power in the economy and the total value of consumer nssignments orto leave them without penalty. The second traditional
output, thus preventing either inflation or underconsurnption. In other words exception to a totally free labour market has been the punitive use of com-
wage determination is not done by the autonomous workings of a labour pulsory job assignments in lieu of jail, especially for minor crirninals. The
market but rather by plan. This means that the tendencies of wage markets official ideology here is that productive labour is a good cure for anti-social
to perpetua te and genera te inequality, as well as a reserve anny of Jabour bchaviour and works far better than confmement. In any case, these two
functioning to keep the level of wages down , are not manifested . Since wages latter forms of labour recruitment play only a small part in assigning people
are centrally determined, they can qe set al a level sufficient to allow adequate lo jo bs.
reinvestment funds without the need to force wages down by means of the It was not unti11966 that the Soviet Union set up republic wide (not
unemployed threatening to take away th.e jobs of the employed. The mechan- Union wide) commissions for placing workers with enterprises that needed
ism of central wage determination thus allows the economy both to avoid all labourers, and thus began to allocate individuals to jobs on an organized
structural unemployment (i.e. a reserve anny oflabour) and to accumulate basis . In addition to serving as Iabour exchanges where a worker or enter-
sufficient investment funds . prise could go to fmd out what openings or what workers were available, these
In a market economy (whether socialist or capitalist) the permanent labour commissions were charged with systematically providingjob information,
shortage would produce a rapid increase in wages and reduction in profits to organizing recruitment of wage labour, developing proposals for the use of
the point where many marginal businesses would go bankrupt and the surviv- perso ns not currently employed, participating in the development of locations
ing businesses would introduce new Jabour saving technology to replace fo r new industries and developing measures for locating and utilizing the
workers. Large numbers of workers would then be Jaid off, swelling the labour reserve.31 By the early 1970s about one half of all new hires carne
reserve anny of labour. Millions of workers desperately seeking work would through these commissions rather than by direc t contact between the enter-
then allow the enterprises to reduce greatly the wages of the employed under prises and workers. The operation of these labour exchanges, by greatly
threat of being replaced by members of the reserve army. No such logic facilitating the process of flnding desüable jobs, has reduced tl1e average time
opera tes in the Soviet Union. between jobs from approximately 2 8 days to 12 to 15 days in the Russian
The structurallabour shortage implies considerable opportunities for Republic and to shorter periods in other regions. The purpose of establishing
changingjobs since, according io one estímate , the rate ofjob turnover in the these commissions was to rationalize the whole process of matching jobs with
Soviet Union is 20 per cent less than in the U.S., and since laying off and workers and thereby to reduce: (1 ) the cost to society ofunderemployment
dismissing workers is far Jess prevalent in the Soviet Union than in the U.S., it nnd over-manning, (2) the time between jobs, (3) wasteful geographical
is clear that the rate at which Soviet workers voluntarily change jobs is mobility, and (4) unnecessary retraining.32 It is rather surprising that the
significantly higher. 26 Soviets did no t adopt such a system far earlier. Perhaps the reason lies in their
To meet the structurallabour shortage, measures have been taken in recent reluc tance to adrnit that anything resembling unemployment could ever exist
years which encourage people of pensionable age to c on tinue to work, and m lhe Soviet Union.
27
housewives have been increasingly drawn into the labour market. The social The layoff or dismissal of workers is far rarer in the U.S.S.R. than in
norm in the Soviet Union is that all able-bodied adults sho uld work and that capitalist econornies. On the one hand , the structural labour shortage has
everyone is entitled to ajob . But there are no formallaws which fully mo tivated enterprises to ho ard labour, even if all workers are not being
embody either the duty o r the right to work. There are ' anti-parasite laws' cfficiently employed (because at sorne future time the enterprises may need
which make it illegal to live off exploitative income such as rents, speculation, labour which would be unobtainable), and on the other because there are
blackmarketeering or buying other people's labour power; but there are no considerable legal and customary c onstraints on the manager's ability t o
laws against living off relatives, friends or savin¡p (although there is consider- dismiss workers. Through most of the post-war period, and still in most
able social pressure against these ways of Ji fe)? Most new jobs in the Soviet en terprises today, the following have been the Jegally permissible reasons for
Union have until very recently been obtained through newspaper, radio and dismissing workers: 1) a worker refusing a transfer, 2) liquidation of the
29
television ads, posted openings at fac tory gates and by word of mouth. ln cnterprise, 3) the worker's unfitness fo r his or her job , 4) the systematic non-
the l960s about 90 per cent of all 'new hi res' were directly negotiated fulftllment of duties, 5) criminal ac ts, 6) excessive absenteeism , 7) long-term
between the enterprises and workers.30 The major exception to complete dlsability, and 8) restoration of a predecessor to a job. 33 Workers can be

48 49
ls the Red Flag Flying? Tl!e Role o{ Market Forces

dismissed by managers, however, only with the agreement of the factory and Remuneration
local trade union committees {with a few exceptions). Further, in the event of
a dismissal with the trade union 's concurrence, the worker can appeal to the With the implementation of the 'new system', the principie of socialist
courts for restoration ofhis or her job. Empirical evidence indicates that distribution, i.e. 'from each according to his ability, to each according to
about one-half of workers who so appeal are reinstated by the labour courts. 34 bis work', was entirely discarded. The income gap between the 1eaders of
Beginning in 1967-68 ín selected enterprises, managers have been given enterprises, engineering and technical persorme1, and high-ranking staff
expanded authority to dismiss workers they consider to be redundant ín order members on the one hand and the workers on the other become wider
lo raise productivity and release workers to other enterprises where they are and wider. A small handful of meo of the privileged stratum gets richer
and richer while the broad masses of workers become poorer and poorer.
needed. The Shekelcino Plan (as this experiement is called) gives the enterprise (Renmin Ribao, 8 November 1967)
an incentive to use labour more efficiently by allowing it to keep the same
size wage fund even though workers are dísmissed {with the dlfference going . . . inequality is growing; rich and poor have emerged and the rich are
to the remaining employees in the forro of increased wages). As of 1972, becoming richer and the poor poorer.(Nicolaus, o p. cit., p. l71 ).
300 enterprises in the Soviet Union were operating according lo this system. 35
In selecting workers to be released, the following factors must be consid- In the Soviet Un.ion today, the distribution of wealth has grown increasingly
ered : seniority, family circumstances, number of dependents, pregnancy, u~even ~d t_
he_ruling class is in every respect a privileged elite. Expanding
single motherhood etc. Managers must moreover fmd other jobs for displaced differentials m mcome are coupled with cutbacks in social services.
workers, jobs of a similar kind to those previously held. ln lieu of being able (Revolutionary Union, op. cit. , p.82).
todo this, the dismissed worker's former enterprise must pay 100 per cent of
the costs of retraining the worker for another job of comparable skill and lf labour markets operate in the Soviet Unjon (as they do in the Westem
provide him or her with a stipend during the retraining process.36 ' apltalist countries) to establish the price of the commodity labour power,
Enterprises remain reluctant to dismiss workers even if they are redundan t. i.e. ~ges, then we should expect both the distribution of wages, salaries and
There has been considerable discussion in the Soviet press and other institut- the mcome of managers/owners of productive enterprises to be more or less
ions about guaranteeing protection for dismissed workers, e.g. giving six ~:ompamble in the two types of society, and for the trends over time either
months notice, increasíng severance pay, etc. Dismissed workers are presently lo reflect a growing inequality (as capitalism became consolidated in the
entitled to two weeks pay regardless of the length of their termination notice.31 U S.S.R.) or at the very least to maintain already existing inequalities.
One study found that only about 40 per cent of dismissed workers took more Table 3 . 3 reports the average wages of various sectors of the Soviet labour
than lO days to fmd a comparable job.38 Al! in all, the lirnited managerial force in 1965 and 1973. From this table it can be seen that the highest paid
right to dismiss workers includes so many guarantees and protections for people are industrial, engineering and technical persormel who in 1973 eamed
dismissed workers that it can hardly be considered a decisive step towards un average of 1.27 times the wages of industrial workers. The lowest paid
making labour power a commodity or constituting a threat hanging over group were the collective farmers who earned 0 .60 limes the wages of industrial
workers lo ensure their subordination to management. It would appear, given workers. ln 1973 no group other than industrial engineering and technical
the extreme labour shortage in the Soviet Union and the very real problem of personnel eamed more lhan industrial workers. ln 1973 the spread between
increasing productivity {which has been aggravated by the tendency of enter- the highest and lowest paid groups was a factor of 2.12, while in 1965 it had
prises lo hoard redundant labour), tl1al something like these measures were heen a factor of 3.20. The eight year trend from 1965 to 1973 shows a very
dictated by the situation and thus cannot be considered as measures which dear tendency for the highest paid occupations in 1965 to have the slowest
enhance the power of the managerial stratum over the working class. ln a r1te of growth in wages, while the lowest paid occupations have lhe most
perfecl model of an industrial socialist society, provisions would stiU have to ~npid r~te of growth. The major exception to this trend would appear to be
be made lo separate redundant workers from an enterprise that introduces uadustnal workers who were rather well paid in 1965, but nevertheless
labour saving technology so that other collectives which are sl10rt of man- u:ceived the highest increase in wages of any non-agricultura] group. Very
power will be able to recruit them. The real question is not dismissal of dearly, then, there appears to be a rather egalitarian wage structure, a strong
workers, but who has ultimate control over dismissal policies and whether rrndency towards further egalitarianism in wages, and also a tendency for
such dismtSsals are purely technical orare instruments of the power of one andustrial workers to be favoured .
class (or incipient class) over another. The trend towards wage equalization has been a long-term one. In 1940
rng¡neering and technical workers earned 2.13 times as muchas manual
workers, while in 1960 they eamed only 1.48 times as rnuch. 39
A thorough disucssion of income levels and trends, as weU as of

50 51
ls the Red Flag Flying? The Role o! Market Forces

Table 33 Worker Participation in tbe Day-to-Day Operation of Enterprises

Olanges in Average Wages in the U.S.S.R., 1965-1973
The regulations empower the managers to fix or change the wages, grades
Ratio o[ and bonuses for the workers and staff at will, to recruit or d.ismiss workers
Wages to and mete out pun.ishment to them, and to determine themselves the
Industrial structure and personnel of the enterprises. Thus, the enterprises of socialist
Worken' ownership have been turned into capitalist undertakings owned by a
Wages bourgeois privileged stratum, and broad sections of working people in
Category of Wage-eam en 1965 1973 lncrease (1973) mdustry and agriculture into wage slaves who have to seU their labour
power.(Hsinhua, 29 October 1967)
(in rubles) (%)
Employees of the state apparatus 106 126 19 0.83 ... the power to handle and use the means of production in the enterprises
Industrial engineering and technical and the power of distribution and personnel all rest in the hands of the
personnel 148 185 25 1.27 ngents sent there by the bureaucratic-monopoly bourgeoisie .. .(Peking
Educa tion and culture employees 94 121 29 0.83 Review, 18 Juty 1975)
Trade and service employees 75 102 36 0.70
Industrial white collar workers 86 11 9 38 0.82 There is near consensus among non-Marxist Anglo-Saxon social scientists
Industrial workers 102 146 43 1.00 who seriously study the Soviet Union that workers' participation in industrial
State farm workers 72 116 61 0.79 management goes considerably beyond that found in American firms and that
Collective farmers 49 87 78 0.60 workers have a real say in enterprise dedsion making. 40
All workers and employees Strikes are Wegal in the Soviet Union. This is justified by lhe Soviets on
(excluding collective fanners) 97 135 39 0.92 the grounds that no segment of the working class has the right to strike
• gamst the working class as a whole. Strikes, according to the Soviet theory
Source: Jerry Hough, 'The Brezhnev Era: The Man and the System', Problems would give workers with the strongest unions and those in the most strategi~
o[Commnism, November-December 1974, p.l3. locations an unjustified advantage over the weaker and Jess strategically
placed segments of the work-force, as well as reducing the output of the
economy and undermining the rationality of the plan. Jf in fact the Soviet
non-monetary forms of income, accruing to different groups in the Soviet Umon is really a socialist society in which the working class rules and benefits,
Union,is contained in Chapter Four (the section entitled 'The distribution of the Soviet theory makes considerable sense. l f on the other hand the system
material rewards'). To summarize the data presented here, as well as the much ls not a proletarian socialism, then the no-strike rule is a front for greater
more comprehensive data presented later, il is obvious that the income sp read c·'<ploitation of the working class. Whether the Soviet theory underlying the
in the Soviet Union is far more egalitarian than it is in lhe U .S. This is rm-strike rule is valid must then be based on our analysis of the class nature
especially true in the very highest income ranges since lhere are no equivalen ts uf .tl~e Sovi~t Union. Striking for one's own economic benefit (as opposed to
in lhe U.S.S.R. of the owners of industry in lhe U .S. (e.g. the Rockefellers, \lnk1ng agamst bureaucracy and for political demands) would result in
Mellons, Duponts, etc., who eam tens of millions of dollars each year from r¡;onomic inequality and the accumulation of privilege as well as undermining
their stocks and bonds) and because the top Soviet managers (the leading thc overall democracy of working-class rule in any authentically socialist
officials of lhe economic ministries) average only three or four limes as much uuntry.
as skilled workers compared to ten to fifty times as much in the U.S. Finally, Although strikes are illegal, in a situation of extreme labour shortage such
the trends in income in lhe Soviet Union are decis1vely in the opposite ·' ex1sts m the Soviet Union, the use of widespread resignatlon from jobs in
directlon from lhat predicted by the defenders of the lhesis that a new response to adverse conditions and/or unsympathetic management or
capitalist class is consolidating its privileges in lhat country. Rather than hureaucratized trade unions is a very powerful weapon. There have been well
increasing income inequality, there is a strong trend towards increasing Jlllbhcized cases in which discontented workers simply left en masse~ 1 The
income equality. rnrre threat of this happening is probably as potent as a strike in dealing with
lmreaucratic management.
Trade unions play a strong and growing role both nationally and 10 the
rntcrprises. Especially since 1956 the role of unions as defenders of workers'
tntcrests has been emphasized. 42 The basic functions of Soviet t rade unions

52 53
1: tht Rtd Flag Flyirrg? The Role o[ Market Forces

include : 1) taldng part in drafting, discussing and examining the production wus In conflict with the law. Grievances seem to run the full gamut of
plan of the enterprise; 2) participating in drafting new systems of wages and pu~sible issues. While the managers are bound by law to fulfil the conditions
fiXing wage scales, 3) establishing obligatory safety rules and nonns; 4) uf the collective agreements, the obligations of the unlons are purely moral,
participating in drafting legislation on labour conditions; 5) promoling active 1e they cannot be enforced in the courts.44
fonns of worker participation in solving production problems; 6) encouraging About 95 per cent of aU workers in the Soviet Union belong to trade
workers' initiative in the introduction of new techniques, inventions and unlons (which exist in aU enterprises). For one reason or another, several
rationalization of production; 7) managíng nruch of the social insurance and uulhon workers abstain from union membershlp (whlch is voluntary) inspite
welfare programmes including funeral allocations, help with childcare, free uf the great material benefits accruing to members.45 Regular meetings of
legal aid, subsidies for special diets, places in sanatoriums, sickness benefits, runk and ftle trade union members are held in each enterprise. All union
retraining expenses and housing; 8) organizing cultural, recreational and organs from the bottom up are elected by union members and are account-
sports activities including tourism (the unions own and manage resorts for ahle to the majority and subordina teto hlgher union organs. Factory trade
lheir members), musical events, dances, artistic programmes, fJ.lms, education- unlon committees are assuming increasing rights and responsibilities for
al programmes,lectures, etc .; 9) organising meetings ofworkers in the enter- r nterprise management, while the national trade unions are assuming increas-
prise at which management must report and be scrutinized; 10) approving or lng responsibility for the management ofwelfare programmes.46 The official
rejecting the dismissal of workers ; 11) discussing the correct use of work e,:)(planation for the widening powers of the trade unions is that this represents
time and personnel, and methods for increasing labour discipline and produc- part of the process of the witherlng away of the state.47
tivity; 12) establishing collective agreements with management on production A second major means by whlch production workers take part in the day-
quotas, methods of production, allocation of workers, etc.; and 13) checking tn-day management and operation of lheir enterprises is through production
up on management's compliance with the collective agreements and labour confe rences. These inslitutions, although they played an importan trole
laws.43 throughout the 1930s and J940s, were revitalized in 1957. The members of
The Soviet view of trade unions is that they should perfonn the dual role the production conferences are elected at general meetings of all workers and
of directly representing the interests of production workers and advancing nre composed of representatives of the plant trade union commlttee, the
the quality and quantity of production for the benefit of the working class as l~rty. the Young Communist League, the scientific and technical societies in
a whole.If in fact the Soviet Union is a socialisl society, there is no antagon- the enterprilre, the employees, etc. The conference of an enterprise in tum
istic contradiction between the interests of the state and management on the clects a presidium of five to fúteen members. There is frequently a hlgh leve!
one hand, and the workers on the other. Therefore both goals can be realized of worker participation at the general meetings ( which must be held at least
at the same time. Thus an evaluation of the union's role in advancing the once every six months). The permanent production conference members must
interests of production hinges on one's evaluation of whether there exists in rcport to the general meetings. Members of the conferences can be recalled
the Soviet Union an exploiting class that derives a disproportionate benefit ,Jt any time. The functions of the production conferences include taking part
from increases in production at the expense of the working class as a whole. In the drafting and discussion of production plans, examining questions con-
Beginning in 1957 {after being suspended in the 1930s) the trade unions ccrning the organization of production, wage rates and labour allocation,
once again have cometo sigo collective agreements with the enterprise mcreasing the efficiency of equipment, introducing new machinery, protecting
management. Because aU wages are centrally determined, these annual coUec- workers and increasing labour discipline.48 The evidence seems to be that they
tive agreements do not set wages. However, they do establish work norms, ure both a real instrument of workers' participation and have resul ted in
quotas, standards of labour productivity , ways in whlch the plan will be mcreasing production. 49
fulfilled , and the uses of enterprise funds. lt is not clear how the terms of the General meetings of al! workers are also held where the managers are
collective agreement are arrived at in the event of disagreement between the rcquired to report and subrnit themselves to questioning from the floor.
manager and the trade union. The managers of the enterprlse must, by law, llnance, procurement, production schedules and according to one pro-U.S.
üve up lo both labour regulations and contractual agreements. A manager business observer 'everyone and everylhing' is fair game for the workers.
found in violation of either can theoretically be dismissed and sentenced to These sessions are apparently a real ordeal for the managers who must answer
up to five years in confinement. Union and management meet together on llll questions put to them. Attempts by managers to suppress criticisms can be
grievances and the decisions they reach must be unanimous and based on punished by dismissal or even legal action.50 The evidence seerns to indicate
labour legislation and the labour contract. lf unanimity cannot be reached that workers have a real and meaningful say in enterprise decision making.
at the first stage of a grievance procedure, the plant committee of the union 1t is also apparently the case that the enterprise is normally managed in an
is empowered to make the fmal decision . Management can appeal the decision ¡¡tmosphere of authentic co-operation between the union, production con-
of the union plant committee only on the grounds that the union's decision ferences, general workers' meetings and managerial personnel.

54 55
ls the Red Flag Fly1ng? The Role o/ Market Forces

The thlrd major mechanism by which production workers have an impor· Wt)rkers as merely embodying labour power (Le. a commodity bought and
tant input into the day-to-day management of a firm is through the plant old llke any other by the entrepreneurs who manage industry). Very signifi-
committees of the Communist Party whose members are selected by the ~:.mlly, workers' involvement in industrial decision making is increasing (not
Communist Party members in the plant. In 1957 the local party was greatly tL-creasing as the proponents of the thesis of a recent capitalist restoration
strengthened in relation to plant management.51 The chairman of the plant 1100 consolidation must maintain). 1b.is increasing self-managing role for
party committee, according to many observers, seems lo have power equal workers would appear to be thoroughly incompatible with the idea that
to that of the plant manager.51 Although de [acto responsibility for results llbour power has recently become a commodity.
lies wi th the manager appointed by the state ministry, the Party also holds
the party plant committee responsible for results. Local party branches lendencies in the Rate of Profit
attempt to guide the general policies followed by the enterprise, while lltere is sorne disagreement among Marxists about whether under conditions
avoidlng too detailed interference with management prerogatives. The precise 111" monopoly capitalism there is a tendency for the rate of profit lo decline
role of the local party branch in enterprise policy making has been a matter ur to rise over time. 55 According to Marx, at least under classical competit·
of periodic public debate and struggle. 53 1t would appear that real power in tve conditions, the organic composition of capital {the ratio of lab our time
the typical enterprise ís shared between the manager appointed from above, lncorporated in the raw materials and means of production consumed in the
the party committee elected by party members but influenced by higher lnhour process, to the amount of active Jabour time it takes to transform the
party bodies, and the trade unions and production conferences representing 111w materials into ftnished products) tends to grow over time. This is both
a11 the workers in the enterprise. It would seem that, although all three centres hecause of the increasing productivity of more and more advanced industrial
of power ha ve a real impact on the outcome of decisions, more power resides tedwques and, more importan ti y. because of the competitivo pressure among
with management and the Communist Party apparatus outside the plant than { .1p1talists which forces each to reinvest most of their profits in ever more
with rank and me workers within the plan t. The question of whether the nt.uginally efficient technology in order to produce more cheaply than their
working class in the last analysis can be considered to control production must ~.:ompetitors {or face the immediate threat ofbankruptcy in an increasingly
then rest on the resolution of the question of whether they control the party l!lutted market). The rate of profit can be expressed as the ratio of the rate
and state {which is a question examined in Chapter Five). ul exploitation oflabour power {which grows in proportion to increases in
The feeling of having influence in one's enterprise varíes in accordance pruductivity in the wage goods sector) to the organic composition of capital.
with occupational group. A study of feelings of influence over collective 11 can thus be seen that, since the organk composition of capital increases in
affairs made around 1970 in three areas of the U.S.S.R. found that the propor- J'IOportion to both improvements in technique and in proportlon to the
tion of managerial personnel and specialists who felt they had no influence on rompetitive pressure among capitalists, while the rate of exploitation increases
the affairs of their work collectives ranged from 13 Lo 24 per cent, while the uuly in proportion lo improvements in technique, the rate of profit should
range among machine operators was 32 to 45 per cent, skilled manual workers lcnd to decrease over time.
32 to 67 per cent and low skilled and unskilled manual workers from 67 to Baran and Sweezy argue that this tendency is specific to competltive
68 per cent. 54 Such feelings are probably a functíon of actual intluence {but { .1pitalism, and does not opera te under conditions of monopoly, where the
not this alone). It would thus seem that managerial personnel do in fact ha ve wrupetitive pressure lo reinvest almost all profits has been neutralized by
more influence over enterprise decision making than do manual workers, and rnllusion among giant corporations to invest only when there is sufficient
thal among manual workers the relatively high status occupations have more cttum to rationally justify doing so {there is now an impücit prohibition
influence than the low status ones. 1t should be noted that the majority of ••g:¡inst cut-throat price competition designed lo drive competitors out of
those in the relatively higher status occupations felt they had some influence lu1~1ness). Instead, under monopoly capitalism, there is a tendency lo compete
on enterprise policies. But it must also be noted that the percentage who hy reducing costs. 1b.is, combined with the tendency for prices to rise {due
felt they had no influence would seem to be incompatible with direct day- In collusion in price setting), tends to result in the economic surplus (more
to-day control of the enterprise by 1ts workers as a whole (although not of 111 less the equivalent concept to Marx's profits - both include interest, un-
course incompatible with considerable influence commg from the Party cll tributed profits, rents, payments lo sales personnel, etc.) rising over time.
members or the most skilled workers who may well dominate the organs of lllis book is not the place to resolve empirically whether Baran and Sweezy
worker participation). tue corrector whether there is a tendency for the rate of profit to decline
In conclusion, although experts and specialists, both in the plant and in tven under monopoly conditions.
those bodies which supervise the enterprises from above, appear lo play the 1ñe important point to make is that the Soviet economy has neither a
pre-eminent role in operational decision making, worker involvemcnt in the lrndency for the rate of profit to decline nora tendency for the rate of
running of industrial enterprises would appear to be too great to consider ~urplus to rise. lnstead the leve! of profits and surplus are a product of the

56 57
ls the Red Flag Flying? The Role of Market Forces

plan, not of any inherent logic of the system. There is no tendency for the ¡trofit, nora rising rate of surplus. Whether such tendencies empirically occur
organic composition of capital to rise more rapidly than justified by purely then ls a product of policy not necessity. This makes the Soviet economic
technological considerations. Because al1 prices are centrally determined and ~ystem very different from market capitalism, or even market socialism,
basic investment decisions are made by the central authorities, there is no where the logic of markets produces its own law of profits independent of
competitive pressure to reinvest profits ata rate more rapid than required the intentions of the class which has power. Lastly, it should be emphasized
by pure criteria of efficiency. Such purely rational criteria for investment, that the absence of any inherent tendency in relation to profits or surplus
by the way, often dictate the introduction of more efficient machinery ~peales only to the question of the role of capital and commodity markets,
which utilizes less raw material than the old process and/or incorpora tes not to the question of the relations of production.
fewer labour hours in its construction (i.e. capital saving innovations). On the
other hand, there is no inherent tendency for the rate of exploitation (the
number ofhours a worker labours and is paid for, divided into the number of C'onclusion
hours worked, but not paid for) to increase. This is because decisions about
both direct pay and social benefits,and the proportion of the value of the lllis chapter has shown that market forces do not operate in the Soviet
worker's product to be reinvested and allocated to the non-productive llnlon to structure its economy, and specifically (and very importantiy) that
classes, are made centrally on the basis of a rational plan; this plan m ay, or l.tbour power is nota commodity. Thus the Soviet Union does not fit either
may nol, depending on the criteria of the planners, increase or decrease the the classical Marx.ist or the neo-Marxíst definitions of capitalism. If we had
share of the producl going to workers and the share going to reinvestment and rnorely shown that capital and commodity markets do not predominate, then,
non-productive workers. The rate of profil can be expressed by the ratio of ;~q:ording to the classical Marxist defmition, we wouJd have only demonstrated
the rate of exploitation to the organic composítion of capital. We see that lhat the U.S.S.R is not a market capitalism. But the fact that we have also
there is no inherent tendency for thís quantity to move one way or the other. hown that labour power is nota commodity rules out even the further
Similarly wíth any tendency for the rate of surplus to rise. Since there is JIUssibillty of the Soviet Union being a state capitalism. The next two
no systematic inflation in the Soviet Union, prices have no inherent tendency dtapters wi1J examine a different dimension - the question of social classes
to rise. Although costs of production are continually being reduced through 1111d political decision making - in search of evidence for and against the
increases in efficiency, rather than these reduced costs of production being untion that the U.S.S.R is a capitalist society.
expressed in reduced prices, they are manifested in increased wages and
social benefits. They are defmitely not expressed (as they are in the U.S.) in
growing sales expenses (e.g advertlsements), or wasteful govemment expend-
itures (such as unjustified military expenses, highway constructlon, etc.) [For
a discussion of Soviet military expenditures, see Chapter 6.] There is a sharp l{rferences
tendency for wages of productive workers lo rlse in relation lo those of non-
Paul Gregory and Robert Stuart, Soviet Economic Structure and
ptoductive workers and for the leve! of free social benefits, which dispropor-
Performance, (New York; Harper and Row, 1974), Ch. S and
tionately benefit the productive classes, also to rise (see Chapter Four). This pp.353-9.
indlcates that the surplus is not increasing. ln looking for any tendency for ~ !bid., pp.15(}.2.
the surplus to rise, the role of social benefits appears to be key . lt is prob· On the role of the five year p1ans see Gregory Grossman, 'An Economy
ably the case that in the Soviet Uníon the ratio of productive lo unproduc- ' at Middle Age' in Problems of Commumsm, Vol. 25 (18-33), November-
tive workers (i.e. the ratio ofpeasants, industrial and farm workers to sales, December, 1974.
clerical, medica! , educational, scientific, professional, managerial, etc., Howard Sherman, The Soviet Economy, (Boston : Little Brown and
personnel) is decreasing. Whether thís means that there is a tendency for the Co., 1969), p.316; and Gregory and Stuart, op. cit., pp.349-50.
surplus lo rise must be judged by the extent lo which the growing non- S. J. Wilczynski, The Economics of Socialism, (Chicago: Aldine Publishing
Co., 1970), Ch. 3.
productive sector is providing authentic services for the produclive strata, as fl . Sherman, op. cit., pp.308-11 and Gregory and Stuart, op. cit., pp.346-8.
opposcd to merely allowing the system to go on functioning (as well as in the 7 E.G. Liberman, 'The Plan, Profit and Bonuses', Pravda, 9 September
wage lrends of the lwo groups). Since there is a sharp tendency for the wages 1962, reprinted in Alee Nove and O.M. Nuti, (eds.), Socia/m Economics
of productive workers to rise relatively faster than for non-productive workers, (Baltimore: Penguin, 1972), p.313. '
and since it appears that productive workers are increasingly benefiting frorn 8. Gcrtrude Schoeder, 'Recenl Oevelopments in Soviet P1anning and
social services, there does not appear to be any evidence for a rising econornic Incentives' in Morris Bornstein and Daniel Fusfeld, (eds.), Tlae Soviet
surplus. The Soviet economic system genera tes neilher a declining rate of Economy: A Book of Readings, (4th edilion), (Homewood, lllinois:

58 59
Js the Red Flag Flying? Tlle Role o[ Market Forces

Richard lrwin lnc., 1974). 44. Conquest, op. cit., Ch.5.

A.N. Kosygin , Report ro the CPSU Central Committee, 25 September, 45. /bid., p. 174.
9. 46.
1965. Reprinted in Nove and N u ti, op cit., pp.324-5 . lb1d., Ch.5.
Schoeder, op. cit., and Gregory and Stuart, o p. cit., Ch.l O. 47. 1t is of anterest to note that at the All Umon Congress of Trade Unions
10.
/bid., and Shennan, o p. cit., Ch.13. in 1961, 36 per cent of a11 delega tes were fu U-time u nion officials and
11.
12. Schoeder, o p. cit., pp.5 14-8 and Gregory and Stuart, op. cit., pp.357-9. 40 per cent full-time worken. This suggests considerable rank and file
13 . Schoeder, op. cit., p.5 19 ff, and Gregory and Stuart, op. cit., p.359 . mfluence in the unions. See Conquest, op. cit., pp. l61-2.
14. Ahce Gorlin, 'Socialist Corporation: The Wave of the Future in the 48. /bid., pp. 182-5.
U.S.S.R.; in Bomstein and Fusfeld , op. cit. 49 David Brodersen, The Soviet Worker: Labor and Governmen t in Soviet
15. Wilczynsk..i, op. cit., p. l21 . Society, (New York : Random House, 1966).
16. /bid., p.166 and Gregory and Stuart, o p. cit., pp. 152-67. so. Granick, op. cit., p.l99.
17. /bid., p.260. SI. Merle Fainsod, How Russia is Ruled, (Cambridge· Harvard University
18. !bid., pp .l52-67 and Bomstein, 'Soviet Prlce Theory and Policy', op. cit. Press, 1963), pp.514-5.
19. Wilczynski, op. cit., p.89. 52. Granick, op. cit., Ch. 12.
20. /bid., p.90. 53. Fainsod, o p. cit. , pp. 240, 514-8.
21. /bid., pp.85-7, 149; and Gregory a'nd Stuarl, o p. cit., Ch.1 O.¡and the 54. l. V. Arutiunian, 'The Distribution of Decision Making Among the
Revolutionary Union, How Capitalism Has Been Restored in the R~ral Population of the USSR', in Murray Yanowltch and Wesley
Soviet Un ion and What This Means [or the World Struggle, (Chicago; FtSher, Soc1al Stratification and Mobility in the USSR, (White Plains,
the Revolutionary Union, 1974) p.50. N.Y.· lntemational Arts and Sciences Press, 1973), pp. 1 13-4.
22. George Garry, 'Finance and Banking in lhe U.S.S.R. in Bomstein and 55 See Karl Marx, Capital, Vol.III, Part 3, for the presentation of Marx's
Fusfeld , op. cit., and Wilczynski, op. cit., pp.143-8. own argument on the question of the falling tendency of the rate of
23. Robert Osbom, Soviet Social Polfcies: Welfare, Equality and Commun- profit. See Paul Sweezy, The Theory o[ Capitalist Development,
ity, (Homewood, lllinois: The Doney Press, 1970). (New York. Monthly Review Press, 1942), Ch.6 for a crltical
24. Gregory and Stuart, o p. cit., pp.202-3 ; Sherman , o p. cit. , p.233; and discussion. See Paul Baran and Paul Sweezy, Monopoly Capital, (New
Osbom, op. cit., pp.139-40. York: Monthly Revtew Press, 1966), Ch .3 for the presentation of the
25 . Gregory and Stuart, op. cit., pp. 193-21l. argument that the surplus has a tendency to rise under monopoly
26. /bid., p.203. capitalism.
27. Murray Feshbach, 'Manpower Management' in Problems o[Communism,
November-December, 1974.
28. Osborn , op. cit., p. 141 .
29. !bid., p.14lff.
30. Feshbach, op. cit., p.29.
31. /bid., p.30.
32. Emily Clark Brown, 'Continuity and Change in lhe Soviet Labor Markct'
in Bomstein and Fusfe1d , op. cit.
33. Robert Conquest,Jndustrial Workers in the U.S.S.R., (New York:
Praeger, 1967), p.19.
34. /bid., p.20.
35. Brown, op. cit., p.l82 .
36. /bid., p.192.
37. /bid., p.183 .
38. /bid. , p. 183.
39. Robert Lane, The End of Inequaliry: Stratification Under S tate
Socialism, (Baltimore: Penguin, 197 1)
40. David Granick, The R ed Executive, (Carden Cily, N. Y.: Doub1eday,
1961 }, Ch. 13 , Conquest, op cit., Ch.5, and Wilczynski, op. cit., p.209.
41 Osbom, op. cit., pp. 138-9.
42. Conquesl, op. cit., pp.157-59.
43 . /bid., Ch.5; Granick, o p. cit., Ch . 13 ; Sherman, o p. cit., pp.l63-6; and
Wilczynsk..i, o p. cit., pp.l 00-2 .

61
60
 Social Classes

4. Social Classes thc working class.

'llte Distribution of Material Rewards

In 1973 about 61 per cent of the economically active peop1e in the Soviet
l lruon were manual workers, about 1Oper cent were non-professional white
wllar emp1oyees and service workers, about 16 per cent 'intelligentsia' and
.tbout 14 per cent peasants on coUective farrns. 1 The manual working class
(which was 33 per cent of the total in 1939 and 48 per cent of the total in
1959) is the most rapidly growing section, while the collective fann peasantry
2
1\ shrinking fast.
This chapter will examine the evidence for and against lhe thesis lhat social Tab1e 3.3 reported the average wages ofvarious sectors of the 1abour force
classes have fonned orare fonning in the Soviet Union. l will examine two In 1965 and 1973. As was seen, the highest paid people are industrial
aspects of the question of inequality in the Soviet Union : the differentiation t·ngineering and technical personne1 who in 1973 earned an average of 1.27
in tenns of material rewards amongst those with different types of jobs, and tlrnes the wages of industrial workers. In 1973 it was only this group that
the tendency for the different strata of Soviet society to crystallize into c.trned more than the industrial workers. The spread between the highest and
distinct social classes on lhe basis of differences in income or occupation. lnwest paid groups was 2.12 times, while in 1965 it had been 3.20 times. The
The c1ose1y re1ated questions of whether the Soviet power elite has become etght year trend from 1965 to 1973 shows a clear tendency for the highest
a class, and more generally whether any classcs exist in the Soviet Union is paid occupations in 1965 to have the slowest rate of growth in wages while
only partially dealt with here. In this chapter we will not examine actual the 1owest paid occupations had the highest rates of growth. The majar
power relationships within enterprises or in society as a who1e. {lbe question exception to this trend would appear to be industrial workers who were
of political power is dealt with in Chapter 5). He re will will only look at the rather well paid in 1965, but who neverthe1ess received the highest increase
d.istribution of material rewards as an tndicator of the re1ative power exercised 111 wages of any non-agricultural group.
by the power elite, intelligentsia and working peop1e. On the reasonable ex- Perhaps a better idea of the wage spread in the Soviet Union can be got
pectation that people with power will exercise il in their own interest, the lrom data on occupations within the same industry. In 1965 the average
distribution of material rewards - as well as the trends in that distribution - wages of machine building personnel in Leningrad (a key industry in a majar
are good indicators of the distribution of power over the means of production rnanufacturlng city) showed that the highest paid category of workers, the
(i.e. of the re1ationships ofproduction and the control over 1abour power) in cxecutives of labour collectives and of public and state organi7.alions, earned
a society. 1 60 times the wages of skilJed operalives. (See Table 4 . 1)
This chapter will also examine whether distinctive social classes have Table 4.2 reports the basic monthly rates, in rubles, for production and
tended to fonn in the Soviet Union by 1ooking at the majar indicators of uon-produclion personnel in the construclion industry in 1969. F rom this
social class : distinctlve customs and life styles; common friendship and inter- 11able it can be seen that the highest paid managers and specialists earn about
marriage pattems; and the tendency to pass one's position on to one's 1 46 times as muchas time-rate workers in the highest pay grade. (See
children . lt1ble 4.2).
1shou1d also point out at the outset that 1 use the tenn 'intelligentsia' to 1t should be noted that the average eamings of production workers in"
mean all people in teaching, scientific, techntcal, managerial, engineering, etc. "crtain segrnents of Soviet industries exceed those of engineering and tech-
roles, as well as those holding govemment posts and party or mass organiz- rm;al personnel in many industries. For example, In 1969, steel workers
ation offices. In thls chapter, when discussing the intelligentsia, 1 focus on the o~veraged 145 rubles a month, lumber workers 143 and coal miners (the
scientific-technical intelligentsia (scientists, academics and other technical lughest paid) 210. This compared with monthly eamings of 138 rubles for
specialists), sometimes referred to as the technical or professional intelligentsia, rngmeering and technical personnel in light industry and the sarne ~roup's
and on the managerial-political intelHgentsia (!hose with fonnal positions of uverage monthly salary of 172 rubles in Soviet industry as a whole.
authority and 1eadershlp in the production enterprises, the state, party, or There appears to be a strong tendency towards egaJitarianism in wages and
mass organizations such as trade unions), sometimes referred toas the 1lso a tendency for industrial workers to be favoured. The trend lowards wage
managerial strata. l will attempt to deteqnine the degree of homogeneity eiJualization has continued since the 1940s. 4
between these two strata as well as their differential social integration with The híghest paid people in the Soviet Union are prominent artists, writers,

62 63
Js the Red Flag Ffying? Social Classes

Tnble 4 1 lahle 4.2

Average Wages of Surveyed Machine-Buildmg Personnel in Leningrad, 1965 IIJasac Monthly Rates of Production and Non-production Personnel in
(in rubles per month) lonstruction, 1969
(In rubles per month)
Groups o¡ Fmptoyea Personnel Average Ratw to Slcilled
Wa,11e Machine Workers Hl\ltion Basic Wage
Personnel in unskilled manuallabour and or Salary Rote
low-skilled nonrnanuallabour without Wílhin a trust:
special trainin~ 97.5 0.90 l'luef of production department, also chief specialist 160.190
Personnel in skilled nonrnanuallabour Cluef of planning and economic department 150.190
without special educalion 83.6 0.78 C'hief of personnel department 135-170
Personnel in skilled, primarily manual Wllhln an administration:
labour, employed on machines and Chief of administration 170.190
mechanisms 107.5 1.00 Chlef of supply offtce, chlef of production department 150.190
Personnel in skilled, primarily manual, C'haef of planning and economic department 150.180
hand labour 120.0 1.12 '" naor work superintendent 180-200
Personnel in hlghly skilled work Wmk superin tendent 160.180
combining mental and manual functions 129.0 1.20 lnreman, shop mechanic 135-150
Personnel in skilled mental work 109.8 1.02 1 ngineer 120-160
Highly skilled scienlific and technical lechnician 100-125
personnel 127.0 1.18 A counting and related personnel 90.145
Executives of labour collectives, public 1ypist, clerk, cashler, and similar posillons 78-80
and state organizations 172.9 1.60 lune-rate worker in the 6th (hlghest) grade 137
llme-rate worker in the lst (lowest) grade 76
Source: O.J. Sh.karatan, 'Social Groups in the Working Class of a Developed
Socialist Society', in Murray Yanowitch and Wesley Fisher, Social Stratifi· ~o\lr(; e : Robert Osbom, Soviet Socwl Policies, Homewood, Jll.: The Dorsey
cation and Mobility in the USSR, (White Plains, N.Y.. lntemational Arts I'II.:SS, 1970), p.l76.
and Sciences Press, 1973), p.8.

tlo•slgned to make Soviet income distribution look as non-egalitarian as

lending university administrators, professors and scientísts. In the mid 1960s IHIS:>able, have been forced to conclude that it is about twice as egalitarian as
lhe president of the Soviet Academy of Sciences made 1,500 rubles a month thc American . 10
and leading university presidents 1,200.5 A few famous artists and performers When, as such critical authors do, the ratio of U1e lower limtls of the upper
have incomes in the same range. ln the 1960s leading governrnent officials tlr~. ale are compared to the upper limits of the lower decile the Soviet income
eamed about 600 rubles a month, about four times the wages of industrial tllflerentaation looks somewhat less egalitarian than it really is, because the
workers, and leading enterprise directors from 190 to 400 rubles a monlh, hscnce of very high incomes in the Soviet Un ion is not taken into account.
(exclusive of bonuses), whích was about 1J to 2.7 tunes workers' wages.6 1he very highest incomes in the Soviet Un ion (of which there are very few)
1n 1956 the rallo of the wage exceeded by the top 1O per een t of Soviet 11rc ten times more than the average industrial wage, while the wages of the
employees and workers (excluding only collective farmers) to the wage lughestlevel state mmisters and enterpnse managers are about 2.7 to 4.0
eYceeded by 90 per cent was 4.4; in 1964, 3.6; in 1970 3 .2; and in 1975 (if lime:. the average industrial wage. The rallos of the very hlghest to the average
the intentions of the plan were fulfilled) 2.9. 7 Again the rather strong tuc.lustrial wage must be compared to the equivalen! income distribution in
egalitarian trend in the Soviet Union can be seen.ln the U.S. in 1974, the tl~t· Unlted Sta tes. In lhe U.S. in 1973, there were about 1,000 individuals
similar spread was roughly 6.2 times.8 In 1956 the ratio of the average wages who hadan income of at least a mil !ion dollars ayear, while the annual wage
of the 1Oper cent hlghest paid to the 10 per cent lowest paid was 8.1; in 111 rnanufacturing was $8,632. 11 Assuming (very conservatively) a million
1975 it was only 4.1. In the United State$ in 1974, the similar ratio was •h•llars a year as the highest incomc leve! in the U.S., this is a ratio of roughly
roughly 12.9 Even those whose conceptuaüzation of income distribution is 115 times compared to the Soviet ratio of approximately ten times. ln the

64 65
ls tlle Red Flag Flying? Social Classes

U.S. the pay of top managers (including income from stock options) in the l'uble 4.3
leading corporations in the mid 1970s was around a million dollars ayear. Sc•v1et Wages and Per Capita Family In come, c.J 966
For example. in 1970 the president of l.T.T. eamed SI ,242,000, the
presiden! of Xerox S 1,032,000 and the president of Atlantic Richfie1d Average Month/y Average Month/y
$972,000. 12 Again, comparing such incomes to the income of U .S. production Wageo[ Head Jncome per
workers, we ha ve a ratio of roughly 115:1 compared lo the equivalent (n1bles) capita according ro
Soviet ratio of about 25:1 between the best paid managers and the average Occupation o[ Head
industrial wage, and a ratio of about 4 :1 between the heads of ministries and (robles)
the average industrial wage. Thus when we compare the lúghest incomes with l lnskilled and low-skilled workers 74 62
the average income, we see that the Soviet Union is far more egalitarian than Sk11led workers 111 69
the U.S. 1hghly skilled workers 144 72
Furthem1ore, while there has been no appreciable decrease in income 1 mployees in management positions 169 81
inequality in the last generation in the U .S., in the twenty years between the ll•achers, scientific, medica! and
mid 1950s and the mid 1970s, the Soviets have eliminated about half of the other specialists not in the sector
inequality in their income distribution (reducing the ratio of the highest of material production 110 81
decile's to the 1owest decile's average wages from 8.1 to 4.1) - a radical lngmeering-technical personnel and
reduction in inequality in a very short time. 13 Such a reduction provides other specialists in the sector of
strong evidence against the Chinese claim that a 'new capitalist class' of either matenal production 117 78
state bureaucrats or managers assumed control of the Soviet Union in the lrnployees without specialized
1960s, since if this were the case they would have undoubtedJy used their education 84 66
new power to increase, not decrease, their relative material advantage.
ln the United States in 1973, mate self-employed professionals earned on &mrce: LA. Gordon and E. V. Klopov, ' Sorne Problems of the Social Structure
average 120,490 ayear while salaried physicians and surgeons eamed uf lhe Soviet Working Oass', in Yanowitch and Fisher, op. cit., p.42.
$23,360!4 The ratio of these earnings to the average industrial wage in the
U.S. in 1973 was 2.4:1 and 2.7:1 respectively. This is approxirnate1y the same
as the ratio in the Soviet Union of the highest manageriaJ incomes to the ni managerial wages), as well as their privileged access to fringe benefits
industrial wage, and considerably less than the average managerial wage to the h as automobiles, summer houses, etc. 16 On the other hand, tlle state
l lll

average industrial wage. Thus the spread between top management and pro- IIIOYtdes a wide range of free and heavy subsidized goods and services which
duction workers in the Soviet Union is more or less the same as that between rlhproportionately favour the low income groups.
petty bourgeois professionals and industrial workers in the United States. Sta te pricing policy sets the price of basic necessities such as basic food-
This suggests tllat the leading stratum in the Soviet Un ion is, at least in .tuffs below their vaJue and luxury goods above thelr value} 7 This means
income terms, similar to the U.S. professional petty bourgeoisie, rather than lh,rl a wage spread of 3: 1 is actually considerably less than this, when measured
to the American capitalist class (of either corporate managers or multi- IJ .tlnst lhe actual value of the goods and services purchased by the high and
millionaire wealthy) . luw wage earners. Most of the lowesl wage eamers' income goes to purchase
It should also be noted that family income distribution in the Sovief t"•uds and services obtainable below their value (or cost of production) while
Union is considerably more egalitarian than the distribution of average o ••uod share, if not most, of the income of the highest wage eamers purl:hases
monthly wages because of differences in the number of wage eamers and Jnnds ata cost considerably above their value (e .g. automobiles and personal
dependents per family . 15 The lowest paid occupations have relatively more luxury goods). 18
wage earners and fewer dependents than do the highest paid families. While 8cs1des the equaJizing effect of the pricing policy on necessities and
the spread of average monthly wages is from 74 to 169 rubles (a factor of hr xuries, another major equalizing effect comes from social welfare services
2.28) between unskilled workers and managerial personnel, the spread in ni len referred toas the 'social wage'. Such benefits available to al1 in elude
average monthly family income per capita was only 62 to 81 (a factor of lrr.c medica! care, free education at alllevels including college, heavily
only 131). (See Table 43). uh~id1L.ed housing (rents are set at the leve! required to maJntam housmg),

Soviet data on wages are complicated by two factors. On the one side, auhstdized cluld care, generous pensions, paid matemity leave, etc., al! of
they underestimate the income of managers and directors by leaving out whid1 considerably increase family income for manual workers in particular. 19
bonuses eamed over and above wages (bonuses average about 25 to 30 per cent 1ht• relative proportion of the social wage in total worker compensation has

66 67
Is tlle R ed Flag Fly ing? Social Classes

risen over lhe last generation. As a percentage of individual eamings it rose uppear that the difference in material living standards between managers and
from 23 per cent in 1940 and 29 per cent in 1950, to 34 to 35 per cent ¡;11vemment mimsters in the U.S.S.R. and industrial workers come close to tbe
through the 1960s.20 Because lhe social wage adds about lhe same absolute 1lifference between professionals and industrial workers in the U.S. Nothing
amount to each household, it has a considerable equalíting efTect on tolaJ like the gap between milüonaires and workers that extsts in the U.S. can be
family mcome. ln 1968 it has been estimated that free goods and services fn und in the U.S.S.R
averaged about 46 per cent of the mcome of lhe lowest paid strata, but only
12 per cent of the income of lhe highest paid . In heavy industry the spread
of about two to one in take-home wages is reduced to about l. Sto 1 because fendencies Towards the Formation of Social Classes
of the egalitarian effect of services provided on lhe basis of need.21 In
addition lo trends towards reducing wage differentials and increasing free Wlule there are no strata in Soviet society comparable in income Lo the top
goods and services, in recent years the mínimum wage and pensions have been managerial and property owning classes in the capitalist countries, as we have
greatly increased, and also income tax used increasingly to promote equality .22 o,~.•en above, there is a stratum comparable in income lo the professional
While it could be lhat higher paid strata in the Soviet Union have far easier uuddle classes in the capilaJist countries. Here we will examine the extent to
access lo scarce goods such as cars and housing, lhus manifesting far greater which this stratum may be fonning into a distinctive social class.
lnequalHy in possession of material goods lhan is suggcsted by lhe income lf such a class is forrning in the Soviet Un ion , we would expect to find
distribution, this does not appear to be lhe case. The relative egalitarianism of thrce things: ( 1) a high correlation of customs, life style and leisure patterns
income is reflected in lhe distribution of housing. Most housing in the Soviet Wlth occupation; (2) a high rate of intermarriage and friendship pattems
Union is built by eilher lhe state or the trade unions. Rents (including utilities) Wlthin each occupational group; and (3) a higher inter-generational correlation
are set at a leve! necessary to maintain lhe housing, rents thus consuming on bc:tween parents' and children's occupationallevels. We will examitlc data on
average about 7 per cent of workers' income (compared lo over 20 per cent rac.h of these factors in tu m.
m the US .).13
A study done in the mid 1960s showed that the quality ofhousing for Lífe Style
higher professionals was, on average, about 1.6 times better than lhat of semi- A number of studies have been done by Soviet sociologists on the material
skilled workers. Another study found that socio-occupational status only guods possessed by different types of Soviet families. A study done around
correlated about 0.1 with the amount ofhousing space per family?4 There is 1970 in the Lukhovitskü District of the Moscow reg10n found that 61 per
no consistent pattem of neighbourhoods differentiated by income leve!. cent of the intelligentsia, 26 per cent of white colJar employees, 23 per cent
There are, for example , sorne exclusive neighbourhoods in Moscow where uf machine operators and 1O per cent of low skilled nnd unskmed workers
leading officials of the Communist Party and its employees live, but there are possessed a library. The figures for radío ownership were 94 per cent, 88 per
also many cases (for example) of janitors and fu U professors at leading ~:ent , 95 per cent and SS per cent respectively and for TV ownership 73 per
universities living in the same apartment building. ll is normal for govemment ccnt, 65 per cent, 68 per cent and 41 per cent. A study done of Leningrad
and enterprise offictals to live in the same apartments as production workers. 25 mochine building personnel in 1965 showed lhat 2.5 per cent of production
Similar, but not quite as egalitarian, results have been found for automobile workcrs own both an automobile ahd a piano compared to 5.6 per cent of
ownership. Studies show that enterprise directors and leading professional the executives of production collectives and 6.8 per cent of the engineers.27
people have about a 2.5 times higher probability of owning an automobile than Another study done in Akademgorodok in the late 1960s showed lhat 22 per
do manual workers.26 Thus, the chances of owning a car are roughly proport- ~:c:n t of the directors of institutions and senior research personnel had either
ional to the income difTerential between the highest paíd managers and the ¡¡n automobile or motor boat, compared to 8 per cent of low skilled workers,
production workers, and do not reflect any special access to automobiles by fl!( per cent of the former compared to 80 per cent of the latter had tele-
the intelligentsia strata beyond lhat accounted for by their higher incomes. VISIOn sets, 90 per cent of the former and 75 per cent of the latter had
In summary, although it certainly is true that managers receive bonuses w·a~hing machmes, 85 per cent of the former and 52 per cent of the Jatter
av~ragmg 25 to 30 per cent of their income (workers receive bonuses as well) hada refrigerator.13 Sorne significant differences between workers and the
and have access to special privileges such as the automobiles belonging to the 111telligentsia emerge from these findings.
enterprise, the weight of the evidence leads us to conclude that such effects, Studies of leisure pattems among members of various occupations also
when set against the generous subsidies to lhe lower paid strata, do not make .how there to be sígnificant differences. Among the intelligentsia SS per cent
the distribution of material goods more unequal. ln fact the evidence, at preferred to spend their free time with fellow employees, compared to
least for housing, suggests that the distribution of material goods may even be lO per cent of operatives and 25 per cent of manual workers. On the other
more egalitarian than the income statistics indlcate. ln conclusion it would hand, 63 per cent of these unskilled workers, compared to 50 per cent of

68 69
Js che Red Flag Flying? Social Classes

opera ti ves and 23 per cent of the intelligentsia, preferred to spend lheir leisure cm to be relatively small, they do reflect sorne differentiation of strata,
time wilh their relatives and neighbours.29 11lthuugh certainly noth.ing on the scale existlng in the Westem countries
One Soviet sociological study on leisure activities in different regions of hntween managers or owners and production workers.35
the U.S.S.R. in the late 1960s found sorne significant differences in the use
of leisure time by occupational groups. This study showed lhat the high leve! Jnterrnarriage and Friendship Pattems
inteUigentsla (hlgher managers, state officials, top scientists, etc.) are much ,, .tudy of graduating secondary school students in Estonia in 1966 showed
more Jikely to be engaged in self-education and reading in lheir spare time thllt 79 per cent of their fathers who were manual workers in enterprises
than are manual workers. They are also more likely lhan manual workers to rmploying more than 50 workers were themselves married to other manual
spend lheir time watching TV and listeni.ng to lhe radio. On the other hand, 111 uffice workers. Manual fathers married to women in the professions or in
manual workers are more likely simply to spend lheir time cesti.ng than are h-udmg positions in trade unions, Soviets and other organizations represented
the higher level intelligentsia. These, however, would seem to be lhe only llllly 2 per cent of the total. On the other hand, 29 per cent of lhe fathers
areas in which there is a significant difference between the leisure time who were scientists and 74 per cent of lhe fathers who were leaders in trade
activitles of the two groups. There are no consistent differences between uutons, Soviets, and other organizations were married to women who were
them in relation to housework, spending time with children, going to ni.ms lllíiOUal or office workers. 36 ln su m lhere did not appear to be all that .much
and dances, playing doml.noes or cards, engaging in sport, hunting, flsh.ing 1ht ference in the marriage pattems of manual workers and of leaders of trade
or partlcipati.ng in other hobbies.30 uruons, Soviets and other organizations. The most signlficant difference here
A study of the Leningrad machine too! industry showed that 56 per cent uppears to be among scientists who have a high rate of interrnarriage to other
of the unskilled labourers, 80 per cent of lhe skilled and 85 per cent of the prnfessionals.
executives were regular newspaper readers.3 1 Twenty per cent of unskilled Another study found that among male employees ata Pskov automatic
workers read one or more books a week, compared to 35 per cent of the tt'lcphone exchange plant in 1967, 87 per cent of unskilled manual workers,
skilled and 29 per cent of the technicians, scientists and directors. Also, 80 M per cent of skilled manual workers and 83 per cent of machlne operatives
to 85 per cent oflow paid workers attended theatres and concerts at least wcre married to manual or unskilled white collar workers, while only 33 per
once a month, whlle among highly paid workers only 58 per cent did. This ~ rnt of personnel in skilled mental work (includtng scientific and technical
would indicate no great differences in life style between the more skilled work) and 36 per cent oflabour collective execullves were married to women
workers and the managers. who were manual workers or unskilled office workers. Thirty-slx per cent of
Recen ti y, studies of Soviet customs broken down by occupation have uecutives and 24 per cent of personnel in skilled mental work were married
appeared. One showed that there was no great difference by occupation ~ lll women who hada specialized higher education, compared to only four per
altitudes towards using physical punish.ment on children or towards mamage 1t•n t of the unskilled manual workers, nine per cent of skilled, manuaJ
between people of different natlonality groups. This study did fmd, however, wurkers and nought per cent of operatives. 37 This study showed no signifi-
that professional and managerial people are less likely lhan manual workers 1 .mt difference between the professional and managerial strala.
to believe that wives should, lf the possibillty existed, engage only in Another Soviet sociologicaJ study found a correlation of +0.66 between
housework. 32 The overall difference, however, was relatively small. the educational attainment of spouses, and discovered that 93 per cent of men
Most Anglo-Saxon non-Communlst scholars are of lhe opinlon that there w1th higher education had wives wilh middle or higher education, while 65
is relatively little class snobbery in the Soviet Union. Most believe that, pn cent of men wi lh only an elementary education had wives at the sa.me
compared to the situation in Westem capitalist countries, there are relatlvely ,·cJucationallevel. 38 A study of fnendship pattems showed that about two-
few cultural differences between people in various urban occupations. tlurds of workers say that their best friend is another manual worker an(l
There appears to be little in the way of a disti.nctive class culture, accents or that only about flve to eleven per cenl have a best friend who is an engineer
mode of dress.3 3 However, there are sorne differences in status and life or someone else with higher education. On the other hand, about 10 per cent
styles. 34 Evidence about whether elite members regard themselves as part of ur the professional intelligentsia and 21 per cent of the manageriaJ personnel
a distinctive status group is conflicti.ng, but tt is clear that any such status have best friends who are manual workers, whlle 50 per cent of the professional
consciousness is considerably less tha.n in the Westem capitalist countries. lntel1lgentsia and 42 per cent of the manageriaJ personnel have best friends
ln summary, although differences in life style between the professional and who are engi.neers or others with a higher education. There seems to be a clear
managerial strata and the production workers are, for the most part, not very palie m for people of similar occupations to associate wilh others of their
great as measurcd by consumer goods, leisure pattems and altitudes, signlfi- •lWO kind with this tendency being most pronounced among the professional
cant differences do exist in relation to b~ok ownershlp, possession of trt telligen tsia.39
au tomobiles and pianos, and engaging in study. WhUe differences in life style The evidence from intermarriage and friendship pattems that there are

70 71
Is the Red Flag F/ymg? Social Classes

distinctive social strata (based on different relations of production} is stronger ·r•rations to become members of the intelligentsia, and (2) dlfTerential
than that based on life style and consumption patterns. There clearly is a lulity todo well in schoo1 and examinations. Both are products of the degree
distinctive social stratum of professional intelligentsia difTerentiated from the ul ~..u1tural stimulation of the chiJd by parents. One study in the Novosibirsk
production workers, while the managerial stratum seems to be more socially Oh1as t in 1962-63 showed that 7 J pcr cent of chiJdren of the intelligentsia
integrated into the working class lhan are the professional intelligentsia. compared to 60 per cent of children of workers in industry and construction
nspired to become part of the intelligentsia, while only 25 per cent of
Education and Social MobiJity d11ldren of the intelligentsia, but 35 per cent of chiJdren of industrial and
A higher proportion of Soviet youlh go through higher education than in any , onstruc tion workers aspired to be workers.44
olher country of the world except the United S tates and Canada. The system A 1966 study in the Sverdlovsk region showed that 94 per cen t of the
of part-time, nigh t and adult educa tion programmes is probably the most lntelhgentsia compared to 65 per cent of workers were planning a higher
extensive in the wodd. ln general the Soviet working people are among the t ducation for their children.45 In 1970, 71 per cent of students who passed
best trained anywhere. rntrance examinations for Novosibirsk State University had parents with a
Stipends to cover living and school expenses are provided for higher lu~her education, while only 33 per cent of app1icants passed whose parents
education students who maintain a 'B' or better average. All J.Q. and general liad mere! y a primary education, and 42 per cent of applicants passed whose
aptitude tests are barred. Admission to higher education is on the basis of parents had a general secondary education.46 Performance in school is also
passing standardized examinations in specific subjects. Among applicants for 11sociated with parents' occupations. A study of Leningrad eighth grade
positions in institutions of higher education, preference is given to !.hose ~·raduates in 1968 showed that 89 per cent of the chiJdren of the intelligent
with two or more years work expericnce. Special preparatory courses are .IJ compared with 69 per cent of the c hildren of skilled workers hadan
available for studen ts with at least one year of work experience who fail uveral! grade average of al 1east 3 .5.47
urtiversity en trance examinations. Adult education is encouraged and facili- In order to pul this data in perspective, it is necessary to look at the
tated by enterprises and trade unions . There are no guidance counsellors in l upilalist countries. Around 1960 the percentage of university students of

Soviet schools to push working class chlldren into prescribed life channels. working-class origins in Britain was about 25 per cent, in Sweden 16 per cent,
All these aspects of the Soviet educational system encourage children from hl France 8 per cent and in West Germany and the Nelher1ands only 5 per
the manual working class and peasantry lo gel into higher education and ~:~nt (compared to approximate1y 40 per cent in the Soviet Union). 48 ln the
thereby to provide the personnel for the higher leve) positions in society .40 IJ.S. in 1950 children of manual workers were about 8 per cent of total
ln spite of these considerable efTorts to equalize educational opportunity ~:ollege graduales and in 1965 about 25 per cent of college studen ts. 49 One
for all, chiJdren of the intelligentsia are considerably more likely to complete U.S. study reported that, of 1957 high school seniors, 14 per cent of the
higher education successfully. Through the 1960s children of manual workers dlildren of working-dass families had graduated from college by 1965
and unskilled staff represented roughly 40 to 50 per cent of all higher cumpared to 42 per cent of the chi1dren from the upper middle class. 50
education students although they made up approximately 60 per cent of the 1hus it appears tha t the differen tia1 probability of working-class child ren
population.41 Children of lhe inteUigentsia also accounted for about 40 to ttomg to coUege in the Soviet Un ion is higher than that of any capitalist
50 per cent, while students from the collective farm peasantry represented w untry anda 1ot higher thart most. This indicates that the relative privilege
approximately 1O per cent. Studies of the differen tia! probability of secon- (in terms of ability to pass on occupational position) of higher groups in the
dary school graduales going on to higher education generally find that chiJdren Soviet Un ion is 1ess than that of higher groups {both professionals and
of the intelligentsia have a 1.5 to 2 times greater chance of beginning higher c.1pitalists) in the West. But children of the Soviet intelligentsia are still three
education than do the chiJdren of urban workers.4l However, the trend in the limes more like1y than working-c1ass children lo be at college.
last generation is away from the over-representation of children of the Because there is no inheritance of productive property or any other Linkage
intelligentsia in institutions of higher education. For exan1ple the ratio of hetween the generations except those which opera te through unequal
51
children of production workers to children of employees (both intelligentsia t•duca tional opportunities, upward mobility in the Soviet Union is very high .
Wld non-professional staff} amongst first year students in the day-time division Nevertheless, because of this educational factor, there is a significan! 1inkage
of six Sverd1ovsk higher educational institutions was 0.52 in 1950, 0.57 in uf occupational positions from generation lo generation. A 1965 study of
1957,0.70 in 1965 and 0.94 in 1969.43 lu:ads of fa mil y in Leningrad showed that only 35 per cent of highly skilled
Although all higher education is free , students are given stipends to support " ientific and technical personne1 and 63 per cent of executives from labour
themselves, and admission is on the basis of standardized examinalions, .md state organizations carne from manual or peasant farnilies. 52 This same
occupational position still tends to be p3$sed on through two mechanisms tudy showed that 20 per cent of the adult children of managerial personnel
(which operate in Westem capitalist societies as well) : (1) differential 1111d 26 per cent of the chiJdren of high1y skilled scientific and technical

72 73
ls the Red Flag Flying? Social Classes

distinctive social strata (based on different relations of production) is stronger • p1ralions to become members of the intelligentsia, and (2) difTerenlial
than that based on life style and consumption patlems. There clearly is a ththty todo weU in school and examinations. 8oth are products of the degree
dislinctive social stratum of professlonal inlelligentsia difTerentiated from the ni cultural stimulation of the child by parents. One study in the Novosibirsk
production workers, while the managerial stratum seems to be more socially 1lhlas t in 1962-63 showed that 71 per cent of chUdren of the intelligentsia
integrated into the working class than are !he professional intelligentsia. l:Ompared to 60 per cent of children of workers in industry and construction
a~pired to become part of the intelligentsia, while only 25 per cent of
Education and SociaJ Mobility ehildren of the intelligentsia, but 35 per cent of chlldren of industrial and
A higher proportion of Soviet youth go through higher education than in any eunstruction workers aspired to be workers.44
other country of the world except the United Sta tes and Canada. The system A 1966 study in the SverdJovsk region showed that 94 per cent of the
ofparl·time, night and adult education programmes is probably !he most ~r~tclligentsia compared to 65 per cent of workers were plarming a higher
extensive in the world . In general the Soviet working people are among the 1 ,Jucation for their chUdren.
45 In 1970, 71 per cent of students who passed
best trained anywhere. • nlrunce examinations for Novosibirsk State University had parents with a
Stipends to cover living and school expenses are provided for higher ltt••.her education, while onJy 33 per cent of applicants passed whose parents
education students who maintain a '8' or better average. Alli.Q. and general hull merely a primary education, and 42 per cent of applicants passed whose
aptitude tests are barred. Admission lo higher education is on thc basis of fliiiCnts had a general secondary education.46 Performance in school is also
passing standardized examinations in specific subjects. Among applicants for 1\\tlCiated with parents' occupations. A study of Leningrad eighth grade
positions in institutions of higher education, preference is given to those r•·•duates in 1968 showed that 89 per cent of the children of the intelligent
with two or more years work expericnce. Special preparatory courses are .111 compared with 69 per cent of the children of skUled workers hadan
available for students with al least one year of work experience who fail uveral! grade average of al Jeast 3.5.47
university entrance examinations. Adult education is encouraged and facili- In order to pul this data in perspective, it is necessary to look at the
tated by enterprises and trade unions. There are no guidance counseUors in , .tpttalist countries. Around 1960 the percentage of university students of
Soviet schools to push working class children into prescribed life channels. wurking-dass origins in Britain was about 25 per cent, in Sweden 16 per cent,
All these aspects of !he Soviet educational system encourage children from 111 France 8 per cent and in West Germany and the Netherlands only S per
!he manual working class and peasantry to get into higher education and ~enl (compared to approxirnately 40 per cent in lhe Soviet Union). 48 ln the
thereby to provide the personnel for the higher level positions in society.40 U.S. 1n 1950 children of manual workers were about 8 per cent of total
ln spite of these considerable efforts lo equalize educational opportunity n1llege graduales and in 1965 aboul 25 per cent of college students.49 One
for all , children of the inteUigentsia are considerably more likely to complete lJ.S. study reported that, of 1957 high school seniors, 14 per cent of the
higher education successfulJy. Through the 1960s children of manual workers , hlldren of working-class families had graduated from college by 1965
and unskilled staff represented rough.ly 40 to 50 per cent of all higher w mpared to 42 per cen t of the children from lhe upper rniddJe class. 50
education students although they made up approximately 60 per cent of the 1hus it appears that lhe differential probability of working-class children
popuJation.41 Children of the intelligentsia aJso accounted for about 40 to ••mng lo coUege in the Soviet Union is higher than that of any capitalist
50 per cent, while students from the collective farm peasantry represented umntry and a lot higher than most. This indicates that lhe relative privilege
approximately 1O per cent. Studies of the difTerential probabUity of secon- (In terms of ability to pass on occupational position) of higher groups in the
dary school graduates going on to higher education generally fmd that children Suviet Un ion is less than that of higher groups (both professionals and
of the intelligentsia have a 1.5 to 2 times greater chance of beginning higher Lll pltalists) in the West. But children of the Soviet intelligentsia are still three
education than do !he children of urban workers.42 However, the trend in the tunes more likely than working-class children lo be al college.
lasl generation is away from lhe over-representation of children of the Because there is no inheritance of productive property or any other linkage
intelligentsia in institutions of higher education. For example the ratio of hetween lhe generations except those which operate lhrough unequal
children of production workers to children of employees (both intelligentsia rllucational opportunities, upward mobility in the Soviet Union is very high.s'
8Pd non-professional staff) amongst first year students in the day-time division Ncvertheless, because of this educational factor, there is a significan! linkage
of six Sverdlovsk higher educational institutions was 0.52 in 1950,0.57 in uf occupational positions from generation to generation. A 1965 study of
1957,0.70 in 1965 and 0.94 in 1969.43 hcads of fa mil y in L.eningrad showed that only 35 per cent of highly skilled
Although al! higher education is free , students are given stipends to support >~:ienlific and technical personnel and 63 per cent of executives from Labour
themselves, and admission is on !he basis of standardized examinations, ,IJld state organizations carne from manual or peasant families. 52 This same
occupational position still tends to be p3$SCd on through two mechanisms tudy showed that 20 per cent of the adult children of managerial personnel
(which operate in Western capitalist societies as weU): (1) differential .utd 26 per cent of the chUdren of highly skilled scientific and technical

72 73
ls the Red Flag Flying? Social Classes

workers were in the intelligentsia compared to about 1O per cent of the capitalist countries. ln the latter, children of manual workers are more likely
children of manual workers and 14.3 per cent of the children of skilled worken to retain the manual status of their parents than to become non-manuals by
Another Leningrad study found that in 1970 42 per cent of specialists had u factor of roughly three. ln the U.S., for example, it is 2.7, in France 2.5,
manual working-dass fathers while 31 per cent had fathers who were also m Japan 3.0, in Britain 2.3, in West Germany 3.6, and in Sweden, 2.8. 58
specialists.53 Since the category 'non-manual' in the West includes even low leve! white
Most studies of Soviet mobility show that working-dass children are the collar workers such as clerks and sales people, while the Soviet category of
major source of recruits for administrative positions while the scientific- intelligentsia used here excludes them, the differential between the two types
academic intelligentsia has an especially high rate of recruitment from the of society is in fact considerably greater than the data reported here suggests.
intelligentsia. The inter-generational continuity ofintelligentsia status is most The greater upward mobility of workers in the Soviet Union than in the
pronounced arnong those with advanced acadernic degrees. 54 The proportion capitalist countries is clear enough when comparing recruitment into the
of senior party and government leaders from the working class is much higher mtelligentsia as a whole. But it becomes qualitatively different when com-
than among the leading segments of the professional intelligentsia, again paring mobility into the elites, especially into the highest leve! economic
suggesting that there is a tendency for something like a social class to be positions. The differential in access between the intelligentsia and manual
forming around the roles of the professional intelligentsia but not around workers to the highest leve! economic positions in Soviet society is about
managerial-administrative jobs. two to one; this compares with a ratio in the West of middle class versus
Of the 47 government ministers of the U.S.S.R . (the nearest Soviet manual worker access toa broadly defmed elite of 3.6 in France, 4.2 in
equivalent to the richest owners and top managers of corporate wealth in the Britain, 4.4 in Sweden and 5.5 in West Germany .59 A study of U.S. business
West) 40 per cent in 1966 had manual working-class parents, 27 per cent had elites in the mid 1950s showed that, of the businessmen bom from 1891
parents who were peasants, 1S per cent had parents who were low leve! white to 1920, only three per cent had manual parents comparcd to 74 per cent
collar workers, and only 18 per cent had parents in the intelligentsia. i.e. who had wealthy parents. 60 This compares to the approximate 40 per cent
About 80 per cent carne from humble origins.55 of Soviet economic ministers who are from manual working class back-
The two leading bodies of the Communist Party, the Central Committee grounds, a difference of more than 1O times in favour of the Soviets.
and the Politburo, are also predominantly composed ofpeople from lower ln capitalist countries, like the U.S., ownership of economic wealth is
status non-in telligentsia backgrounds. F or example, a study of the 1966 passed from generation to generation through inheritance. lf one's parents
Central Committee showed that, of the 74 per cent on which information were corporate wealthy, the probability approaches 100 per cent that one
could be found, 36 per cent had manual working-class parents, 47 per cent will be as well . Thus the Rockefellers, Fords, Mellons, Duponts, etc. accumu-
peasant parents and only 16 per cent non-manual (i.e. either intelligentsia late wealth from generation to generation, assuring each new generation of
or low leve! white collar) parents. 56 Le. About 90 per cent of leading Party tremendous fortunes. Further, the members of boards of directors of
members carne from humble origins. This information on the social back- Jeading corporations tend to come predominantly from those who inherit
ground of both the econornic and the political elites leads us to conclude that large sums of wealth. A study of SO of the largest U.S. corporations in 1963
the differential rate of inter-generational working class versus intelligentsia showed that 53 per cent of their 884 directors were hereditary members of
recruitment into the highest managerial and political positions is no different thc U.S. upper class while mosl of the rest had middle-class backgrounds. 61
than into the intelligentsia as a whole. Further, working class recruitment to Furthermore, the top hired managers of the corporations, while not generally
the power elite is greater (i.e. more favourable to the lower strata) than into being part of the hereditary capitalist upper class, are recruited mostly from
the scientific-technical segment of the intelligentsia. urban rniddle-class, not manual working-class or rural, backgrounds. There
The intelligentsia are able to give their children a good chance of not going is nothing like this in the Soviet Union where access to the highest leve! •
into manual occupations (i.e. avoiding downward social mobility), but at the cconomic positions shows no inter-generationallinkage and hence no
same time children of manual workers have a fairly good chance of rising into tendency whatsoever for a social class of top managers to form. There is no
the intelligentsia. The amount of upward mobility into alllevels of Soviet significant tendency for Jeading govemmental, enterprise or party officials
society is considerable. Although children ofthe intelligentsia have a better lo pass on their positions. At best they can give their children only member-
chance ofbecoming managers than children of manual workers or peasants, ship in the intelligentsia as a whole. There are virtually no cases of any Soviet
the majority of managerial personnel at alllevels are not children of the lcaders successfully passing on a top leve! position to their children. Each
in telligen tsia. 57 generation of top managers and politicalleaders is recruited afresh from
The children of the intelligentsia have twice as great a chanceas manual the lower levels of the intelligentsia (no more than a quarter) and the manual
workers of making it into the intelligentsia (either as a whole or into the top working class (at least a third), as well as from the peasantry and white collar
managerial positions). Let us compare this Soviet situation with the Westem workers. This is qualitatively different from the Westem capitalist countries.

74 75
ls thl! Red Flag Flying? SoCial Classes

In summary, the data on social mobility in lhe Soviet Union shows that (nevertheless the gap between the professional stratum and thc working class in
this society is far more open, especially in its highest reaches, to children the U.S.S.R. is roughly equivalent to that existing between professionals and
from the manual working class than are contemporary capitalist societies, manual workers in the U.S.); and (6) unlike the capitalist countries, the
but that children from the inteUigentsia (especially the professional intelli- mcumbents of decision making positions in the economy and state apparatus
gentsia in contrast to governmental, party or managerial personnel) have a ¡¡re not integmted into the technical intelHgentsia. Rather the managerial
significan ti y higher probability than working~lass children of becoming uratum appears to be significantly closer to the manual working class than is
members in their tum of the intelligentsia. Although status boundaries are the scientific-technicallnteUigentsia.
considerably more fluid in the Soviet Union than in the West, there is a
tendency for the scientific-technical inteUigentsia to crystallize as a distinc-
tive social stratum, separate from both the manual working class and the
managerial-political intelligentsia (who appear to be significantly more References
working class in origin than the former group).
l. Murray Yanowitch, Social and Economic Jneqttality in the Soviet Union,
Summary (Whlte Plains, N. Y.: M.E. Sharpe, 1977), p. IJJ .
The evidence on social class formation seems to parallel that on the distri- 2. Mervyn Matthews, Class and Society in Soviet Russia, (New York:
bution of material rewards. While there is no social class corresponding to the Walker & Co., 1972), p.35.
wealthy corporate owning and managerial class in the Westem countries l Yanowitch, op. cit., p.32.
(i.e. the Soviet power elite does not form a distinctive social class), there does 4 Robert Lane, The End of lnequality? (Baltimore: Penguin, 1971 ), p. 73.
5 Matthews, op. cit., pp.91-3.
tend to be a significant differentiation in life style, marriage patterns and
6 /bid.
inheritance of position, roughJy comparable lo the differences between the 7 Jerry Hough, 'The Brezh.nev Era: The Man and the System', Soviet
pelty bourgeoisie and the manual working class in the U.S. The most Studies, 25:2, (October 1973), p. l2.
distinclive tendencies toward social class formalion occur within the scienti.fic- 8 Computed from data reported in the 1975 edition of the U.S. Depart-
techrucal section of the intelligentsia who appear lo have the mosl distinctive ment of Commerce, The Statut1cal Abstraer of the U.S., p.393.
life styles and in ter-marriage patterns and the highest probabillty of passing on 9 lb1d., and Yanowitch, op. cit., p.25.
intelligentsia status, while the managerial-political stratum of the intelligentsia 1O Peter Wiles, Distribution of Jncome. t:ast and West, (New York:
appears to be somewhat more socially integrated into the working class. American Elseview Publishing Co., 1974), p 48.
11. U. S. Department of Commerce, op. cit. , pp.233, 366.
12. Howard Tuckman, The Economics o[ the Rich, (New York : Random
Conclusion House, 1973), pp.44-5.
13. U. S. Department of Commerce, op. cit., p.392.
14. /bid., pp.366, 370.
The evidence on income distribution as well as on social class formation 15. In addition to Table 4.3 see Robert Osborn, Soviet Social Policies,
shows that: (1) there is no wealthy class which has an income remotely com- (Homewood, lll.: The Dorsey Press, 1970), p.SO.
parable to that of the economic elite in the capitalist countries; (2) no elite 16 Pau1 Gregory and Robert Stuart, Soviet Economic Strucrure and
privileged social stratum exists with its own highJy distinclive life style, Performance, (New York : Harper & Row, 1974), pp. 189-90 and 399.
exclusi>te intermarriage patterns and virtual certainty of passing on its 17 J. Wilczynski, The Economics of Socialism, (Chlcago: Aldine Publishing
positions lo its children as is the case in the capitalist countries; (3) there is Co., 1970), p. 121 .
an income differential in the Soviet Union between the higher leve! managers 18 Mortis Bornstein, 'Soviet Price Theory and Policy', in Mortis Bornstein
and the scientific and technical inteUigentsia on the one hand and the manual and Daniel Gusfeld, (eds.), The Soviet Economy- A Book of Readings,
{4th edition), (Homewood, 111.: Richard lrwin, lnc., 1974), p.l09.
working class on the other, roughly similar to that between the higher pro-
19 Osbom, op. cit., p.50.
feo¡sionals and manual workers.in the U .S.; (4) there are distinctive life style 20. Ibid., p.32.
and intermarriage pattems as well as inter-generationallinkages among the 21 /bid. , p.48.
scientific and technical intelligentsia which tend lo make them a social 22 Frank Parkin, Class Jnequality and Politlcal Order, (New York : Praeger,
stralum distinct from the working class; (5) tendencies for the scientific- 1971 ), p. 144; and Gregory and Stuart, op. cit., p. l98.
technical or managerial-political intelligentsia lo crystallize in lo a social class 2J Gertrude Schroeder, 'Consumption in the U.S.S.R.', in Bomstein and
are significan ti y weaker compared to the .class divide that ex.ists in the Gusfeld, op. cit., p.281.
capitalist countries between the economic elite and the manual workers 24 Lane, op. cit., p.78.

76 77
ls rile Red Flag Flymg? Social Classes

25. Osbom, op. clf., Ch. 6 and Schroeder, op. cit., pp .279-82 ; Yanowitch, Sociological Review, 1977, No. 3. Reprinted in Annual Review o{
op. cit., p.40; and Vladimir Voinvich, 'Oh for a Room of My Own', Sociology.
Ntw York Tunes Magazine, 20 June 1976. 52. Shkaraton, 'Social Ties and Soc1al Mobility', op. el/. p.294 .
26. 0.1. Shkaralon, 'Social Groups in the Working Class of a Developed 53. /bid., p.300;and Yanowitch,op. el/., p.I09.
Socialist Society', in Murray Yanowitch and Wesley Fisher, Social 54. Dobson, op. cit., p.309; and Yanowitch, op. cit., pp. l08-14.
Stratzfication and Mobility in tlze USSR, (White Plains, N.Y. : Inter- SS. Jeremy Azreal, .Managerial Power and Sovzet Polztzcs, (Cambridge,
national Arts and Sciences Press, 1973), p.9S ; and Yanowitch, op. cit., Mass.: Harvard University Press, 1966}, pp.l 57-67; and Lane, op. cit.,
p.45 . p.l26.
27 . Shkaraton, op. cit., p.95; and I.A. Arutiunian, 'Culture and the Social 56 T. H. Rigby, 'The Soviet Politburo', Soviet Studíes, 24 : 1, (July 1972),
Psychology of the Soviet Rural Population', in Yanowitch and Fisher, p.l 1; and Lane, o p. cit., p.122.
op. cit., p. l20. 57. See also David Granick, The Red Executive, (Carden City, N. Y.:
28 . Yanowitch, op. cit., p.45 . Doubleday, 1961}, Ch.3; and John Hardt and Theodore Frankel,
29. M.V. Timiashevskaia , 'Sorne Social Consequences of a City-Building 'The Industrial Manager', in Bomstein and Fusfield, op. czt., p. l55 .
Experiment', in Yanowitch and Fisher, op. czt., p.l44. SS. S.M. Miller, 'Comparative Social Mobility', in Celia SheUer, (ed.},
30. Aruliunian, op. cit., p. l24 . Structured Sociallnequality, (New York : Macmillan Co., 1969), p.33 0.
31. Shkaratan, op. cit. , p.86. 59. /bid., p.334. The definition of elites used here refers to the top 2.5 to
32. Arutiunian, op. cit.. p. l32. 4. S per cent of the population.
33 . Parkin, op. cit., p,l57 . 60. Lipset and Bendix, op. cit., p. l22.
34. Lane, op. cit., pp.79-86. 61. G.W. Domhoff, Who Rules America, (Englewood Cliffs: Prentice-
35. See for example August HoUmgshead and Frederick Redlich, Social Hall, 1967), pp.l51-2.
Class and Mental fllness, (New York · John Wiley, 1958), Appendix
Three.
36. M.K. Tilma, 'The lnfluence of Social Origins on the Occupational
Values of Graduating Secondary School Students', in Yanowitch and
Fisher, op. czt., pp.l92-3 .
37. Shkaratan, op. cit., p.309.
38. Lane, op. cit.. p.l Ol.
39. 0 .1. Shkaraton, 'Social Ties and Social Mobility', in Yanowitch and
Fisher, op. cit., p.290.
40. Osbom, op. czt., Ch. 4 and Matthews, op. cit., Chs. 9 and 1O.
41. /bid., p.297 , Yanowitch, op. cit., pp. 89, 90; and M.N. Rutkevich and
F.R. Filippev, 'The Social Sources of Recruitment of the lntelligentsia',
in Yanowitch and Fisher, op. cit., p.248.
42. Yanowitch, op. cit., p.86 .
43 . M.N. Rutkevich and F.R. Filippev, 'The Social Sources of Recruitment
of the lntelligentsia', in Yanowitch and Fisher, op. cit.
44. Matlhews, op. cit., p.263.
45 . Yanowitch, op. cit., p.71
46. L. F. Liss, 'The Social Conditioning of Occupational Choice', in
Yanowltch and Fisher, op. cit., p.286.
47. Yanowitch, op. cit., p.? l .
48. Parkin , op. czt., p.ll O.
49. Seymour Martín Lipset and Reinhard Bendix , Social Mobiliry in
Indu strial Society, (Berkeley : University of California Press, 1964),
p.97; and Daniel Rossides, Tlze Amencan Class System, (Boston:
Houghton Mifflin Co., 1976), p.21 l .
SO Lucile Dubennan, Social/nequality, (Philadelphia. J .B. Lippincott
Co.,l976),p.208.
51. For a lhorough review of the literature on social mobility in the U.S.S. R
see Rich Dobson, 'Mobilily and Stratification in the USSR', American

78
79
 \
Pnlltical Procc:rws

5. Political Processes dasses, unless the working people are involved on an ongoing basis in running
thc state.
Stnce approximately two generations have passed smcc the Bolshevik
Revolutton, claims that the Soviet Umon is a socialist country where the
working classes rule, based only on evidcnce that the working people dis-
proportionately benefit and that these classes installed the leadership of the
Uolshevik party in power in the 1917-1920 period are tnsuffictent to prove
thnt the U.S.S. R. is stilJ socialist. Whether the working people of the Soviet
Umon can be considered to rule must depend on whether structurcs and
processes of the kind outlined in Chapter Two predominate. Tims, as part of
uur attempt lo determine whether the Soviet Union is n socialist country, we
will examine the processes of elections and decision making in state bodies,
There is considerable and highly polarized debate about the role of the Soviet public debates and public opirlion formation, partictpation in state and
wotking people in the decision making processes of Soviet society. The anti- cconomic enterprise administration and decision mnking, the role of the
communists of the West, the Chinese Communist Party and their supporters working people in ilie Communist Party, the social origins of, and integration
throughout the world, claim that the Soviet state is the instrument of a small of, the leadershlp with the masses of working people, and finally, the structural
minority of state bureaucmts, or 'state capitalists', who use ll as their instru- constraints whlch ensure that decisions made benefit the masses of working
ment against the interests of the Soviet people. 1 The Soviet working people people.
thus are seen as excluded from the real decision making processes. Further,
this is largely the result of developments from the death of Stalin in 1953, to
1965, when, they claim, capitalism was restored in the Soviet Union. The Ole Fonnal Political St:ructure
Soviets and their supporters, on the other hand, maintain that the Soviet The Electoral Process
Uruon ts a popular democmcy in which the masses of working people are hen though the number of candidates on the ballot papers in Sovtet elecuons
mtegrally involved in making the decisions that affect their lives, and that the is equal to the number of positions open, the electoral process in the U.S.S.R.
1
Soviet state is an mstrument of their i.nterest and thetr will. 1t wouJd be must be taken seriousJy as one means of exerting influence on the decision
hard to imag¡ne two more opposite positions on any question . rnnking process. At the final stage of the election process (in a secret balJot
To prove that a society is socialist, in addition to showing that the produc· tllt election day) the voter (over 99 per cent ofSoviet adults normally vote
ing classes benefit economicalJy relalive to the power elite or lo any owning or 111 elections) checks a 'yes' or 'no' after the various candidates' names. lf the
controlling class that is hypothesized to exist, it rnust also be shown that such majonly of voters reject a candidate, he or she is not elected and another
groups are in fact U1e ruling class, i.e. that the role in the poUtical process is cundida te must be nominated and is in tu m subject to the possibility of being
the primar y factor whlch determines the role of the state in society. . vctoed by a majority vote. In 1965, 208 candida tes for local Soviets were
There are numerous possible ways, it must be remembered, by whlch rCJCCted by the voters at the fmal stage of Lhe election process, and in 1969
the producing classes can determine state policies. Amont these are there were rejections in 145 districts. 3
as we argued earlier, the initiaJ revolutton by whlch the producing But, since virtualJy a1J candidates nominated gel elected, it is clear that
classes overthrew the old regime and selected a new leadership. rnost of the negotiation and politicking takes place at the nomination stage.
Because there is considerable inertia in people's commitments, this 'election' ( n1is is not so unlike how primaries and general elections produced successfuJ
rrught well be expected to determine the class content of policies for sorne c.tndidates in the old one party system of the South of the U.S.A.) ConSlder-
time. Again , as we saw, thls initial 'election' is retnforced by the real possi- ahle atlention is given in the Soviet Union to producmg a slate of nominees
bility that a polillcalJy rnobilized people would be incli.ned to overthrow a who represent the commuruty, support Commurust Party policies and can win
leadership that betmys its onginal revolutionary commitments, i.e. would clcction. The actual fmal elections serve mosUy to express solidarity and
revolt once again if necessary , lo ensure thal policies were in the popular energize people, rather Utan to make decisions. The very real decision making
interest. These two factors will not, however, guarantee that a group of process occurs befo re the final casting of ballots. Candidates are nominated
leaders, once installed by the working people, will indefinitely uphold their .11 meetings of workers and members of mass organizations after sounding out
original commítments, unJess there also exist ongoing mecharusms by which thetr opinions and evaluation of the candidates by local electton comnuttees
the masses of people can affect state policies. A country cannot be considered and Communist Party members. Anyone ata meeting has the right to propose
socialist, even if state poUcies disproportionately benefit the productive or oppose a candidate.4 Wide and thorough discussion of the qualifications of

80 81
Js the Red Flag Flyzng? Política/ Processes

candidates al these meetings is said by official sources to exist. Regrettably, lu ,ome speeches and give legitimacy to decisions which have a1ready been
1could fmd no hard evidence on the cxtent to which the nomination process •nade. No real debate norrnally occurs in either body. Agam, it should be
was authentically democratic. But ít is relevant lo point out that the election uuted that there is nolhing especially unique about such a situation. For
process in China, formally at least, is the same as in the Soviet Uruon, China r.xample, in the U.S.A., the Democralic and Republican party conventions,
havmg adopted the latter's system. Congresstonal votes on major foreign policy questions (e.g. the declaration of
The fact that there is only one candidate per post at the fmal stage of the Wllr m 1941 and the Gulf ofTonkin Resolullon in 1964). the brief perfunc-
election procedure and that almost all candidates nominated get elected lury debates about Departrnent of Defense approprialions and for lhat
cannot be considered ipso Jacto evidence against lhe thesis that the producing matter most major legislalion before the U.S. Congress, a11 indica le that most
classes rule in lhe Soviet Union. Whelher lhis is the case must be decided on ul the hammering out of policies occurs in priva te and before general public
lhe basis of a study of their role in lhe selection of nominees, the political mcetings. The actual process of voting in the U.S., as in the Soviet Union and
positions of nominees, and in their control over lhe nominees both directly ( luna, very often serves primarily to generate public support behind a decision
and lhrough their influence on lhe Communist Party. .rlready reached. In none of these countries does the relative absence of real
tll•clsion making in the public general sessions of their leading legislative
Legislative Bodies h<>dles indica te that their ruling class does not participa te in a thorough and
Western sovietologists agree lhat there has been a significant increase both in wide _ranging process of debate, negotiation and compromise befo re making
the political role of lhe Soviets and in popular participation in them since the lll·clstons. The unanirnity of Supreme Soviet votes lhen cannot be taken as
mid 19_50s. 5 The standing comrnissions of the Supreme Soviet (which has rvidcnce against lhe producing classes actually controUing the state. Whelher
authonty over all aspects of Soviet society) initiate and draft proposals to be lhis is the case depends on lheir involvement in processes prior to taking the
submitted to its general meetings. They also operate as a permanent watch- llnal public votes.
dog on social institutions, and supervise and assist state organs in irnplementing
the acts of the Supreme Soviet and its Presidium {which is empowered to
make decis10ns when the Supreme Soviet is not meeting). In addition, the l~1blic Debate and Public Opinion Formation
Supreme SoVlel establishes olher commissions whose members visit localities
for investigations and hold on-the-spot pubüc meetings. These commissions Authentic democracy wilhin a ruling class irnplies lhe real opportunity for
continually check lhe state of administration in lheir arcas. There is an ~on flicting ideas to confront one another on a more or less equal basis so that
expanding policy of bringing in experts in various fields for consultation wilh 111cmbers of the ruling class can forrn valid opinions without being 'brain-
thc standing comrnissions and Presidium of lhe Supreme Soviet (which suggests w.tshed' lhrough hearing only one viewpoint expressed. FuUy developed and
the growing power of professiona1s). ¡.oenuine socialism must lhen irlstitutionalize the structures for full and
The City and Republic Soviets have responsibility for checking up on the .ruthentic debate among lhe producing classes on questions of public policy.
work of all enterprises and organizations within their territorial jurisdiction. There is very little public debate either in the open meetings of the Supreme
Such Soviets focus on matters like public eating facilities, public hea1th and Soviet or in candidates' election campaigns for state office on the pros and
publ~c transport, education, anti-'social parasite' activities, working conditions, wns of the various issues facing the Soviet people. But lhis does not mean
penstons, etc. Careful studies of lhe operation of local Soviets by Western lhnt freewheeling and wide ranging public debate on the basic issues facing
sovietologists conclude lhat these institutions play a real and active role in the Soviet Union does not occur, or thal such debate does not influence the
local decision making; lhat a considerable diversity of views is pul forward ll··cisions made, or that elections and the Supreme Soviet play no real role in
in lheir interna] discussions prior to adopting legislation; lhat lhey actually ·~·ctsion making.

make _ralher than just 'rubber stamp' decisions previously agreed on by Party In the Soviet Union, unlike the Westem capitalist countries, the major
orgamzauons; and lhat lhey do influence broader política] processes in lhe lururns for public debate, criticism, and public opirlion forrnation are the
direction of popular responsiveness.6 rnass media, together wilh specialized joumals and conferences. The media
As for lhe general meetings of lhe Supreme Soviet which are open lo the 1uc the major forum for opposing views with Pravda and Jzvestia ranging
public, lhese serve the function of expressing unity and solidarity behind rnure free! y as social critics than lhe local weeklies. 7 The Soviet press is full of
policy decisions a1ready hammered out in public debate, the commissions and public debates on a very wide range of issues: literary policy, econornic and
the Party, rather than actually forrnulating state policy. It should be noted Ir•pi reforrn, military strategy , lhe relation between the Party and the
that the Nationa1 People's Congress in lhe People's Republic of China mtlítary, ci~y plan~g, crirne, pollutíon, fam1 problems, the role of the press,
functíons in exactly lhe same manner. Both national bodies meet for only a uzt, wo~en s role m the economy, access lo higher education, incompetent
few days ayear, obviously not enough time lo do anything other than listen '"'-Ononuc management, bungling bureaucrats, etc. The only issues that are

82 83
 Politicaf Processes

llllltC nr lt•ss unmunc from open, concerted criticism in the press, whether ltlc and forward them to the appropriate govemment agency By law any
rcullcrs' ~:ommentarics or official editorials, are the Communist Party asan ncy against whom a complaint or suggestion is directed must respond
h"ltlution (as opposed to concrete abuses by party officials), the existence of Y.llh.in 15 days and the sender must be notified of the results. The state takes
the military (lhough not mihtary strategy and the polítical role of the mili· vcry seriously the channelling of complaints and grievances to coUection
tary), socialism as a system and communism asan ideal (though again not putnts where they can be processed. The press thus serves the function of
spectfic practices of the Communist Party), the tdea of the unity of the tlttlbudsman for the masses. In 1970 Pravda handled about 360,000 letters a
Party and the people (but not flaws in its concrete manifestations), and the Vt"M and lzvestia 500,000. Obviously the press cannot publish all the letters
persons of the current top poülical leaders (but not lower and intermedia te 11 receives, but all must be processed and referred to the agencies against which
17
level officials, and not the ideas and programmes of the top Jeaders). All but 1 ~.omp1aint is directed.
the last of these taboo subjects represen! the fundamental assumptions of ll1e press itself does more than provide a forum for public debate and
Soviet society .8 These issues are considered to have been settled once and for t~¡llnion formalion. lt also active! y performs the role of social critic (although
all and public discussion of them is considered by the regune to be potenlially uot of the basic premises of Soviet society listed above). The newspapers
disruptive of popular rule. Other than these few basic assumptions of Soviet .t~lively search out corruption, managerial incompetence, inept govemment
society there appears to be no official policy that is immune from questioning .1110 Oaws in social organization. They investiga te allegations of injustice,
and criticism in the press.9 Even in the sensitive areas of foreign and nation· lucfficiency, bungled planning and highhanded bureaucracy. Pravda and the
ality poltcy, where advocacy of basic changes is permitted only in veiled form, nlher majar papers, in particular, systematically engage in public exposures.
a lively public debate goes on under the guise of discussions on the actual l11e press maintains public surveillance over official programmes, checks the
facts of the present situation. 10 The consensos among those who follow the pt•rformance of social institutions and promotes creati ve solutions to complex
Sovtet media seems to be that the arca and depth of public debate has been problems of Soviet society. lt encourages citizens to take an active part in
growmg and that in recent years there has been vutually no proposal for wlicizing everyone who may be abusing public trust, except the persons of
gradual change in the policy of the Communist Party which has not been the top leaders. 18 Complaints, many of them originating from readers, have
aired in the mass media. produced criminal prosecutions or disciplinary action against Communist
Observers otherwise hostile to lhe Soviet Union claim that the public l'arty members.
debates, struggles and criticisms are reaching deeper and deeper into the social Soviet citizens are becoming increasingly active in working with the press.
structure as policy mak:ing becomes more and more decentralized and the 11 ts cornmon for volunteers work.ing with a paper to 'raid' a factory or govern·
19
number of participants increases. 11 There is considerable freedom of dis· 111ent installation and produce a sharp critique for the paper. And Sovtet
cussion and there exist sharp differences of opinion on a wide range of uewspaper editors are rewarded for represent.ing public opinion and taking a
issues.11 Basic policies are increasingly formulated, discussed and challenged crilacal stance towards inefficiency, bureaucracy and other abuses. That the
in public speeches, forums and editorial statements in newspapers and press al least sorne of the time does its job effecllvely is attested to by
periodicals. 13 The different Soviet papees and periodicals more or less .tttempts by bureaucrats to suppress criticism, attempts which themselves
10
openly take sides on public issues. This appears to be especially the case with huve been exposed by the press.
proposed new welfare policies, each of which has been debated vigorously by 1t may be usefulto mention sorne of the specific issues which have
specialists and o rdinary citizens alike in profess1onal JOUmals and the public tuvo! ved considerable public djscussion: Khrushchev's attempt lo proletanan·
press. Public debate on proposed legislation has for the most part become an 11.c higher education from the late 1950s unW 1965; the ongoing and sharp
institution . A law is proposed, a period of wide ranging debate takes place, debates about the greater access of children of the intelligentsia lo higher
and a revised version of the law is final\ y promulgated which incorpora tes the euucation (and the consequences of this for the creation of a privileged
results of the public criticism.'" 1tratum); the debate over the role of the Communist Party in the military
U:tters to editors of the Soviet press, which very often amount to guest wtuch occurred between 1958 and 1962; continuing discussions on the role
editorials or articles, play a very significan! role. 15 This institution provides uf writers and artists; the question of centralization versus decentralizaúon
a maJar forum for the producing class to present lls opinions and participa te uf economic decision making; environmental protection issues (the debate
directly in the sharp confrontation of connicting ideas. Many discussions are over Lake Baikal being the most famous exarnple); discussion over whether
thus initiated from below. Letters lo govemment agencies, Party organs, etc. the birthrate can best be increased by paying mothers a wage for staying at
also play a very important role in initiating public discussion and influencing home or by improving day care services (prominent in the mid 1970s); and
the decision making process. lt appears that group opinion, as expressed in oiscussions over whether enterprise managers should be elected by worlcers in
1
letters and the media, exerts a significan! influence on the course of events. 16 lhe plants (also a public issue in the mid l970s)?
All the mass media have letter departments which keep letters received on Public debates over legal reforms have also taken place in universities, legal

84 85
ls the Red Flag Flying? Polttica/ Processes

research institutes, jurists' associations and factories, as well as in the public 1>unng the 1960s the intelligentsia and experts who beca me increasingly
press and joumals ( e.g. around the refonn of Civil Law in 1961 ). They have llonunant m the Czecb party pushed harder and harder for greater mequality
often produced considerable changes in the original drafts ofTered for public m a-11is workers. Novotny, leader of the anti-liberal faction , appeaJed to the
discuss10n.12 tndustnal workers for support against the mtelhgentsia ~lndeed several strikes
The professional intelligentsia, especial1y econornists and jurists, seem to 111large factories did occur against the Czech reforms) 2
exert considerable influence on public decision maJung through their In summary, there appears to be very widespread mvolvement both among
specialized papers,joumals, conferences and other institutions. These pro- thc professional intelligentsia and the working class in the fomlUiation and
fessionals, through these media, set out various pubUc policy options and •h~ussion of public issues, as well as Ln criticlsms of state and Party perfonn·
seek to convince their colleagues and the public through debate at meetings 111ce. But although considerable influence over the course of public policy
and the written word. Especially important channels of influence are the ••cms lo be exercised by the working class, it does appear that greater irtflu-
Soviet Academy of Sciences and the universities.23 r nce is exerted by the professional intelligentsia. The Soviet political process
Various groups of the intelligentsia generally - particular!y econornists, ···oms to be considerably biased in favour of the highly trained employees.
joumalists, mllltary officers, managers, scienlists, party officials, state
officials, etc - are active in presenting their Lnterests and opinions to the
public. Their associations and periodicals play a disproportionate role in l'opular Participation in State Bodies
public debates, and they have a disproportionate influence on both the
outcome of public debates and the actual decisions reached {by influencing 1'11pular institutions mcJude the system of comrades courts which were set up
both the public and the behind-the-scenes aspects of the declsion making ht 1959. The judges of these courts are local citizens elected by local mass
process). ln contrast, the trade unions and the Young Comrnunlst League have urganiza tions. They deal witb rninor crime, violations of work discipline and
not traditionally played as active andas autonomous a role in public opinion 111lcs of behaviour in apartment blocks, neglect of safety regulations, im-
formation. However, the trade unions m recent years are coming to play an proper behaviour in public places, fallure to bring children up properly,
Lncreasingly active role in public debates especially at the regional and factory 'parasitism', 'hooliganism', drunkenness, etc. The courts are empowered to
levels.2.4 lmpose penalties mcluding banishment, transferring people to lower paying
Another Soviet institution which provides a forum for public discussion jubs, reprlmands, ordering apologies and unposing fmes. There are also com-
and criticlsm Ls wall newspapers {which the Chlnese have adopted and made a uuttees elected at general meetings of all residents in apartment blocks which
vital part of their own politicallife). These papers are issued by shops and rrgulate, improve living conditions and assign living quarters.u
sections of industrial enterprises, as well as by collectives and state fanns, The Soviets have People's Control Commissions whose sole function is to
educational institutions, etc. Every worker has the ngh t to participa te by 111~pect enterprises and public institutions and Lo expose abuses. They were
having their ideas and criticisms put up for public scrutiny. There 1S a right to u•lnvtgorated in 1962 {although they have a history dating from the revolut-
5
criticize the heads of trade unions, enterprises, etc. through this medium? hm). The commissions are set up and co-ordinated with the local, regional,
The organs of public policy making in the Soviet Union - the mass media, ~t•publlc and supreme Soviets. They have state authority behind them in their
the Soviets, public meetings and the Party - seem lo be the forums in which lnvestigations. Their officers are elected for two year terms. 19 In 1963-64
various interest groups fight it out within the broad assumptions of the .1hout 4.3 mlllion people, mostly volunteers, were working on thcse control
system.26 There appear to be systematic difTerences over major policy hudacs; in 1975-76,9.4 million. 30
declsions among various interest groups. One of the principal interests seems Ptople's police units and a popular mili tia have been given increasing
to be the 'experts' (scientists, academics, engtneers,jurists, etc.), many of r .ponsibilities since the 1950s. Around 1970 the popular mili tia had six
whom tend to favour such policies as greater inequality and more decision nllllion volunteers. lo 1964-65 there were 5.5 million people's auxiliary
making power for enterprise directors and other professionals, as well as Jlullcemen; in 1975-76, 7.0 rnillion. 31
favouring purely technical criteria for admtssion to institutions of higher As for legislative bodies, although the intelligentsia are considerably over-
education. On the other hand, the working class organizations, most party t ¡trcsented, workers and peasants are increasingly involved in them. Workers
officials and the Young Comrnunist League have tended to favour sucb lm:reased their share of alllocal Soviet deputies from 10.6 per cent in 1954-
contrary policies as greater egalitarianism and limits on the powers and ~S to 39.3 per cent Ln 1972-73 and their share of Supreme Soviet positions
prerogatives of enterprise directors and experts, as well as class criteria in Ir um 14 to 4 2 per cent. 32
admission to institutions ofhigher educatton. As we will see in a later TI1ere appears lo be a clear increase in popular participation in the Soviet
chapter, it was a split along similar lines that engulfed Czechos1ovakia in 1hllon. The levels of public debate and participation (and the nature of the
1967-68 and precipitated the intervention , for good or ill , of the Soviet army. '"' tnUst ideology which Ls hegemonic) indica te that public opinton and

86 87
ls tllt Red Flag Flying? Political Processcs

parttcípation play a major role in policy decisions. 33 lt seems to be the case, tu.mual workers to increase. Through the early 1960s manual workers were
however, that the considerably greater participation of the professional intelli· huut 45 per cent of all new recruits to the Party .37 Sin ce the 23rd Party
gentsta tn Soviet institutions gives them disproportionate political influence 1 nngrcss in 1966, well over half of all new recruits have been industrial
compared to the manual working class \.\urkers and in the major industrial areas the number has been between 60 and
There seems to be virtual consensus among Westem sovietologists - most /O pcr cent. In the most recent penod ( 1971-76}, manual workers ha ve been
of whom are of course, neither Marxists nor sympathizers of the Soviet ~7. 6 pcr cent of aJJ new party members.38 'Specialists' (i.e. the professional
regune that there is widespread support for the Soviet system among the lutrlhgentsia), on the other hand, were only 24.2 per cent of recruits in
people as a whole and the working people in particular. Even harsh domestic Jll71- 72, compared to 27.3 per cent in 1962-70 and 26.4 per cent in 1952-5 5. 39
critics of the system bemoan the fact of the unpopularity of their own ideas lltrre ís no evidence that manual workers are being pushed ínto the back-
among working peop1e .34 Although workers' oppositton has periodically ¡•ruund in the C.P.S.U.
made itself felt on specific economic issues, there is no evidence of widespread In 1976, enterprise directors and top level state officials were four per
working class support for oppositional tendencies. For example, an analysis of 1rtll of aJI party members, while 10.8 per cent were scientists, teachers,
names on petltions calling for liberal reforms found that only 6 per cent of the lit liMs and medical professionals, and 17.8 per cent were agricul tural
names were those of workers. 35 While the apparently high leve! of support pccialists, engineers and technicians.40 The policy is to maintain, if not
for the Soviet system amongst the working class tS not proof that they rule luocase, the relative number of specialists being admitted into the Party
(after all , a high percentage of U .S. working people support capitalism), it is lr11gineers, technicians, agronomists, doctors, teachers, economists, etc.) and
certainly compatible wilh the position that Lhey are the ruling class. Converse- tu dccrease recruitment from administrative positions.41 Official Soviet
ly, if there had been significant evidence (which there is not) that most lltrrature proudly emphasizes the recruitment of scientists and other
workers were disenchanted with the Soviet system, this would constitute p•nfcssionals. 42
strong evidence that they don't rule.
1 cision Making Within the Party
l11 the 1920s, fundamental and often bttter debate occurred at the plenary
The Communist Party tons of the Party Congresses. From the 1930s to 1950s the plenary
tons carne instead to serve the function of expressing the solidarity and
The most irnportant institution in Soviet society is the Communist Party. lts tttllty of the Party and boosting the Party's and country's morale. Votes
influence and guiding role are aiJ pervasive. An exammation of the social t~·came unanimous and debates perfunctory. The real debates and decision
composition of its rank and me and its leadership, as well as of its processes 111.1ktng occurred in committees, the Politburo, the press and through the
of decision making, can therefore be expected to give us a good idea of the uthcr institutions already outlined. Recent evidence indicates that the Party
power of various social groups in both the party apparatus itself and society t ungress is once again a genuinely deliberative body where real decisions are
as a whole. r11atle.
lñe principal decision making organs of the Party are its Politburo (with
Social Composition thout 15 fu U members, it normally seems to be the more importan t organ)
In 1976,41.6 per cent of the membership of the Communist Party were 111d the Central Committee wWch elects the Politburo. But the Central
manual workers (including workers on state farms), 13 .9 per cent were peasanta t mnmittee seerns to be becoming an increasingly central decision making
on coUective farms and 44.5 per cent were white collar workers and intelli· hutly. A telling event which demonstratcd the power of the Central Committee
gentsia. ln comparison with the occupational structure of the Soviet Union in \\ J\ the attempted re moval of Khrushchev in 1957. After a majori ty of the
1973, these figures reflected an under-representation of manual workers by l~1lllburo voted to dismiss him as secretary of the Party , he refused to resign,
a factor of 0 .69 andan over-representation of white collar persons and the t ktng his case instead to the Central Committee which upheld him~3
intelligentsia by 1.71.36 Trends in the social composítion of the Party over Smce the 1950s there has been renewed emphasis on democratization and
time are reported in Table 5.1. wttler participation in the Party, and more frequent meetings of Party bodies,
Table 5.1 reflects the fact that during the 1930s and 1940s white collar 1 me of which had fallen into disuse (e.g. there were no Party Congresses
workers and intelligentsia were heavily favoured in the Party's recruitment hc•tween 1939 and 1952). Rank and ftle initiative has been mcreasingly
policies. By the mid 1950s they were actually the majority of party members llltllulated and broader participation encouraged.44 There is considerable
while manual workers represented less than one-third of the total membership. rvttlence that inner party democracy exists and that it includes wide ranging
Since the mid 1950s, however, there has been a steady tendency for the Ctlticism and self-criticism. This fills the party press and is expressed at party
proportion of white collar workers and intelligentsia to decrease and that of utl'ctings and public gatherings. 45 The percentage of delegates to Party

88 89
l:r tlle Red Flag Flying? Politica/ Pressures

Table 5.1 u itics of the Soviet Union almost all agree that the Party does command the
The Class Composition of C.P .S.U. Membership : 1924-1976 pupular support necessary for the system to function effectively.
Percentage o[ A/1 Members and Candúlates In summary, there is substantial evidence that a considerable degree of
1924 1930 1932 1956 1961 1966 1971 1911 antemal party democracy exists, that the Party has considerable support in the
Manual workers 44.0% 65.3% 65.2% 32.0% 34 .5% 37.8% 40.1% 41 wurking class, and that the two-thirds of its members who are ordinary
Ptasants 28.8 20.2 26.9 17.1 17.5 16.2 15.1 1H wurking people play an active and influential role in party afTairs. Nevertheless,
Whlte-<:ollar workers ti ts almost certainly the case that the one-third of the Party who are profess-
and others 27.2 14.5 7.9 50.9 48.0 46.0 44.8 tunals - teachers, engineers, technicians, managers, officials, scien tists,
tl·onomists, agronomists, etc. - do exert influence greatly out of proportion
Source : T .H. Rigby, Communist Party Membership in the USSR, p327 and tu their numbers, thus in considerable degree reducing the influence that the
The Qment Digest of the Soviet Press, 29 September 1976, p3. munuaJ classes can exert on Soviet society through the Party.

Congresses who are workers and peasants has increased signHicantly. At the Social Background of the Leaders
1952 Party Congress these groups represented only 15 per cent of all
delegates, but in 1959 they comprised 31 per cent. 46 On the other hand, it Another very important mecharúsm of popular control can be the immersion
must be pointed out that in 1966 higher leve! party and govemment officials uf the power elite in the producing classes, especially the manual working
(i.e. full-time members of the party or state apparatus}, who represented only · l.tss. To the extent they are recruited from this class, maintain close contacts
2.1 per cent of all party members, were 40 per cent of all delega testo the wtth 11 and are socially, culturally and ideologically integrated with the
23rd Party Congress, and 81 per cent of all those elected to the Central wur~ng ~ople, they must be heavily influenced by them. Common origins, in
Committee .47 • \octety m which there is no property owning class to attract them, and thus
New rules passed in the 1960s stipulate that party officials must rotate in scparate worki.ng people from their origins, are a strong force bringing the
office. At the Central Committee and Politburo leve!, one-fourth of the leaders to think and act Like the common people from which they come.
membership must tum over at each Party Congress (held every four years); ( ummon lüe style, participation in physicallabour, shared friendship patterns,
at the lowest levels one-halfmust tum over at each election ; and at inter- d ose immersion in popular activities, and exposure to the same ideas are
mediate levels one-third. Further, members of executive Party bodies cannot unportant forces which can make the decisions of the power elite those of the
be elected more than three times. There can, however, be exceptions to these J"'Ople.
rules for those who receive more than three-quarters of the vote.48 Ln practice,
however, from 1966 to 1971 there was no tumover among the full members lhe Central Committee of the C.P.S.U.
of the Politburo, although there was a 24 per cent tu mover in the Central Of all 360 (full and candidate) Central Committee members in 1966, 42 per
Committee, a 21 per cent tumover of Re~ublic fust secretaries anda 43 per 1 tnl were engaged in full-time party work, 28 per cent were in the govemment
cent tumover of Obkom ftrst secretaries. 9 tpparatus, 14 per cent were in the military or poUce, and 4 per cent {15
Party rules also guarantee the formal right of any member to criticize any nwmbers) were full-time workers. However, most of the 360 had working class
Party leaders.50 The draft of the Party Programme on polilical, economic and nt peasant backgrounds. Twenty-seven per cent were children of manual
cultural issues is pul up for nation-wide preliminary discussion before it is workers, 35 per cent children of peasants, 12 per cent children of non-manual
revised and adopted by the Party. The Party units in insututions also mix all wnrkers and for 26 per cent no information could be found. 1t would appear
strata of the population. For example, in institutions of higher education, thrn t.hat at least two-thirds of Central Committee members and probably
Party committees include full professors, administrators, junior instructors, mure (considering t.hat many low leve) white collar jobs are counted as non-
graduate students and undergraduate students. This has a definite demo- manual and many of those for whom no information was available are prob-
cratizing influence on the Party .51 nhly from poorer backgrounds} are from the lower strata. 53 Comparing
The Party, to guide Soviet society, relies heavily on 1ts moral prestige, on 1 entra! Comrnittee members between 1917 and 1951 with those in the period
setting an example, inspiring people and persuasion . Party members have no 1116~ to 1971 shows that very little has changecl 54 The overwhelming majority
special privileges except undoubtedly an enhanced chance of promotion. • tllllmue lo come from humble origi.ns.
They carry a considerable extra burden in being expected to set standards of One further point. In 1956, only six per cent of the Central Committee also
exemplary conduct, volunteer for rublic service activities and otherwise lu·ld jobs as industrial officials and only 20 per cent were ever industrial
55
behave like the 'new Soviet man'.5 Even the harshest Westem academic ntanugers. Thus industrial management is not the route to top posilions in

90 91
/s rhe Red Flag Flying? Pollfica/ Processes

the Party .56 tln the children of manual workers or peasants. 64 Industrial managers seem
·ncrally to come from much the same types of background as do Party
The Politburo of the C.P.S.U. ulficials, i.e. they tend to have parents who were peasants, manual workers and
Of lhe 15 fuU members of the Politburo of lhe C.P S.U. in 1971 , ten (i.e. unskiJied employees. 65
66 per cent) had at sorne poinl in lheir careers been manual workers (the mean In 1967 about 68 per cent of directors hada higher education, mostly at
average experience of aU Politburo members in manuallabour was two years). rngmee ring institutes.66 The career pattem of enterprise direclors starts on the
On the other hand, the same percentage also had had experience as managers hop floor asan assistant foreman and involves a series of promotions through
(wilh an average experience of 33 years). Thls represented an increase in both productJon jobs. 67 8oth because of their engineering training and their direct
categories over lhe 195 l Politburo where 45 per cent had had experience as production experience throughout their careers, Soviet managers are consider-
manual workers and 18 per cen t as industrial managers. lt should be noted nllly more familiar with production processes than are Westem capltalist
however that, while the number with experience as manual workers has cllrectors.
increased, the average experience as manual workers has declined . The over- There is considerable managerial tumover, with transfers decided on by
riding tendency would seem to be for Politburo members to more and more the minístries lo which an enterprise is responsible. Thus any tendency lo
be career party people. 57 The typical career pattem of 1971 Politburo tlrvolop proprietary altitudes towards (let alone proprietary rights in) a given
members includes a period as a manual worker In their youth , a diploma tnterpnse is undermined. Managerial security of tenure has, however,
course in a technical school foUowed by a managerial job in industry, then a tncreased a lot since 1940.68 Recruitment and promotion depend on quali·
position in the party apparatus whlch includes a period as regional party h'ations, performance and politicalloyalty to the principies of Marxism-
secretary. The Party leaders tend then to be generalists rather lhan specialists 1cnirusm as interpreted by the C.P.S. U. Top enterprise directors must norm-
and have had a wide range of experience. tlly be trusted Party members who are active politically and accept the leader-
lup of the Party. 69 There is no evidence that managers pass on their preroga-
Govemment Ministers llves to their relauves.
There seem to be rather distinct differences in career pattem separating Training in Marxist principies plays an important part in the education of
Jeading Party officials, industrial directors and economic ministers, and senior managers. 70 In-depth interviews have shown that managers take seriously
government officials (other than economic ministers). Most econornic thc1r belief in industrialization, patriotism and serviee to their fcllow human
ministers and top managers, while they are usually Party members, do not have lwmgs. 71 They seem to be rnotivated by a combination of material and
experience at full-time Party posts .511 Heads of economic ministries tend lo u1oral incentives which include genuine dedication to socialisl princ1ples.
have had careers in industry. Ukewise very few Party officials transfer to After the death of Stalin in 1953, one of the leading contenders for the top
govemment jobs. From 1950 to 1970 a total of only five government ministen l•·adership position, Malenkov, tended to articula te the interests of Soviet
switched between Party and governrnentjobs. 59 One study showed that ntanagers and in lum received their support. Khrushchev, however, who was
only two per cent ofParty officials are ever transferred lo Union leve! govem· lhe representative of the Party apparatus andan articulator of proletarian
mentjobs and only 15 per cent to Republic govemment level jobs.60 Recruit- lltetoric, decisively defeated Malenkov.72 During the period that followed
ment to both top managerial and govemmental positions appears to be deter· ( 1Q57 to 1965), the managerial stratum was clearly subordinated lo the Party
mined by education , qualifications, performance and politics; and promotion wlnc.h made it very clear that the managers were in a subordina te position.73
seems to be on the basis of merit and politics.6 1 While the position ofmanagcrs improved somewhat after 1965, they rcmain
Perhaps more importan ti y, andas was seen in the previous chapter, of the ckarly subordinate to the Communist Party which closely directs their
47 governrnent mirusters of the U.S.S.R. in 1966 40 per cent of lhose for 11(1Jvilies. 74 Although the managerial stratum consistently pushes for grcatcr
whom mformation was available had manual working class parents, 27 per uutonomy in the running of their enterprises, they show very lit tle intercst in
cent were of peasant origin, 15 per cent had parents who were m lower level tu ability to assume leadership of Soviet society as a whole. 75 On the
white collar positions and 18 per cent grew up as children of lhe intelligentsia.• untrary, if only because of the effectiveness of training and promolion
l'nlicies, and beca use of their elose supervision by the Communist Party, tltey
Enterprise Directors cm to accept the politicalleadership of the Party.
A study in K.azan in 1967 showed that 753 per cent of the executives of
economic enterprises and state organizations carne from manual and peasant lnheritnnce of Top Positions
backgrounds and that only 8.6 per cent of lheir parents had higher education. 61 lltere is no tendency for there to be any inheritance of govemmcn t, party or
The clear majority of managerial personnel lhus are not chlldren of the intelll· lltanagerial positions. 1 have never come across any evidence that thcrc is a
gentsia, although the latter do have a better chance ofbecoming managers than h·ndency to pass on higher govemment, Party , or enterprise oflicc to one's

92 93
Is the Red Flag Flying? Political Processes

relatives. (Of course there is a passing on of enhanced probabilities of making nun;e it can toa considerable degree be directed. Attempts to use terror or
it into the intelligentsia as a whole). Neither Lenin, Stalin, Khrushchev, tntimidation, or even purely economic incentives, to produce the enthusiastic
Brezhnev, Kosygin or any other top officials have ever, as far as 1 could ll:lrttcipation that the system requires- being, as it is, a complex industrial
determine, successfully passed on top govemrnental, managerial or party '"'ety not dependent on markets and inheritance - would result in demora!-
prerogatives to their children or other relatives (even Khrushchev's attempt to ' atton , resistance and social disintegration (as has happened in right-wing
put his son-in-Jaw in a leading position proved short-lived). 1b.is fact makes the ¡1¡, tatorial regimes such as Portugal, Greece, lran, etc.). lt is a necessity to
Soviet Union very different from Westem capitalist, or feudal and slave preserve the legitimacy of a system whlch has Marxism-Leninism as its guiding
societies where those who control property are virtually certain to pass on ti.lrology. For this ideology is far more specific in its analysis and goals than
their positions to their children. We)tem liberal capitalist ideology. This necessity not only sets ltmits on the
In sumrnary, there appears lo be no tendency for the power elite of Party, hrcdom of action of the power elite, but also forces it to take concrete
govemrnent and econornic enterprise officials to be self-perpetuating across tho utrasures towards egalitarianism and decentralization of decision making.
generations. In each generation the majority of incumbents starts life in M.trxist-Leninist ideology requires movement towards the withering away of
humble positions. Further, there is no significan! exchange of positions tht• state and thc reduction of class distinctions. OnJy the extreme emergency
between the top managerial and the top govemrnental and party personnel. ni the 1930s and 1940s, when the immlnent danger of foreign invasion and
In both these respects, the Soviet Union differs fundamentally from Westem clmncstic subversion was most real , could justify, in the popular mind, move-
capitalist countries. The data presented in this section is fully compatible uu•nt in the opposite direction. But, once conditions settled down , and the
with the thesis that the productive classes exercise control over the state, threat of fo reign intervention had subsided, and the basic industrialization of
Party and enterprises througb providing the majority of incurnbents of the thc country had been completed, anything other than a reversa! of the course
leading positions in all three sectors. lullowed in the 1930s and 1940s would have produced a widening gulf
1· t ween the Marxist-Leninist ideology, which was used to justify the posi tion
111ttl dccisions of the power elite, and the reality of life among the producing
Structural Detenninants of S tate Policies musses. Thcrefore, in a rder both lo preserve their position (i.e. to avoid a
1 l::)llmation crisis) and to realize their own self-conceptions (since it appears
Socialisl, like capilalist, societies have a structurallogic operating indepen- th.tt the power elite for the most part takes Marxism- Leninism seriously
dently of the will of their power elite. The capitalisl state is forced to behave 111tl believes in its mission to strive towards communism), the power elite is
in certain ways regardless of the ideology of top political office-holders becau• rr.IJuired to take concrete steps towards communist transfonnation. i.e. It has
of the structural necessity lo guaranlee profits, ensure ongoing capital accurnu- '" decrease wage differentials, increase popular involvement in decision making,
lation, and in general to maintain business confidence. The decisions reached rulsc social mobility and devolve state functions to mass organiz.allons.
the probabilities of their successfuJ implementation are in a large measure a pr01
ducl of the laws of capitalism, in the sense that an economic collapse would
if the leaders of the state followed anything other than one of a very limited 1111 Summary and Conclusion
options which are viable within the capitalist logic. Parallel factors operate in
a socialist society still surrounded by a capitalist world. A rather lirnited set 1he re appears to be a high Jevel of political participalion in the Soviet Union,
of options are imposed on its power elite by the necessity to develop industr· hut h through fonnal governmen tal channels and through the process of public
ially in order to feed the people, to satisfy the aspirations of the people for a upinion fonnation in the mass media. Public debate on a wide range of topics
comfortable living standard, and to defend the society. Since they are 1 rtal and growing in depth and significance. Support for the regime is
dictated by the structure of the situation, decisions made by a socialist power !ICCtally high amongst the working class. Manual workers are playing a
elite, or directly by the people as a whole, would toa large extent be the same Ecr.tter and greater role in the self-management o f enterprises. The Commun-
Barrington Moore and Herbert Marcuse argue that, independently of the 1 t l'arty is becoming increasingly proletarian and democratic. Most leading
direct mechanisms that exist for popular control over the Soviet state, the nlllcials and managers come from the ordinary working people. The pressures
power elite's decisions must confonn lo the ideology which gives the system lomaintain legitimacy push the power elite lo take egalitarian and dem o-
and their positions legitimacy .76 This argument appears valid. In order to (lltlk measures. In sum, there appear lo be numerous mechanisms by which
maintain the Jegitimacy of the system, the power elite must operate within r .11con trol is exerted by the pro ducing classes over the power elite. The only
the framework ofMarxist-Leninist values, or face massive popular resistance lrnportant qualiftcation to thls statement is that the centre of gravily of
(passive perhaps at first , but eventually active). The system requires massive l'•'wcr withln the producing classes Hes with the skilled workers and the
active participation to function, and this cannot be compelled, although of ,,., hnical and professional intelligentsia who seem to play a disproportionate

94 95
ls the Red Flag Flying? Political Processes

role in public debates, the Communist Party, the govemment apparatus and
the decision making processes in economic enter¡Srises. While democratic life
in the Soviet Union seems to be real, it is not dominated by the peasantry, l. As examples of the Chinese and pro-Chtnese posHions on the Soviet
and unskilled and semi-skilled workers; but rather by the upper levels of the state, see How the Soviet ReviSionists Carry Out All-Round Restora-
tion of Capitali.sm in the USSR, (Pekmg. Foreígn Languages Press,
working class and professionals and experts of various kinds. 1968); Down with the New Tsars, (ibtd 1969), Yenan Booh, (ed.),
While it is clear that major steps have been ta.ken towards democratization Sociollmperiali.sm : Reprints [ro m Peking Review, (Berkeley · Yenan
since the mid 1950s {and that the Chinese thesis of the coming to power of a Books, n.d.); Martín Nicolaus, Restoratlon o[ Capitalism in the USSR,
group of 'state capitalists' is not valid), it is not clear that such measures will (Chicago: Liberator Press, 1975); Revolutionary Union, How
continue in a linear fashion until there is fuU equality among occupational Capitaltsm Has Been Restored tn the Soviet Union and What This
strata, and aU state functions devolve to mass organí.zations and aU people are Means for the World Struggle, (Chicago : The Revolutionary Union,
active politlcaUy. It may well be that a considerable residue of privilege will 1974).
be maintained by the power elite who will insist on maintaining the means to ~ ror the Soviets' own position, see for example: M. Perülyev, Soviet
keep the initiative. Only the future can reveal the course that will be followed. Democracy and Bourgeois Sovietology, (Moscow: Progress, n.d.);
But the high and growíng leve! of popular involvement in Soviet institutions, Progress Publishers, The Soviet Formo[ Popular Government, (Moscow :
Progress, 1972); G. Shahnazarov, Socialist Democracy, (Moscow:
the fact that Marxism-Leninism is tak.en very serlously by wide segments of Progress, 1974); Víctor Torovtsev, Pe o pie 's Control in Socialist
the population and that clear steps are being taken in the direction of greater Society, (Moscow: Progress, 1973).
economic equality and political democratization {which of course creates 1 Progress Publishers, The Sovtet Union Today, (Moscow: Progress, 1975).
rising expectations of further measures), and the growing economic prosperlty 1 Ronald J. Hill, 'The CPSU in a Soviet Election Campaign', Soviet
of the country vis-a-vis its own pastas well as vis-a-vis the Westem capitalist Studtes, XXVlll No.4, (October 1976)
countries {which reduces the credibility of appeals for sacrifice), are all impor- ~. D. Richard Little, 'Soviet Parliamentary Committees after Khrushchev',
tant forces leading the working class to push effectively for still more equality Soviet Studies, 24 :1, (July 1972); Jerry Hough, 'Pohtical Participation
and decentraliz.ation of decision making. tn the Soviet Union' , Soviet Studies, 28 : 1, (January 1976); Jerry Hough,
The formal institutions of the Soviets, and their auxillary commlssions and ' The Soviet System : Petrüicatíon or Pluralism', Problems o[ Commun-
control bodies, the Communist Party with its increasing membership of i.rm, March-Apri11975; H. Gordon Skilling, 'Groups in Soviet Politics',
10 H. Gordon Skilllng and Franklyn Griffiths, /nterest Groups m Sovtet
workers and apparently growing intemal decentralization of initiative, and the
Politlcs, (Princeton: Princeton Umversity Press, 1971 ) ; Shugo Mlnagua,
increasingly significant system of public debate and criticism , aU appear to be 'The Function of the Supreme Soviet Organs and Problems of Their
becoming more and more central in the process of decision making. Given thia lnstitutional Development', Soviet Studtes, 27: l, (January 1975).
mass participation, devolution of decision maklng and the increasing ll See Ronald Hill, Soviet Polllical Elites, (London: Martín Robertson,
egalitarianism , there would seem to be a definite momentum which should 1977), Chs. 5 and 6.
increasingly reinforce these tendencies. ll is possible that at sorne point the '/, Mark Hopkins, Mass Media in thc Soviet Union, (New York: Pegasus,
power elite and the professional intelligentsia will attempt to reverse the 1970), Chs. 1 and 8; and Skilling, op. cit.
egalitarlan trend (as they were able todo temporarily in Czechoslovakia in 8 Hopkins, op. cit., Ch. l.
the mid 1960s). They may at least pul the brake on further egalitarian and •1 Hough, ' The Soviet System', op. cit., and llough, 'The Brezhnev Era:
democratic measures (as they did in China in the periods before the Great The Man and the System', Problems o[Communum, November-
Leap Forward, before the Cultural Revolutlon, and perhaps again since the December 1974.
1ll. Hough, 'The Soviet System', o p. ci t
death of Mao Tse-tung). But in such a case it is likely that something like a 11 . Franklyn Griffiths, 'A Tendency AnalyslS of Soviet Decision Making',
Great Proletarian Cultural Revolution could occur in the Soviet Union, since m Skilllng and Griffiths, op. c lt
it seems unlikely that the working class would passively accept a recentrallz- 12 Skilling, op. c1t.
ation of decision maklng and a movement towards greater inequality, without 13 Hopluns, op. cit., Ch. l.
a struggle . 1". Robert Osbom, Soviet Social Policics, (Homewood, UL The Dorsey
Press, 1970), pp. 13-15.
lS Skilling, op. cit., pp.43-4.
l ll /bid. , p.44 ; Hopkins, op. cit., pp.302-ll.
17 /bid., pp.303-4.
1R /bid., Chs. 1 and 8.
PI /bid., p. 298.

96 97
Js the Red Flag Flying? Political Processes

20. !bid., p.306. Soviet Studies, XXVIII, (Ju1y 1976), Tab1e 6.

21. For discussions of the public debate on the relation of the C.P. to the .19. M. Matthews, Class and Society in Soviet Russia, (New York: WaJker
military, see, Roman Kolkowicz, 'The Military', pp.151-66, in S.killing and Co., 1972), p.223.
and Griffiths, op. cit.; for the public debate on proletarianizing higher 40. See Cu"ent Digest of the Soviet Press, 29 September 1976, p.3.
education, see Osbom, op . cit., Ch.4; for the public debate on writers •11 Perfi1yev, op. ciL, p.l21.
and artists, see Emest Simmons, 'The Writers', in Skilling and Griffiths, 42. Progress Publishers, The Sov1et Umon Today, op. cit., p.48.
op. cit., and for the public debate on economic reforms, see Paul 43. Jeremy Azrael, Managerial Power and Soviet Pollflcs, (Cambridge:
Gregory and Robert Stuart, Soviet Economic Performance, (New York: Harvard University Press,l966), Ch.5.
Harper &. Row, 1974), Ch. 10, and Howard Sherman, The Soviet 44 M. Fainsod, p.174.
Economy, (Boston : LittJe Brown, 1969), Ch.11. For discussion of the 4S. /bid., p.211.
environmental debate, see Donald R. KeUey, 'Environmenta1 Policy- 16. Brodersen, op. cit., p.228.
Making in the USSR',Sov1et Studies, XXVIII, No.4 , October 1976. 47. David Lane, The End of Jnequality ? (BaJtimore: t>enguin, 1971), p.122.
See Murray Yanowitch, Social and Economic /nequality in th e Soviet •18. Fainsod, op. cit., p.212.
Union, (White P1ains, N.Y.: M.E. Sharpc, 1977), for a good discussion 49. Hough, 'The Soviet System', op. cit., p.32; and Gregory Grossman, ' An
of many of the public debates of the m id 1970s in the U.S.S.R., Economy of MiddJe Age', in Problems o[ Communism, Vo1.25,
especially on the questions of privileged access to higher education of (November-December 1974), p.32.
chlldren of the intelligentsia, the problem of 1ow birth rates and the SO. Perfilyev, op. cit., p.l32.
role of women, the election of managers and the question of enterprise S l. Hough, 'Political Participation in the Soviet Union', op. cit., p.9.
democracy and payment systems. 52. Fainsod, op. cit., and Perfilyev, op. cit., Ch.3.
22. Donald Barry and Harold Berman, 'The Jurists', in Skilling and Griffiths, ~3 Lane, op. cit., p. 122.
op. cit., p.323ff. ~4. lbid., p. l23.
23. Skilling, op. cit., and Richard Judy , 'The EconomlSts', and Barry and ~S D. Granick, The Red Executive, (Carden City, N.Y.: Doub1eday, 1961),
Berman, op. cit., both in Skllling and Griffiths, op. cit. pp.274-5.
24. Skilling, op. cit., pp.33-8. S6. Lane, op. cit., pp.l24-5.
25. Turovtsev, op. cit., p. 156. S7 T. H. Rigby, 'The Soviet Politburo', Soviet Studies, 24.1, (Ju1y 1972).
26. H. Gordon Skllling, 'Groups in Soviet Politics'; and H. Gordon Skilling, Sil Lane, o p. cit., p.127.
'Group Conflict in Soviet Politics', in Skilling and Griffiths, o p. cit. S9 /bid. , pp.l24-5.
27. Frank Parkin, Class lnequality and Political Order, (New York: Praeger, 110. lbld.
1971 ), pp.175-6. See the discussion of the Czech events in Cbapter 7. h1 /bid., p.l28.
28. Turovtsev, op. cit., pp .2 1-2 ; David Brodersen, The Soviet Worker, (New t12. lbid., p. l26; and Azrael, op. Cll., pp.l57-72.
York : Random House, 1966), p. 143 ; and VladimirVoinovich, 'Oh, for td. 0.1. Shkaratan, 'Social Ties and Social Mobility', in Murray Yanowitch
a Room of My Own', New York Times Magazine, 20 June 1976. and Wesley Fisher, (eds.), Social Stratification and Mobility in the
29. Turovtsev, op. cit., Ch .3 . USSR, (White P1ains, N.Y.: lntemational Arts and Sciences Press, 1973).
30. Hough, 'The Man and the System ', op. cit., p.10. h4 Granick, op. cit_., Ch.3; and John Hardl nnd Theodore Franke1, 'Tbe
31. Progress Publishers, The Soviet Union Today, op. cit., Ch.2; and Hough, Industrial Managers', in Skilling and Griffiths, op. cit., p. ISO.
'The Man and the System', op. cit., p. lO. h5 Granick, op. cit.. p.273 ; and S. White, 'Contradiction and Change in
32 llough, 'Political Participation in the Soviet Union', op. cit., p.11. Sta te Soc•a1ism', Sovie t Studies, 26:1, (January 1974).
33. fbid.; and Hopkins, op. Cit., Chs. 1 and 8. M1. llardt and Franke1, op. cit., p. l93.
34. Alee Nove, 'ls There a Ru1ing C1ass in the USSR7', Soviet Studies, 27:4, 117 Granick, op. cit., Chs. 4 and 5.
(October 1975); Steven White, 'Contradiction and Change in S tate 1111 llardt and Frankel, op. cit., p.194.
Socialism ',Soviet Studies, 26:1, (January 1974 ). h 11 Granick, op. cit., Ch.l2; and Azrae1, op. cit., pp.l28·9.
35. lb1d., p.Sl; and David Lane, The Sociali.rt lndustnal S tate, (London: 70. lb1d., pp.l57-62.
George Allen and Unwin, 1976), p.115. 71 Hardt and Frankel, op. cit., p.l86.
36. For figures on Soviet social structure, see Murray Yanowitcb, Social and '12 Azrael, op. cit., pp.l31-9.
Economic Jnequaliry in the Soviet Union, (White Plans, N.Y.: M.E. 7J lbld., pp.l37-47.
Shape, 1977), p.lll . 74 /b1d., pp.l47-51, Ch.6; and Gregory and Stuart, op. Cit., pp.179-93.
37. T .H. Rigby , Communi.rt Party Membership in the U.S.S.R., (Princeton: 7S Azrael, op. cit., pp. 167-73.
Princeton University Press, 1963), p.306. 76. See Barrington Moore, Soviet Politics: The Dllemma o[ Power,
38. White, op. cit., p .53; and Cu"ent Digesto[ th e Soviet Press, 29 Sept- (Cambridge: Harvard University Press, 1950) ; and Herbert Marcuse,
ember 1976, p.l; T.H. Rigby , 'Soviet Party Membershlp Under Brezhnev'. Sov1et MarxiSm, (New York, Columbia University Press, 1958), for

98 99
ls the Red Flag Flying?

this argument. Moore's, Marcuse's and my own argument on the role

of legitimization parallel the argument devefoped by Nicos Poulantzas 6. Soviet Foreign Relations :
in his Political Power and Social Classes, (New York : Hurnanities, 1975);
and the Kapllalutate Collective. see 'Recent Deve1opments in Mantist
Theories of the Capitalist State', David Gold, Clarence Y. H. Lo, Erik
The Logic of Trade and the
Olin Wright,Monthly Review, 27:5 & 6, October-November, 1975.
These latter authors argue that the state in capitalist society has a
're1ative autonomy' from direct capitalist class control in order to
Uses of the Military
guarantee its 1egitimacy in the eyes of the masses. Likewise, it can be
maintained that the Soviet state has a 'relative autonomy' from being
controlled by the Soviet 'power elite' or intelligentsia for the same reason.

l11c Chinese and their supporters around the world accuse the Soviet Union
of being a 'social imperialist superpower'. By this they mean that there is no
cssen ti al difference between either the causes or the effects of the Soviet
llnion's intemational economic, political and mllitary relations and those of
lhe leading capitalist countries of the West (especially the U.S.). The Chinese
tnce 1967 have been arguing that the Soviet Union is essentially a monopoly
\:ilpitalist economy {'of the Nazi type'), and thus that all the basic laws of
monopoly capitalism, including the logic of imperialism as outlined by Lenin
1
tn htS book lmperialism: The Highest Stage o/ Capitalism, operate. In this
thapter we will begin to examine the validity of this aspect of the Chinese
claim.

l>efinitions

Uy imperialism is meant the political domination of one nation by the ruling

~·roup in another in order to exploit economically the dominated nation.
lmperialism then has two basic components: (J) economic exploitation
lhrough trade, investments, plunder, migration , etc; and (2) political domin-
·lllon by military occupation or threat thereof, support of local ruling groups,
c: ultural hegemony, etc. Jmperialism can be associated with any type ofsocial
lurmation - class society or non-class society, capitalist or pre-capitalist.
In sorne Maoost circles the term 'imperialism' is used in a different sense.
lnsptred by the tille of Lenin's book lmperialism. 111e Hixhesr Stage o/
Cop!lalism, 'imperialism' is referred to synonymously with 'advanced capital-
' m', 'state monopoly capitalism' or 'late capltalism'. Such usage of the term
1 based on a misreading of Lenin who gave his book the tille he did in order
to underline the valid point that advanced capitalism necessarily generates
unperialism (i.e. that imperialism is an organic outgrowth of advanced
capatalasm and nota policy). In lmperiallsm: The Higllest Stoge o/ Capitalism
IJ.•nan talks about 'capitalistic imperialism'. He does not use the termas many
of his followers today do as synonymous with 'late capitalism'. For exarnple
he argues: ' Colonial policy and imperialism existed before the Jatest stage of
l'apitalism and even before capitalism. Rome, founded on slaverytpursued a

100 101
ls che Red Flag Flying? Soviet Foreign Relations: Trade and the Military

colonial policy and achieved imperialism' (Imperialism: Chapter 4, Paragraph Ul such a manner that they are all used. (In fact there is always a demand for
13). In this book the term 'imperialism' is used the way Lenin used it. capital goods greater than the supply.) Further, there is no tendency for the
In the Marxist-l.eninist tradition the use of the adjective 'social' before a rate of investment to slow down because of inadequate profit opportunities.
noun indicates that, although a socialist ideology is being used to justify a In fact, the Soviets maintain a very high rate of capital investment which con-
course of action, the objective results of that action are the same as achieved ~istentJy averages twice that of the U.S. Thus there is no inherent economic
by the unqualified noun, e.g. the communist parties of the world referred to logic requiring overseas investment in order to counteract either a tendency for
the Social Democrats as 'social fascists' from 1928 to 1935. Thus the Chinese profits to decline, or underconsumption.2
use of 'social imperialism' means that, al though the Soviet Union j ustifies i ts It should also be noted that the Soviet Union has the richest and most
intemational re1ations with a Marxist ideology, objectively it behaves just like complete assortment of raw materials of any country in the world and so has
the U.S.A. (and for the same reasons). The Chinese, following l.enin's analysis, no inherent requirement for dorninating other areas for the sake of providing
claim that both the U.S. and the U.S.S .R. (like all monopoly capitalist itself with secure and cheap raw materials.
economíes) are driven to imperialism by the need to export capital and to Since -there is no inherent imperialist logic within the Soviet economy, the
secure raw materials. Soviet Union could onJy be 'social irnperialist' as a matter of policy. Beca use its
Class societies are imperialistic because of their inherent economic logic. cconomy really does operate according lo an economic plan rather than by the
If a socialist society were imperialist, however, it wou1d be so because of the impersonal logic of market forces, whether its foreign relations are aggressive
policies followed by its leading forces, not because of any inherent logic. nnd expansionist is a matter of choice (i.e. they are policies), nota matter of
Thus a socialist society is Iess likely to be imperialist than a class society. slructural compulsion as they would be if l.enin's argument applied . Although
However, a socialist imperialism cannot be ruled out a priori. the Soviet system is not necessarily imperialist, it could nevertheless still be
According to Lenin , capitalism in its monopoly stage is necessarily irnper- tmperialistic. That is, Soviet foreign relations couJd : (1) politically domina te
ialistic because of the irnpossibility of the masses being able to purchase the other nations (in the process subordinating working~lass and progressive
rapidly growing output of industry and the consequentJy limited chance for forces and securing military advantages for the Soviets); and (2) secure special
profitable investment opportunities. The onJy real possibility for profits to be econornic gains through market manipulation,control of raw materials and
successfully reinvested therefore líes in the less developed countries where non- control over local production. To prove that the Soviet Union is social imperia-
monopolized markets contínue to exist, wages are low and the rate of profit list, both elements must be demonstrated. If political domination onJy, but not
is higher. Colonialism and neo~olonialism are then required in order to protect econornic exploitation, is demonstrated, then all that is shown is that the
these investments in the poorer countries, and to guarantee against intrusion U.S.S.R is hegemonic.
by other imperialist powers. The motive force behind imperialism is thus the The questíon of whether the Soviet Union can be regarded as a social
endemic tendency to underconsumption inherent in monopoly capitalism lmperialist superpower or is hegemonic is exarnined throughout the next four
(l.enin, lmperialism, Chapter 4) . chapters : this chapter on trade and the military, Chapter Seven on Soviet
Sorne Marxists argue that the motive force behind imperialism is the rclations with Eastem Europe, Chapter Eight on Soviet relations wíth the non-
tendency for the rate of profit to decline in the advanced capitalist countries ocialist counlries of the Third World and Chapter Nine on Soviet relatíons with
due to the rising organic composition of capital. In this argument capital China and Cuba.
would flow to the low organic compositíon areas of the world that were still In this Chapter 1 will examine the nature of Soviet foreign trade - its link-
unindustrialízed and where wages were low. Colonialism and neo~olonialism nges with its domestic economy, the dynamic of the balance of trade, the
would be required for the same reasons as in the underconsumption argument. composition of irnports and exports, and the terms of trade. Parallels and
Neither logic of irnperialism is a part of the Soviet economic system. We dífferences with the trading pattems a.n d structures of Western capitalist
have already seen in Chapter Three that there is no tendency for the rate of countries will be focused on. This chapter will also examine the nature of the
profit to decline in the Soviet economy. We have also seen that, far from Soviet rnilitary and the principies behind both its composition and deployment.
stagnation, the Soviet economy suffers from endemic shortages of labour and Again, the focus will be on similarities and differences with the armed forces of
producer goods (the opposite of market econornies that ha ve a surplus of both lhe advanced capitalist countries of the West. Here we will thus be concemed
workers and productive plant). Thus, far from having a capital surplus which with basic processes which could be the dynamic, as well as a manifestation, of
seeks investment overseas, the Soviet economy has a shortage. Because it is Soviet social imperialism in general. The subsequent chapters will focus on
guided by a plan, resources are allocated by rational and planned criteria, i.e. specific relations with three different categories of countries: the more or less
wages are set at a leve! to clear the market for consumer goods thereby tndustrial socialist states of Eastem Europe, the poorer non-socialist countries
ensuring that al! of them are bough t (i.e. making su re there is no tendency for of the Third World and the socialist Third World countries (China and Cuba).
underconsumption of consumer goods). Likewise, capital goods are allocated

102
103
ls the Red Flag Flying? Soviet Foreígn Relations. Trade and the Military

Soviet Foreign Trade approximately a five year period. 5

lt IS interesting to note lhat in the ten years or so after World War n
All foreign trade of the Soviet Union is carried on by state lradmg corpor- trade relations between the Soviet Union and Eastem Europe were not
ations (in the late 1960s there were about 30 of them), each specializing in a govemed by the above principies. Trade was mstead detenmned by a combin-
different type of commodity over which it has a monopoly. These corpor- ution of the labour theory of value and the explicil demand that the former
ations ha ve the exclusive right to buy locally produced goods for export and Axis countries should subsidize the reconstruction of the Sovtet Union. Raw
to purchase foreign goods for import. The Ministry of Foreign Trade maintains matenals produced in Eastem Europe, Polish coal being the most notorious
tight control over them through detailed plaru which specify how the trading case, were paid for by the Soviet Union on the basis of the labour time it took
corporalions shall operate re volume, assortment, prices and transport of to produce them, with no regard for what the world price happened to be or
commodities. 3 the need to take into account lhe depletion of scarce resources. The resent-
Profltabili ty plays no role in the behaviour of the trading corporations. menl produced by the application ofthe labour theory ofvalue to th~ terms
They purchase Soviet goods at the prevailing domestic prices and sell them of lnternational trade between socialist countries (because of the cons1derable
overseas at the prevailing world market price. The difference between the tltvergence of prices from those on the world market) resulted, in the mid-
domes tic and extemal prices goes to the general foreign exchange reserves of the 1950s, in the scrapping of this basis for eslablishing the terms of trade, and
Soviet state. The Soviet domestic industrial enterprises have neither knowledge tls replaccment by a system which caused much less resentment.
of nor interest in the price or disposition of export goods. As for imports The state plan for foreign trade, in terms of which the state trading corp-
from abroad, the state trading corporations purchase these at world market urations operate, is geared to material balances (i.e. a given quanttly of trade
prices utiliz.ing funds from the general Soviet state reserves. They then sell the by vol u me) and especially to ensuring appropriate imports.6 The plan starts
imported commodities to the domestic consuming enterprise at the prevailing wtlh an estimate of how much of which kinds of goods are needed over and
in te mal price. If the latter is less than the world market price, the enter- ~bove whal will be produced domestically The planners then figure out the
prise is thus subsidized by the state; ifmore, the enterprise subsidizes the quantity of exports that will be necessary to pay for the required imports at
general state treasury. Since the Soviet productive enterprises ha ve no economic prevailing world prices. They then examine domestic production lo locate
involvement in foreign lrade (although of course they are affected by import.s those commodities that are either likely lO be produced in excess of domestic
of technology), fluctuations in world prices have no impact on their output rcquirements or can easily be expanded to provide goods for exporl. Because
plans, which are determined by the requirements of the overall econornic plan. the Soviet trade plan is geared to securing a set leve! of imports and lo
Generally the Soviets tend to huy and sell in the intemational market well exporting only enough to ensure these imports, the resultan! Easl-West trade
below their domestic prices. This implies a subsidy for export oriented leve! is relatively insensitive to world prices.7
industries and a tax on import oriented industries.4 The Soviet Union is the most self-sufficienl industrial economy in the
The Soviet economy is isolated from world markel (i.e . capitalist) forces world. Total imports totalled only 4 .7 per cenl of its net material produc t in
by the system of trade planning and centralized prices. Domestic enterprises 1973. The U.S. , lhe only other industrial country which approaches the Soviet
are thereby shielded from fluctuations In world market condltions. The lack Un ion in actual self-sufficiency, had imports constituting 5.4 per cent of its
of correspondence between domes tic Soviet prices and world market prices gross nalional product in 1973.8 Since the Soviet concepl, net m~terial
more or less requires bilateralism in trade relatlons, i.e. agreements to trade a product, excludes services, it is considerably smaller than the equtvalent
certain set of commodities for a certain other set of commodities because Westem concept of gross nalional product. The U.S.A.'s dependence on imports
there is no common scale ofvalue that might serve lo measure trade volume. 11 therefore about one anda half times greater than the Soviet Union's. The
This problem is especially acute in trade relations among socialist countries, Soviet Union's lack of dependence on imports is both because it has the
none of whose domes tic prices are govemed by the law of value. Socialist nchest raw matenal endowment of any country in the world (see the U.S.
countries thus tend to exchange goods among themselves at the world market l.)epartment of Interior Minerals Yearbovk), and because of its tendency to
price since deviations from the world market price are regarded by one or plan for minimizing its dependence on imports so as lo isolate tlself from
another party as evidence thal they are losmg from the trade. lf they are not pressures that can be put on it by capttalist countnes. Consctous plan~ng for
being paid as much as they could get in the West for their exports or if they .tutarchy was especially pronounced from the 1930s through to the mtd-
could gel more in imports for less ouUay in the Wesl, they feel exploited. 1950s. During these years trade was engaged 10 almosl exclusively to obtain
The Comecon countries of Eastem Europe make, however, certain negotiated thc matcrials and sophisticated machinery needed for the raptd industrializ-
adjustments In world prices to try and rid them of erra tic fluctuations, mono· .Jtion of the country. By 1959 the Soviet Union was in a position to supply
polistic elements and the effect of transporl costs. But once a set ofprices is vtrtuaJiy all the industrial ingredients necessary for its growth withoul
negotiated among the Comecon countries, they usually stay in effect for cngaging in any trade at all . [t hadan abundance of coal and petroleum and

104 105
/s the Red Flag Flying? Soviet Foreign Relations: Trade and the Military

virtually all the minerals necessary for an advanced industrial economy. unport goods from country B, he will purchase country B's currency oo the
When it did engage in foreign trade, it was because : (a) it could obtain certain mternational money market. The currency of the typical market capitalist
materials or manufactured goods more cheaply or quick.ly througb trade than countries is thus convertible and each currency has a price in terrns of others.
it could produce them domestically; {b) it wanted to import technologically The non-market socialist countries do not have convertible currencies. Their
sophisticated equipment from the West to accelerate its economic growth; currencies cannot generally be bought and sold by Westem importers and
(e) it wanted, for political reasons, to support other socialist or the Th.ird exporters. Those interested in importing Soviet goods must en ter into a trade
World countries; and {d) it oeeded a buffer for imbalances in the plan orto •1greement stipuJating both the imports desired and the exports to be
compensa te for crop failures {thereby sparing the people emergeocy belt- cxchanged with the appropriate Soviet trading corporations. lnconvertibility
tightening measures and assuring the economy of smoother growth). In general, nf currency , the coroUary of bilateralism and state planning of trade, facili-
then, the U.S.S.R. engages in trade primarily to organize more efficieotly its ta tes the integration of foreign trade into the overall economic plan. 10
domestic production and consumption and secondarily to Jeod economic Bilateral trade agreements with countries typically cover two to six. year
support to other countries. lt does not engage in trade because its economy pcrlods. These agreements norrnaUy specífy the total value of trade, the broad
could not opera te successfully without such trade.9 dasses of goods to be traded, the mechanics of payment, methods oftransport
All Soviet foreign trade is geared towards imports rather than exports, etc. General trade agreements are later n.tled out in detail with speciftc con-
which is pretty much the opposite of capitalist countries' trade that focuses tracts stipulating exactly what wiU be exchanged under exactly what
on exports and maintaining an export surplus. The capitaJist economies have c.:onditions of delivery. 11
to focus on expanding exports for two reasons. Firstly, profits are to be made In market capitalist countries chronic trade deftctts result in inflation,
for individual enterprises by securing overseas markets. SecondJy, maintaining unemployment, declining growth rates, falling standards of living and often
overall economic prosperity and the capital accumuJation process require economic chaos because local industries lose out in their competitive struggle
finding export markets for the system as a whole, to counter the inherent wtth foreign enterprises. Market mechanisms aided by thc state attempt to
tendency to underconsumption {whlch is promoted by workers not being lower costs (mostly domestic wages) and increase prices of imports {with a
paid eoough to buy back everything that they produce). Jn contrast, exports ~condary effect of increasing all prices) in order to stimuJate the economy
for a planned economy like that of the Soviet Union are merely a necessary and so counter the trade deficit. No such process occurs in non-market
eviJ required in order to secure imports needed for more rapid economic soctalist econornies for two reasons: (1) bilateral trade agreemeots generally
growth. This is the opposite of the case of a capitalist economy whose imports ensure a relative balance of irnports nnd exports, and (2) the insuJation of
tend to be the necessary eviJ generated by the money paid for exports. Here, domestic production and markets from the international market by virtue of
of course, the greater the Jevel of imports, the less the effect of exports in the monopoly over trade of the foreign trading corporations prevents any
alleviating the surplus production problem and therefore the less the effect trade deficit that rnight occur from having a significant effect on domestic
these exports have on promoting the continuation of the capital accumu- pricing, wages, etc. (factors which are determined by the central plan).
lation process, since the creation of new markets overseas (i.e. new outlets for lf, as the Chinese claim, the system in the Soviet Union is one of mono-
surplus production) are negated by the sales of foreign produced goods poi y capitalism and behaves according to the logic laid out in Lenin's
imported into the capitalist economy {which thus deprives the country's Jmperiolism: The Highest Stoge o[ Copitolism, we would expect that the
corporations of their previous home markets). U.S.S. R. would normally have a favourable balance of trade (a surplus of
Because the US.S.R.'s overall economy and foreign trade are governed by exports over imports), and that this would represent a significant proportion
a plan, and because trade prices a.re not govemed by the law ofvalue, the of capital formation. Since, according to Lenin's model, profitable domestic
Soviet Union prefers simple bilateral trade agreements with other governments mvestment outlets would be blocked, the two major channels for allowing
or chambers of commerce. This is different from the practice of capitalist capital accumulation to continue would be foreign investrnent (perhaps in the
market economies where individual enterprises seU commodities overseas for form of foreign aid) and a surplus of exports over imports (more selling than
money . money which has beeo generated through the sale of foreign produced buying overseas). In the following chapters Soviet foreign aid, the most likely
commodities in the enterprises' own countries. In this system there need be channel for anylhing like ovcrseas investments, is examined . Here it is shown
no relation between the amount of imports and exports between any two that Soviet exports are unable to provide a sígniftcant channel for capital
given market ecooomies since any deftcit in one country's trade with a given formation.
country can be made up through multilateral trading with other countries. Thc ratio of the Soviet trade surplus to tts fixed capi tal formation in the
Because of the multilateral and unplanned nature of trade among market period 1970 to 1974 was only 0.8 per cent, which is slightly lower than in the
economies, foreign exchange or money markets become key in clearing 1950 to 1957 period when the average was 1.0 per cent. Clearly there is no
international markets of goods. i.e. If an importer in country A wants to tendency for the development of the mechanjsms suggested by Lenin (the

106 107
Js the Red Flag Flying? Soviet Foreign Relations: Trade and the Military

development of monopoly and the increased importance of a trade surplus). Tab1e 6.1
Moreover if the ratio between total exports and fTxed capital fonnation is Soviet lmports in Relation to Net Material Product, 1950-1975
examined, it is seen to be virtually the same in 1950 to 1957 (16.6 per cent)
as it was in 1970 to 1974 (16.0 per cent). 12 Clearly, exports could play only Raw Material Jmports as 9'oage Total lmports as
a tiny role in facilitating the formation of capital in the Soviet Union. No lncluding ofN.M.P. 9'oage ofN.MP.
support for the thesis that the Soviet Union is run on the basis of capitalist Food Excluding
imperialism of the type described by Lenin can be found in these statistics. Food
The ratio of raw material irnports (excluding food) to net material product 1950.53 2.0% 1.6% 3.3%
(N.M.P.) decreased considerably from the 1950s to the 1970s. While in the 1954-57 1.9 1.4 3.1
1950s this ratio stood at approxirnately 1.5 per cent, in the 1970s it averaged 1958-61 1.8 1.3 3.3
only 0.6 per cent (see Table 6.1 ). Thus the Soviets ha ve actually reduced their 1962-65 1.7 1.1 3.7
proportional reliance on imported raw materials to 40 per cent of what it had 1966-69 1.4 0.9 3.5
been 20 years before. If foodstuffs are included with other raw materials, a 197().72 0.9 0.4 4.3
similar although not so sharp trend is seen. During the 1950s total raw 1973-75 2.0 0.9 5.8
material irnports (including food) were 1.9 per cent of the Soviet net material
product, while in the 1970-75 period they were 1.5 per cent. This trend of Source: Paul Marer, Soviet and East European Foreign Trade, 1946-69,
decreasing dependence on raw material imports is hardly what would be (Bloomington,lndiana: lndiana University Press, 1972), p.44; UnHed Nations,
expected from a country which was transforming itself from socialism to Yearbook o[ National Account Statistics 1976, Vol.ll, Table 28; Uruted
social irnperialism . lt should be noted, however, that the ratio of total irnports Nations, Yearbook of Intemational Trade Statistics, 1975, pp.984,985 ; and
toN .M .P. has increased significantly from the 1950s to the 1970s. While in United Nations, Statistical Yearboo k, 1976, Table 148; and earlier years'
the flrst period it averaged around 3.2 per cent during the second it averaged volumes from the same sources.
around five per cent. The increasing reliance on irnports in general thus makes
the decreasing role of raw material irnports aJl the more irnpressive. These
opposite movements suggest that the Soviets are now engaging in foreign lable 6.2
trade much more because it is convenient and advantageous todo so, rather Soviet lmports and Exports, 1950.1969
than because it can obtain the necessary inputs for its economy in no other
way (as would seem to have been much more the case in earlier periods). Industrial Fuels and Raw Foods Manufactured
The single biggest category of Soviet irnports (see Table 6.2) is industrial Machinery Materials Consumer
equipment and machinery (35.5 per cent of the total in 1966-69). Fuels and (ex. f oods) Goods
raw materials (excluding food) are second at 24.8 per cent, foilowed by Imports Exports lmports Exporrs Imports Exports lmports Expom.
manufactured consumer goods (18.6 per cent) and foodstuffs (15.2 per cent). (As o/oage of (As %age of (As o/oage of (As %age of
The trend over time has been a consistent increase in the percentage of total) total) total) total)
industrial machinery and equipment in total imports anda reduction in the 195().53 23.2% 15.6% 48.5% 39.7% 16.5% 20.0% 6.9% 2.9%
percentage of fuels and other raw materials while foodstuffs have stayed more 1954-57 27. 1 16.4 44.4 49.7 17.2 14.1 8.2 2.9
or less constant. Again this would not be the pattem to be expected from a 1958-61 27.9 19.2 40.0 53.3 13.2 13.6 16.7 3 .0
typical imperialist country of the advanced capitalist type (which we might 1962-65 34.4 19.4 30.4 53.7 16.4 10.4 16.3 2.5
expect to be irnporting principally and increasingly raw materials). 1966-69 35.5 21.6 24.8 51.2 15.2 10.4 18.6 2.4
Tuming to Soviet exports, over half are fuels and raw materials (51.2 per
cent of the total in the period 1966 to 1969) and only 21.6 per cent industrial Source: Paul Marer, Soviet and East European Foreign Trade, 1946- 1969,
equipment and machinery (see Table 6 .2) . Since the early 1950s the percent- pp.44, 53.
age of fuels and raw materials in total exports has increased, as has the per-
centage of industrial equipment and machinery (while the share of foodstuffs
has gone down). Again this pattem of exports differs from the typically
capitalist imperialist country which tends lo export principally manufactured
goods.
Soviet trade with the non-socialist, less developed , capitalist countries is

108 109
Js the Red Flag Flying? Soviet Foreign Relations: Ttade and che Military

not characterized by the exploitation of these states. The terms of trade rxamine whether they are in fact, as the Chinese as well as pro-NATO forces
between Third World countries and the Soviet Union are generally consider- In the West claim, primarily oriented to aggressive and expansionist pUiposes or,
ably better (i.e. in favour of the Th1rd World countries) than the terms of the Soviets themselves maintain, oriented to the defence of the Soviet
trade between the advanced capitalíst countries and the Third World. In other llnion. 13
words the Soviets tend to pay more for the exports ofTitird World countries The Soviet analysis is that Western capitalism in general and U.S. capit-
and charge them 1ess for their imports from the U.S.S .R . than do the advanced •hsm in particular is inherently imperialist by nature and has consistently
capitalist countries. This is documen ted in the detailed analyses of Soviet luoked for in the past, and will continue to do so in the future, ways to under-
trade with India (see Chapter Eight} and Cuba (see Chapter Nine). mine, and if possible destroy, the Soviet system as well as all socialist and
Finally, we should consider how significant is the fact that the socialist progressive movements around the world. The official Soviet position is that
coun tries use approximations to world prices as the measure of value in trade nnly total disarmament, or at least the absolute prohibition and elimination
among themselves. World prices of raw material exports are kept uf all nuclear weapons, will bring real security to the U.S.S.R. and the other
artificially low and prices of industrial products artificially high by the .ncialist countries. But, in the absence of such disarmament, the greatest
monopoly power of the transnational corporations and the imperialist policiea .C'curity for the Soviet Union lies in its not only having lhe nuclear capacity
of the advanced capitalist countries over the less developed raw material In deter an atomic attack from the U.S., but also lo wage any nuclear war the
exporters. This means that the net raw material exporters among the socialist IJ.S. initiates. The Soviets consider it quite possible that a U.S., faced with the
countries wiU suffer (be 'exploited') in their trade with the net exporters of lltcline of its intemational military and econornic position, might act in an
industrial goods. But it is the Soviet Union that is the major supplier of raw urational and foolhardy way and attack the Soviet Union; or, alternatively,
materials to the East European countries which provide industrial products lhat a local conflict rnight escalate into a nuclear war that neither side
in retum. The Soviet Union is a net raw material exporter anda net industrial 111ticipated or really wanted (e.g. another CUban rrussile crisis oran lsraeli-
good importer, andas such it suffers the same type of discrimination borne Arab conflict into which the U.S. and the U.S.S.R. could be drawn).
by the Third World countries which specialize in raw material exports. And The Soviets view their military capacity, and their nuclear arsenal in
it is the Eastern European countries who benefit from this situation. particular, as the means by which the U.S. is constrained from attempting to
lt should be stressed lhal this method of pricing, considered together wilh rull back the advance of socialism around lhe world and is forced to respect
the composition of trade between Eastern Europe and the U.S.S.R., means thal lhc Soviet Union. ln 1973 Brezhnev said:
the consequences of arguments, such as those of Arghiri Emmanuel, about
unequal exchange between raw material producers and industrial exporters, Together with our allies in the defenSJve Warsaw Pact we had to create a
work in reverse in lhe case of the Eastem European socialist countries. The defensive strength that would make the leaders of the bourgeois states
unequal exchange between the Soviet Union and Eastern Europe opera tes to understand that we cannot be spoken to in the language of threats; that
accelerate the growth of lhe smaller COMECON countries while slowing down one must tal.k with us on equal terms, so to speak, in the language of
lhe growth of Úle Soviet Union beca use of the 'inequitable' transfer of value reason, realism and mutual advantage. 14
from the latter lo the former.
ln summary, no evidence can be found in the structure, dynamic and 1\n authoritative article published by a member of the Central Comrnittee of
patterns of Soviet foreign trade that eiilier drive the Soviet Union to, orare lh" C.P.S.U. in 1972 argued:
instances of, social imperialism. Tite isolation of Soviet enterprises from lhe
intemational capitalist market, the structural scarcity of domestic capital, the The increased might of the U.S.S. R. and of the socialist community and
existence of perpetual excess demand, Úle logic of the balance of trade which lhe intensified anti-irnperialist struggle have become prime factors for
is oriented towards importing rather than exporting, the rich natural resource averting another world war and compelling imperialist states to display
endowment of lhe U.S.S.R. and Úle terms of trade which favour the Soviet certain caution and restraint in international affairs and give most serious
Union's trading partners, all provide strong evidence against the thesis that tht considerations to Soviet positions on internationa1 questions. 15
dynamic of Soviet trade is similar to that of capitalist countries.
111 the Soviet view only superior military force can effectively compel the
lmpcrialist countries lo restrain their aggression. Soviet Majar General Ye.
The Soviet Militar}' lolulimov argues:
fhe reactionary circles of imperialism can only be forced into peaceful
ln this section 1 willlook bolh at Sov1et military philosophy and, more coexistence by making them renounce violent, anned methods of struggle.
importantly, at lhe actual strengths of the Soviet armed forcrs in order to No considerations of morals, religion or intemationallaw and no

110 111
ls the Red Flag Flying? Soviet Foreign Relations: Trade anci tllt> Military

consideration based on reason can hall the aggressive desires of the react- was serious talk in lhe West of a pre-emptive strike against the Soviet Union in
ionary imperialist circles and the military-mdustrial complex if they sense urder lo destroy the socialist system. The U.S. exp1oded the wor1d's first
their impunity and their supenonty in strength. 16 hydrogen bomb in 1952. Again the Soviets (in 1953) were forced to follow
1111 or suffer intinúdation and possible destruction. The use of gutded
Brezhnev argued in Havana in January 1974 that 'Finally the capitalist world nu~~iles to deliver atom and hydrogen bombs was developed by the U.S. and
had to face the truth . lt had to recognize the impossibility of solving militarily l.ttcr copied by the U.S.S.R. The fLrSt submarine-1aunched, rocket-delivered
the historical differences between capitalism and socialism.' 17 11om and hydrogen bombs were developed and deployed by the U.S.,
In addition lo preserving world peace and preventing either an attack on lullowed a few ytars later by the U.S.S.R. The first mu1ti-warhead and
the Soviet Union or the other Socialist countries, the Soviet Union sees the tudcpendently targetab1e nuclear missiles were both developed by the U.S.,
fact of its military strength as a means to aid the national liberation and llga m forcing the Soviets to foUow suH. In the late 1970s the two most
socialist movements around the world . General A. Yepishev, the head of the ulvanced weapons systems: the neutron bomb (which k.ills people with
Main Poli tic al Administration of the Soviet Am1y and Navy, has argued that nummum damage to property) and the Cruise missile (a cheap drone-delivered
the nuclear-based strength of the Soviet Un ion is a 'migh ty factor for preserv· hyd rogen bomb which flies under Soviet radar) are both being initiated by
ing peace and security of the peoplcs, a factor which objectively promotes tho thc U.S. Once again the Soviets will be forced to duplicate American efforts
development of world revolutionary forces'. The Soviet nuclear arsenal is tmd develop their own neutron bombs and Cru.ise missiles m order to de ter
looked on by the Soviets as providing a shield for revolutionary forces around lhc U.S. from credib1y threatening their use. Except for the first interconti-
the world which puts limits on imperialist counter-revolution.18 wntal range-guided missiles (which because of their bases surrounding the
The Soviet conception of the role of their mílitary has in recent years II. S.S.R., the U.S. didn't need), in no case bave the Sovtets introduced a
expanded beyond the traditional one of mere! y defending the Soviet Union, IIIUJOr new ~eapons sys~em ~ead of the U.S. These facts are thus thoroughly
to encompass the prevention of impenalist attempts to export counter- lllOSIStent wtlh lhe Sovtet claun to have developed only a defensive armoury
revolution, i.e. deterrence of Westem imperialist policies and activities that iJcstgned to deter attack and intimidation from the U.S.
stand LO the way of national 1iberalion movements. General Yepishev, writing The Soviet military goal, as expressed publicly both at home and abroad
in 1972, argued : for essenlial parity with the U.S. It wants freedom from fear of intimi- '
ll;ation or destruction as a result of a decisively superior U.S. military capacity.
The army of the Soviet socialist stale represents part of the mtemational lluttt was not until 1972 that the U.S., at the Moscow Summit mecltngs,
revolutionary-liberation forces ... Today the defence of the socialist gtudg¡ngly conceded the legitimacy of essential nuclear panty betwecn
falherland is closely tied to giving comprehenstve assistance to national lhrmse1ves and the U.S.S.R And the U.S. milttary still rem:uns qualitative1y
liberation movements, progressive reginles, and new slates wbo are fightma IIIJlC~IOr and more advanced in alrnost every area to thett Soviet counterpart.
against imperialist domination. 19 lhh ts so much the case that there is always a posslbility of thc U.S. making
1 ~uccessful first strike against the Soviet military establishment. Whlle the
Just because Soviet military ph.ilosophy and publicly enunciated strategy •tpposite has never remotely been possible. The Soviet military machine is
{both that announced to the West and that presented in military journals tlr.,tgned_for land war in Eurasia, both in defence of Soviet territory agamst
inside the Soviet Union) maintains that the Soviet military establishment is nt1.11.ks like those launched by Gennany in 1915 and 1941, and in pre-
geared to deter aggression , does not make it so. The public statements of tho rmpltve strikes against the NATO countries in the event of war becoming
U.S. military also stress the purely defensive nature of its military machine lncvttable and lhe Soviet Union being forced to strike first LO order to avotd
(e.g. the Department ofWar was renamed lhe Defense Department in 1947) surprise attack (again, like that by Gennany in 1941 ). TI1e memory of 1941
To determine whether the Soviet military machine and strategy , unlike that uttlthe two subsequent years of devastating defensive warfare i~ very real for
of the Americans. is essentially defensive, it is necessary to examine concretoly lile Sovtet Union. A total of over 20 million SoVIet citizens were killed by tlte
the composition and deploymenl of Soviet armed strength. U rrnans in World War ll.
Virtually every major advance in modem military weaponry since World lhe misston of the Soviet military is reflected LO the relatíve siLes of its
War 11 has been inlroduced by the United States and subsequently imitated tlm·c services. In 1976 the Soviet Army had 1,825,000 soldiers compared to
by the Soviet Un ion. She has done so in order lo protect herself against the ltO ,000 for the U.S. But the Soviet Navy had 450,000 sailors comparcd to
posstbility of intimidation and even destruction made real by the U.S.'s /20,600 for the U.S. and the Soviet Air Force 450,000 compared to
exclusive possess10n of advanced military technology. The atom bomb was ~&1,100 in the U.S.A.F. The sma11er but technically more proficicnt U.S.
first developed by lhe U.S .A. in 1945 and wus used to intimidate the Sovtet Army together with the larger and far more technically advanced lJ.S Air
Union until the Soviets exploded their own bomb in 1949. Before this, thert 111rce and navy, are decisive1y superior to the Soviet military ll1e rcason

112
IIJ
!s the Red Flag Flying? Soviet Foreign Relat1onr Trade and tlle Milltary

the Soviets maintain such a large army is precisely because of their acknow- ilivisions are equipped with make them ill-suited for rurlift. The heaviest Soviet
ledged technical inferiority. The Soviets learned in World War 11 that their llr transports (of which there are only 30) can carry just two medium tanks.
ability to survive and defeat an invasion lay in their superior numbers (as well In summary, it is clear that lhe Soviet Air Force and Navy are not designed to
as in guerrilla warfare) and that the technically superior Nazi armies could be project Soviet military power around the world, but are rather in tended for
beaten by using this advantage. Soviet military literature is full of discussions the defence of the integrity of the U.S.S.R.
which uphold the importance of superior troop ratios (a lesson drawn largely Much is often said about the superiority of Soviet tank divisions. The
from World War Il batlles) as the key to military success.l0 Soviets (with huge land borders) in fact havc about 40,000 battle tanks com-
ln m id 1976 the U .S. strategic arsenal of independen Uy targetable nuclear pared to 10,000 for the U.S.A. However, the North American tanks are
warheads deliverable by bombers, submarine-launched missiles and land-based ,uperior, as is their anti-tank technology. A Soviet tank offensive would m all
strategic missiles, was 8,530 compared to the Soviets' 3,250 (an advantage of likelihood be easily defeated by the use of the highly sophisticnlly arsenal of
2.6 times for the U.S.). While there is a parity between the land-based I.C.B.M.s tJ.S. anti-tank weapons, even without the neutron bomb - a most effective
possessed by both sides, the U.S. has 5,120 submarine-based warheads com- unti-tank weapon . Probably the most serious technologicallag of the Soviet
pared to only 785 for the Soviet Union (an advantage of 6.5 times for the mllitary lies in precision-guided munitions {precisely Ute strength of anti-tank
U.S.). These figures reflect the emphasis placed by the U.S. on submarine- wnrfare). Tclevision and laser guided projectiles (missiles and artillery shells,
deliverable weapons compared to the Soviets' outdated continuing reliance both wilh conventional and tactical nuclear weapons) are specialities of th.e
on land-based missiles (which are far more easily destroyed in a fust strike lJ S. Arrny (its so-called 'smart-bombs'). ln 1975 the Pentagon announced
than the hard-to-find n-u clear submarines).ln addition, U.S. bombers in 1976 the successful development of a 1aser guided artillery shell. Such shclls,
were capable of delivering 1,256 nuclear bombs to the Soviet Union com- c:rnployed in 155 millimetre and eight inch howitzers, will trariSform the U .S.
pared to the Soviets' ability to deliver 270 to the U.S. (an advantage of 4.7 •utillery from an indiscriminate a rea fire weapon into a precise instrument
times for the U.S.). wllh the capacity to destroy individual mobiJe targets, such as tanks, thereby
In sharp contrast to the U .S., the ability of the U.S.S.R. lo project its Wlping out any Soviet advantage in arrnour.
military strength beyond its immediate frontiers is severely constrained by the Furtherrnore, the U.S. main batUe to.nks of the 1970s are qualttatively
limited strategic mobility of the Soviet miJitary. lt IS simply not designed to superior to those of the Soviets in almost all respects. They have a more rapid
carry on warfare beyond its immediate borders (unlike the U .S. whose rate offtre, bigger arnmunition storage capacity, greater long range accuracy,
mihtary is oriented to fighting wars anywhere in the world). ~eater arrnour protection and better shielded fuel tanks. The inferiority of
The contrast between the Soviet and U.S. navies underlines this essential Soviet compa red lo U.S. arrnour was decisively demonstrated in the 1973
difference in the missions of the two militaries. The U.S. Navy has twice the War between Egypt and Israel. Further the U.S., begmning in 1980, IS intro-
tonnage of the Soviet Navy, its ships are more modem , its equipment more llucing a new and superior main batUe tan k, the XM-1, while thc Soviets on1y
advanced in most areas and it is designed to transport military forces any- have plans for a slightly improved mode1 of thcir 1970s main battle tank, lhe
where m the world (while the Soviet Navy is designed mainly to protect the 1 62. The XM-1 ís said lo possess a spectacular new type of armou r capablc
U.S.S.R. and its merchant shipping from attack). The U.S .A. has 13 oper- uf withstanding the impact of any contemporary gun or antHank missile.
ational aircraft carners with a total of 1 ,200 combat airp1anes stationed on The general inferiority of Soviet military cquipmcnt to that of the U S.
them. These floating military bases can project U.S. military presence into any was spectacularly revealed in 1977 when a defecting Soviet pilot brought his
are a of the world . In contrast the U .S.S.R. has no full-size aircraft carriers. MJG-25 (the most advanced Soviet fighter p1ane) to Japan. TI1c C.J.A.
Only in the J970s did the Soviet Union build even miniature carriers. As of tl~elf described this plane as a generation or two behind U.S. fightcr tech-
1976 the U.S.S.R. had one miniature carrier, the Kiev, capable of handling nulogy and conceded that it was primarily a defensíve weapon designed lo
25 airplanes or 36 helicopters, and two helicopter carriers (each capable of tutcrcept enemy bombers.
carrymg 25 hehcopters). These three miniature Soviet carriers are designed The new U.S. Cruise missile is, according to Jane 's Figllting Ships (the
for anti-submarine warfare, specifically to try and locate and if necessary wor1d's most authoritative appraiser of naval strength), 'altering the naval
destroy U.S. nuclear missile submarines, thereby preventing them from Ct1Uation beyond recognition' because of the ability ít gives the U .S. Navy,
1aunching the1r missiles against the U.S.S.R. The Soviet Navy, unlike the U.S. usmg these re1alively inexpeTISive but híghly accurate self-guided missiles, to
Navy, has very limited amphibious capacities, Le. it is not designed to deliver ll··stroy any target it chooses.
and support troops in coastal areas. The U.S. Navy meanwhile continues to The U.S.S.R. simply doesn't have anyUung evcn approximately as
be gearcd to putting down wars of nationalliberation anywhere in the world. .uphisticated as the U.S. technological military arsenal. Few qucstion the
The Soviet strategic airlift capability is also very limited , especially com- l.tttcr country's demonstrable lead in such arcas as sophisticated avionics,
pared with that of the U.S. The heavy armour that Soviet motorized and tank ptt•cision guidance and fire control systems. U.S. supenority in most military

114 115
ls the Red Flag Flying? Soviet Foreign Relations. Trade and the Military

technologies, especially its overwhelming supenority in tndependently target· term ' base' as applied to the Soviet Union is much abused. Traditionally the
able warheads based on hard to locate (and t.hus hard to destroy) nuclear term meant a sanctuary which provided guaranteed physical security, storage
submarines, together with the Soviet inability to project its military power lnr ammunition, spare parts, stores and fuel and often overhaul facilities,
beyond its borders, gives ita considerable military advantage over the Soviet 111~ther with política! guarantees that it would not be withheld duñng a
Union, even wtule the Soviet Union has sufficient nuclear capacity to deter political crisis. The U.S. for example has such facilities in a great many
t.he U .S. from attacking it or too aggressively pushing it or other socialist cuuntries al1 over the world including many on the borders of the Soviet
countries and national Uberation movements around. The danger is ever present lfnion. The U.S.S.R., on the other hand, has no such facilities anywhere
t.hat a new technological breakthrough by the U.S. would make its lead over nutstde its own country and the Eastem European countnes of the Warsaw
the Soviets sufficient once again to use nuclear blackmail against the U .S.S. R. l'.tc.t (and probably Mongolia). What U.S. propaganda describes as Soviet
or even to launch a successful first strike. h,J\CS are almost exclusively berthing stations (a fancy tenn for mooring buoys).
Westem media have made much of the expanding Soviet naval presence 'iuch was the case with the highly publicized Soviet Somali base. The Soviet
throughout the world and the supposed Soviet bases that such a world-wide N¡¡vy's basic requirements, in the Mediterranean or Indian Oceans (as well as
naval presence entails. Unlike the U .S. Navy, whose prune functions are to rl~ewhere), for stores, water and fue! are in fact supplied by accompanying
pul U.S. military power ashore anywher~ in the world and to carry the majar 'upply ships based in Soviet ports. The Soviet Union has nowhere in the world
strategic nuclear capacity of the U.S., the primary function of the Soviet (nutside of the Eastem European countries) anything remotely resembling the
Navy is to deter or cripple a nuclear attack on the U.S .S.R. The stated purpose massive U.S. naval and air bases U1at the U.S. possesses around the U.S.S.R.
of the world-wide Soviet naval presence is to maintain a presence wherever U.S nd scattered al1 over the world, e.g. Canada, GreenJand, lceland, Cuba
naval units are deployed in arder to carry out 'an unmediate counter-attack' (Cuantanarno Bay), Panama, Turkey, Diego Garcia, the Philippines, Korea,
should war break out. Justas the U.S. Navy expccts continuously to track Australia, Taiwan, Japan, Guarn, Hawail , Germany, Spain, The United
down all Soviet missile-carrying submarines and irnmed1ntely destroy them in 1\ingdom, etc.
the event of war, the Soviets too hope eventually to be able todo the same in In su m, there is nothing in the evidence of either the Soviet arsenal or the
arder to prevent the possible launching of thousands of hydrogen bomb ileployment ofthe Soviet military that suggests imperialist motivation or
warheads by the U.S. submarine fleet. t.·haviour. This contrasts sharply with the constellation and deployment of
The expanded world-wide Soviet naval presence has coincided exactly with 11 S. weapons. The evidence clearly points toa purely defensive role for the
the expanding range of U .S. missile-launched submarines. This was obviously '.nvtet military. There is no evidence that the Soviet military is designed or
necessary if the Soviets were to have any chance of neutralizing the threat of m('d as an instrument of impeñalism.
Polaris submarine launched l.C.B.M .s In June 1962 the Polaris A-2, with a In lhis chapter it has been demonstrated that both Soviet trade relations
range of 1,600 miles, became operational. lts deployment in the Mediterranean 1111d the nature of the Soviet military are qualitatively different from those of
pul the Ukraine and Baku oil fields within striking distance . As a consequence, tlu: advanced capitalist countries such as the United States. In the next three
in 1963 the Soviet Navy began to have an active and pennanent presence in the • hupters we willlook at the concrete relations, both economic and political,
Mediterranean. In September 1964 the longer range A·3 Polaris missile became 1 lween the U.S.S.R. and the countries of Eastern Europe and the non·
operational; this could hit any part of t.he Soviet Un ion from Leningrad to ~«•dalist and socialist countries of the Third World. In each case we will
Eastem S!beria (including virtually all the Soviet's maJOr industrial arcas) •ttcmpt carefuUy to screen the evidence in search of support for the thesis
from the north-westem comer of the lndian Ocean. As a consequence, the that the U.S.S.R. acts like a 'social imperialist superpower'.
Soviets in December 1964 proposed to the U.N. that the lndian Ocean
become a nuclear-free zone in whlch nuclear missile submarines would be
prohibited from operating. Failing thts, the Soviets were forced pennanently
lo deploy their navy in the lndian Ocean to track U.S. Polaris submarines. A
similar process has occurred in all the seas of the world where U.S. missile· ltcferences
carrytng submannes have been deployed. For the Sovtets lo follow any othcr
policy could wcll amount to suicide. In no way can the expanded world-wide For the Chinese position see, for example, 'How lhe Sovtel Revisionists
Carry out All·Round Restoration of Capitalism in the USSR', (Peking:
Soviet naval presence then be laken to mean t.hat t.he U.S.S.R. is primarily
Foreign Languages Pu blishing House, 1968) and 'Down with the New
interested in projecting its power ashore or attempting to intimidate other Tsars~·. (Peking: Foreign Languages Publishing House, 1969). Perhaps
countries (as is the case with the U.S.).21 the two most thorough arguments tn support of the Chmese thesis
Much has also been made of the alleged Soviet bases around the world, generally available in English in the U S.A. are Martin Nicolaus, The
especially the so-called Soviet base (since removed) in Berbera , Somalia. The Restoration o{ Capitalism in the USSR, (Chtcago: Liberator Press,

116 117
Js the Red Flag Flying? Soviet Foreign Relations: Trade and the Military

1975); and The Revo1utionary Union, How Capitalism llas been Restored Balance, 1976-77, (London, 1976).
in the Soviet Un ion and What this Means for the World Srruggle, 21 The cliscussion of Soviet naval dep1oyment relies heavily on The Center
(Chlcago: The Revo1utionary Umon, 1974 ). This 1atter book1et contains for Strategic and lntemational Studies, Soviet Sea Power; and Christopher
one of the most systematic and 1engthy presentations of the Chinese Stevens, The Soviet Union and Black A[rica, (New York : Holrnes and
argument about Soviet foreign relalions. Meier, 1976).
2. See especially Paul Gregory and Robert Stuart, Soviet Economic Structurt
and Performance (New York: Harper and Row, 1974); Josef Wilczynski,
The Economics of Socialism, (Chicago: A1dine Pu blishing Co., 1970),
as well as the other authors cited in Chapter Three.
3. Gregory and Stuart, Soviet Econom1c Structure and Performance, op. clt,
Chapter 8; J . Wilczynski, The Econom1cs of Socia/ism, op. cit., Chapter
13; Howard Shennan, The Soviet Economy, (Boston : Little, Brown, 1
Chapter 8 .
4. Gregory and Stuart, Chapter 8; Sherman, Chapter 8.
5. !bid., Wllczynsk.i, o p. cit., Chapter 13; Guy Gilbert, 'Socialism and
Dependency', Latín American Perspectivts. 1: 1, (Spring 1974).
6. Franklyn Ho1zman, Foreign Trade Under Central Planning, (Cambridge,
Mass: Harvard University Press, 1974), pp.53-56 ;Lawrence J . Brainard,
'Soviet Foreign Trade P1anning', U.S. Congress, J oint Economic
Committee, 94th Congress, 2nd session, Soviet Economy in a New
Perspective, p.698.
7. Shennan, op. cit., Chapter 8 ; Ho1zman, op. Cit. , Chapter 10.
8. See the United Nations, Yearbook o{ National A ccount Statistics,
(1975) ; and the United Nat1ons, Yearbook o[ Inte rnallonal Trade
Statistics, (1975).
9. Ho1zman , op. cit., Chapter 2; Wuczynsk1, op. cit., Chapter 13.
10. !bid., Chapter 13 ; Sherman, op cit., Chapter 8.
11. Wilczynski, op. cit., Chapter 13.
12. See Pau1 Marer, Soviet and East European Foreign Trade, (81oomington,
Indiana: Indiana University Press, 1972), Vol.IIJ . p .34 ; United Nations,
Yearbook o{National AccountStatistlcs, (1975), Tab1e 2B ; and United
Nations, Yearbook o[ lnternational Trade Statistic s, ( 1974), p.926.
13. The discussion of the Soviet military's main purpose relies heavily on
the following sources: Cenler for Strategic and IntemationaJ Studies,
Soviet Sea Power, (Washington D.C.: Georgetown University , 1969);
Joseph Coffey, Deterrence m the 1970's, (Oenver: University of Denver,
1971 ) ; Leon Goure, Foy Kohler and Mose liarvey , The R ole of Nuclea'
Forces in Current Soviet Strategy, (Center for Advanced lnternational
Studies, University of M1arni, 1974); David Joncs, S o viet Armed ForctJ
Review, (Annual), (Academic-lnternationa1 Press. 1977); William
!Unter and Harriet Scott, (eds.), The Nuclear R e volution in Soviet
Military Affairs, (Nonnan: University of Ok1ahoma Press, 1968).
14. Leon Goure et aL, op. cit., p.44.
15 lbld., p .44 .
16. !bid., p.27.
17. /bid., p.28.
18. !bid., p.33 .
19 lbid.,p .6 .
20. The statistics on the strength of the Soviet and American militaries an:
taken from the lntemational JnstJtute for Strategic Studies, Tlle Militaf'1

118
119
 Soviet Re/ations with E'astern Europe

7. Soviet Relations with cuuntries {including the Soviet Union) (plus Yugoslavia), one-seventh went
lo lhe advanced capitalist econornies and about ten per cent went to the less

Eastern Europe tkveloped market economies. This contrasts with the miniscule percentage of
1Jtin American (excluding Cuban}, African, Middle Eastem and Asían
wunlries' exports that go to the COMECON countries; about three-quarters
uf the exports of these arcas are to the advanced capitalist countries. (see
fuble 7.1). Thus comparing the less developed market economies (most of
wh1ch are satellites of the advanced capitalist countries) to the COMECON
wuntries, we see that the COMECON countries are much less trade depen·
1knt on the U.S.S.R than are the Thlrd World countries on the advanced
r.tpttalist countries: only one-third of exports for the COMECON countries
versus three-quarters of exports for the Third World. While COMECON
Those who accuse the Soviet Un ion of imperialism typically argue that the ruuntries have altemative export markets in the capitalist countries (over a
six COMECON countries of Eastem Europe (Bulgaria, Czechoslovakia, East t¡unrter of total exports), the non-socialist Third World counlries have only a
Germany, Hungary, Poland and Romanía) are essentially neo-colonies of the tlny altemative export market in the COMECON countries (about one
U.S.S.R. in a sense similar to the relationsltip between, for example, the U.S. rwenty-fifth of total exports).
or Britain and much of the Third World. These 'satellites' are supposed to be
both politically dominated and economícally exploited by the U.S.S.R. in l¡tble 7.1
much the same way as the Westem powers domínate the Third World. Let us t xports of Comecon and Third World Countries Compared ,1 969-1973
then examme the concrete relations between the U.S.S.R. and Eastem Europe
in order to determine whether these six countries can m fact be considered ToAdvanced ToLess To Soviet Union
de [acto colonies of the U.S.S.R. 1 will first examine the contemporary Capitalist Developed six COMECON
economic relations between the two, looking at the composition, significance Countries Non-Socialisc cowuries plus
and terms of trade; the possible uses by the Soviet Union of trade as a political 1ñird World Yugoslavia
weapon; economic assistance; regional economic co-ordination;joint enter- Countries
prises ; and the effect which Eastem Europe's economic relations with the l11c Six COMECON
U.S .S.R. have on the economic growth and sectoral structure of their countries plus
economies. 1 will also analyse the historical development of the political Yugoslavia 15.0% 11.7% 64.2%
relations between Eastem Europe and the U.S.S.R. in the post World War 11 I.Jtin Arnerica 74.5 19.4 3.6
period, focusing on the transfonnations in economic relations that occurred Mlddle East 75.7 19.8 2.2
around 1956, and on the Soviet interventlons in Yugoslavia, Hungary and Al rica 81.1 11.0 6. 1
Czechoslovakia. A~IO 66.5 28.3 4 .2

Suurce: United Natíons, Yearbook of lntemational Trade Statistics, 1974,

Trade Relations IJble B.

In the penod 1970 to 1972,37.2 per cent ofall exports of the Council of 11 Í!> interesting to note that 65.5 per cent of Canada's exports go to the U.S.
Mutual Economic Assistance {C.M .E.A. or COMECON) countries of Eastem 1u1d 76 per cent of its imports come from there. Canada, a coun try of com-
Europe went lo the Soviet Union. This represented a slight decline from the parable location, population and econom1c development in relatíon to
1960s when exports to the Soviet Un ion averaged 41 per cent of all exports. !he U.S., as the six COMECON countries are to the U.S.S.R., 1s tw1ce as trade
In 1970-72 total COMECON imports from the Soviet Union totalled 35.5 per tlcpendent on the U.S. as the COMECON countries are on the Soviet Union.1
cent of all imports, down slightly from an average of 37 per cent in the 1960s 1 Yet Canada, while its economy is closely integrated wilh that of the U.S., is
Thus, slightly over one-third of all East European trade is with the Soviet ¡,:neraUy regarded notas a dependency of the latter, but as a country whose
Un ion. ruling class simply has the same interests as lhe U.S. lf Canada can remaJn
In the period 1969-73 about two-thirds of all lhe exports from the six pnlitically independcnt of the U.S., the COMECON countries of E:.astem
East European COMECON countries (plus Yugoslavia) went to COMECON h1rope, which are far less trade dependent on the U.S.S.R. than Canada is on

120 121
Js the Red Flag Flying? Soviet Re/ations with Easurn Europe

the U .S., should be even more capable of remaining independent. ¡Mltem of lrade observable between the advanced capitalist countries (which
The 35 per cent of imports that the six East European countries Lake peci~ze in capital.goods and manufactured exports) and the less developed
from the U.S.S.R. compares as follows wilh the percentage of imports that 1 ountnes of the Third World (whlch specialise in raw material and food

selected Third Wor1d countries, often regarded as dependencies of the U.S. 1 n ports).
take (circa 1973) from the U.S.: Colombia 39.6 per cent, Dominican Republic
47.2 per cent, Guatemala 31.9 per cent, Honduras 44 per cent, Mex.ico 62.9 per
cent, Nicaragua 343 per cent, Panarna 353 per cent and Venezuela 45 per lable 7.2
cent. Tuming to exports, the 37 per cent of the COMECON countries' \oviet Trade with Eastem Europe, 1950-1968
exports that go to the Soviet Union compares as follows to the percentage of
total exports ofselected Third World countries to the U.S.: Colombia 37.4 Industrial Fuels and Raw Foodsru[fs Manu[actured
per cent, the Dominican Republic 733 per cent, Guatemala 29.3 per cent, Machinery Material (exclud- Consumer
Honduras 56.5 per cent, Mex.ico 68.8 per cent, Nicaragua 33.3 per cent, and Equip- ing [ood) Goods (excluding
Panama 44 .7 per cent, and Venezuela 39.7 per cent.3 The trade dependence mmt [ood)
of the U.S.A.'s Caribbean satellites is greater than the trade dependence of Exports lmports Exports lmports Exports Jmports Exports Jmports
the East European countries on the Soviet Union, although the difference (% of total) (% age of total) (% age of total) (% age of total)
between the two sets of countries is not all that great. 1'150-53 22.0% 39.2% 51.7% 43.7% 25.2% 7.2% 1.1 % 9.9%
In the period 1970 lo 1972, the balance of trade between the Soviet 1'154-57 15.5 46.8 60.7 37. 1 21.6 5.8 2.3 10.3
Union and the six East European countries was slightly in the latters' 11158-61 13.9 45.8 64.4 27.0 18.6 7.6 3.0 19.6
favour - the COMECON countries exported to the Soviet Union about four 1'162-65 19.7 49.8 65.9 20.5 12.2 7.9 2.2 21.9
per cent more than they imported from it. During the 1960s total exports 1'166-68 24.4 48.2 62.8 16.9 10.7 9.2 2.1 25.7
and imports between the Soviet Union and lhe COMECON countries almost
exactly balanced, wh.ile in the previous decade exports of Eastem Europe &mrce: Pau1 Marer, Soviet and East European Foreign Trade /946-1969
exceeded import.s by about two per cent.4 Clearly, then , there is no significan! pp.87. 111. , ,
imbalance in trade which might reflect a permanent net flow of resources to
the Soviet Union from Eastem Europe. This leaves open the possibility,
however, ofSoviet exports being overvalued and East European exports In com.pariso~ to the 2~ per cent of total East European exports to the
undervalued . Such a situation would result in trade exploitation of Eastem Sovtel Umon which compnse raw materials, fue1s or food, the percentages of
Europe by the Soviet Union. h1lal exports of such commodities from countries often regarded as dependen-
The six East European COMECON countries primarily export industrial ~ Ir of the U.S. lo the U.S. are considerably greater, e.g. (circa 1973) Colomb 1a
machinery and equipment to the Soviet Union and import raw materials ''11 Q per cent, Dominican Republic 98 per cent, Guatemala 84.4 pet ccnt,
and fuels in exchange. In 1966-68 48.2 per cent of all East European exports llunduras 97.9 per cent, Mex.ico 54.3 per cent, Nicaragua 82 per cent Pan runa
to the Soviet Union were industrial machinery and equipment and onJy '1 S p~r cent, the Philippines 95.6 per cent and Venezuela 98.8 per c~nt
26.1 per cent were raw materials, fuels or food. During the same period llll're ~s thus a qualjtative difference in the trade pattems of the COMFCON
62.8 per cent of Soviet exports lo Easlern Europe were raw materials and ,,untnes of Eastem Europe with the Soviet Union, compared with the trade
another 10.7 per cent was food , and onJy 24.4 per cent was industrial mach· P ltcms of the U.S.'s Third World dependencies with the U.S Tite laller
inery and equipment (anda negligible 2.1 per cen t manufactured consumer almnst ~ni~ersal1y specialize in the export of raw materials to thc U.S.
goods). The proportion of East European exports made up of industrial (ll•tmarily m exchange for manufactured goods), wh.ile Ute Easl European
machinery and equipment has risen shghtly over IIIlle, while the proportion u1111!nes. export manufactured goods, especially capital equipmen t, to the
that consists of raw materials and fue! has decreased drastically (it stood al IJ ~S. R. tn exchange for raw materiaJs. UnJess the terms of trade hetwcen the
43.7 per cent in 1950-53). The proportion of East European exports in the "'vict Union and Eastem Europe were highJy imbalanced m favour uf the
shape of manufactured consumer goods has risen significantly since the U S S R. (w!Uch, being based on world prices, they are not), ti wouhJ be vcry
1950s. (See Tab1e 7 .2). The proportion of Soviet exports in the form of rl•lltLUit t~ mterpret the trade relationship as imperialist.
raw materials and fuel has stayed about the same since the 1950s. The Soviet "' preVIou~~ noted, ~e prices of commodities exchanged betwecu J:usl
Union tS the principal supplier of these two e1ements for Eastem Europe, l111upean soctal~t ~ountnes and the Soviet Union are approximul iuns uf prkcs
Eastem Europe is a major supplier of capital goods and manufactured con· In tite ~orld capttaltSt market. Beca use lhe law of value is not thc cs~cnl ial
sumer goods for the Soviet Un ion. This is of course exactly the reverse of tha d lcumnant of prices in the planned economies of thesc count rics. dume~llc

122 123
ls tlle Red Flag Flying? Soviet Relations wtih Eastern Europe

prices of commodities are in good part arbitrary (i.e. nol based on the value ud lugher for six.1
conlained in a commodity). Differenl coun tries might lhus price the sarne Since it is logically possible that the few goods the Sovtets trade to their
commodity at very different levels because of various political or long·tenn atlvantage could represenl tbe majority of goods traded, or lhat an advantage
economic considerations. Because of the arbitrary nature of domestic pricing, 1111 a few goods could be so great asto outwe1gh a slight disadvantage on most
these prices cannot be used in inter·socialisl trade withoul one or other party nods and thus that the Soviets could secure a net gain from trade, it is
complaining of exploitation, thls exploitation becomlllg apparent if an export unportanl to look at measures of trade advantage wtúch incorpora te quantily
IS offered ata hlgher price than the equivalent price on the world capilalist •·· weiJ as price. The sarne study cited above found that overall Polish exports
market.5 COMECON regulations therefore specify that all prices of raw tmeasured by unit value, a concept whlch includes botll pnce and volume) lo
materials are based on adjusted world market prices in the previous five year 1he Soviet Union were purchased at 1.45 tinles the prevailing prices for
period . tnular goods on the West European market and Bulgarian goods at 1.32 times
As is well known, a few advanced capitalisl counlries have a monopoly on thuse prices. It was also found that overall Soviet exports to Poland were
manufacturing technologically advanced producer goods. This allows them tu purchased by Poland at 81 per cent of the prices similar goods were available
sell U1ese goods to the Third World at monopoly priccs. In rclum, cxccpt f01 111 in Western Europe, and Soviet exports to Bulgaria at 69 per cent.8 Thus Ule
pclroleum, overproduction, competition. and foreign owncrship in the raw urt barter tenns of trade (a concept whlch incorporales both price and volume)
material and food producing Third World counlries deprcsscs (albeit erra ti· ¡,,.¡ wcen Poland and Ule Soviet Union in 1959 were 1.8 times bet ter for
cally) the world prices of their exports. As a rcsult, a real transfer of value l'11lond (and worse for the Soviet Union) than Poland could have obta.ined in
occurs from the raw material and food producing countnes (excepl for the tr.1de with Ule West. The terms of trade for Bulgaria were 1.9 times better.
oil exporlers) Lo the advanced capitalisl counlries. The Third World raw Suhstantially identical results were found for 1960, indicating that 1959 was
material suppliers are in this sense exploited. But the socialist counlries are uut a fluke year. Thus, even though the prices of commodilies traded among
utilizing world prices for capital goods and raw malerials. The resull is that tht the non·market socialist economies officially approximale world market prices,
exports of the raw material exporters, namely the Soviet Union, tend to be lhe East European countries gain at the expense of the Soviet Union in this
undervalued and the exports of the capital goods exporlers, mosl of the hade. Part of Uleir advantage may be a result of the different commodJty mix,
countries of Eastem Europe, tend to be overvalued. In Ulis respect the SoVIet pc:cially of different qualities of goods witllin the basic commodity
Union is being exploited in its trade with Eastem Europe in the same way thll tegories employed in thls study. Hence lhe general difference in favour of
the Third World raw material exporters are exploited by the advanced .... ,.,· ....,.. thr l•.ast European countries may not typically be as large as found in Ulis
countries. ludy But these data at least make clear that, if there is any systemalic devia-
A further poinl needs to be made. Although the rule is that exports are thlll from world market prices in trade between Eastem Europe and Ule Soviet
exchanged al approximately world prices, the Soviet Union has, since the 1lnton, it is not in favour of the Soviet Union.
mid-1950s . been supplying crucial raw malerials, especially petroleum nrnnnn • In addHion to complaining about Ule subsidy they give Easlem Europe
lo Easlern Europe at considerably below thc world market price . For llunugh supplying petroleum at significantly less than the world market price,
the price charged lo the East Europeans for Soviet oil in 1974 was approxi· thr Soviets have also been complaining of an exploitation effect causcd by
malely one-fifth the world market price. Even afler a substanlial increase in thdr having lo undertake all the heavy investment expenditures of developlng
the price of Soviet oil in 1975, lhe cost lo COMECON countries in 1976 wat lltul producing oil in the Soviet Union. It was estimated lhat in the late 1960s
still about one-third less than the world market pricc 6 thr· capital intensity of the basic raw materials and fuels exported by Ule
Detailcd empirical studies show that the l::.asl European socialist countrlet tJ I).S. R. to the COMECON countries was 3 to 3.5 tinles higher lhan that of
are not discnminaled against or expl01ted in thetr trade relations with the thc machinery suppHed by them to the U.S.S.R., Le. the value of materiAl
U.S.S.R. One careful study of prices for Bulgarian and Polish exports lo, and hwestment (machinery and flX.ed facilities such as pipelines and other trans·
imports from, the Soviet Union (i.e. their tenns of lmde) shows that they fiOtl) per worker was considerably hlgher in raw material producllon than in
to be significanUy better than Ulose oblainable with the advanced countnes tite rnactúne producing sectors. The Soviets have Ulerefore begun f ostering
In 1959, of 32 lending categories of Bulgarian exports, Ule prices paid by tht lrttrgration in the production and distribution of raw materials and fuel so that
Soviet Umon were hlgher than those obtainable in Westem Europe for 24 .... 11• Fastem European countries share more equitably in the costs of acquiring
lower for eight. In the case of Poland, the Soviet priccs were higher in 20 oul tltr.tt own raw materials. Beginning in the early 1970s, the COMf:CON
of 28 categories and lower in seven. In the case of Soviet exports to Bulgartl t•untnes have begun to fmance projects jointly to produce fuel and raw
the prices charged Bulgaria in 1959 wcre lower than those ofWest European IIIAirrlals mostly in the U.S.S.R. In retum for Ulese capital•nvc:stmcnts m raw
equivalent commodilies for 18 of the 32 basic categorics and higher for 12, tu• tena! production enterprises, Ule investing countries (mostly East Europcan)
9
while for Poland the Soviet prices were lower for 11 categories of ll•r trpaid in raw materials.

124 125
 ls rile Reú Flag Flymg? Soviet Re/a tions with Eastern Europe

Since the mid 1950s, there is no evidence that the Soviet Union obtains llum these countries and trade with Albania embargoed. While trade with
unrequited goods from Eastern Europe. In fact it costs the Soviet Union con· 1 lunn has never been suspended, it was considerably reduced. Again, in 1962-
siderably more to trade with Eastern Europe than with the West, while M, when North Korea was leaning toward the Chinese position in the Sino-
Eastern Europe disproportionately benefits from trade with the Soviet Union Suvlet dispute, the Soviets refused to sell advanced military equipment or jet
i.e. lf anyone is being exploited it is the Soviet Union. Moreover, the terms of hu:l to that country. As soon as the Koreans renounced theu position of
trade of the COMECON countries with the Soviet Union have shifted con- lllflport for China, Soviet supplies were resumed. The cutting off of trade is
siderably in favour of Eastem Europe and against the Soviet Union since the 1!11 cspecially strong weapon since both the industry and armed forces of the
mid 1950s. 10 _. .. tahst countries are typically highly dependent on spare parts from the
The East European countries depend very heavily on their raw material ·.. ,viets. The Soviets have also used the technique of delaying delivery as a
imports from the Soviets. Around 1970 the Soviets provided 100 per cent Wt'.1pon of control over bloc members who become too critica! of the Soviet
of Czechoslovakia's oil imports (about 97 per cent of its consumption), 85 llnton, e.g. against Romanía in 1967 _13
per cent of its iron ore imports (about 75 per cent of its consumption), 92 ·n1us, although there is no evidence in the post 1956 period that the Soviet
per cent of its aluminium and 76 per cent of its copper. During the same l lnlon exploits the other socialist countries through trade, there is evidence
period the U.S.S.R. supplied about 90 per cent of East Gertnany's oil, 60 per tlwt the Soviet Union has striven for politlcal hegemony over the other socia-
cent of its iron ore and 70 per cent of its aluminium and Jead. Hungary JI 1 ~:ountries by using trade as a weapon to get them lo follow policies
imports most of its oil, iron ore, phosphates and electric power from the tpproved by her.
11
Soviet Union, and so on. Because it is the main supplier of raw materials to 11 should also be noted, however, that China has behaved in essentially the
Eastern Europe the Soviet Union is in a poten tia! position to exploit them une way as the Soviet Union towards those smaller and more vulnerable
economically. That it does not take advantage ofits position is indicative of Suctalist countries of which she disapproves, name1y Vietnam and Albania
the lack of a typical imperialist relation between the two areas. No wonder, ht 1978. The Chinese thus find themselves in the ironic situation of doing to
Vietnam decided after liberation to join COMECON. uthers exactly what the U.S.S.R. did to them - withdrawing advisers, end.tng
Thlngs were not always so advantageous for Eastern Europe. Before the m tance and reducing trade in order to pressure countries they are having
mid 1950s the terms of trade, essentially dictated by the Soviet Union, were thlferences with. 1t is difficult to see any difference between the Soviet
overwhelmingly in favour of the Soviets. Soviet trade with the East European IJ111on's and China's behaviour in these questions, other than lhat the Soviet
countries during the immediate post World War 11 period was primarily a l lmon has become more gentle and tolerant of differences in recent years
mechanism to reconstruct the war devastated Soviet economy. The former wlule the Chinese as reflected in their recent behavlour towards Vietnam and
Axis countries (East Germany, Hungary , Romanía and Bulgaria) were espec- \lbania have not.
ially badly treated ; but Poland, Czechoslovakia and Yugoslavia were treated
little better. One of the clearest examples of the exploitation of Eastem
Europe through unequal exchange before the mid 1950s was the export of l.conomic Assistance
coa! from Poland to the Soviet Union. Until November 1953 Poland was
supplying coal to the Soviet Union at approximately one-tenth of the world 1he Soviets extended sorne e-conomic assistance to Eastern Europe in the
price. In 1956 the Soviets acknowledged that there had been exploitation of tntmediate post-war period (1946-52), mainly to relieve especially troubled
Poland in the coal trade and cancelled the S626 milllon in debts owed by lluntions and to persuade the East European countries to reject the U.S.A.'s
Poland to the U.S.S .R. This was in compensation for the coa! subsidy M.ITShall Plan aid, e.g. a proferred S450 million loan to Poland tn 194 7-48.
supplied the U.S.S.R. by Poland from 1946 to 1953. 12 llte most generous period of Soviet aid to Eastern Europe however was •
Although the Soviet Union has clearly not exploited Eastern Europe throuah 1953-58, following the rebellions and riots in East Germany, Poland and
trade relations since 1956, it has, both before and after 1956, used trade as a llungary which were in good part directed against the exploitive relationship
weapon against recalcitrant socialist countries (in Eastern Europe and elsewhert) thc East European countries found themselves in regarding the Soviet Union.
in attempts to get them to follow its leadership. lltc most comprehensive aid programme took place in the 1956-58 period
The first time the U.S.S.R. used the trade weapon was against Yugoslavia when the U.S.S.R. extended S3.6 billion in aid {Sl.S billion in loans, SI bilUon
which was cut off from trade relations with both the Soviet Union and aU the 111 debt cancellations, and S1 billlon in free transfers ofjointly owned enter-
other socialist countries in 1948. This trade embargo was imposed in an pn~es to the East European countries). Generous export credits werc also
attempt to get the Yugoslavs to accept Soviet hegemony. China and Albania Jl••mted to these countries during this period.'~ The year 1956 marks a water-
in 1960-61 were the next socialist countries to suffer from Soviet economic hcd in the economic relations between Eastem Europe and the U.S.S.R., the
pressure. Economic and technical advisers, with their plans, were withdrawn tt•mainingjoint stock companies were handed over Lo the local countrtcs,

126 127
ls the Red Flag F/ying? Soviet Re/ations witll Eastern Europe

much of their debt was canceUed, temlS of trade favourable to the East No supra-national planning authoritles exist whích can dictate lo any
European countries established, and generous aid extended. The total value of member sta te what to produce or how to distribute their production. Instead,
Soviet aid to Eastem Europe (including debt canceUations, handing over of ~.,Juntary agencies have been set up to co-ordina te joml efforts and inte-
enterprises, loans and credits) was of the same order as that of the Marshall grution. A Committee for Co-operation in Planning exists lo promote co-
Planto Westem Europe, approximately S14 billion dollars. 15 The Soviet ~t~dtnatíon of five year p1ans and exchanges of information Oiscussions are
Union, at least since the mid 1950s, has thus played a central role in acceler- held among the COMECON countries in the process of each constructing
ating the econornic growth and all round development of the East European thrir opera ti ve plans.. The primary concems of the Committee for Co-oper-
econornies. This is h.ardly a phenomenon to be expected from an imperialist- •tu>n appear to be systematically developing adequate raw material and
type relation such as exists between the United States and Westem Europe on ncrgy suppües throughout the COMECON countries, promoting lhe most
the one hand and most of the countries of the Third World on the other. u1vanced technological processes by allowing economíes of scnle, and devel-
In the period 1954 to 1964 the majority ofSoviet loans and grants to upmg integrated transportation networks. COMECON also continues to
socialist countrles went to the COMECON countries of Eastem Europe- promote co-ordination of productíon for purposes of planning trade among
53 per cent of all Soviet aid . But in the period 1965 to 1972, only 21 per cent thc COMECON countries. This mostly means the development of intra-
of allloans and grants were to the East European countries. In the 1954-64 urdustry specialization, e.g. Czechoslovalda specializes in metal pipe, East
period, East Germany and Bulgaria were the principal recipients of Soviet aid r.rrmany in steel for bearings, Poland in thin rolled steel and Hungnry m fme
in Eastem Europe, wh.ile China, Mongolia and Cuba were the principal hure tubing. Each country decides whcther or not to participale in a given
recipients arnong Titird World socialist countries. In the 1965-72 period, urlcgration project (of which there are many) on the basis of what it thinks
Poland and Bulgaria (two of the least developed COMECON countries) 11 would gain from participatíon. COMECON rules, deferring to the interests
became the principal recipients in Eastem Europe while Cuba, North Vietnam ''' the less developed COMECON countries, especlally Romania, specify that
and Mongolia (in that order) were the principal beneficiarles of Soviet aid HIC of the goals of COMECON is to eliminate differences in the levels of
amongst the Tiúrd World socialist countrles. 16 tkvelopmen t of the member countries. Concretely this takes the form of the
1 developed countries being given preference in developing new lines of
Industrial production (providing the new products are of sufficien tJy high
C(K)rdinated Planning 1¡11ahty) and the granting of economic assistance lo the Jess developed by the
18
uur 1 deve1oped COMECON countries.
During the first decade of the C.M .E.A., the co-ordination of the COMECON While economic integration of the socialist countries has for a long time
countries' econornies was lirnited to planning trade among themselves. Since lwcn an ideal, little real progress was made in co-ordlnating economic plans
1958 , however, there has been a gradual increase in overall economic inte- untll the late 1960s, when the advantages ofeconomic co-ordination becarne
gration and co-ordination of production plans among the COMECON countriet lt•ar to all participants. The Soviets had long pushed for integrntion, with the
While the ideal is the eventual total integration of the various econornies as 1., 1 European countries, led by Romania, resisting out of fear of lostng their
nation states wither away, all parties are extremely jealous of maintaining thelr ,, onomic índependence. The major force pressing them lo move towards
economlc independence and all -round development. So the process advances . ,, urdinating their economies was the need to overcome technologicnl
very slowly. The procedures of economic integratlon adopted in 1971 after hftáwardness. None of the small East European countries could develop an
many years of struggle and comprornises stipulated that : ll ·round technologically advanced economy on their own. They were
'"' Jeasmgly forced to participa te in a regional exchange of scienti fic and
.. . furtber intensification and improvement and the development of tbe t dmological knowledge, and to engage in specíalization m order to acc~ler­
socialist economic integration of C.M.E.A. member nations will be carried llt' technological advance. The small East European countries, with limited
out in accordance witb tbe principies of socialist intemationalism and on lJllttnnl markets, were also increasingly unable efficiently lo produce al1 the
the basis of respect f or national soverel&Il ty, independence and national
y 1vnnced goods they needed. Efficient production of advanced industrial
interests, of nonintervention in the interna! affairs of nations, and of total
equality, mutual advantage, and comradely reciproca) aid . . .. socialist KCHH.b required intemational markets to make economies of scale possible,
economk integration is carried out on an entirely voluntary basis and is well as to promote research and development in specialized areas. The
not accompaned by the creation of supranational organs, nor does it affect unomic advantages of co-operation accruing to each country became more
matters pertaining to interna! p1anning or the financia! , and cost-calcu1aUna Hllll more difficult to resistas the potential gains became greater and greater.
activities of organizations. 17 lt \I'Cms that the pressures from the East European countries have resulled in
111 tllulions which represent an intemationally unified system increasingly
•ulonomous of the U.S.S.R. 19

128 129
1
ls the Red Flag Flymg? Sovtt!t Re/atlons with Eas tem Europe

There is a bias among the COMECON countries against inter-industry Bulgaria leases forest land in the Soviet Union for purposes of building and
speciaJization along the Unes of broad economic sectors. Jnstead, economic operating a forestry enterprise for lumber exports to Bulgaria. In retum for
integration tends to take the forrn of intra-industry specialization (e.g. one providing building materials, land, technicaJ advice, equipment and transpor-
country manufacturing one kind of truck; another sorne other kind, and so 1.1ltion, as well as the trees, the Soviets get a share of the Bulgarian entcrprise's
on). lt does not take the foon of one country building all the trucks and output proportionate to U.S.S.R.'s contribution to the project. The key
another making all the shoes, etc. All the COMECON countries are deterrnined clement the Bulgarians provide is the lumberworkers. This is an example of
to possess baJanced industrial economies encompassing all branches of mcipient labour mobility among COMECON countries from areas of relative
production. 20 As a result, their economies are far more balanced, especially labour surplus to areas of relalive labour shortages. Another example is Polish
in the industrial sector, than the economies of capitilist countries of similar workers working in the Czechoslovak construction industzy .22
size and per capita wealth. This gives these East European countries a sound
base for political independence.
Economic Growth
Joint Enterprises Today The radicalliterature on the less developed countries focuses a lot on how
capitalist imperialism underdevelops, or blocks, the development of the Third
Economic co-operalion among the COMECON countries of Eastem Europe World satellites of U.S. and European imperiaJism. It is therefore important, in
(including the U.S.S.R.) takes a number ofspecific forrns : (1) technological an exarnination of whether the Soviet Union's relations with Eastern Europe
co-operation including exchange of blueprints and knowledge about processes are essential1y equivalen! to the advanced capitaJíst countries' relations with
and the res u! ts of scientific research, as well as training of scientists and the Third World, to determine whether Soviet economic links with Eastem
specialists in each other's countries; (2) standardization of products and parts; l· urope hinder or promote the latter's economic development and industriaJ-
(3) development and co-ordination of transport and communications, includina tzation.
a common freight car pool and canal and river networks; and, (4) joint under· lf the relationship between the U.S.S.R. and Eastem Europe is of the kind
takings in which the capital, know-how and personnel of several COMECON that the dependency literature (e.g. Gunder Frank, Baran, Magdoff, Samir
countries are pooled. Amin , Dos Santos, etc.) describe as existing between the U.S. or Western
These joint enterprises are mostly concentrated in the extractive sector, Europe and the Third World, then we would expect the rates of economic
e.g. bauxite, celluJose, coal, copper, iron ore,lead, phosphates, potash, growth and industrialization of Eastem Europe and the Third World non-
sulphur and zinc. The more famous ones include the Kingisep potash works socialist countries to be comparable. We would also expect these rates to be
in the U.S.S.R. (jointly developed by Bulgaria, Czechoslovakia, East Gerrnany, much lower than in the U.S.S.R. Yet this is not the case, as Table 7.3 shows.
Hungary, Poland and the U .S.S.R.), the Fríendship Pipeline linking the Urals The average rate of growth in per capita Net Material Product (the socialist
with Eastern Europe, the Peace electrical power transmission grid tinking all equivalen t of Gross Na tional Product, whlch excl u des U1e service sector) in
the East European countries, and lnterrnetaJ , an iron and steel association the six COMECON countries of Eastem Europe in the 1960-73 period was
developed by Czechoslovakia, Hungary and Poland.21 rumost double that of Latin America in the Third World. It was
lncreasingly, the COMECON countries ha ve been resorting to joint enter- illso almost double the rates of growth in the U.S .A. and the
prises after a 10 to 15 year hlatus in this organizational forrn. While the earlier Common Market, the heartlands of advanced capitalism. Further it was
joint-stock companies were dominated by the Soviet Union and pretty much virtual! y identical to the rate of growth of the Soviet Union, the most n;tature
exploited Eastem Europe to the advantage of the Soviets, the new enterprises of the sociaJisl econornies. Eastem Europe's average rate of growth of industry
seem to be truly joint operations functioning to mutual advantage. As the fn lhe same 1960-73 period also compares favourably with the rates for Latín
principal supplier of raw materials to the other COMECON countries, the America (that part of lhe Third World mosl comparable to Eastem Europe),
Soviets have been encouraging the forrnation of these joint enterprises to and the U.S.A.. the Common Market and the Soviet Union .
exploit natural resources in the Soviet Union. General agreements among the The economies of the East European countries also differ from the
various participants in a project establish its broad oullines, then bilateral ~:conornies of Third World countries in their overalllevel of development and
agreements between the U.S .S.R. and each participating COMECON country thelr sectoral composition. Fifty-five per cent of the net material product of
specify the precise contribution (financing, equipment, construction workers) l~stem Europe originales in the industrial sector, compared to around 30
and product accruing to each country . pc r cent of the G.N.P. of the major countries of Latín America (which are
Another form of COMECON co-operation in vol ves leasing of land in one arnong the more developed, and most influenced by the U.S., countries of the
country to another. Bulgaria and the Soviet Union have an arrangement whero 11lird World).23 The East European figure is also slightly higher than thal of

130
131
Js the Red Flag Flying? Soviet Relations with Eastern Europe

Tab1e 73 uon-socialist countries of the Third World. ln keeping with these figures, in
Economic Growth Rates of European COMECON Countries and Others, 1964 personal consumption per capita in the German Democratic Republic
1960-1973 wns 156 per cent (or one anda half times) that of the Soviet Union,
C7echos1ovakia was 150 per cent, Hungary 117 per cent, Poland 103 per
Rateo[ Rateo[ Rateo[ tcnt, Bulgaria 100 per cent and Romania 86 per cent.25 In general the level
Growth Growth per Growth in nf economic deve1opment and the standard of living are both generally higher
(NM.P. or capita (N.M.P. lndustry In most of the COMECON countries of Eastem Europe than they are in the
G.D.P.) or G.D.P.) Soviet Union.
Bulgaria 8.1% 7.3% 11.0% That the period of socialist construction in Eastem Europe has resulted in
Czechoslovakia 4.7 4.1 4.9 the rapid industrialization and economic development of these formerly
German Democratic Republic 4 .8 4.8 5.3 ugricultural, underdeveloped countries can be seen by comparing them now
Hungary 5.7 5.3 6.8 tu what they were in the 1930s. ln 1937 Czechos1ovakia had 17 per cent of
Poland 6.6 5.6 3.5 lt~ cconornically active population working in manufacturing, Hungary 7.3
Romanía 8.8 7.7 12.8 per cent, Poland 6.2 per cent, Bulgaria 5.9 per cent and Romanía 2.7 per cent.
Average o[ Six East Eu.ropean 6.5 5.8 8.2 ll1cse figures are generally lower than for most Latin American countries of
COMECON Countries tomparab1e size in the 1970s. The gross domes tic product per cap ita of these
~ountries in 1937 (in 1973 U.S. dollars) was S440 for Czechoslovakia, S428
lor Hungary, S300 for Poland and $271 for Bulgaria. These figures are again
U.S.S.R. 7.1 5.9 9.1 •mnparab1e with or 1ower than many Third World countries today. For
axomp1e in 1973, the G.D.P. per capita of Colombia was $400, the Dorninican
U.S.A. 4.3 3.1 4.8 l<epublic S480, Guatemala S402, Chile $579, and Egypt (in the Middle East) only
'245. 26 1n comparison, the 1937 G.N.P.percapita (in 1973 dollars) ofthe
E.E.C. 4.6 3.8 5.1 llniled Kingdom was Sl,676 and of ltaly S503.ln 1974 thepercapita
111Come of the East European countries was $3,599 for East Germany,
Latin America 5.9 3.0 7.0 \ ,505 for Czechos1ovakia, SI,812 for Romanía, Sl,812 for Poland, $1,520
lor Hungary and SI,002 for Bulgaria (the Soviet figure was S1 ,880).
Source : United Nations, Yearbook o[ National Account Statistics, (1975), l11ese figures compare well with the 1ess affluent countries of Westem Europe
Tables 4A, 48. In 1974, e.g. Spain $1,991, lre1and S2,02l, ltaly $2,442 and the United
Klngdom S3,016. 27
Eastem Europe was truly a poor and backward area in the pre-socialist
the Soviet Union (51 per cent.) Granted these figures must be reduced some- llériod, fully comparable to the middle leve1 underdeveloped countries of
what because of the exc1usion of the service sector from the concept 'net la, Africa and Latin Ame rica today. It is the past 30 years of planned
material product', but the figures for Latín America must also be reduced ocialist development policies since 1948 that have modemized these econo-
because of the extreme!y low level of monetary income in the rural sector rnies and greatly increased the standard of living, especially of the working
and hence under-evaluation of the product of that sector. mtl pe asan t classes.
The percentage of the economically active population engaged in manu- In summary, we see that nothing like the processes described by depén-
facturing in the six COMECON countries of Eastem Europe ranges from 11 ncy theory operate between the Soviet Union and Eastem Europe. The
36.9 per cent for the Gerrnan Democratic Republic through 34.7 per cent for ~ovict Union does not grow rich at the expense of East European countries,
Czechoslovakia, to 30.9 per cent for Hungary, 25 .7 per cent for Bulgaria, lll'ilher does it deve1op a specialization in industrial production while the
24.0 per cent for Romanía and 23.6 for Poland. This compares with 25.2 per 1.1tter specialize in raw materials. In large part it has been the economic ties
cent for the Soviet Union, 26.1 for the U.S., and only 10.2 for Chile, 8.6 lll"tween Eastem Europe and the U.S.S.R. which have been responsib1e for the
for Venezuela and 8 .4 per cent for Brazil and Colombia. 24 The average ~o1pld economic growth and industrialization of Lhe former region. In fact,
of 29.3 per cent for the six Eastem European COMECON countries 1.1slcm Europe has consistently had the highest rates of economic growth
is actually higher than the comparable figure for the Soviet Union. It is 1110 industrialization of any region in the world.
the exact reverse of the relation between these indicators of economic
deve1opment for the US. (or other advanced capitalist countries) and the

132 133
Js tlle Red Flag F/ying? Soviet Relarions wlfh Eastern Europe

Economic Relations Before and After the mid 1950s ullied with Nazi Germany (Bulgaria, Romanía, Hungary, East Germany and
Austria). But joint stock companies were also formed m Yugoslavia with the
It is claimed by the Chinese that there was a qualitative change in the way in voluntary agreement of the Yugoslavs. The agreements signed m 1946 and
whlch the Soviet Union related to other socialist countries in the mid 1950s. 1947 between the Soviets and the Yugoslavs stipulated that these companies
They see Soviet Socialimperialism as a phenomenon of the 1960s and 1970s. were to promote the economic development of Yugoslavia and to serve as
while under the leadershlp of Stalin there were comradely relations among mechanisrns by whlch the Soviets would channel capital goods and technical
socialist countries. In examining this claim, it is essential to study the changes .JSSistance to Yugoslavia. Two companies were formed, one in civil transport-
in the relationships between the Soviet Union and the other socialist countries ution and the other in Danubian shlpping. In both cases they carne to domín-
before and after the mid-1950s. ate their respective sectors, driving out purely Yugoslav enterprises. The Soviet
There was indeed a major change in the economic relations between these managing of these enterprises to the advantage of the U.S.S.R. became an
countries after 1956, but it was in exactly the opposite direclion from that 1mportant issue in the split between the Yugoslavs and the Soviet Union in
whlch the thesis of social imperialism predicts. The vastly one-sided trade 1948. 28
policie"s and joint stock companies (beneficia! to the Soviet Union) were endcd The joint stock companies typically were granted concessions not available
in the period 1953-56 and considerable economic assistance was granted by to purely locally owned enterprises. They often had special property and
the Soviets to Eastem Europe whlch had previously not been available. Whlle legal rights, and were normally free from taxatlon, customs duties and most
prior to 1956 Soviet relations with Eastem Europe were exploitative (a basic, foreign exchange restrictions. These privileges virtually amounted to extra-
but not the sole, characteristic of imperialism), thls has not been the case territoriality and gave them a strong compelitive advantage over local state
since 1956. Economic co-operation between COMECON countries and the enterprises.
Soviet Union before 1956 was largely dictated by the latter and designed to The joint stock company was first developed with Mongolia, the world's
serve its interests. But since 1956 economic co-operation has been voluntary second socialist country, and with the Republic of China, both in the m id
and projects participated in only when all parties independently agreed that 1920s. Among the first to be established were those in wool and leather
it was in their interests. procurement and export (tradingcompanies) and the Chlnese Eastem Railway,
A leading example of the transfom1ation in economic relations between both initiated in 1924. ln the course of the pre-World War JI penod, numer-
Eastem Europe and the US.S.R. which occurred in the 1953-56 period was ous other joint stock enterprises were established in all fields of trade, trans-
the liquidation of the inequitable joint stock companies which had been port and banking. After the War joint enterprises were set up in mining and
established in Eastem Europe in the aftermath of the Second World War. In processing of oil and minerals. The mutually endorsed purposes of the
these enterprises the bloc partners contributed labour and most of the numerous Mongolian-Soviet joint stock companies were to force out Chinese,
material inputs, while the Soviets contributed the assets which were almost Japanese, British and American capitalist interests and to aid the economic
always former German owned properties and equipment expropriated by the development of Mongolia.29
Soviet Union in Eastem Europe. In good part German reparations took the Following the outbreak. of ovcrt opposition to Soviet dominalion in
form of equipment and faetones formerly German owned (both in Germany l•astem Germany in 1953, the Soviets rapidly began to liquidate their various
and throughout Eastem Europe) staying in place but run by the Soviets JOint stock enterprises. They turned aJl assets over to the local countries and
usually in co-operative arrangements with the locals. Much of the industrial m the process recognized the disproportionate and unjust benefit the
output of such enterprises was exported to the Soviet Union. When the Soviet Union had been gaining from the1r operation. The earliest liquidations
economies of the East European countries were nationalized in the late 1940s, were partly in the form of outright gifts to the countries concerned and partly
normally the only exceplions lo the nationalization decree were the Soviet as sales to be paid off gradual! y. After the Polish and Hungarian events óf
owned joint ente'rprises. 1956, which also indicated considerable resentment against Soviet domination
From the 400 formerly German enterprises in Romanía, 16 joint stock of Eastern Europe, all remainingjoint stock companies (in both Eastern
companies were formed in such key sectors as oil, civil aviation, river transport, Europe and Mongolia) were turned over without compensation and almost
banking, and lumber. ln 194849 eight new companies were formed in all of the debt inherited from the earlier liquidation of joint stock companies
chemicals, tractor manufacturing, natural gas, coal metallurgy, construction, was cancelled. By 1957 all but a single joint enterprise with Bulgaria (main-
mms and insurance. In Bulgaria there were five joint stock companies (plus tained at Bulgaria's insistence) had been liquidated and al1 assets tumed over
30
sorne wholly Soviet owned power stations) in non-ferrous mining, construct- (almost always without charge) to the Eastem European govemments.
ion, shipbuilding, civil aviation and uranium ore. In Hungary the Soviets 1t is of some interest to note that after the liberation of Ch1na in 1949
incorporated at least 69 former German enterprises into joint stock companies. JOint Soviet-Chinese stock comparues were set up in oil, uranium prospecting,
Most of the joint enterprises created were in countries formerly part of or c1vil aviation and shipbuilding. But unlike in the cases of Mongolia and

134 135
ls tlle Red Flag Flying? Soviet Relations witll Eastem Europe

Eastem Europe, when these joint enterprises were liquidated in 1954 the lhe decisive ingredient in allowing local communist parties lo assume leader·
Soviets insisted on full payment (wh.ich was collected), making China unique ship of their societies, the 'motherland of socialism' was in the best position
among the socialist countries in this regard. The Manchurian railway, which lo decide for the new1y born socialist countries what poHcies they ought to
had been joi.nt Soviet-Chinese property before being taken over by Japan in adopt. Whether one accepts these arguments as legitimate or not, the reality
the 1930s (the Soviets sold their interests to Manchukuo) and which reverted is that the Soviet Union did insist on gulding all the world's communist parties
to Soviet control in 1945, was tumed over to China in 1952. 31 and all the new socialist states during this period. The Soviet Union for good
The voluntary liquidation of the inequitable joint stock comparues of the or ill was hegemonic in Eastem Europe at this time.
1945-53 period, and the tuming over of their assets to the various socialist This hegemony over socialist counlries has declined considerably since
countries without compensation (China excepted) is a phenomenon unknown 1953-56. Considerable deviations from Soviet positions are rncreasingly, if
to a capitalist imperialist country. The only known cases o( amicable liqui· reluctantly, tolerated, that would not have been before 1956. Romania's
dations of imperialist owned enterprises (e.g. Arabian or Venezuelean oil long-term and successful deflance is a leadlng example: she refused to partici·
holdings) occur on the basis of sale at prices acceptable to the imperialist pate in the intervention in Czechoslovakia in 1968, consistently drags her
owned transnational corporations. The Soviet Union's mid 1950s massive feet on COMECON integration, maintains neutrality in the Sino-Soviet dispute,
Uquidation of joint stock companies without compensation, at the very time as a member of the lnternational Monetary Fund, etc. Sois the independence
when the Chinese and their supporters now argue capitalism was being from Soviet leadership of most of the West European communist parties
restored and the Soviet Union was becoming social imperialist, is a strong which has emerged since the mid 196~. And Vietnam (until 1978) and the
argument against the Ch.inese thesis. The reviva! of the joint enterprise in Democratic People's Republic of Korea have both kept clear of the Sino-
recent years, on terms mutually agreeable to both the Soviets and the Soviet dispute. Yet the Soviet Union continues as a hegemonic force (albeit
COMECON countries, must be considered a qualitatively different phenom· decreasingly successfully) as the intervenUon in Czechoslovakia in 1968
enon from the old East European enterprises in the ex-Axis countries in the mowed.
1945·53 period. Rather than being set up and run primarily in order to aid That the Soviets were considerably more active in interfering in the
the reconstruction of the Soviet Union (as a form of reparations), the current domestic affairs of the East European countries before 1956 than after, is
joint enterprises are entered into voluntarily by the various countries by mutual dlustrated by the drastic sanctions taken against Yugoslavia in 1948 and the
agreement and with benefit to all parties. Another key difference is that most ~ military intervention in Hungary in 1956. The advice and supervision provided
these present enterprises are located in the Soviet Union rather than in Eastem by the Soviets in every sphere of activity were al! pervasive in determining the
Europe, and are geared to the production and export of raw materials from course of govemment and party policies in Eastem Europe before 1956.
the Soviet Union to the other COMECON countries (whereas the earlier joint lt is instructive to look at the actions taken by the Soviet Union against
stock companies were geared to exporting machinery and raw materials from Yugoslavia in 1948 and Hungary in 1956 in comparison with the actions
Eastem Europe to the Soviet Union). The reality that the COMECON countries taken against China in 1960, Albania in 1961 and Czechoslovakia in 1968. If
of Eastem Europe fa re much better with the new joint enterprises than with lhese interventlons dlffered qualitatively, with the latter being manifestations
the old joint stock companies directly contrad1cts the thesis that the Soviet of social imperialism, but not the forrner, we would have sorne support for the
Union has evolved in the direction of capitalism and social imperialism since Chinese position.
1953. The qualitative change in econornic relations between the East European
countries and the U.S.S.R. after the mid 1950s (in terms of joint enterprises
and also trade re1ations) refutes the Otinese notion of the development of The Break with Yugoslavia
social imperialism during this period. The evidence clearly shows that either
the Soviet Union was social imperialist from at least 1945 and is becorning Yugoslavia had, more than any other country in Eastem Europe, won its own
substantially less social imperialist over time, or that it is not social imperialist revolution independently of Soviet assistance. lts base among the people had
at all. The evidence is clearly incompatible with the notion that social imper· been won during the course of partisan warfare against the Germans and much
ialism has arisen since 1953. of the country had been liberated without the aid of the Red Arrny. lt hada
lt rnight be added, out of faimess to the Soviets, that their exploitation of long tradition of autonomy and militancy. lt was Serbia that defied the
Eastem Europe in the post-World War 11 decade was h.istorically justified by demands of Austria-Hungary in 1914, setting off World War l. 1t was the
the fact that the Soviet Union had suffered so grievously to defeat fascism and Yugoslav resistance that most effectively defied Hitler in World War n. 1t was
Uberate Eastern Europe. Thus all of Eastem Europe owed the Soviet Union a Yugoslavia that in 1946 shot down a U.S. plane which had slrayed over its
debt that could justly be repaid by aiding ln the reconstruction of the territory, this incident precipitating the Cold War. And it was Yugoslavia that
Soviet economy. Further it could be claimed that since the Red Arrny provided was the flrst among all the communist parties and socialist countries

136 137
ls the Red Flag F/ying? So11iet Relations with I::astern Europe

successfully to resist Soviet hegemony . federalion with Bul~ria and policies in Albania and Greece, the Yugoslavs
Although Yugoslavia had not coUaborated with the Nazis in World War Il were forced to resort to desperate actions to mobiliz.e domestic support and
the Soviet Union adopted economic policies towards her which benefited ' antemational aid lo preserve their regime. ln order to cement peasanl support,
mamly the Soviets. As we noted earlier, two joint Yugoslav.Soviet stock they reduced pressures on the peasantry and reversed collectivlZ3tton. To
companies were set up in 1946, one ofwhich carne to have a virtual monopoly furthe r consolidate enthusiasm in the working class, they adopted the system
of Dan u be shipping, the other of intemal air traffic. Most of the modem of workers' councils which carne to make basic policies for enterprises,
equipment formerly owned by the Yugoslavs was taken over by these thereby undercutting the econornic plan and in good part restoring market
companies. They paid no taxes or customs. For the purposes of aiJocating pnnciples to the Yugoslav economy with all the problems ofunemployment,
profits, the Yugoslav asset contributions were valued at 1938 prices, while the tnflation , inequality, commercialism and all-round economic írrationality that
Soviet contributions were valued at the considerably inflated prices of 1946- this implies. lntemationally the Yugoslavs were forced to tum to those who
47 (thereby giving the Soviets a disproportionate share of the profits). The had previously been their arch enernies, the Americans, for economic assistance
Yugoslavs also had to pay 52 percent higher rates than the Soviets for the to prevent the coUapse of their economy. The cost of Yugoslavia's successful
use of river transport.31 resistance to Soviet hegemonism in 1948 has been the degeneration of the
After these two companies were set up, the Soviets began negotiations to most milltant socialist country in Eastern Europe - the country which had
set up joint companies in oil, non-ferrous metals, coal, iron and steel. ln these the most enthusiastic support of its people - into a market socialist economy
negotiations the Soviets were insisting on special concessions. For example, well on its way to restoring capitalism (in a joint state capitalist prívate
the Yugoslav contribution to the oil company, for the purpose of al1ocating capitalist form).
profits, would not be considered to include the land or oil in the ground, but Soviet sanclions against Yugoslavia were both more sudden and more
only labour and equipment; the Soviets would be given priority access to the draslic than the similar sanctions taken against China 12 years later. They
oil produced, and the joint stock companies would not have to grant welfare were taken with less provocation and had considerably greater effects. The
benefits to Yugoslav workers comparable to those given by solely Yugoslav Soviet actions against China and Yugoslavia were, however, similar in that
enterp~ses. The Yugoslavs refused to conclude such agreements and began they were taken against two of the most militant and independent minded
expressmg resentment, both over the operation of the lwo existing companies rocialist regimes, re gimes whose defiance of Soviet hegemony had the greatest
and over the new Soviet demands . As for the Soviets, they were disturbed by chance of succeeding and thus of underrnining Soviet hegemony all around
the Yugoslavs' general independent role in the Balkans and wanted to bring the world. ln no reasonable sense can Soviet action against Yugoslavia be
them to heel. Two leading issues in this respect were Yugoslav support for the considered justifiable, while the action against China is regarded as social
Greek insurgents and her attempt to domina te Albania. imperialism. Yugoslavia's tendencies to degenerate occurred after and because
The actual break between Yugoslavia and the U.S.S.R. occurred over the of Soviet sanctions. Yugoslavia's fault was to defy Soviet hegemony, precisely
Soviet demand in February 1948 that Bulgaria and Yugoslavia forma feder- the same thing that China began doing in 1957. Both intervenlions are
atlon. The Yugoslavs rejected this demand and as a result the Soviets, in cqually examples of Soviet hegemonism.
March 1948, began ta.king strong sanctions agalnst Yugoslavia. On March 18
aJI Soviet military advisers were withdrawn, and on March 19 aiJ econornic
advisers. An embargo was placed on trade with Yugoslavia by the Soviet lntervention in Czechoslovakia
Union and a1l the other socialist countries. This threatened the collapse of the
Yugoslav economy which was heavily dependenl on trade with the East fhe most cited and apparently dearest example of Soviet social imperialism was
European countries because of the West's hostilíty to recent Yugoslav nationallz· the intervention ofthe Soviet army, along with the arrnies ofPoland, HÜngary,
ations and the friendly relations since 1945 among the East European countries llulgaria and East Germany in Czechoslovakia in 1968, in order to reverse the
The Yugoslav Communist Party was expeUed from the world communist course of Czech 'liberaJiz.ation'. The majority of Czechs would ha ve preferred
movement and its leaders compared to fascists. Leading communists were put the Soviet army not lo have intervened. Bul to prove social imperialism, it
on triaJ throughout Eastem Europe and charged with treason for being must be shown that the U.S.S.R. gained economic advantages (or at least that
Titoists. The Soviets also tried lo overthrow Tito's leadership inside bis own ~uch was the intention) and that the intervention was against the more
country by supporting altemative leadership within the Yugoslav Party. progressive forces and classes in the Czechoslovak struggle. In the case of U.S.
Although never carried out, the Soviets also made threats of military interven- 1mperialism, or other capitalist inlerventions, such elements can always be
tion against Yugoslavia. found. Capitalist imperialist intervention always overthrows popular regimes,
In response to these sudden and drastic sanctions imposed by the Soviet hke that of Goulart in Brazil, Arbenz in Guatemala, Mossadegh in lran,
Un ion for defying its requests on the questions of joint stock companies, Oosch in the Dominican Republic or Sihanouk in Cambodia, in order to insta!

138 139
ls the Red Flag F/ying? Sov1et Re/ations w1th L!'astern Europe

right wing milltary regimes in their place. The govemments so installed clear case of a socialist country going revisionist and moving rapidly towards
then remove the restrictions on imperialist investment, encourage economic restoring capitalism through using legal forros (rather than through extra-legal
exploitation of their countries by transnational corporations, and typically action as in Hungary in 1956), it was Czechoslovakia m the 1966~8 period
become closely allied milltarily with the U .S., granting the U.S. bases and In the 1961-68 period the real wages of Czech workers grew at one of the
other military assistance {including interventions in favour of the U.S. in slowest rates of any country (capitalist or socialist) in Europe. T11is was, how-
third countries) when desired. If it cannot be shown that the Soviet inter- ever, not true of the salaries of managerial and technical personnel. As a result
vention in Czechoslovakia was more or Iess equivalent to U .S. interventions the latter gained significantly in relation to the working class in the pre-1968
in these respects, it cannot be cited as a case of social irnperialism, however period. From 1961 lo 1967 engineering and technical personnel mcreased
improper or hegemonic it may be judged . their salaries sorne 42 per cent more than manual workers.33
In judging whether the Czech intervention was a case of spcial imperialism, The essence of the Czech reforrns of 1968 were economic. They included :
it is also instructive to examine other cases of milltary intervention by socialist ( 1) the granting of managerial autonomy to industrial enterprise managers;
countries, e.g. the Soviet intervention ln Hungary in November 1956 and the (2) increasing the income of the new petty bourgeoisie at the expense of
Chinese ending of Tibe tan autonomy ln 1959. lf it be granted that sorne the w~rkers; (3) the expansion of the use of material incentives, including
interventions are legitimate, e.g. Hungary and Tibet, in order to counter lncenhve pay systerns, for the workers; and (4) the reduction in trade union
rightist regimes, and that such interventlons are not manifestations of social control over enterprises. 34
imperiallsm , then of course merely proving that a soclalist country militarily The draft enterprise bill of 1968 called for three types of enterprise: (1)
intervenes in another is not proof of social imperialism. 1t must in addition be social enterprises which would be 'autonomous units', managed exclusively
shown that the intervention was self-serving, that it reversed a progressive by their own directors within the brond framework of the govemment's
course and hinde red the advance of sociallsm . Whether the Chinese are correct general econornic policies and solely responsible for their own business trans-
or not, they have consistently defended both the Soviet military intervention octions and obligations, receiving no subsidies from the state and relating to
in Hungary and their own in Tibet, on the grounds that they were none of one another and the public basically through the market; (2) privately owned
these things, that instead they were motivated by a desire to advance the ce>-operatives in the service, handicraft and other sectors which were to be
interests of the working class and peasants in the countries intervened against. entirely independent bodies; and (3) state owned organlzations in certain
They argue these interventions were not self-serving, but rather effectively bnsic services such as railways, water and roads which would be neither
countered reactionary forces which were pushing these countries to the right. autonomous nor self-supporting.35 The managers of the autonomous enter-
They argue further that they set or reset the intervened in country on the road prises were to be appointed by the state and made responsible for the
to sociallsm, and that the world movement was spared a demorallzing reverse effec tive management of their enterprises without interference from the state
at the sarne time as the forces of imperiallsm were denied an important ur trade unions. 36
propaganda victory which might have underrnined the solidarity, resolve and The reforrns merely proposed pro [onna workers' advisory orga.ns to the
rniJitary position of the remaining socialist countries. lf it can be shown that rnanagement's indivisible authority. The reforrners' fear of giving workers any
the intervention in Czechoslovakia was equivalent to the ones in Tibet and lllly in enterprise management was based in their belief that the workers, if
Hungary, rather than being similar, for exarnple, to the U.S. intervention in nllowed to vote in such matters, would work for their own short-sighted
1965 in the Dominican Republic, then the Chinese case for the Soviets being t'Conornic interests and ignore economic viability. 37 Workers' participation
social irnperialist in this instance cannot stand. was disrnissed as 's~alled direct democratism' - this being considered
As we shall see below the reforms which occurred in Czechoslovakia in tl.tngerous to the economy. Considerable anli-working class elitism perrneated
1966~8 were led by and served the interests of the class of professionals and the proposals, discussions and plans of the Czech technocratic reformers. Not
technocrats (the professional intelligentsia). These reforms neither had the nnly did the wide ranging enterprise management reforms not include any real
support of the Czech working class nor were they in this class's interest. They rnechanism for workers' participation in decision making, but the formal
reflected a clear shift in power within Czech society from the working class lo rowers of the trade unions were also considerably cut back, so as lo 'improve
the new petty bourgeoisie of technicians and professionals who increasingly m.anagement efficiency' and 'crea te a freer flow of labour' . The unions'
carne to dominate Czech society in their own class interest. Their ideology of control over recruitment and specific questions in relation to hours, wages,
liberalism, which had such a great attraction in the West, served the interest • nd disciplinary actions were eliminated, makinfa all decisions in these crucial
of these inteUectuals who wanted to be free of control by a working~1ass helds the exclusive prerogative of management.
party, and of the industrial managers and state bureaucrats who wanted both Wages were lo be deterrnined by each enterprise. A significant part of them
more income and other privileges, and greater freedom to run enterprises and were to depend on the worker's output, i.e. piece work was increased.
the economy without interference by the working class. lf ever there was a Oirect penalties for poor quallty work were to be instituted. And the abolition

140 141
/s the Red Flag Flying? Soviet Relations wlth Eastt!m Europe

of any restraints on firing workers meant that many would lose their jobs, yet reforms. At one Prague factory he received enthusiastic applause when he
no provisions were initially made lo cover unemployment. {After strong declared: 'lf to be a conservative means to oppose the lowering of the workers'
opposition from workers, a 60 per cenl rate of unemployment compensation ~tandard of living, 1 am proud to be a conservative.' 411
was proposed .) The technocrats insisted that there wouldn't really be any ln 1969 - a year after the intervention - there was an ac tive rank and fJ..Ie
significant unemployment,39 but when a number of plants were closed for movement within the Czech Communist Party {branded 'ultraconservatives·
reasons of inefficiency, many jobs were los t.~ by the Westem press) which grew impatient at the slowness of the reversa! of
Those with greater 'responsibility' in production (managers and foremen) the liberalization measures, and which mounted an active {and in good part
were to receive special remuneration as well as considerable bonuses depend- ~uccessful) campaign against liberals in the Party. The Soviets were apparently
ent on the results of their efforts.41 The creation of a much wider wage spread, fearful of this rank and flle movement, worrying that it rnight ndopl a pro-
a!Jegedly in tended to increase productivity through the use of material aúnese, anli-bureaucratic, militant, anti-revisiorust form .49 This widcspread
incentives, was a keystone of the whole reform . This 'delevelling' of wages 11nd influenlial movement indicates considerable ongoing working-class oppo-
was consistently defended by Dubcek as a means of combatting the 'all ~llion to liberalization.
destroying mediocracy' .42 During the late 1960s, the role of the Communist Party in Czech society
After considerable working-class opposition to the enterprise reform was was in the process of being very much constricted and weakened .50 In the
expressed, the idea of setting up workt'rs' councils with very limited author- ' ummer of 1968 there was a debate on amendments to the Party constilution
ity was reluctantly introduced. These councils, far less influential than those to allow minorities within the Party to voice public disagreements with the
in Yugoslavia, were to be mainJy advisory bodies lo management with a rnajority, and to perrnit the organization of factions within the Party. The
number of members being appointed as experts. OnJy in the most basic Soviets argued that this would have transformed the party 'into a debating
questions, where workers' wages could be jeopardized, would the councils dub'. 51
have a veto over managerial prerogatives. Throughout the revised proposal Beginrung in 1965 and 1966, North American programmes began to
on workers' councils, it was slressed that the managers must still run the ••flpear on Czech T.V. Jackie Gleason, Dinah Shore, Dr. Kildare and the 97th
enterprise, determine the programme of development and control personnel l'recinct beca me regular fea tu res. 52 ln June 1968 direct control of the content
poticy. It was stipulated that the managers could be dismissed by the councils uf the mass media by state agencies was abolished. The inteiJectuals took full
onJy in the most extreme and specified condilions.43 advantage of this change to caJJ increasingly into question more and more of
The Czech working class not only had nothing lo do with formulating these the socialist instilutions of Czech society.53 In the course of 1968 there was
Uberal reforms, there was active working class opposition to them . There was .1lso a mushrooming of political clubs a.nd other organiz.ations andan increase
particular resentment over the imposed reforms which involved econornic 111 the demand to restore sorne of the old non-Communist political parties. 54
penalties for poor work, the threat of unemployment, the linking of salaries In the realm of foreign policy, the Czechs cut back their militar y assistance
to enterprise income, the closing of inefficient plants and the removal of wage tu Egypt and Nigeria (Egypt's defeat at the hands of the Zionists had just
equalization policies.44 Most workers were opposed to the whole package of luken place and the war against Biafra's secession was going on al the time).
econornic reforms, understanding that they would operate against their hiYOurable pubtic discussion of the lsraeli and Biafran positions began to
interests. They saw them asan attack on their wages and economic security .... .1¡1pear. There was i.ncreasing discussion of an 'independent' foreign policy for
A public opinion poll adrninistered in the spring of 1968 reported that 36 c·,cchoslovakia, improved relations with West Germany , and all-round improved
per cent of aiJ people expected their econornic situation to gct worsc in the "lations with Westem Europe.51 The rapid development of events - especially
immediate future and that another 37 per cent were uncertain about their tlu.• growing Czechoslovak coolness to participation in the Warsaw Pact and
future economic situation.46 'upport of Third World struggles, and a warming towards NATO countries
Numerous strikes, slow downs, refusals lo pay uruon dues and protests on r' pecially West Germany - caused considerable anx.iety among the other
the part of workers in opposition to the technocratic liberal reforms occurred, I'IHiicipants in the Warsaw Pact. East Germany, Poland and the Soviet Union
beginning in 1966 and continuing through 1968. Sorne of the workers' strike 1111 have very real reasons to fear NATO, and especially West Germany, given
actions were spontaneous protests against reorganization of production lines thl' history of the 20th century.
or plant closures and similar issues, while others were offensivc actions to Iñe increase in unfriendJy comments aboul lhe Soviet Union appearing in
demand changes in the workers' favour in the running of enterprises. Large lhr mass media was also a cause of alarm in the U.S.S.R., always most
numbers of letters were received by Czech newspapers from workers ~rusttive about maintaining a solid fron t of Warsaw Pact countries against
protesting against the reforms.'n ln January and February 1968 Novotny, JK'~'ible invasion from lhe West. 56
the ex-party secretary who had been deposed by the liberal technocratic ll1e Soviets during 1968 expressed increasing concem to the Czechs, abou t
reformers, began lo agitate among industrial workers against the economk huth lhe course of their domestic and their foreign policies. They argued thal

142 143
ls the Red Flag Flying? Soviet Relations with Eastern Europe
socialism was being undennined in Czechoslovakia, and that the Warsaw to ensure their independence as we!J as peace and security in Europe and
Treaty's front against possíble Westem attack was being undermined. The to erec~ an unsurpassable barrier against attempts by imperialist forces of
Soviets expressed their concem about the coune of domestic events to the aggress1on and revancbe ... The borders of the socialist world were pushed
Czechs as follows : mto the centre of Europe up to the Elbe and the Shumar Mounta.ins.. We
shall never assent to the prospect of a threat to these historie achievements
The developments of events in your country causes us deep apprehension. of socialism as weU as to the independence and security of our peoples.
The offensive by the reaction supported by imperialism against your party We shall never assent to the prospect that imperiaJism might peacefully or
and the foundations of the social regime in the Czechoslovalc Socialist not, from the outside or the inside, make a breach in the socialist system
Republic threatens, we are deeply convinced, to push your country away and change the balance of power in Europe to its advantage. 58
from the social.ist path, and consequently, threatens the interests of the
whole socialist system ... Anti-socialist and revisionist forces have talcen
the press, radio, and television into their own hands and have transformed ll1e doctrine, invo.ked when the five countries sent their troops (unopposed)
them into a tribune for the attacks on the Communist Party, for the lnto Czechoslovakia, reflected the principies contaíned in the above two
disorientation of the working class and all working people, for an unbridled •tutements. To what extent the intervention was in fact motivated by these
anti-socialist demagogy, and for undermin.ing friendly relatlons between ldeals can only be evaluated in the llght of the evidence for this model venus
the USSR and the other socialist countries ... In this atmosphere attacks the evidence for a social imperiallst type intervention. It is a fact that the
are being carried out aga.inst tbe sociallst foreign policy of the USSR and Mviets and four other countries sent troops into Czechoslovakia to reverso
against alliance and friendship with the socialist countries. One hears voicea thc liberal reforrns. lt is also a fact that this intervention was not generally
which demand the re~xaminatlon of our joint and agreed policy toward wtlcomed by the Czech people, even though the Czech worklng class was
the Federal Republic of Germany regardless of the fact tbat the West
German govemrnent foUows without change a policy hostile to the intereat npposed lo the econornic reforms. lt is equally a substantial fact that the
of the security of our countries. Attempts by tbe govemment of the FRG liberal reforrns were a product of the new petty bourgeoisie of professionals
and the revanchlsts to engage in a flirtation find echoes in the leading llnd technocrats, were instituted against the working class, served the interests
circles of your country ... The leading circles of the FRG display ••l the class which proposed and implemented them, and at least the economlc
particular activity ; tbey intend to malee use of events in Czechoslovakia in u·forrns, which were. the heart of the en tire programme, were often actively
order to plant the seeds of disagreements among the socialist countries, to luught by the worklng class. The Soviet intervention, even though it was not
isolate the ODR, and to carry out their revanchist plans ... Do you not L lle~ for by the Czech working class, was nevertheless decisively on their
see that the counterrevolution deprives you of one position after another, h.le m the intemal class conflict which Czech society was undergoing around
and that the party is losing control over the course of events and is !he question of llberalizing the economy to thc advantage of the managerial
retreatlng more and more under the pressure of anti-Communist forces? · la,s. Furthermo.re, the subsequent measures forced on the regime by the
... lt is our conviction that a situation hu been created where the threat
to the socialist foundations of Czechoslovakia menaces the common vital \uv1cts had considerable support in the Czech working class. The intervention
interests of the remaining socialist countries. The peoples of our countries unllke any by a capitalist imperialist country, overthrew the rule of a privi- '
would never forgive us for indifference and carelessness in the face of thal lr~t"Cd elite that was consolidating ltself; and restored a regime much more
danger ... Our parties and peoples bear the historie responsibility for not l.•vourable to the interests of the lower classes. This alone would ma.ke the
allowing the loss of the revolutionary gains a.lready obtained ... This is •· rusation of social imperialisrn questionable.
why we consider that a resolute rebuff to the anti-Commun.ist forces and In addition, it must be pointed out that no special Soviet economic ad-
a resoluto struggle for the preservation of the sociallst regime in ~"rHage was gained through the intervention. As we have already shown the
Czechoslovalcia are not only your task but also our task. 57 r. nnorni~ relationship between Eastem Europe and the Soviet Union today is
lully equ1table and most beneficia] to countries like Czechoslova.kla. No
The Soviets, together with the four other Wanaw Pact states which were iuvcstment opportunities, special trading rights or other economic concess-
shortly to intervene in Czechoslovakia, issued a letter to the Czech Party on lnn were granted the Soviets as a result of their intervention. Tlus too
July 15 1968 which very explicltly expressed their fears and intentions: harply dis~guishes it from interventions by capitalist imperialist 'cou~tries.
We cannot accept tbat the hostile forces push your country away from the lñe SoVlet and other Warsaw Pact countries' arguments about maintaining
aocialist path and create the threat of pulling Czecboslovalcia out of the udlltary security also reflected a very real concem. Eastem Europe had been
socialist commonwealth. This is not only your problem . This is the com luv•ded and conquered twice in the previous 53 yean by the Germans. The
problem of all Communist and Workers' parties and of all states united by lvlets alone, as previously mentioned, had suffered the loss of 20 million
aUiance, co-operation, and friendshlp . This is a matter of common concem llvr only 25 years before. They are militarily inferior to the U.S./NATO
for the countries which have joined together in the Warsaw Treaty in order (•untries, especially in nuclear weapons. Whether realistically or not, they

144 145
ls tire Red Flag Flying? So vtl'f Rt'lattons Wtflt f.'astern t:urope

are extremely afrrud of another attack by Wesl Germany and the U.S., d1d the Czechoslovak events.
and are thus insistent on maintaining the integrity of the Warsaw Pactas long 8oth the ~ugoslavs_an~ the Ch~nese _argue that the intcrvention in Hungary
as NATO exisls. While the wishes of one or another East European people was an act of proletanan mlemationahsm' wltilc the intervention in
lo be neutral in the dispute between East and Wesl may get trampled on by C'zechoslovak!a was not._ Howev~r, to make this argumcnt, one must analyse
the Soviets, to call their insistence that the Warsaw Pacl stay solid 'social ho th the motives of the mterverung power and thc conditJOns in the countries
imperialist', wtuch implies domination in the self-serving economic interest mte rvened against, and not jusi refer to the act of interven !Ion To make a
of the Soviet Union , is a considerable distortion . c.: red~ble ca_se that the Czech intervention, but not the llungarian, was a
mamfestatton of social imperialism, it must be shown that the Sov1ets were
pursuing their ~wn economic interests in the former case, (1.e. U1at they
Hungary, 1956 wuned economtcally from the C.lech intervention), but not from the llungarian.
1t would probab_ly also be nec~ssa_ry to establish that pro-working class forces
Clearly, al leasl in the eyes of the Chinese and Lheir followers, military inter- wcre supported ~ the Hunganan_1ntervenüon, but anti-working class forces
vention is nol sufficient to categorize a counlry or action as social imperialist wcre supported tn the Czech. Ne1ther of these two points can be substant-
since China (and Yugoslavia) at the time supported , and has continued to l"tcd. The Soviets did not gain economically from either intervenlion
support, the Soviet intervention in llungary in November 1956. China argues (alt_hough their defence structure was preserved in both cases). Further lhcy
this was justified by the need to prevent the complete overtum of the socialial ítcllvely op~osed the_work~~· council movement among the Hungarian'
system there and its replacement by capitalism . Let us examine the differencaa workers whilc essenhally stding with lhe Czech working class in 1968. In sum
and simUaritles between the 1956 inlervention in Hungary and the 1968 1~1~ lhe Czech :md the Hungarian events must be categorized as inslances of
intervention in Czechoslovakia .
59 .SOVIet hegemon~m , albeit hegemonism exercised by and large in the interests
Because of serious bureaucratic distortions and forced industrialization in uf the preserva !ton and advance of socialism. Neither of thcse actions can
the previous seven years, there was considerable unrest amon~t the Hungarian lt•g¡tlma_tely be considered manifestations of social imperialism since both
populahon , including the industrial working class, which manifested itself in 11rc lac~g the e~e~lial characteristics of the interventions by the advanced
spontaneous riots and rebellions m October 1956 after a period of liberali7.- ~.:OJpttahst counlnes m Lhe affairs of Third World nations.
ation. Ouring the course of two weeks, the Hunganan Workers' Party (the
Communists) virtually fell apart and ceased lo function . There were numeroua
acts of terror against Communists. The old pre-socialist political parties were The Autonomy of Eastem Europe Today
reorganized and started lo funclion again. Openly anti-socialist propaganda
and agitalion became common and foreign supported rightist groups began 1he consisten! independence of Romanía is clear proof that the East European
to operate . In two wee.ks the situation in Hungary degenerated a lol more than 1 OMECON countries today exercise great autonomy from the Sov1et Union
ils equivalenl in Czechoslovakia in 1968, wherc the Communist Party con· 111td cannot be categorized as satellites, cilher in the sense of being economi-
tinued lo function and crilicism of the socialisl system remained much less rnll y exploited by, or politically subordina te to, the Soviet Un ion . The
vociferous. On the other hand, the Hungarian working class, unlike the Czech, tntcrcsts of the COMECON countries secm pretty much lo coincide. The
was actively involved in the process. Jlungarian workers formed workers' e' unomic relationships among them are mutually beneficial, alU1ough
councils which tended to be pro-socialist but anti-party , while the Czech prl)bably somewhat less so for the Soviet Union. Their mililary alliance is
workers in 1968 were hostile lo the basic liberalization reforms and split on ntutually ~dvan_tageous since they all fear a U.S./West German sponsored
the question of Soviet intervention. Had the Soviets not intervened in •rvanche, mvas1on or support of local reactionary forces. The fact thal the
November 1956, it is likely that wittun a short time a Westem type of parlia I'OMECO~ ~ountries ~reel~ choose whether to participa te in jomt projects
mentary regime , not under the leadership of a communist or socialist party, C••lt.cn dechrung a specific rnvitalion) is further proof that they are not co-
would have come to power and un done most of the socialist reforms of the ortlrna ted by sorne central decision making bureau operating out of the Soviet
previous ten years. As in the case of Czechoslovakia, the Soviets were mainly llmon There are considerable differences in economic organization amongst
interested in preserving the Warsaw Pact as a defensive screen against Westem tlr.·m (e.g. between Hungary and East Germany), degree ofliberalization
invas1on . 1l1ey saw the Hungarian withdrawal from the Pact and adherence lO (e ~· Bulgana and Hungary), degree of collectivization (Poland versus the rest
nculrality (sleps the Czechs mver took) as a major threat to their defences. ' '' l·,tstem Europ~). worker participalion in industrial management (Poland
In short , excepl that the Hungarian working class (unlike the Czech) gave ~··r,us llungary), mvolvement with world capitalist economic institutions such
active support to the liberalization process, the Hungarian events representod u·, thc I.M.F. (Romanía is_a m~mbcr), e_conomic relalions wiU1 the U.S.
a greater immediate threat to both socialist institutlons and Soviet defence ti olond accepts U.S. fore1gn rud), relattons with other socialist countries

146 147
ls the Red Flag Flymg? Soviet Relations with Eastern Europe

(Romanía is on good tenns with China), etc. Before 1956 the U.S.S.R. was Robert Owen Freedman, Economic Warfare tn the Communíst Bloc
clearly the hegemonic power in Eastem Europe and used its position to its (New York, Praeger, 1970). '
own economic advantage. Although the Soviet Union continues to insist on 14 Mare~, 'The Potitical Economy of Soviet Relations w1th Eastern Europe',
the integrity of the Warsaw Pact and vows to prevent the total disintegration op. Cit., Goldman, op. cit., pp.34-7; and Howard Sherman Tite Soviet
of socialisrn in any of the COMECON countries, it can no longer be said that Economy, (Boston: Little Brown and Co., 1969), p.194. '
15. Marer, op. cit.
the COMECON countries are exploited by, or subordina te lo, the Soviet
16. Leo Tansky, So11iet Foreign A id: Scope, Direction and Trends in Morris
Union in anything like the way many Third World countries are subordinate
Bomstein and David Fusfe1d (eds.) The Soviet Economy (Homewood
to the U .S. and other advanced capitalist countries. lllinois: Richard Irwin lnc., 1974).' ' '
The Soviet Union within rather broad parameters is still hegemonic.in most 17 Fallenbuchl, op. cit., p.403.
of Eastem Europe, but does not use its superior posilion in its own economic 111 L. Brainard, 'Soviet Foreign Trade Planning' in U.S. Congress Joint
interests as it would if it were a social imperialist superpower. The countries Econornic Comrnittee, 94th Congress, 2nd Session, 1976, The Soviet
ofEastern Europe by and large control their own affairs provided only that Economy in a New Perspective; Fallenbuchl, op. cit., Wilczy nski,
the basic socialist organization of their society is preserved, and continued pp.195- 203; Goldman, op. cit., pp.51-59; Gregory, pp.276·8.
participation in the Warsaw Pact is ensured. The economies of the COMECON 19. Fallenbuchl, op. cit.; Jan Triska and David Finley. Soviet Foreign
countries are co-ordinated in the genuine interests of all participants and the Policy, (New York: Macmillan, 1968), pp.223-9.
20. F.allenbuchl, op. cit.; Sherman, op. cit., pp. l92-8; and Wilczynski, op..
beneficia! trade and aid relations with the U .S.S.R. ha ve greatly helped the
Cit., p.l98.
industrialization of the six Eastem European countries since 1956. To sum up, 21 Wilczynski, pp.196-7; Triska and Finley, pp.219-220; and Current
while the U.S.S.R. is hegemonic in Eastem Europe, in no sense can it be Digest o[ the Soviet Press (July 7 1976), p. 13.
considered to be social imperialist. 22 Fallenbuchl, pp.404-5; Current Digesto[ the Soviet Press (July 7 1976),
p. 13.
23 U. N. Yearbook of National Account Statutics, Voi.Ill, 1975.
24 U.N. Statistical Yearbook, 1915.
25. Ellen Miclciewicz, Handbook o[ So11iet Social Science Data, (New York:
References The Free Press, 1973), p. 209.
26. U.~· Yearbook o( National Account Statistics, Vol.lll Tab1e 11 A, 1975.
l. Paul Marer, So11iet and East European Foreign Trade, 1946-1969, 27 Busmess lntemahonal Corporation, lnvesting, Licensing and Trading
(Bioomington: Indiana University Press, 1972), pp .33, 43 ; and United Conditions .Abroad, June 1976.
Nations, Yearbook o[ Jnternational Trade Statistics, (1974), p.926. 28 Marer, 'The Political Economy of Soviet Relations with Eastem Europe'·
2. fbid., Special Table B. Goldman, Ch. l. '
11) Goldman, Ch. l .
3. /bid.
4. Paul Marer, op. cit., pp.33, 43 ; and Unlted Nations, op. cit., p.932.
10. Goldman, Ch. l .; Marer, 'The Political Economy of Soviet Re1ations with
5. John Kramer, 'The Energy Gap in Eastem Europe', Sur11ey, 2 1: 1-2 Eastern Europe'.
(Winter-Spring 1975).
11 Goldman, pp.20-21.
12. The information for this discussion of the Yugoslav-Soviet confront-
6. fbid., p.71.
7. Franklin Holtzman, Foreign Trade Under Central Planning, (Cambridge, ation is ta.k:en from the following sources: Robert Owen Freedman
Mass.: Harvard University Press, 1971 ). Economic Warfare in the Communist Bloc., (New York: Praeger '
8. /bid. 1970); Vladimir Dedijer, The Battle Stalin Lost (New York : Vtking
1971 ). ' '
9. Z.M. Fallenbuchl, 'COMECON lntegration', m Morris Bomstein and
Daniel Fusfeld (eds.), The Soviet Economy, (Homewood, 111.: Richard
3. Frank Parkin, Class Inequality and Political Order, (New York: Praeger,
lrwin lnc., 1974), pp.401 -2. 1971 ), p.178. Galia Golan, The Czechoslovak Reform Mo11ement
10. Paul Marer, 'The Potitical Economy of Soviet Relations with Eastem (Cambridge, England: The Cambridge University Press, 1971), p.'78.
M Golan, Ch.21.
Europe', in Steven Rosen and James Kurth (eds.), Testmg Theories of 15 /de m.
Economic lmperialism, (Lexington, Mass.: D.C. Heath and Co., 1974).
16 /bid. , Ch. 5.
11. Ellen Miclciewicz, Handbook o[ So11iet Social Science Data, (New York.
17 Golan, pp.97-98; Alex Pravda, 'Sorne Aspects of the CzechosJovak
The Free Press, 1973), p.2 15 ; Cu"ent Dfgest of the Soviet Press, 'Fuel
and Raw Materials for CMEA Lands', 28:33 (7 July 1976), pp.12-13. Economic Reforms on the Working Class in 1968,' Sov1et Studies,
12. Marshall Goldman,Soviet Foreign Aid, (New York : Praeger, 1967), p.7 July 1973, 25: 1' pp. 115-79.
13. For a good discussion of the Soviets' use of trade as a weapon, see 38. Golan, pp.96-100.

148 149
Js rhc Red Flag Flying?

39 .
40.
Golan, pp.67, 23 l .
Pravda, p. l06 .
8. Soviet Relations with the
41.
42.
43 .
Golan, p.67.
Pravda, pp. l 06-9 .
Pravda, p. 119.
Non-socialist Third World
44 . Go1an, pp .76, 231 , 276.
45 . Pravda, p.1 07; Golan, pp.230-231.
46. Pravda, p. 110.
47 . Pravda, p. 113 ; Parkjn, p.176; Golan, pp .76, 230-231.
48 . Pravda, p.104.
49. The New York Times , Oecember 10, 1969,2:4 .
50. Go1an, pp.J00-303 .
51. W.W. Kulski, Tite Soviet Umon m World A[fairs, Syracuse, New York.
Syracuse University Press, 1973. ln this chapter we will examine Soviet economic and political relations with
52. Golan, Pravda, U1e non-socialist countries of Africa, Asia and Latín America in order to
53 . Golan, p. l38. determine whether its relations with them are irnperialistic, or hegemonic, or
54. Golan, p.295. truly supportive of progressive and revolutionary movements in ways which
55 . Go1an, pp .3 12-3 !5. offe r no special advantage (other than the weakening of Westem imperialism).
56. Golan, Ch.24 .
We will examine Soviet economic assistance, military aid and anything that
57 . Kulski, pp.326-7.
/bid., pp.320-321. . . could be considered analogous to Soviet investments. Through looking at the
58.
59. The discussion of the Hungarian evenls of 1956 draws pnmarily on case of one of the U.S.S.R. 's main trading partners in the Third World - India
Herbert Aptheker, The Truth abour 1/ungary, (New York. Ma_instream the nature of Soviet export and import trade with the Third World will also
Publishers, 1957); Paul Kecskemeti , The Unexpeu ed Revolutwn , be examined. In considering these economic relations, careful attention is
(Stanford, Calúorrua: Stanford University Press, 1961 ); an~ Pau_l pa~d to the question of whether Soviet assistance and trade are essentially
Zimmer, Revolution in flungary, (New York : Columbta Umverstty analogous to that of the leading Westem capitalist countries. Can the Soviet
Press, 1962). Union be said to exploit the countries of Africa, Asia and Latin America, to
lúnder their economic development and to make them subservient to Soviet
lnterests? Tiús chapter also examines whether the Soviet Union in tervenes
politically in Third World countries against the interests of progressive and
revolutionary movements in order to advance its own narrow self-interest. In
Llús examination, the countries and situations which China and her supporters
rnost often cite as manifestations of Soviet social imperialism are looked at
In tum : lndia, Bangladesh, Cambodia, Angola and the Hom of Africa.

Economic Assistance

01e foreign assistance of a typical capitalist imperialist country such as the

United Sta tesis designed to: (1) facllitate the exports of the major domestic
~orporations to the Third World (assistance is almost exclusively in the form
uf export credits which must be used on designated products of the donor's
major corporations); (2) pressure the recipient countries to foUow policies
tavourable to the transnational corporations based in the donor country, (e.g.
no restrictions on the repatriation of profits, no protection oflocally owned
husinesses, low wages, etc.); and (3) very often, result in a profit for the
treasury of the donor nation which normally requires repayment with interest
1
10 hard currency. In this section Soviet foreign assistance is examined to

150 151
Is the Red Flag Fly ing? Soviet Relations with rile Non-socíalisr Tllird Wor/d

determine whether it possesses similar characteristics. About 95 per cent of Soviet aid to non-socialist countries IS m the form of
Before the mid 19 50s the Soviet Union did not provide economic or expo rt credits, i.e. promises to deliver Soviet products in retum for eventual
military assistance to non·socialist countries. lt was not until ten years after repaymenl. As a rule these credits call for repayment over a 12 year period
the end of World War 11 and sorne years after the beginning of the programme from.one year after completion of a project, generally In goods and at 2~ to 3 per
of U.S. assistance that the Soviets began their foreign assistance program.me. cent mterest. In the event of the country having difficulty in meeting its
The total amount of Soviet foreign assistance lo the less developed capitalist repayments, the U.S.S.R often extends the repayment terms, frequently after
countries of the Third World has fairly consisten ti y averaged only about 1O long periods of grace. Sometimes it even cancels outstanding debts altogether.
per cent of U .S. aid in the period 1954 to 1974. In the period 1954 to 1965 lñe interest rate on U.S. loans is now the same as on Soviet toans but the
Soviet aid averaged 8 percent ofU .S . aid , while in the period 1967 to 1974 fo rm of repayment is very different. Repayment to the Soviets is Ín the form
it averaged 1O per cent, a slight but not very irnpressive growth. of locally produced goods, very often the goods produced by enterprises
Over three-quarters of all Soviet aid to the Third World is to the Near developed with Soviet assistance, thus ensuring that these enterprises are
East and South Asia. ln the period 1954-74 , the largest recipients of Soviet rnaking a net addition to the local economy and not depriving it of either
aid were : India (S 1,943 million), Egypt (S 1,300 million), Afghanistan foreign exchange or the products of other enterprises. Repayment in local
(S826 million), lran (S750 million), Pak:istan (S652 million) , lraq (S549 goods rather than in foreign currency distinguishes Soviet ald from U.S. and
million), Turkey (S530 million), Algeria (8425 million), and Syria (!417 most West European aid. The latter requires payment in dollars or their
million). Priorities in aid for these countries were basically the same in the equivalent, an undesirable and difficult task for Third World countries, since
periods 1954-66 and 1967-74, with the exception that aid to Turkey and lo pay back a loan in dollars or any other 'hard' currency requires an increase
Pakistan has been concentrated in the post 1966 perlod (most ofPakistan's In exports, meaning emphasis on developing the export sector, (in contrast, to
aid has been granted since the restoration of civilian rule in 1971 and before pay back in local currencies or goods does not.) lncreasing exports to malee
the overthrow of Bhutto). In the post 1966 period, Chile, (prior to Allende's repayments often entails forcing down the world market price for raw
overthrow in 1973) , Bangladesh , Argentina (during the neo·Peronist period) materials so that the labour necessary for repayment is greater than would be
and Guinea have also been major recipients of Soviet aid.l An examination of the case if the donor took local goods or currency. Further, the Westem
the countries favoured by Soviet aid reveals two factors motivating its lnststence on repayment in 'hard' currency means that the intemational divis-
distrlbution : {1) Soviet strategic interests around its southem borders, e.g. lon of labour between advanced industrial exporters and backward raw
Turkey , lran , India, Pakistan and Afghanistan, which seems to dicta te aid material exporters is aggravated. This is because the country belng aided must
independent of the nature of the regimes; and {2) support of progressive anti· r,tar i~ economy to expanding raw material exports. Again in contrast, repay-
imperialist forces, e.g. lraq, Algeria , Egypt (during the p re Sadat period), ment m local goods or currencies (especially, as is the case with Soviet SJd, in
Syria, Argentina (during the neo-Peronist period), Chile (during the Allende tnanufac tured goods produced from the industries fmanced by the assistance)
years) , Guinea and Pakistan (during the Bhutto era). fncilitates industrlalization and underrnines the intemational division of labour.
ln terms of the total amount of aid received, the two factors appear In comparlson to U.S. aid, Third World states fi.nd the Soviet method of repay-
equally important. India, a mildly progressive regirne somewhat antagonistic me nt a most agreeable aspect of her assistance.4
to U.S. irnperialism and to the Chinese, and fitting to sorne extent into both Repayment in goods produced by the enterprises constructed with Soviet
categories, has been the major recipient of aid. Regimes li.ke in Chile, Algeria, 11ld has the additional benefit of providing a market for an industrial enter-
Guinea and Argentina seem to have received it for purely political reasons. prlse which rnight otherwise have difficulty selling its output. This is likely to
And regimes, such as in lean (the fourth biggest recipient of Soviet aid) and lit" the case where a project, essential for all-round and rapid economic growth,
Turkey, seem to have received it for purely strategic reasons. We shou1d note 1 built before there is sufficient domestic demand. For example, a techno-
that, since the independence of Bangladesh in 1971 , the Soviets ha ve been lu¡pcally efficient steel mill might have to produce, say, one milllon tons of
even handed in their aid to India and Bangladesh on the one side and to teel a year to be run efficiently, but local demand rnight only be 500,000
Pakistan on the other. Since the 1971 War Pakistan has received !496 tuns, not enough to justify building a local mili. However, if a local steel mill
million, India S350 million, and Bangladesh S299 million .3 r.dsted, it would greatly facilita te econornic growth such that In a few years
Only in the Near East and South Asia is Soviet aid more than a quarter of luc.:al demand for steel rnight well be one million tons. By acceptmg payment
that of the US. ln the post 1967 period it was only greater than American aid lu locally produced industrial goods, the Soviets thus accelerate the rate of
in Guinea, Mali, the Sudan, Argentina, Afghanistan, Egypt, 1raq and Syria. In ludustrialization of a country by allowing it to increase its industrial capacity
this period US. econornic aid to india was ten times greater than Soviet aid (.¡nd hence its ability to accelerate its all-round econornic growth) more
(S3,552 milllon for the U .S. compared to S350 million for the Soviets), and ••padly than local demand would allow. By 1971 about 20 per cenl of all
four times greater for Bangladesh than Soviet aid . ~uviet imports from the Iess developed non-socialist economies were industrial

152 153
Is the Red Flag F/ying' Soviet Relations with the Non-sucia/1st Tlurd World

goods. For example, tractors, mdustríal machlnery, aluminum products, tcrms of the conditions whlch require the local govemment to pro mote prívate
rolled steel, wire, automobile stampings, clolhlng, fabrícs, footwear, fumiture rnterpríse, especially U.S. corporations' investments. U.S aid also almost never
and other consumer goods. lran , lraq and Afghanistan repay much ofSoviet 'iSJSts industrial development (almost all U.S. aid is for development of raw
aid with natural fas and petroleum (from projects in good part developed material production or infrastructure that facilitates raw matenal exports).
with Soviet aid). Ncedless to say, Soviet aid encourages all-round developmenl, economic
An additional aspect of the Soviet practice of accepting repayment in lndependence and the strengthening of the state sector, while discouraging
goods produced by projects built with their own aid is that this gives them a dependence on foreign owned corporations and U.S. and European imperíal-
speclal interest in ensuring both the hlgh quality of the goods produced with 1\m. U.S. assistance encourages specialization in raw material exports, and
their assistance and the smooth running of these enterprises. lt should also be fucilitates the investments of U.S. corporations and general dependence on the
remembered from our earlier discussion that the Soviet Union is virtually self· U.S.
sufficient in raw materíals and actualJy a net exporter of petroleum , natural One of the major accomplishments of Soviet aid has been that it has
gas and almost all metals. So it cannot be considered to be dríven to acquiríng .umulated the amount given by capitalist countríes. It has even inc reased the
otherwise unobtainable raw materíals through foreign aid . lut ters' willingness to give aid to the state sector and industrial projects, and
Soviet aid generally has few stríngs attached. Jt is efficient and allows for lcd them to improve their tenns by reducing the interest rates lo the 2.5 per
considerable flexibllity. ln the mid and late J950s, when the Soviet Union n:nt level offered by the Soviets and attaching fewer condilions to loans.~
first began granting foreign assistance to non-socialist, less developed countries, The Soviets provide extensive technical assistance to the Third World in
it tended to specialize in highly visible projects such as the Aswan dam, a the fonn of training in modem sk.ilJs. In 1975 there were about 18,000
major steel mili in India, or sports stadiums. However, this is no longer the lt"chnicians in the Soviet Union from the less developed countríes. By that
case. Since the 1960s Soviet aid has focused on promoting sustained and year, the Soviets had also trained about 23,000 local technicians in the U.S.S.R
balanced economic development, rather than on a few large projects. Soviet •nd 450,000 on the job in the Third World. 10 They provide elabora te training
aid projects receive prioríty treatment - the best Soviet engineers and projects which are far superior to those provided for locals by the West's trans-
designers, and the best resources available. Emphasis is given to training local n.ttional corporations. The Soviets train locals for positions of responsibility at
technicians {both on site and in the Soviet Union) and turning the operation •lllevels of the operation since it is they who will be running the enterprises.
of projects over to them.6 1ocals are also very often integrated into the designing of projects. 11 Such
Soviet aid does result in expanding the U.S.S.R.'s relations with Third tcchnical assistance is considered part of the costs of project construction and
World countríes. On the one hand, once a project is completed, the U.S.S.R. 1 must be eventually reimbursed by the local government.
is in a position to provide spare parts and to sell equivalent goods to those who By the end of 1972 an estimated SI .4 billion had been repaid on more than
have become used to dealing with it. On the other hand, the local countríes 1-1 billion in actual Soviet aid distríbuted to the less developed non-socialist
must export locally produced goods to the Soviet Union in repayment. Once • u un tries. Repaymen ts reached $260 million in 1972. 12 Repaymen ts in
such a trade pattern is established, it is likely that it wlll continue after repay· lr!Cally produced goods in 1973-74 accounted for abou t 1O per ceo l of total
ment is completed. It is irnportant to note that the Soviet Union does not havo 'itwiet imports from the less developed non-socialist countríes. Because of a
ownershlp ríghts in the enterprises established through íts assistance. Owner- rrduction in Soviet econornic aid to India and Egypt in recent years, plus the
ship ríghts remain with locals, almost always with the state sector. However, 11 lact that so much assistance was granted to these countríes in the 1950s and
should be noted that, for the f!ISL time, in 1970,an agreement (with India) for JI) 60s, the val u e of the goods exported to the Soviet Un ion m repaymen t f or
the establishment of joinUy conducted productive enterpríses on the Eastern p.1st aid has exceeded the value of new assistance in the mid-1970s. 13 lt should
European model was approved.7 llho be noted that, because the Soviet Union often agrees to take repayment
Soviet aid goes almost exclusively to the state sector. This allows the local lu goods it does not really need, it sometimes resells these goods on the world
govemment to establish an economic basis independent of prívate enterprise, m.arket.
as well as free of ties to foreign corporations. The Soviets also emphasize Soviet foreign assistance is a real burden on the Soviet economy because,
industrial projects. From 1955 to 1965 , about 55 per cent of its aid went into ll\ a plarmed economy, it has full employment and no surplus production
them. This emphasis has become even more pronounced since the mid 1960s. racity or workers. Everything produced in the Soviet Union has an
Since then, up to the mid 1970s, about 65 per cent of Soviet aid has been for lmmediate domes tic use. In a capitalist economy, on the other hand, there is
industry . About 20 per cent of all Soviet aid since 1954 has been f or the • perpetua! spare capacity which can be brought into productaon via aid-
construction of steel plants.8 In both its almost exclusive aid to the state tuhsldized exports to the less developed countríes. With the U.S., foreign
sector and in its great emphasis on industrialization , Soviet aid differs radically •ulstance actually takes the fonn of the American government paying its
from U.S. aid. The latter emphasizes the prívate sector, both directly and in 1 urporations to shlp goods to the Third World, i.e. subsidizing prívate

154 155
ls th~ R~d Flag Flying? Soviet Rclations wuJr the Non·sociallsr Third World

enterprise to increase production and profits. Without such a state subsidy to 1t promotes industrialization and helps the con tainmcnt of priva te industry
private enterprise, the goods exported would never have been produced and (local and international) without generating significan! dependence on the
the profits made never have been gained. In this way foreign assistance does Soviet Union (other than that implicit in securing spare parts)
not reduce total consumption in a capltalist economy. But it does reduce the
total amount of goods available to a socialist economy . Thus, althou~ the
14

less developed countries have to pay a two and a half to three per cent _mtere1l l:.conomic Assistance: The Case of India
rate on the credits they get from the Soviet Union, a considerable subSldy
component is contained in these loans. For if she ~id not exp~rt adv:mced . As one of the two leading recipients of Soviet aid in the Thud World, tt is
equipment to the less developed countries on ~redtt fo_r l<><:almdustrl_al prOJOCia lllstructive to examine the case of India. Although since 1954 India has been
but instead utili.zed such equipment at home, tts contnbution to SoVlet the principal recipient of Soviet economic assistance in the non-socialist world,
economic growth would be far higher (since the Soviet rate of growth averapi most of this was received in the 1950s and during the first part of the 1960s
7 per cent) than the tiny rate of interest she gets on foreign assist~ce. whcn India was leader of the non-aligned movement in the Third World.
Suggestions that the Soviet Un ion is an imperialist country, dnven by thc C:cnerous Soviet aid was given during this period in order to encourage
same econornic logic as a monopoly capitalist country, are also not substan· hnilar policies in both India and othcr countries, as well asto encouragc 01e
tiated by the data on the role of foreign assistance in thc Soviet economy. tdvance of progressive domestic policies within India. When lndia's role as a
The value of Soviet foreign assistance totals only 0 .23 per cent of the Soviet rriUJOr progressive force in the Third World declined (its domeslic policies also
net material product (compared to 0 .54 per cent of the U.S.'s G.N.P.); 0.57 .howing less progressive promise), Soviet assistance declined. In the period
per cent of the value of total fiXed capital investment (compared to 4.0 per 1967-74lndia has received only one credit from the Soviet Umon {for
cent of the U.S.'s); and 4.1 per cent of total Soviet exports (compared to ~ \50 mili ion in 1973)_1 6
12.2 per cent of the U.S.'s). In Lenin's model of the motive force of imperia· By far and away the major supplier of economic assistance lo India in both
lism, foreign investment serves as the primary mechan~ b_y which the capital the 1954-66 and the 1967-74 periods has been the U.S. lt has supplied 4 .3
accumulation process can contlnue. Quite clearly nothing like the process lald ttmes more assistance than the Soviet Union to India in the period 1954·74
out by Lenin could possibly be operating in the Soviet Union where dom~stlo • J whole and lO times as much in the most recent period (1967-74). lt is
capital investment is 200 times larger than foreign aid .. We must_also ~e mto lear that not only does the U.S. dominate foreign assistance to India, but tl
account that there has been a slight d~crease in the ratio of SoV1et fore¡gn 1 also dwarfing lhe Soviets more and more in this respect.
assistance to domestic flXed capital formation from the peiiod 1955-66 to India, along with Egypt, were in the mid 1950s the first non-socialist
the period 1967-74. This shows that there_ is no tendenc~ t~ n~ed overseas uun tries to receive Soviet economic assistance. The generous terms of repay-
capital outlets to maintain the rate of capttal accumulatton tnsJde the U.S.S.R 1111'01 offe red by the Soviets (two and a half per cent rate of ínterest and
It is interesting to contrast Soviet assistance to that from the People's tl•payment in local goods for the most part not saleable for hard currency in
Republic of China. An examination of the leading ~ecipients of Chinese ald tl1r world market, or in goods actually produced in factories bullt wllh Soviet
reveals that its motive does not appear to be very dtfferent from that of Sovill 1 sis lance) forced the U.S. and other capitalist countries lo offer economic
aid. Both countries seem to combine support of progressive regimes, e.g. 1 11Stance on much better terms to India in order to keep up with the Soviets.
Tanzania and Indonesia {before 1965), with strategic considerations, e.g. The capitalist countries traditionally charged more or less commercial rates
Palcistan , Zaire and Zambia. 15 In the Chinese case, strategic considerations ni mterest and repayment for the most part had to be in hard currencies
primarily imply winning friends against the Soviet Union an~ hence . :uned by lndian exports on the world markel. Soviet assistance lo the lndians
regimes which tend to be hostile to the Sovi~ts. For ~e Sovtets, st~tegJC h•ll the major secondary benefit to India of forcing the capitali~l countncs to
interests mainly imply an attempt to neutralize U .S . mfluence (e.g. m lran, J'lllvíde much better terms. 17 The U.S. govemment reduced the rate of interest
Turkey and the Middle East in general), but als~ secondarily ~ese_influen• on loans to India to the same leve! as the Soviets, extended thc rcpayment
(e.g. supporting the only mildly progressive lndtan regime agamst China, and 1 •tod beyond theirs, and expanded the proportion of asststance rcpayablc
attempting to neutralize Chinese inOuence in Pakistan ) . In lndian currency (but the U.S. slill required the repayment of u !urge propor·
Chinese assistance terms are more generous than Soviet, and dallar for tiun of its economic assistance in dollars).
doUar it is probably more effective in winning friends and encouraging_local In the period 1951-66 India paid back to lhe Soviet Un ion 24.9 pcr ~cnt
development. However, the differences between the l\~o are_n~t suffiCJ_ent lo of the value of aJI economic credits utilized by India dunng that pcriod. This
ca11 the ftrSt truly altruistic and the second a form of tmpenaiiSJTl. SoV1et flptre has risen during the 1970s because only $350 milhon of ncw c rcdils
assistance is far more beneficia! to the less developed countries than Am•eno.-, htm· been extended to India since 1967 and lhe average tcml of Soviet loans
aid (dollar for dollar), and rcsults in making them less dependent on 1 nnly 12 years. Na tu rally in all years since 1967 , exccpt 197~ whcn the

156 157
ls the Red Flag F/ying? Soviet Re/ations wllh the Non·socia/ist Third Wor/d

$350 million credit was extended, repayments lo the Soviet Union for past 111 hard currency charged by the West Europeans. In 1964 the Soviets offered
loans have exceeded tbe value of new Soviet credits. In the case of U.S. aid, l o build a second steel mili at Bokaro after another long fruitless negotiation
in the period 1951 to 1966, the ratio of repayment for past loans to total hetween India and the U.S. to build the project. This again provided the
credit utilized by India was 4 7.1 per cent. Because a great deal of American lndians with a major source of leverage in their dealings with the capitalist
~..ountries.
24
economic aid to India comes in the forro of grants and surplus agricultural
commodities which are sold for rupees which are then re-lent in India, the Soviet assistance has never been offered to or withdrawn from India (as it
ratio of repayment to total gross assistance utilized from the U.S. is much háS in the case of China and sorne other socialist countries) as the price for
18
lower. only 7.8 per cent in 1966. had or good behaviour.25 While, as we have seen, the Soviets often agreed to
Between two and three per cent of total lndian exports in the early 1970. ttccept repayment in the forro of goods produced by a factory aided by
were going to the Soviet Union in repayment for previous Soviet credits (both Soviet credits (so as not to place an undue burden on the lndian economy)
military and economic). 19 A U.N. study found that only 20 to 25 per cent \ UCh export agreements cease when the period of repayment is u p. TI1ere are
of the commodities shipped by India to the Soviet Union in repayment for no Soviet investments in India, although in 1970 agreements were signed
past credits could ha ve been sold in the world markct to ea m hard currency. JO t~lowing for the formation of joint Soviet/l ndian enterprises on the
Thus it is clear that lndian repayment on past credits is no real burden on COMECON model. In contrast, in 1974, U.S. corporations hada total of
lndia. For example, even if all Soviet military and economic assistance had S145 million worth of investments in lndia. 26 In no sense can the state
been a grant instead of a loan, lndia's forelgn exchange earnings would ha ve nwned faetones constructed with Soviet assistance be considered as analogous
been increased by between 0.5 and 1.0 per cent of her total export eamings. to U.S. or British transnational corporation owned industries. For these re-
This is far less than the added export capacity developed, thanks to Soviet patriate profits to the metropolitan country and operate under profit maxi·
assistance, in manufacturing. The fact that so few of the goods received in rmzing principies, without concem for or control by the local Third World
payment by the Soviet Union are saleable on the world market, indicates a ~:ountries. Neither can this be said for any joint Soviet/lndian enterprises
significan! grant-like component in Soviet assistance (the U.S.S.R. taking nrganized on the Eastem European modelas a result of the 1970 agreement.
relatively undesirable local products not wanted by the advanced capitalist
countries).
Unlike American aid, Soviet economic assistance to India has been heavily Ownership and Control of Enterprises
concentrated in the industrial sector and designed to help the country
modemize her economy.l 1 And of course, unUke American aid, Soviet l lnhke the Westem capitalist countries, the Soviet Unton does not own pro-
assistance is given almost exclusively to state agencies and not to private tluc tive business enterprises in Third World countries. Consequently she does
enterprise, thereby facilitating the development of the state sector. Soviet aid nol have any interest in promoting profits and protecting the value of foreign
has included modem steel milis, heavy machinery plants, coal-mining lnvestmen ts. This allows her to give support to progressive policies designed
machinery plants, glass factories, power stations, precision instrument plants, l u give locals authentic control over their economy, where the imperialisl
oil refineries, hydro-electric power stations, petroleum exploration, pump ¡·ountries must support the interests of their transnational corporations
and compressor construction plants, high pressure boiler E lants, heavy "l~ninst !hose of the local countries.
2
equipment plants, machine tool faetones, and foundries. There are, however, Soviet economic activities in Third World countries,
The beginning ofSoviet economic assistance to lndia's state owned whíc h do bear at least a superficial resemblance to Westem style invcstmenls.
industrial sector, in the rnid-l950s, had the importan t effect of allowing her l11ey are often pointed to, by both Chinese and Westem interests, as mani-
to break the dornination of her industrial economy , exercised by Westem lcstations o f Soviet social imperialism and it is importan! to examme them
transnational corporations.u The famous Soviet aided Bhilai steel mill l rrefully. The activities referred toare: (1) Soviet trading and shipping

(announced on 2 February 1955) had major repercussions on both lndian ~:umpanies ; (2) temporary ownership of local property secured by such com-
mdustrial development and her treatment by the Westem capitalist countries panies in bankruptcy proceedings; (3) enterprises jointly owned with Tilird
The Bhilai project prompted the British and West Germans, who had been World govemments; and (4) enterprises established through Soviet economic
engaged in prolonged (and until then fruitless) negotiations about the con- ••·.siStance, which are paid for through the temporary export of part of thcit
struction of two other steel milis, to reach favourable agreements with the nutput to the U.S.S.R
lndians. The Soviets, by giving top priority to the project, completed the Asan outgrowth of its foreign assistance programme and to factlitate lts
Bhilai steel miiJ before either the British or West Germans finished theirs. 1111de, the Soviet Union has entered into sorne joint ownership prOJCCts with
Moreover, the Soviet rate of interest (2.5 per cent) payable in locally prod- lhird World countries in shipping and trading. Joint trading companles have
uced goods, was much better than the 4.5 per cent and 6.3 per cent payable hcen established with Singapore, Ethiopia, Nigeria, lran , Morocco and sorne

158 159
ls the Red Flag Flying? Soviet Relarions with che Non-socialist Third World

other countries. They exist under joint Soviet-local management in order to ownership rights or any claims to the products of the enterprises they built,
facilitate bilateral trade. The Soviets enter into such agreements (on a 50-50 beyond the stipulated repayments. 29
basis) mostly with the local Third World govemments, but occasionally (as In comparison to the absence of anything resembling Soviet ownershlp
in Morocco) where the local state is reluctant to undertake such agreement.s, rights in enterprises in Third World countries, the transnational corporations,
with a consortium of priva te businesses.27 based in and owned by nationals of the U.S., had total assets of ! 27.9 billion
To facilitate its trade with the llúrd World (as weU as with the advanced 111 the less developed countries, and another $74.1 billion in assets in the
capitalist countries) and to avoid being exploited and dominated by Westem developed countries in 1973. The U.S. corporations m the sarne year extract-
fmancial institutions, the Soviet Union fmances much of its trade through cd S4.9 billion in profits from theu investments in the Thud World (a retum
banks that it sets up for such purposes (banks which therefore have to ha ve uf 17.6 per cent) and another S4.3 billion on their mvestments in the
branches in many Third World countries which trade with the Soviet Union). .1dvanced capitalist countries. 30 Thls immense economic stake by U.S. corp-
Occasionally, companies whlch such trading banks ha ve advanced credit nrations provides a powerful motive behlnd American govemment policies
to, lo fmance imports from the U.S.S.R., fall, leaving these Soviet banks the dcsigned to guarantee the security and profitability of these investments
owners of property liquidated in bankruptcy proceedings. Thus, as occurred ugainst the interests of the people of these coun tries. The absence of a Soviet
in Singapore in 1978, the Soviets find themselves the temporary owners of equivalent to U.S. transnational investment means that the Soviets have no
productive property in Third World countries. Such properties are, however, cqulvalent motive and are thus free to support national liberatlon movements
liquidated as soon as possible in an attempt to recoup part of the losses designed to eliminate foreign economic influences, while the Americans are,
incurred when the original owners went bankrupt. Temporary ownershlp nf course, not.
of this kind, whlch typically represents a considerable econornic loss for the
Soviets (since it is only partial compensalion for unpaid debts), can hardly
be considered analagous to Westem profit oriented investments in Third Trade: The Case of India
World countries.
There are a few irrigation and electric power generating projects which rñe Sovtets have been accused of exploitmg Third World countries through
are jointly owned by the Soviet Union and its immediate neighbours (such as trade, in a manner analogous to the advanced capital 1St countries, by paying
Afghanistan) which involve the damming of rivers on the borders of the lcss than their value for the raw material exports of the Third World whlle
U.S.S.R. The Soviets may also be entering into arrangements wilh friendly ~:harging more than their value for the industrial exports of the Soviet Union
Third World countries of the kind that ha ve become common with Eastem lt is often suggested by the Chinese that Soviet, like Westem, trade propels
Europe for joint production by enterprises perrnanently under the control of the Third World econornies into being raw material suppliers for the industria-
two or more countries. The fust agreement of this kind was signed with India llted countries. To examine the extcnt to which Soviet trade with the llúrd
in 1970.28 lf the East European model is followed (see the discussion on World is analogous to that of the West, we will examine this trade with one
joint enterprises in Eastem Europe in the previous chapters), the Third World of its main commercial partners in the Third World - India.
countries can expect to receive most equitable treatment from the Soviets. In 1972-73, 14.1 per cent of Indian exports went to the Soviet Union.
Joint ownershlp and management is not in itself evidence of imperialism. In n1ere has been a steady increase over time in the percentage of Lndian exports
any event, as of the rnid 1970s, the Soviets have not to any appreciable extent ••.omg Lo the U.S.S.R. (5.5 per cent in 1960-63, 10.6 per cent in 1964-67,
implemented such agreements outside of the COMECON countries. 11.5 per cent in 1968-71). Today the Soviet Union is the second largest con-
The Soviet Union also assists in the development of raw material production umer of lndian exports in the world (the largest being the United States)_l 1
in sorne Third World countries. An agreement was signed between the Soviets Tuming to imports, in 1972-73 only 4.7 per cent of lndlan imports carne
and Afghanistan in 1963 for assistance in prospecting for and extracting natural lrom the Soviet llnion, down from 7.7 per cent in 1968-71 and 5.5 per cent
gas and constructing a pipeline. Afghanistan agreed to repay the Soviets with 111 1964-67. This compares with 16.5 per cent of Jndla's imports from the
natural gas up until 1985. The Soviets did not maintain any ownershlp rights I I.S, 11.2 per cent from Britain , 9.2 per cent from Japan, 7.9 per cent from
in the enterprise or any rights lo the product. A similar agreement was reached \\cst Germany and 5.4 per cent from Canada. The Soviet Union is thus
with lraq in 1971 when they granted that country a loan of 200 million rubles un1y the sixth largest supplier of the lndians. Clearly the Soviet Un ion does
to finance a refmery, two pipelines and several industrial projects, to be 11111 domina te lndian trade, nor is the overall trend in the d1rection of Soviet
repaid over a period of years entirely in oil produced by the lraq National ,(nmmance. These patterns do not reflect those lo be expected if India were
Oi1 Company. Anolher example is Guinea, where they constructed a bauxite u nco-colony or sateUite of the U.S.S.R. 32
mining operation in exchange for repaymcnl in 60 mili ion tons of bauxite India receives rather better terrns of trade in its dealings with the Soviet
over a 30 year period. In none of these cases did the Soviets retain any 1Inion than il does in its dealings with Britain, the U.S.A. and the rest of the

160 161
Js the Red Flag Flying? Soviet Relations with the Non·socfalist Third World

capitalist world. Studies of the price of lndian exports lo lhe Soviet Un ion
compared to the price of comparable exports to the capitalist countries show
that the lndians usually get higher prices from the Soviets. Of 12 leading
export commodities studied by Datar m the period 1960-69, six (tea, coffee,
black pepper, cashew nuts, iron ore and footwear) were consistently purchased 1 1
by the Soviet Union at higher than their world prices. Three (skins and hides,
oil cake and raw wool) were usually purchased at prices higher than those 1 1 "!f'"-:00,.....
paid by the capitalist countries. Two (castor oil and jute) were purchased on ~-
N f"-
..i..t
M
\O V>
a year to year basis sometimes above and sometimes below the price given by
capitaHst coun tries. Only one (unmanufactured tobacco) was sold to the 1 1
Soviets al consistently below the world price (see Table 8.1 ). Another study,
reported in a pamphlet issued by the Communist Party of lndia (M-L) and
designed to show that the Soviet Union was social imperialist in relation to :q;:r¡ ~¿;; ~~ 00\ NI'- 00 1'"-1'"-
r<~ :;;~ ~~ g~ 2~ ::;~ ~; 2~
1 1
\0V> oóO: 1 1
India, admitted that of 15 important lndian exports the Soviet Union paid NN ~M
less than the world price in the case of only four. 33
AJI these studies are based on unil prices, calculated by dividing the total ~;;) ~8 ~~ ~~ ~~ C!'1 "!C! ~:q ~::el "'!O) 1 1 1 1
\0\0 \00\ NM V\V\ ..Qoñ 000 N-~· MM OOM
value of a category of exports (e.g. tobacco) by the total quantity of exports r--r-- 3~ --
in that category. Consequently unit value does not lake into account syste- :;:g ~~S:=!::!~~~ t"!~""- '1"': ~~ ¡::¡oo "':": 1 1 1 1
matic differences in the quality of products, nor does il specify the mixture ..0..0 oór-: N~~· \()V\ ~:g ~;;:; ........ ..;~ MN
of producls within the somewhat broad categories. These figures ha ve there- ~ ....
fore to be examined carefully. For example, the fact that the unit price paid 1 1
by the Soviets for lndian tobacco is consistently less than the world price
reflects the fact that the more discemmg tobacco tastes of smokers in the
capitalist countries dicta te that only the highest quality is shipped to them 1 1
while the lower quality goes to the Soviets. Consequently the Soviets pay les."
per kilo for the poorer quality tobacco, which lhe lnd ians would probably
1 1
have great difficulty selling on the world market. Similar qualifications could
be made about other lndian exports as well. But it is clear from the data that
no case can be made that the Soviet Union in any way exploits India by under· ~~~~~$s;:;;~~NN~"':~~~~"!'1 11 11
paying for its exports. The evidence slrongly suggests that India in fact gets VlVl o\vi _.:f""i f'l'lr"\ r""-Vl \Ci\C) "'M V'\t"\ -M "d"f'l'\
oo- ~c:l
higher prices for its exports to the Soviet Union than to the capitalist
countries. Likewise, there is no evidence that the Soviet Union charges more ~$ ~::;: ~~ ~~ ~;:(l NO "':"'l ~g !::!;e '1C! 1 1 1 1
oñoñ ..Qoñ
- M MM r-:oñ ~~ ~~ oñ~ M_;~~
than the capitalist countries for its exports to India. This is as we would
expect since India is free to purchase its imports from the lowesl priced "' "'
supplier. 8oth the U.N. study by Datar and studies ciled by the pro-Ch.inese
Communist Party of India (M-L) agree on this point.34
The results of this analysis of Soviet trade with India indica te that it
cannot be considcred exploitative, compared to lndia's trade with lhe Westem
capttaliSt countries. All indications are that Soviet trade with Ind ia is typical
of Soviet trade wilh a1J Third World countnes, both socialist and non-socialist
(see for example the discussion of Soviet trade with Cuba in the next chapter)
The evidence ofboth Soviet trade with India and Sov1et economic ~:;¡¡:;u••­
makes it clear that there is no evidence that India is exploited or that it can bt
legitimately considered a neo-colony of the U.S.S.R. North American
economic influence in India is considerably greater than that of the Soviets
(as measured by levels of trade, economic assistance or investment). But
..
;
.....

162
163
/s the Red Flag F/yíng? Soviet Relations wfth the Non·socialisc Th1rd hlorld

lndia's trade and economic assistance arrangements with the Soviets, although imperialism). Next we will examine the extent lo which the Soviet Union
smaller in quantity, are more beneficia! to India lhan those with the West. intervenes politically in lhlrd World countries; specifically , the extent to
While there is Westem transnational investment, there is no Soviet investment which (as the Chinese and others claún) such interventions advance Soviet
in India. She cannot be considered to be dominated by the Soviet Union. The interests at the expense of the peoples of the Third World; or whelher, on the
secondary economic position of the Soviets in lnd1a Vls-a-vis the United States contrary, its interven tions advance progressive and revolutJonary movements.
does not even give them an economic base to use to put pressure on India if The second will be looked at in terms of whether tite Soviets gain from such
they wanted to (although the provision of considerable military assistance mterventions in any way other than merely weakemng the forces of Westun
does give the Soviets sorne important potentinl clout). Further, there is no imperialism anayed against il.
evidence that the Soviets have ever put significant pressure on the Jndians to Although it has already been shown that Soviet economic relalions with
tow their line. On the contrary, the lndians, on atleast two major occasions, Third World countries are not exploitative and thus that, in the Marxist
have successfulJy pressured the Soviets to support lndian foreign policies: in sense, the Soviet Union cannot be social imperiaHst, the term may still be
the Sino-lndian conflict of 1962-63 and the lndo-Pakistan War of 1971. The applied to it in n metaphorical or ideological sense - i.e. meaning it aspires to
Soviets were also not initially inclined to support the secession of Bangladesh, be hegemonic in pursuit of its self-interesl. After briefly examining tite role
but seem to have been pressured by India into endorsing lndian intervention of Soviet milítary assistance to Third World counlries, we willlook at four
in the civil war in East Pakistan . cases where the Soviets are most often accused of social unperialism (or more
In no sense can India be considered a neo-colony of the Soviet Union. precisely self-interested hegemonism) in the Third World.
Ukewise the Soviet Union cannot be considered social imperialist in relation
to India. In comparison lo its relations, even w1th many socialist countries,
Soviet economic and political relations with India have been consistently Military Assistance
beneficial to the latter and non-demanding. India has gained considerably
more titan the Soviets out of their friendly relationship since 1955. Whereas Soviet military assistance to the less developed non-socialist counlries has
she has received a lot of economic and military help which has enabled her to expanded considerably during the 1970s. In the period 1955 to 1960 it
establish a real independence from Westem unperialism, and without losing uveraged S214 million ayear, in 1961-64 S628 million, in 1965-69 S405
any of it to the Soviets, the latter have only gained a none too reliable friend million and m 1970-74 S 1,238 million . ln lhe ftrst half of the 1970s Soviet
in their struggles with China and the U.S. The U.S.S.R. has also been able to mthlnry assistance has averaged over twice Soviet economtc assJStance. 35 The
use her relations with India to point out to other Third World countries her lending beneftciaries of Soviet arms deliveries in the period 1964 to 1974
benevolence and non-interference in interna! affairs. But, as the case of have been Egypt (S2,305 million), India (SI ,273 milhon), Syria (! 1,153
Egypt showed, long-term military and econornic ~upport of a Third World rnillion), lraq (S742 million), lran (S438 million), Algerin (S281 million),
coun try is no guarantee that that country will continue to stay friendly to the Afghanistan (S246 million), Indonesia (S 144 million), Libya (SI25 million),
Soviet Union. Jf an opportunity presents itself, India may well follow in the •md Somalia (S 69 million). With the obvious exceptions of Indonesia and
wake of Egypt, without having to worry about suffering any serious conse- lrnn (and possibly Afghanistan and India), it is clear that the Soviets tend
quences. The lndian ruling class maintains friendly relations with the Soviets, mílitarily to support the most progressive Third World countries. In the cases
as did the Egyptians, only as long as they JUdge it to be in their interests. lt is uf lran, Indonesia, India and Afghanistan strategic considerations, trying to
they who are in command of the country, not Ute Soviets. llistory may well neutralize Norlh American or to a lesser extent Chinese influence, are clearly
judge that, if anything, the Soviets, far from being social imperialists, were operating. 36
'pats1es', i.e. were used and then discarded when no longer use fu! (as they were lt should be noted that, in tite period 1965 to 1974, SoViet arms transfers
by Egypt). tu the less developed countries totalled 58 per cent of U.S. transfers (39 per
l·cnt if North Korea, Cuba and North Vietnam are excluded)
During that time the Soviet Union and Czechoslovakin were virtually the
PoliticaJ lnterventions in Third World Countries unly supphers of weapons to Egypt, Syria, India, Afghanistan, lraq, Algeria,
Sornnlia and Guinea. The U.S. supplied almost no military equipment to
In the preceding parts of thts chapter Sov1et econom1c relallons with Third these countries. Thus the Soviet Umon hnd a dectsive unpact in arming the
World countries were examined. We paid special attention to whether the more progressive non-socialist countries of the Third World , as well as Cuba,
SoVJet Union was economically exploiting Titird World countries and thus North Korea and Vietnam (who respeclively received a total of S295, SS85
whether it was a social imperialist country 10 an economic sense (i.e. in the .md S3,245 míllion in military equipment from the Soviet Union during these
sense that Marxism has always insisted is fundamental lo the concept of y1·ars). 37 Soviet military supplies played a decisive role m keeping these

164 165
Js the Red Flag Flying? Soviet Relations with rile Non-socialut Tlurd World

countries independent of U.S. imperialism, but without producing any point. Uttle need be said about the Somali intervention in Soviet supported
material gain for the Soviet Union. Ethiopia which occurred even though the Somali military was almost
The U.S.S.R.'s military assistance programme in the Tiúrd World, as the entirely equipped with Soviet supplie·d weapons; or the Egyptian transform-
above cases and, most recently, Ethiopia's have shown, has broken the dom- ation into the leading conservative force in the Arab world, in spite of its
ination of Third World countries exercised by capitalist countries through the heavily reliance on Soviet weapons. lt is clear that Sovtet rrulitary assistance
supply or withholding of arms. Modern military establishments can now be is provided toa wide range of progressive regimes and liberation movements
created by the less developlld countries without automatically promoting without the Soviets coming to domínate them or securing economtc or
dependency on the U .S., France or Britain.38 military advantage.
As with economic assistance, the role of Soviet military assistance is con-
siderably greater than its total value, since by competing with U.S. military
assistance it forces that country to be more liberal in who it supplies weapons Bangladesh
to. A given Third World country is therefore in a position to bargain with
both the U.S. and the U.S.S.R. for weapons, with both suppliers knowing The Soviets have been accused of social imperialism for encouraging the
that if the one doesn't supply the weapons, the other probably will. This separation of Bangladesh from Pakistan in 1971 . The facts ma.ke it difficult
means that regimes, of which one or the other country disapprove, are still to accept this conclusion for, at least during October 1971 , they were trying
able to get weapons. Most importantly, the fact that there is now compe- to prevent a break-up of Pakistan. During this crucial month they were
tition between the U.S.S.R. and the West, as major arms suppliers, means both publicly calling for 'respect for Pakistan's territorial integrity'. They were
that revolutionary movements can be regularly supplied with arms and that urging a política! solution for the problems in East Pakistan on the basis of
the less developed countries have a real option to being dominated by Westem restoration of democracy in the country as a whole, the freeing of the
imperialism . tmprisoned East Pakistani leadership and the retum of refugees who had
Soviet military assistance to liberation movements throughout Asia and Oed to India. The Soviets even sent a deputy foreign minister to Delhi in an
Africa in recent years has been a decisive factor in their growth and victories. attempt to persuade Awarni League leaders to accept autonomy for Bangla-
It is unlikely that the Vietnamese would have defeated the U .S., and almost desh within a united Pakistan. Unlike some Westem powers, they did not
certain that the Angolans would not have defeated the South African invasion suspend economic aid to Pakistan during the crisis or the war with India,
in 1975, without such support. Movements like the Palestine Uberation Further, immediately after that war, they provided Pakistan with generous
Organization , Frelimo in Moz.ambique, the Popular Front for the Liberation of cconomic assistance. ln fact, since the lndia-Pakistan war, Pakistan has
Oman, the South-West Africa People's Organization , Z.A.P.U. and more received more Soviet assistance than either lndia or Bangladesh (10 good part
recently Z .A.N.U . as well, have been and still are heavily reliant on weapons lo support and encourage the progressive Bhutto regime).
supplied by the Soviets and their allies. lf the Soviet Union did not exist (or The reason for these Soviet policies is that it preferred the restoration of
if it refused to supply vital military materials to liberation movements), these pnrliamentary democratic forrns and the continuing unity of Pakistan because
movements would befar less advanced in the world today than they are. The lhis would have meant a stronger, progressive, and not especially pro-Western
Soviet role has indeed been a key one in strengthening such movements to the ur pro-Chinese regime in all of Pakistan.40
point where they can succeed. There is little evidence that the price of such lt should be remembered that the immediate cause of the events in East
decisive military support is subordination to Soviet political direction, or Pakistan in 1971 was the victory ofthe Awami Party, headed by Sheik
promises of economic or military concessions. The Soviets support a wide Mujibur Rahman, in the national elections of Oecember 1970. Winning all
range of liberation movements (as well as progressive states) which ha ve well but two seats in the more populous East Pakistan, Mujibur would have
deserved reputations for jealously guarding their independence and controllin¡ l)l:come prime minister of all Pakistan, but for a military coup which not
their own struggles. The Soviets have equipped movements which are even unly suppressed his party but also launched a military operatton in East
somewhat antagonistic to each o ther. For example, Z.A.N.U. and Z.A.P.U. I,_Jkistan to crush the movement for autonomy and democracy. The response
(Contrary to sorne claims, the lack of significant Soviet rnilitary assistance tu the military regime's repression was growing guerrilla wañare, engaged in
to Z.A.N.U. in the early stages of the Zimbabwe struggle was not dueto hoth by small communist oriented groups (the most unportant of which was
Soviet attempts to support less militant Z.A.P.U. policies in Zimbabwe, but ••ssociated with the National Awami Party generally sympathetic to China)
was due rather to Z.A.N.U.'s refusals to accept Soviet aid - a reluctance md by the much larger Mukti Bahini associated with the Mujibur's own
which has since ceased.) 39 The clear differences between the Ethiopian Dergue Awami Party. 41
and the P. L. O. (the latter supports the Eritrean Popular Uberation Front), Whcn Pakistan attacked India on 3 December 1971, portraying the war as
both of which are heavily supplied wlth Soviet weapons, is another case in .1 connict be tween Hindu India and Muslim Pakistan, the Soviets announced ,

166 167
ls the Red Flag Flying? Soviet Relations with the Non-sociaiiSI Third World

in contradiction to lndian claims, that they regarded the principal aspect of sol e sovereign govemment of Cambodia. It should al so be noted thal, while the
the conflict as the uprising of the people of East Pakistan, not against West Soviets kept their embassy in Cambodia open from 1970 to 1973, they never
Pakistan, but against 'the West P3kistani military oligarchy'. After hostilities sent an ambassador to Cambodia (precisely in order not to g¡ve moral support
broke out between Pakistan and India the Soviets sympathized with the to the coup against Sihanouk). Although the Soviet Union formally broke
lndians and the East Pakistani insurgents. Their major contribution to the dlplomatic relations on 9 October 1973, when it was becoming apparent that
struggle in East Pakistan was directed towards diplomatk activity, aimed at a real civil war was goiog on and that the Sihanouk govemment in exile
keeping the super powers, specifically China and the U.S .A., out of the represented a real force within the country, sorne Soviet dJplomats contin-
conflict. They put pressure on the lndians lo effect a speedy withdrawal ued to stay in Cambodia, and vice versa. The last Lon Nol diplomats were not
from East Pakistan once the West Pakistani army had been defeated and not cx pelled from lhe Soviet Union until March 1975, two months before the
to prolong hostilities against thal country in the West. The Soviets provided collapse of the Lon Nol govemment.44
no significant help lo either the lndian anny or lo the Mukti Bahini, other The diplomatic policies of socialist countries have, since the beginning,
than diplomatic and moral support. As for lhe lndians, lhey actively inter- been directed towards establishing trade and other state-to·state relalions, and
vened in support of the Mukti Battini and lhe Awami Party (which had the not towards serving as a means of expressing political approval or disapproval
overwhelming support of the people of East Pakistan) for their own reasons uf a regime. Jf a govemment has real control of its territory, socialist regirnes
of state. They wanted to weaken Pakislan and prevent the development of a have normally sought diplomatic relations. It has been the capitalist countries
revolutionary movement in East Bengal, which might spread to West Bengal which typically have used the weapon of denying diplomatic recognition - for
and other parts of India. They may also have wanted to secure a dependency example, the U.S. of the U.S.S.R. til the mid 1930s, China til 1978, and
for their own sub-continental imperial ambiUons. Bul - whatever its motives Cuba right up to the present. Traditionally, the Soviet govemment has only
- the lndian intervention was supported by the majority of the people in denied diplomatic recognition toa capitalist (even fascist) govemment in
East Pakistan and did serve to instaJJ in power the party that had . ayear periods of civil war where two real govemments co-exist in the same territory,
before, won an overwhelming vote in the country. 1t should be stressed that une representing the people and the other reaction (e.g. Spain tn 1936-39).
the Soviet Union did nol instigate the crealion of Bangladesh nor did it play Jlte Soviet policy of dual recognition of the Lon Nol and Sihanouk regimes
any significan! role in its actual creation.42 The continuing support of most was fully within the socialist tradition. Indeed it was more supporuve of
of the people of Bangladesh for the Awami League was demonstrated in the insurgent forces than has been the norm, since in the immediate years after
eleclions of 1973 when 73 per cent of the vote went to this party, compared lhe Lon Nol coup, the strength of the insurgent forces in Cambodia (in
to 11 per cent for the two majar pro·Chinese groups and 8 per cent to the contrast to Vietnam) was not clear. The breaking of formal diplomatic
pro-Soviet party .43 rclations with Lon Nol in 1973, when it was clear that there were two states
1t should also be noted that by far the greatest amount of economic aid now exis1ing within the territory of Cambodia, was also in lhe socialist
received by Bangladesh has come from lhe U.S. and the intemational financia! lradilion.
inslitutions associated with it (by the end of 1974, direct U.S. aid totalled Uke Soviet diplomatic behaviour, the Chinese is justas much in the
$560 million and I.M.F. and World Bank aid S350 million). Thís compares with ltadition of recognizing de [acto governments created by military coups
just S 138 million from the Soviet Union.43 In conclusion Bangladesh can ugainst popular progressive regimes. For example, after the fascist coup in
hardly be considered to be eilher a creation or satellite of lhe Soviet Union. Chile against the Allende govemment in 1973, China was among the first
rountries tn lhe world to recognize the new junta and to expel pro-Allende
dtplomats from their country. Unlike the Soviets in Cambodia, however, the
Cambodia rtunese, did not attempt to establish dual relations with any inciptent Chilean
J.tnvemment in exile. 45
Sorne people accuse the Soviet Un ion of having engaged in social imperialist No evidence could be fouod of any Soviet economic or military assistance
ac tivities in Cambodia by supporting lhe Lon No! regune instead of lhe lu the Lon Nol govemment, or of any economic or military advantage granted
govemment in exile of Prince Sihanouk and the Khrner Rouge during the hy it to the Soviets. We must conclude that there was nothing in the Cambodian
early 1970s. Evidence for this accusation ts that the Soviet Union allegedly tl ua lion that m any way justifies the accusation of Soviet socialist imperialism.
extended diplomatic relations to the Lon Nol govemment, rather than to the
Sihanouk govemment in exile . In fact the Soviet Union maintained a policy
of dual recognition of bolh govemments until only 9 October 1973 , two full
years before the Lon Nol regime fell. The Soviets then informed that regime
that they recognized Prince Sihanouk's govemment in exile in Peking as the

168 169
ls the Red Flag Flying? Soviet Relations with tire Non·socialist Third World

Angola January 1975 {10 months before independence). Soviet military deliveries
were accelerated again irnmediately after independence in November 1975,
Suggestions have been made that Soviet support to the M.P.L.A. in Angola when the U.S./South African backed.advance on Luanda looked as if it was
represented an instance of social imperialism. There is in fact simply no sub- about to succeed. The Soviets provided a lot of crucial equipment , including
stance either for the claim that the Soviet Union made economic or milita.ry such heavy weapons as T34 and T54 tanks, 122mm ground to ground rockets
gains out of Angola or that it now has any special control over that country. and SAM-7 mlssiles which played a key role in turning back the invasion.
All the evidence points to the reality that the Soviet Union normally Although there were a few Soviet technicians in Angola, no Soviet troops of
supports progressive struggles in Third World countries, that the M.P.L.A.'s any kind were ever dispatched to the country.
struggle against the South African invasion {which began before the Portuguese Other socialist countries, including Yugoslavia, Romanía, Czechoslovakia,
had withdrawn from Angola) and against U.N.I.T .A. and F.N.L.A., was a the German Democratic Republic and Cuba, had also been sending materiel
progressive and popular struggle, and that Soviet and Cuban assístance to the and technkians to help the M.P.L.A. Civilian techrúcians from Cuba began
M.P.L.A. allowed the progressive forces to triumph and prevented the estab- arriving in Angola in August {three months before independence). When the
lishment of a neo-colonial South African-U.S. dependency in Angola (similar rapid U.S. supported South African and Zalrean advances on Luanda began,
to that set up in Zaire in the early 1960s).46 Lhe Cubans sent, at M.P.L.A.'s urgent request, large numbers of troops to
During the 1965-74 period, only the M.P.L.A. fought a continuous support the M.P.L.A. defenders {the total reached about 11,000 in February
guerrilla war, only it sought to be a national rather than a regional movement 1976). These Cuban troops together with the miUtary equipment from
and only it avoided anti-white racisrn and insisted instead on political, rather Eastem Europe were decisive in reversing the course of events and allowing
than racial, criteria for deciding who was a friend and who was an enemy. the popular govemment to triumph.
While support for the F .N.L.A . and U.N.J.T .A. was almost entirely tribal, The M.P.LA. was also given solid support by a11 the progressive regimes in
support for M.P.L.A. carne from intellectuals, mulattoes, the working class Africa. The recently victorious liberation movements in Mozambique and
and urbanized population throughout the country, although it did get Guinea Bissau gave unreserved support to the M.P.L.A. To quote Sarnora
specially solid support from certain tribal areas too. The F.N.L.A., after 1965, Mache!, President of Mozarnbique :
built itself up in Zaire under the protection of Mobutu's conservative regime
and was sustained in part by American CJ.A. money, while U.N.I.T.A. In Angola, there are two parties in conflict: on the one side, imperialism
organized peacefully in South-eastem Angola with the complicity of the with its allies and its puppets; on the other side, the progressive, popular
Portuguese (as became public knowledge when the Portuguese revolution of forces who support the MPLA. That's the whole story. 1t is not Spinola,
April 1974 released previously secret documents). When the Portuguese Holden [Roberto), Savimbi or anyone else who matter to us. They are
departure from Angola became immlnent, the South African government only instruments of imperialism. lt is imperialism that is the danger and
the true menace. Onterview in A/rique·Asie, 20 October 1975).<47
began more and more actively supporting U.N.I.T.A. with arms and mercen-
aries. In October,just before Angolan independence, the South African anny
- acting in collusion with the C.I.A. - itself entered Southern Angola and Other progressive regimes such as Congo-Brazzaville, Tanzania, and Algeria
together with U.N.I .T .A. forces began marching up the seacoast towards also gave enthusiastic support to the M.P.L.A.
Luanda taking one city after another. At the sarne time, with the aid of arms About the only people in the world who did not see clearly what was at
and troops from Zaire, and considerable financial support from the U.S., the stake in Angola (i.e. which forces were working towards a neo-colonial regime
F.N.L.A. marched South out of Zaire towards Luand:~. Withln a few weeks it which would make Angola's rich natural resources safe for exploitation by the
looked as if the progressive M.P.L.A. regime was about to collapse anda transnational corporations, and which forces werc fighting for genuine
South African/U.S . backed neo-colonial regime installed in a11 of Angola. independence and popular self-determlnation) were the Chinese and their
(The U.S. gave more than S32 million to U.N.I.T .A. and the F.N.L.A. during active supporters, mostly organized in tiny sects in the advanced capitalist
the Civil War.) countries. The Chinese since the early 1960s appear to have adopted the
The Soviets and other East Europeans had been giving rather modest principie that anyone whom the Soviets support must be their enemy and that
military assistance to the M.P.L.A . since the mid 1960s in the struggle for anyone who opposes the Soviet Union should be supported. The Chinese had
independence from Portugal. From its origins the movement had close ties long given sorne support and training to U.N.l.T.A. and F.N.L.A. forces (as
with the Portuguese left. (Many M.P.L.A . Ieaders had become radicalized as well as the M.P.L.A.) while maintaining that the three organizations were
students in Portuguese universities and had made lifelong friendships with cqually important and progressive in the struggle against the Portuguese. This
Portuguese students who later became leaders of the left in their country.) position was rejected by the M.P.L.A. as unacceptable. To the extent (which
Soviet supplies of military equipment to the M.P.L.A. were stepped up in wos questionable) that the F.N.L.A. and U.N.I.T.A. were seriously fighting

170 171
Js the Red Flag Flying? Soviet Relations wlth the Non·soclalist Th1rd World

against the Portuguese for independence, it was correct for the M.P.L.A. to led to the overthrow of the Emperor by progressive elements tn the army.
join in a united front with them (which is whnt tl1'e M.P.L.A. tried todo). But The Ethi.opian masses, e~pecially the students, intellectuals and working class,
the nature of the struggle in Angola changed qualitative1y once the Portuguese were poliucally aroused m 1974 and forrned a wide range of lcftist pohtical
became fully committed to leaving. By late 1975, the question was no longer organizaüons (almoú all of them claiming to be Marxist-Leninist). After two
whether Angola would be a Portuguese colon y, but wbat was to be the years of promises of radical reforrns and intrigues among the arrny officers
nature of the post~olonial state and society there . At that time (beginning a who had seized power, The Dergue (the leadership body elected by the arrny)
few months before tbe last Portuguese had left), the primary contradiction underwent two sharp struggles and consequent purges, one in 1976 and the
in Angola was between the forces (domestic and intemational) desiring a other in 1977. These consolidated a leadership committed to rapid revolut-
Zaire type regime supportive of transnational exploitation, versus the forces lonary transforrnation in Ethiopian society. The Dergue in tended, '" the
wanting a radical Tanzania/Mozambique type, or even socialist, state which hort .run, to irnplement this transforrnation using the military's own
would exclude foreign domination and active! y promote progressive social m~tzatlonal structure. ln 1977 the leading figure of the revolulion emerged
poUcies. tiS üeutenant-C~lo~el M~ngistu Halle-Mariam, a member of the Galla minorily
The Soviet Union won no military or economlc advantages In Angola as a In ~outhem Ethiop1a which has been especially oppressed by thc Am.haric
result of its support for the M.P.L.A. lt gained no bases, no ínvestment rulmg class. The ascendancy of Mengistu marked the end of a period of sharp
opportunities, no unequal trade treaties. The Angolan govemrnent is just as lntemal struggle around the question of whether to break with the United
independent as those of the other recently Uberated ex-Portuguese colonies, States and adopt Marxism-Leninism as the ideological commitmen t of the
and in fact is in a much better position beca use of the rich natural resources ICY01UtiOn.
it controls. The generous supp1ying of milltary equlpment, and now economic In March 1975 the government nationalized all ruralland, taking it away
aid, to Angola is clearly an examp1e of the SoVlel Union helping the growth lrom the feuda11andlords and Church which had controlled 1t for aeons
of progressive forces in the Third World, even at the risk to itself of cooling (much of this land, it should be noted, had already been seized by the
relations with the U .S. and endangering detente (which has consistently been peasants). In July all urban property was sirnilar1y nationalized. The largest
a keystone of Soviet foreign policy). It is ironic that the same peop1e who in c·states were transforrned into state farms while the larger urban businesses
the J960s were critica! of the Soviet Union for giving insufficient support to also carne to be run by the state. Each peasant was given the right to farrn up
Third World liberation struggles (these people identified with the verbally lo 1O hectares, and the use of hired 1abour was forbidden . In 1976 Peasant
more milltant line of the Chinese), in the mid l970s accused the Soviets of Assoc1ations in tbe rural areas and Urban DweUers Associations m tbe towns
social imperialism for giving support to progressive Third Wor1d mov~ents. wcre organized. The Peasant Associations were to be groups of peasants
These people at the same time defended the Chinese who, more than JUSt ~·ollective1y farrning units of up to 800 hectares. These units carne to have
refusing to support the struggle of the M.P.L.A., launched a vicious propa- hroad powers of self-government includingjudicial powers over their own
ganda attack on both that movement and those who made great sacrifices in mcmbers. Forrner landlords were generally barred from joining these
its assistance (the Cubans). rollectives. Large numbers of students were mobilized in the cities to help
tmplement the land reforrn and establish the peasant associalions. The Urban
l>wellers Associations in the cities were also given brond powers of se) f.
The Hom of Africa ~nvcmment.
The govemment nationalized all basic industries and banks m 1975.
Ethiopia is the second most populous country in Africa. Before the overthrow Mcdical care throughout the country becarne free for the needy. The schools
of Haile Selassie in 1974, it was an extremely bnckward feudal society. lt was wcre pul under the control of the masses through a commltlee system whose
one of the poorest countries in the world and had one of the most exp1oited rnembers were drawn from the Peasant Associations and Urban DweUers
peasantries anywhere. Ninety per cent of the population was engaged in A ·'ocintions as weU as representatives of the teachers and students. In
agricultura] production using techniques not involving fertilizers or mech- r, bruary 1978 Ueutenant-Colonel Mengistu Haile Maria m announced that
anized equipment. About 95 per cent of the land belonged to Jandlords. Two- lhl Dergue would build a Marxist-leninist Workers Party which would
thirds was in the hands of a tiny group of noble families with a substantial rvcn tually take over direction of the revolutionary process from the milttary.
portion of the remainder belonging to the Ethiopian Orthodox Church. The In summ.ary, between 1974 and 1977, the revolution under Ute leadership
48
per capita income of the country was about S60 a year. ut the Dergue destroyed the política) institutions of the feudal nobility and
The devastating famines of the early l970s, combined with the Emperor's cummercial classes, instituted a thorough land reforrn which ended feudal
lack of responsiveness (manifested in continuing price increases in the face of l.u1~ t~nure and pul the land in the hands of the peasanlry, nallonalized all
growing poverty) precipitated spontaneous rioting and strikes in 1974 which ulaJor mdustry and banking, established democratic peasant, workers and

172 173
ls th e Red Flag Flying? Soviet Relations with the Non-socialist Tllird World

women's associations, created the mechanisms for local and regional self- by the states of Black Africa as a violation of the agreed u pon covenant notto
govemment, and decisively broke with U.S. imperialism. The regime also attempt lo redraw political boundaries along ethnic ünes by force. This
armed the people, creating large people's militias, armed workers' squads and principie is regarded as sacrosanct throughout Black Africa because all its
self-<lefence detachments which have both defended the revolution against countries are ethnicaJJy cliverse and all have borders that cut across ethnac
its right1st and ultra-left opponents and served in the struggle against Ethiopia't groups.
various secessionist movements, all in all, a rather impressive record. A successful Somali annexation of the regions of EthJopia which were
In the face of the rapid transformation of Ethiopian society, a multi- ethnically Somali might well have been a precedent for similar actaons through-
dimensional struggle broke out. On the one hand, the old feudalist forces and out the African continent. Kenya, a country which also has a significan!
nascent bourgeoisie resisted the socialist measures of the Dergue. Their Somali minority, was particularly upset by the Somali invasion of Eth10pia
organization, the Ethiopian Democratic Union (sympathetic to the U.S. and and gave its complete support to the Ethiopian govemment, in spite of their
to capitalist development of the country) went into armed struggle against differences in econornic and social poUcies. Faced with the inabtlity to gener-
the regime. On the other, a number of ultra-leftist groups composed mainly ate effective intemational support for their invasion, the Somali armed forces
of students and ex-students, the most prominent of which was the Ethiopian were forced to retreat behind their own boundaries in March 1978.
People's Revolutionary Party (E.P .R.P.) , also too k up arms against the govern· The other major secessionist attempt was actually a continuation of the
ment. The major point of diffcrence between groups like the E.P.R.P. and thc 15 year old war for national independence in Eritrea. Eritrea, traditionally
dominant leftíst faction of the Dergue was whether the military should the richest Ethiopian province, contained more than half the country's
continue to provide the leadership of the revolution and run the Ethiopian faetones (a legacy of the Italian colonial occupation of tlus region), as well as
state. In the climate of rapid change nnd sharp ideological struggle, the E.P.R.P an important copper mine. lt also embraces the en tire sea coast of
initiated a systematic campaign of terror and assassination against the leader- Ethiopia. The resources and relative rlchness of this region thus make it
ship of the Urban DweUers Associations and other supporters of the Derguc. economically comparable to the former Biafra in Nigeria.
In response, the Dergue launched its own 'Red Terror' against the E.P.R.P. and The secessionist movement in Eritrea is divided into three different groups,
others committed to the armed overthrow of the regime. This organized the Eritrean Uberation Front (E.L.F.), the Eritrean Popular Uberation
terror proved to be very successful in containing the assassination campaign. Front (E.P.LF.) and the Eritrean Uberation Front-People's Liberation Army
In 1977 the increasingly leftist Dergue broke with the U.S. which, until (E.LF.-P.LA.). As non-Marxist groups the first and last have been getting
then had been the exclusive arms supplier for the Ethiopian military. The considerable material support from conservative regimes in the region, mainly
U.S. 'suspended deliveries of arms to the Ethiopian govemment because ofita the Sudan and Saudi Arabia. The E.P.L.F., the most successful of the three
leftist course, while the Ethiopians closed down the U .S.'s military install- (with substantial support among the Eritrean masses) and committed to
ation in the coun try. Marxism-Leninism, was until 1975 supported, ideologically and militarily,
In addition to precipitating sharp domestic struggles, both between the by Cuba and the U.S.S.R. in its struggle against the feudalllaile Selassie
regime and the old ruling classes and within the revolutionary forces them- 1cgime. However, because of its insistence on carrying on a mllitary struggle
selves, the 1974 Revolution also stimulated a wide range of separatist move- 11gainst the new progressive Ethiopian regime, this support was cut off. As far
ments among the dozens of distinctive ethnic minorities within Ethiopia. .ts can be determined, in 1976 and 1977, the group was mainly dependent on
Because of the weakening of the central government due to the strains of lt~ own resources for military supplies. However, the unity agreement
radical social transformation and a multifront civil war, many of these .achieved between the E.LF. and the E.P.L.F. in early 1978 meant that lhe
separatist movements were able to make significant gains, often with the 1 P.L.F. forces began acquiring military suppUes indirectly from the react-
support and arms of the various conservative powers in the region who were onary Arab regimes, as well as through the P.L.O. {lt might also be noted
interested in preventing the formal ion of a unified and strong leftist Ethiopia that the Dergue may have secured spare parts for its American supplied equip-
The two most important such movements were composed of Eritreans in the ment, which the U.S. would no longer provide , from the lsraelis who have an
North and Somalis in the Ogaden in the east. .1bundance of such supplies plus their own reasons for wanting to see U1c
The eastem third of Ethiopia is sparsely inhabited by Somali-speaking 1lefeat of the Eritrean secession.)
peoplc who, with the active military support of the Somali govemment, in The Ethiopian govemment offered the E.P.L.F. (an organiLation with
1977 attempted to secedc from Ethiopia. Seeang Ethiopia wcakened by which it felt ideologically compatible) regional autonomy within a socaaJist
interna! strifc, the Somali army marched into the Ogaden region to lay the lthiopian federation. But the E.P.L.F. throughout 1978 rebuffed all attempts
foundations for its annexation to Somalia. {lt may be relevant to note that lo negotiate an end to the secession and instead favoured patchtng over liS
petroleum reserves had rccenlly bccn discovcred in the Ogadcn region.) ,Jifferences with the E.L.F. and E.L.F.-P.L.A. in order lo win totalnalional
The Somali intcrvention in thc Ogaden rcgion was universally condemnecl 111dcpendence under a coalition with these non-Marxist forces.

174 175
Js the Red Flag Flymg! Soviet Re/ations w1th tire Non·socialist Flrlfd Wor/d

Alrnost all progressive regimes in the Arab World and Black Africa, as weU with the new progressive regirne in Ethiopia. Cuba also carne to send first
as all the socialist countries (except Albania and China} have supported the doctors and advisers, and then sorne combat troops, to strengthen th~
Ethiopian regime in its struggle to maintain territorial integrity against the EUuop1an forces in the Ogaden and help drive the mvaders out 8oth the
vanous secessionist movements. On the other hand, the most reactionary of Sovtet_s and Cubans, together with the South Yemenis, have also been lending
the Arab states and lran have been the most active supporters of the dis- matenal support to the Ethiopian effort to prevent the secess1on of Eritrea.
memberment of Ethiopia, a position supported by the U.S., West Gerrnany and . The Soviet Union began to get involved in supporting the Ethiopian regime
France (aJong with China). Thus we saw in 1977 the strange phenomenon of m 1976, as the increasingly leftist govemrnent began to ask for assistance
the U.S., Saudi Arabia, Egypt, the Sudan, West Germany, France and Iran frorn the U.S.S.R. and the East European socialist countries. Weapons began
aJI apparently sympathizing with 'national Uberation movements' since it was a_rriving i_n February 1977. ln June 1976 a two-year cultural agreernent was
these secessionist movements whose victory would mean the destruction of SJgned WJth the Soviet Union, providing for co-operation in education culture
the sociaJist revolution in Ethlopia. China supported this position. the arts and sciences. Seven hundred scholarships for Ethiopian stude~ts were'
In 1976, as the character of the Ethiopian Revolution became clear, the provtded by the U.S.S.R. and the East European countries and various trade
two most militan! and revolutionary Arab states, Libya and the Democratic agreements began to be worked out as well. In October 1977, in the face of
People's Republic of Yemen, both of which had been gíving active military the Soma Ji conquest of most of the Ogaden and the imminent danger of the
support to the independence movement in Eritrea, ceased their support and collapse of the Mengistu regime, the Soviet Union and Cuba both pledged
switched instead to the..Ethiopian govemment and its plan for a sociaJist <rupport for the Ethiopian revolution in 1ts war against SornaJia. Between
federation to end the secession. South Yemen in 1977 even sent troops to October 1977 and February 1978 the U.S. govemment estirnated that the
fight on the side of the Ethiopians. Soviets se~t a~proximateJy one billion dollars worth of rnilitary equipment
In January 1978 t.he Shah of lran threatened to intervene in the conflict to Etluop1a. Libya agreed to pay for much of the Soviet arms. The rnassive
between Somalia and Ethiopia on the side of the Somalis, if Ethiopian troops Jrms support of the Soviet Union, together with the assistanct of Cuban
were to cross into SomaliJand. (ln response to this threat, the Organization of rnihta~ advi~ers (and perhaps combat troops) resulted in the repulse of the
African Unity wamed lran against seeking to extend her influence into Africa.) Sornalt mvas1on and the reintegration of the Ogaden into Ethiopia.
Egypt and the Sudan likewise promised to send troops to Somalia if the 1t coul~ be argued that the attempt by SomaJia to annex Eastern Ethiopia,
Ethiopians crossed the border. The Sudan (with Egypt's backing) has also and es~c1ally the mdependence rnovement in Eritrea, are in sorne ways
actively been aiding the rebellion in Eritrea with sanctuary and supplies, as ''mtlar m character to the Biafran war for independence in the late 1960s. In
well as trying to bring the three Eritrean factions together. both cases the wealthiest part of the country (Biafra was both the area of
Before the 1977 attack by SomaJia on Ethiopia, the Soviet Union (and y,rea te.st oil reserves and the rnost developed part of Nigeria) atternpted
Cuba) had been important supporters of the revolutionary processes develop· s.:ce~1on. In both case_s a successful secession would have rneant two (or three)
ing in Somalia. Somalia, like Ethiopia, had nationalized most land and rcl~tJvely weak countnes (rather than one strong one), which could have been
businesses and had broken with Western imperiaJism. Sensitive to the t•astly dominated by imperialism. Alrnost aU Marxists and progressive Third
question of the Ogaden as weU as SomaJia's dispute with France over Djiboutl, World forces understood the irnplications of a successful secession and
the Soviets proposed that a federation be created in the Hom of Africa which .upported Nigeria against Biafra, while Biafra's support carne mainly frorn the
would link up aJI the progressive regimes in the region : the Democratic ruust_ advanced capitalist countnes interested in exploiting her wealth.
People's Republic of Yernen, Sornalia, newly independent Djibouti, and Ukewtse, the Ogaden and Eritrean secessionist movernents reflect rnuch
Ethiopia (with Eritrea being an autonomous region). Such a proposal would, lhe same consteUation of supporters and opponents (the rnajor exception
the Soviets hoped, resolve the conflicts between Ethiopia and Sornalia as weU hcmg China's opposition to Biafran secession,and apparent support of the
as the Eritrean question, while creating a strong socialist state which would O~den and Eritrean secessions). 1t rnust be noted, however. that the domestic
be able to support radical movernents both in the Arabian península and Eaat · haracter of both the Sornali regirne and the E.P.L.F. in Entrea is more
Africa. Colonel Mengístu and the South Yernenis supported the Soviet prngr:ssive than was the Biafran govemrnent (which rnade no claim to being
proposaJ , but neither the SornaJis nor the Entreans would have any part of 11 •"'-'•ahst). Nevertheless, it is quite clear that the intemalionaJ, as opposed
When the Sorna lis in spite of Soviet adVJce and urgmg invaded Ethiopia, In the domestic political , parallels between the two cases are very close
the SoVIet Union. which had equipped the Somali armed forces, decided tu httleed.
withhold further rnilitary support for SomaJia since it was the aggressor, and The righ_t of self-determinatJOn, up to and mcludmg national independence
mstead to provide rnilitary equ1prnent to the Ethiopian defenders (who had lur an ethmc group, has never been an absolute principie of Marxism-
just been cut off frorn U.S. arms). The Soviets continued to hope that the l.crunísrn. Marxists have traditionaJly judged each particular independence
SornaJi govemmcnt wouJd abandon its aggrcssive posture and reconcile itself 111ovcrnent in terrns of the effect it would have on advancing the general

176 177
ls tlle Red Flag Flying? Soviet Relations with rile Non-Socialist Third World

socialist and anti-imperialist movement. Thus China opposed both the Biafran 1n the relationship between the U.S.S.R. and the countries of Africa, Asia and
and Bangladesh independence movements as weakening anti-imperialist l..ntin America.
countries. And the Soviet Union intervened to incorporate the bourgeois In addition, this chapter has exarnined the political role of the Soviet
regimes in the Transcaucasus in the early 1920s and in the Baltic countries in Union in the non-socialist countries of the Tit.ird World by looking at Soviet
1940. The Chinese Constitution itself does not (unlike the Soviet Constitution) military assistance and the actions of the Soviet Union in the creation of
grant the right of self-detennination to its minority regions and the Chinese li:lngladesh, the Cambodian and Angolan civil wars, and in the Horn of Africa.
Communist Party has always opposed its own secessionist movements (e.g. llere we have seen that the Soviets consistently played a progressive role in
Tibet in 1959) as attempts to weaken the Chinese Revolution. Lil<ewise 1 upport of the various national liberation and left movements without
virtually all factions of the lndian Communist Party have consistently uttempting to gain special advantages for themselves or unduly directing the
opposed the break-up of India into its constituent nations (of which there 'ourse of events. In other words the Soviet Union cannot be considered even
could be hundreds). hegemonic in its relations with the Third World.
Contrary to the suggestions of the conservalive Arab regimes, as well as of We are driven to the unexpected conclusion that there is a significant
the pro.Chinese forces around the world, there was nothing in the involvemenl lllfference in the political (but not the economic) relations between the
of the Soviet Union in Ethiopia to reflect social imperialism. The cost to the U.S.S.R. and the Third World and that country and Eastem Europe. Whereas
Soviets of doing all they could in October 1977 to prevent the Somali ' he is not hegemonic towards the Third World, in socialist Eastem Europe
invasion, including stopping anns supplies to that country which had been a he is hegemonic, i.e. she does politically domínate the region, and within
close friend of the Soviet Union for years, was considerable. Its personnel were hroad lirnits does attempt to provide it with political direction.
expelled from Somalia and its naval support station closed down. The Soviets Of course, there are limits to Soviet support for progressive and national
made every effort to resolve the conflicts among the countries of the Hom of Uberation movements. Neither the Soviets in Ute 1940s, the Cubans in the
Africa in a reasonable way. Their proposed federalion would clearly be the 1960s, Chinese in the 1950s, Albanians, the Libyans, the Fourth lntemational
best solution for the advance of the revolutionary movement in that part of nor anyone else interested in supporting anU-irnperialist and progressive
the world. Their generous support of first the Somalis and then the Ethiopiana lnrces, has ever supported every such organization. Everyone must have
brought very little by way of economic or military advantages for the Soviet lriteria by which to select which forces are authentic and have a real chance
Union (other than the security gained whenever conservatíve pro-U .S. regimea uf achieving their goals. For example, the lack of Albanian, Chinese or Fourth
are weakened or progressive and revolutionary regimes gain strength). A lntemational support for the Red Arnty Faction in West Gennany in the
careful evaluation of the developments in the Horn of Africa since 1974 must JC)70s cannot reasonably be considered hegemonism. Nor can the failure of
conclude that the Soviet Union's role there is fully compatible with the thesta Albania and China to support both the Eritreans and the Dergue as well as
that the U.S.S.R. acted on the basis of proletarian internationalism 1 i.e. in both the Somalis and the Dergue in the struggle in the Hom. (All claim to be
support of revolutionary movements. rcvoluUonary forces.) Obviously, insisting lhat, in order not to be hegemonic,
une must give equal support to all claimants toa progressive role would often
lnvolve giving support to both sides in a struggle. Even the most ardent
Conclusion npponents of Soviet social imperialism could not insist that the U.S.S.R give
rt¡ual support to all sides in a civil war. They would rather arbitrarily insist
This chapter has examined Soviet economic and political relations with thc that the side not supported by the Soviets was the more progressive one,
non·socialist countries of the Third World. We have been able to ftnd no wlúle at the same time claiming that their support for the anti-Soviet side was
evidence that lhe Soviet Union exploits the countries of Africa 1 Asia, and nnt hegemonism. Mere demonstration that the Soviets, Albanians or whoever
Latin America through unequal tradel economic assistance, or any analog of ¡dve support to one group and not to anoUter cannot in itself be reasonably
Western style foreign investments. Soviet trade and assistance is more generm11 ronsidered proof of hegemonism. To demonstrate tbe latter lt must be shown
Utan that of the West and is, unlike the latter's 1 designed to encourage thut a power such as the Soviet Union tends to support only those states and
industrialization and independence. The absence of anylhing Uke Soviet rnovements which agree with its politics or which it can dominate in order to
ownership rights in local productive property means that, unlike such 1lirect the course of events according to its wishes.
countries as the United Statesl France and Britain , the Soviet state has no What those who suggest that the U.S.S.R. is hegemonic really mean is not
stake in preserving Ute local class structure which guarantees existing lhat the Soviet Union applies criteria to its giving support, but rather that:
property relations. In summary 1 the Soviet Union cannot be considered to be ( 1) the Soviets in Uteir view suppott the wrong side or at least act to divide
a social imperialist in relation to the non-socialist Third World since the progressive forces; (2) they give their support in order to domina te events in
fundamental characteristic of imperialism (economlc exploitation) is absenl 1he1r own interests, and (3) lhe net result of Soviet involvement is to hold

178 179
ls tlle Red Flag Flying? Soviet Relatfons with tlle Non-socialist Third World

back the development of progressive forces in the world. of state, o p. cit., p.6.
Our examination of Soviet involvement in the Thlrd World in recent yean 9. Go1dman, op. cit., pp. 191 -2.
shows that these three implicit criteria of hegemonism cannot be soostantiated 10. Orah Cooper, 'Soviet Economic Atd to the Third Wor1d', m U.S.
(1) The Soviets have consistently tended to support the more progressive Congress: Joint Economic Committee, Soviet Economym a New
forces in the Third World which have a reasonable chance of success and by Perspective, 94th Congress, 2nd session, ( 1976), p.191
no means only Soviet oriented communist parties or liberation movements 11 R.P. Sinha, 'Soviet Aid and Trade with the Oevelopin¡ Wor1d ', Soviet
and regimes that they can domina te. They support a wide range of movementa Studies, 26:2, (Apri1 1974}, p.279.
and regimes and in sorne cases, such as in Zimbabwe, cornpeting organization• 12. Valkenier, op. cit., and Cooper, op. cit. , pp.l92-5.
13 /bid., pp.193-S.
(in such cases Soviet policy is to unify the competing groups). (2) The Soviets 14 Frank1yn Ho1zman, Foreign Ttade Under Central Planning, (Cambridge 1
do not appear to intervene in their own narrow self·interest although they are Mass.: Harvard University Press, 1974), pp.27 and 372.
of course concemed to wea.ken U.S. imperialism . They consistently attempt 1S US. Oepartment of State, op. cit., pp.6,7.
to assist the development of strong progressive and anti-imperialist countries 16. U.S. Department of State, Specia/ Report: Communist S tates and
in the Thlrd World. Thus they encouraged a reconclliation between Pa.kistan Developing Countries A id and Ttade /965-1974, (Washington, D.C.
and the Bangladesh independence movement within a progressive framework, U.S. Government Printing Office, 1975), Tab1e 2.
and have strongly argued for a federation of aU progressive states in the Horn 17. Asha Datar, lndia's Economic Relations witlr tire U. S. S. R. and Eastern Europe
of Africa. (3) As the examples of Vietnam, Cuba and Angola, as well as the 1953 to 1969, (Cambridge: Cambridge University Press, 1972), p.43 ;
struggles in Southem Africa and the Arab World clearly demonstrate, Soviet and R.P. Sinha, op. cit., p.28 l.
IK. Datar, op. cit., pp. 52, 54..
milltary and economic support has been decisive in advancing liberation IIJ. Robert Dona1dson, Soviet Policy towards India: /deology and Strategy,
movements. In no realistic sense can any inforrned person argue otherwise. In (Cambridge, Mass: Harvard University Press, 1974), p.214.
surnmary, the Sovtet Union cannot be cons1dered to be a hegemonic force in ~o. Datar, op. cit., p.\82; Sinha, op. c1t, p.278.
the Third World. Zl. Datar, o p. cit., Append1x 1, Marshall Goldman, o p. cit., pp.l 02-103.
~l. lb id.
a Datar, op. crt., pp.69-75.
24. !bid. , Donaldson, op. cit., p.\19; and Go1dman, op. cit., Chapter 4.
References J. S. Datar, op. Cit., pp.24-32; Sinha, op. cit., p.279.
.!b. U. S. De~art~ent of Co~me~ce, Survey ~! Current Business, Oct. 1975, p.S3.
'J.7 Cooper, Sov1et Economtc Aid to the Third World' in Soviet Economy in
l. For discuss1ons of the role of U .S. foreign assístance, see Harry Magdl,fr,
The Age o[ lmperialism, (New York : Month1y Review Press, 1969), a New Perspective , o p. cit., p. 193; and Va1kenier, o p. cit., pp.222-4.
Teresa Hayter, A id as Jmperiallsm, (Ba1timore : Pelican, 1971 ); and .!11 Va1kenier, o p. cit. , p. 223.
Steve Weissman, The Trojan Horse, (San Francisco: Ramparts Press,
11) !bid., p.222.
10. U.S. Department of Commerce, Stati.rlical A bstract o[ tl!e U. S., (197S),
1974} .
2. U.S. Department of State, Commumst S tates and Developing Countritl p.801.
A id and Trade in 1974, Table 2; and U.S. Department of Commerce, Unitcd Nalions, Yearbook o[ lnternat1ona/ Trade Stat1stics { 197S) and
Bureau of the Census, Statistical Abstrae/ o[ the United States (1976), vanous previous vo1umes.
Table 1401 , (and various previous volumes). 2 /bid.
3~ Communist Party of India ( M-L), Soviet Soctallmperialism in India,
3. U.S. Department of S tate, op. cit., Table 2.
4. /b id., pp.S-6; Leo Tansky, 'Soviet Foreign Aid : Scope, Direction and (Vancouver, B.C .. lndian People's Association in North Amenca, 1976).
Trends', m Moms Bornstein and Daniel Fusfe1d (eds.), The Soviet !bid.
l:.'conomy, (Homewood, lllinois: R1chard lrwin lnc., 1974}, p.4S7. U. S. Department of State, o p. c1t., Table 7.
S. U.S. Department of S tate, op. cit., p.6, and Tansky, op. cit., pp.460·2. !bid., Tab1e 9.
6. Sherman, Tlle Soviet Economy, (Boston· Little Brown, J969),p.210; U. S. Arms Control and Disarmament Agency, lllorld M11itary Expend-
Marshall Goldman, Soviet Foreign A 1d, (New York. Praeger, 1967), uures and Arms Ttansfers, (196S-1974).
Chapter 11 ; Ehzabeth Krid1 Va1kenier, 'Soviet Economtc Relations wllh ~11. John Waterburg, 'The Soviet Union and North Africa', in lvo J.
Developmg Nations', in Roger E. Kanet (ed.}, The Soviet Union and thl Lcderer (ed.), The Soviet Umon and the Midd/e J::asr, (Stanford:
Develo¡nng Nations. (Ba1timore: Johns llopkins University Press, 1974) Stanford University Press, 1974); and Ur R'anan, The U.S.S.R. Arms
7. See /bid. A1so see discussion of JOint enterprises in latter part of this The Tlurd World, (Cambridge, Mass: M.I.T. Press, 1969).
chapter. 1'1 See for example the interview with Robert Muga be of ZANU in the
8. Tansky, o p. cll., p.4S6 ; Sherman, o p. cit., p.208 ; and U.S. Departmenl (U.S) Guardia n, 13 September 1978, p.l S.

180 181
Js the Red Flag Flying?

40. The principal sources for the d.iscussion of Soviet involvement in the
Bangladesh issue are Vijay Sen Budhray, 'Moscow and tbe Birth of
9. Soviet Relations with the
Bangladesb' Asían Survey , (May 1973), pp.482-95 ; Richard Nyrop
et al. Area 'Handbook for Bangüzdesh , (Washington, D.C.: U.S.
Gove~ment Printing Office, 1975) and Rounaq Jahan, 'Bangladesh'~
Socialist Third World
in Richard Starr, (ed.), Yearbook on /nternational Communist Af!am,
(Stanford, California: Hoover Institute Press, 1976).
41. Jahan, op. cit., pp.23940.
42. Budhray, op . cit., pp.4904.
43. Jahan, op. cit., p.240; and Nyrop, op. cit., p .26~. . , . .
44. The principal sources of information on the SoVJet Uruon s relations w1th
the Lon Nol regirne are: The Economist, (27 October 1973), p.64; and
Facts on File (various issues 1975).
45. The Economist, (27 October 1973), p.64. In this chapter Soviet relations with the socialist countries of the Third World
46 . The discussion of Soviet involvement in Angola is based primarily on .u e examined by looking in detail at the economlc and pollticaJ relations
Immanual Wallerstein, 'Luanda is Madrid', The Nation, 3-10 ~anu~ hetween the U.S.S.R. and both China and Cuba since their respective sociaUst
1976), 222: 1; Stephen Larrabee, 'Moscow, Angola and the Dialechcs lransformations. Soviet trade and economic assistance are examined for
of Detente', The World Today, (May 1976); Michael T. Kaufman, vidence of social irnperialism. Soviet political relations with both countries
'Suddenly, Angola',New York Times Magazine, (4 January 19~6);
111c also studied in order to determine whether they can rightly be categorited
John Marcum, 'Lessons of Angola', Foreign Affairs, 54:3, (Apri11976).
John Stockwell,/n Search of Enemfes, (London: Andre Deutsch, 1978) 11 hegemonic.
47. Quoted in Wallerstein, op. cit., p. l6.
48. The discussion of the developments in the Hom of Africa and the role
of the U.S .S.R. there is based on the following sources: Facts on File ' luna
(various issues from Jan.1977 to Feb. I978) ;A/rica Yearbook an~
Who 's Who , 1976, (London: Africa Joumal Ltmited , 1977); Afnca: l!.<tween 1950 and 1957 the Soviet Union loaned China approximately S 1.8
Contemporary Record, (1976-1977), (London : Rex Collings, 1977); lulhon doUars. The bulk of these Soviet credits were for the importat1on of
Africa Research Bulletin, (various issues from Jan. 1977 to F~b . 1978), utJchinery and equipment for China's industrial development. The cred1ts
and Tire Guardian, (US), (various issues from January to April 1978).
wr re to be repaid at one per cent interest over a 1O year penod (begmnmg
h111r years afler the loan was granted). Repayments were to be 111 lhe form of
1
1 lunese exports of raw materials and consumer goods to the Soviet Un ion.
1lll' Soviet Union's industrial aid included many whole plants. ll was con-
.· ntrated on constructing, under Soviet direction, 156 key Industrial proJects,
1lmost aU in heavy industry (63 in machine building, 27 in coal, 14 m non-
1 uous metals, 5 in chemicals, 7 in iron and steel and 24 power stutions) By
11JSQ the Soviets had completed the instaUation of 130 entire plnnls.l This
•vlet equipment and technical advice played a key role in Clunese industnal
d• vclopment in the pre-1958 period. 3 It has been estimated thal, of the
lnuease in Chlna's productivity in 1953-57, 92 per cent in the tron andustry
Wlll attributable to Soviet assistance, 83 per cent in steel, 100 per cent in
lllt~ks, 45 per cent in power production, 29 per cent in ferllli1er, 51 per cent
In , rude oil, and 50 per cent in metallurgical equipment.4
In 1954 the Soviets agreed to seU the Chlnese their share of the Chinc~e-
·~ td JOint stock companies in the raw materials and transpnrtahon ~ctors
( 1 lhey were doing at the same time in alJ the socialist counl ries). l1tc Suvacts
11luugreed to remove their troops from Port Arthur (where they had been
lhlliuned since the end of World War U) and to tu m over wllhout charge
Mlltn5lallations to the Chinese. 5

182 uu
Js the Red Flag Flying? Soviet Relation.r with the Sociallst Third World

Between 1950 and 1960, 11,000 Soviet experts worked in China assisting to be restrained in the interests of avoiding world war between the U.S.S.R.
development. By 1960 the Soviets had supplied the country with about .md the NATO powers. The Chinese artd the Soviets both supported the
10 000 sets of industrial specifications, 4,000 blueprints for the manufacture principie of peaceful co-existence(a concept initially deve1oped by Lenin for
of ~achines and equipment, and 4,000 sets of technical specifications. A the Soviet Union). lndeed the following principies were incorporated into
number of Chinese experts were also trained in the Soviet Union (by 1960 virtually every treaty made by the People's Republic of China after 1954:
a total of 38,000). With the exception of the specifications and blueprints mutual respect for each other's territorial integrity and sovereignty , non-
which were given to the Chinese , all the technical assistance, including . .tggression, non-interference in each other's intemal affairs, equality and
salaries for the Soviet technicians in China, was to be paid for by the Chinese. mutual benefit, and peaceful co-existence.8
Soviet industrial assistance to China during the early 1950s represented a The difference between the Soviets and Chinese on the question of co-
significan! burden for the Soviets who were still reconstructing ~eir own c:xistence with the capitalist countries was a matter of degree. The Chinese
country after the devastating effects ofWorld War 11. In the penod when the felt the Soviets were unnecessarily withholding military support for Thlrd
biggest Soviet loans were made, 1950-52, China was the only country to World struggles, especially the Algerian, the Congolese, the Cubans and the
receive any Soviet credits. Vletnamese, in order to appease the United States and avoid the rlsk of war.
Although the Soviets' terms for assistance were generous (a one per cent 11 was during this period that the Soviets increasingly emphasized the
interest rate to be paid in goods rather than hard currency), the assistance wu hnrninent danger of nuclear hostilities and the irnportance of ending lhe Cold
entirely in the forro of loans. And when they tumed over the joint st~k Wor and achieving peaceful co-existence with the U.S.A. The questlon of
companies to the Chinese, the Soviets insisted on total repay~en~ (which nuclear war was central in the Sino-Soviet dispute. The Soviets had originally
they had not done in the cases of Eastem Europe and Mongolia). promised that they would provide China with the atomic bomb , but in 1957
Soviet military assistance during the 1950s, much of it in support of they reneged on their agreement claiming that nuclear proliferation repre-
Chinese actions during the Korean War, arnounted toan additional Sl.5 ..rnted a danger to world peace. This of course implied that the Chinese
billion. This money too (including the arnount for the Korean War effort) nught use the Soviet provided weapons to start a war that the Soviets would
had to be repaid to the Soviet Union, and at a higher rate of interest than the h,• drawn into. 9 Although the Chinese felt that they needed to have the
one per cent for economic assistance. 7 This requirement that the Chinese 1111mb to protect themselves from possible intervention by the U.S., and
repay the Soviets for militaty assistance rendered during the Korean W~, American backed regimes such as Taiwan, the Chinese did recognize the great
when the Ctunese had made such heavy sacrifices in b1ood , caused consJder- 1l.tnger of nuclear warfare. For examp1e in 1963 they proposed to the world
able resentment, and would certainly seem to be an unjust imposition. lh;H·
During the Great Leap Forward , 1958-59, friction developed between the
Soviet technical advisers who remained sceptical about the whole endeavour, All countries in the world, both nuclear and non-nuclear solemnly
preferring slower and more organized growth, and the Chines~ who were declare that they will prolúbit and destroy nuclear weapons complctely,
promoting rapid industrialization based on grass roots enthustasm. From _1951 Lhoroughly, totally and resolutely. Concretely speaking, they will not use
the Soviet advisers were basically ignored. In 1960, after two years of fullle nuclear weapons, nor export, nor manufacture, nor test, nor stockpile
argument, the Soviet Union withdrew aU of its technical experts from China lhem, and they will destroy a11 the existing establishments for the research,
along with most of the blueprints and specifications for the still uncompleted testing and manufacture of nuclear weapons in the world ..
The Chlnese Govemment and people are deeply concemed thot nuclear
projects they had been working on. . . weapons can be prohibited, nuclear war can be prevented and world peace
By the time the technicians were withdrawn, constderable antago~m had preserved. We calJ upon the countries in the Socialist camp and all the
developed between the Soviet Union and China on a number of other tssuea peace loving countries and people of the world to unite and fighl un-
The Chinese had always resented the fact that the SoVIets did not give them 5wervingly to the end for the complete, thorough, total and resolute
active support during the Civil War after 1945; indeed the Soviets advised prohibition and destruction of nuclear weapons and for the dcfencc of
aJliance with and subordination to Chiang Kai-shek. After 1955 they had abo world peace. 10
become increasingly unwilling to grant more economic assislance to China.
Further they had demanded concessions such as Chinese renunciation of all 1hl' Chinese have consistently gone on lo argue however that , if nuclear war
claims t~ Mongolia and the establishment of Soviet-Chinese joint stock tkw•s break out, in spite of efforts to stop it, then the surviving peoplc of the
companies. world will surely make a revolution and what is left of thc world will become
In the period 1957-63, public antagonism between the two developed 1111 ialist. Thus nuclear war is not a thing to be avoided at aH costs
regarding the possibility of peaceful co~xtstence with the West. The two The dispute between the Chinese and the Soviets did not mvolve dts -
disagreed to what extent support for the world revolutionary movement Wll ayu:ement over whether peaceful co-existence with capitahst regimes was

184 185
/s the Red Flag Flying? Soviet Relations wlth fhc So e~aiiSI Thlrd World

desirable; the Chlnese insisted that it was. Rather the dispute related to the the lack of Soviet support during these confrontallons Wltll Taiwan and lndia
risks to be taken in sending military assistance and offering diploma tic support greatly angered the Chinese. 13
to liberation movements such as those in the Congo, Algeria, Vietnam and The growing anlagonism and, after 1960, increasingly public Cltlnese dis-
Cuba. Likewise, they did not disagree about whether progressive non-socialist agreemenls with Soviet policies and actions led the Soviet Union lo put
regimes should be supported and encouraged to move to the left. The pressure on the Chinese to modify their positions. The Soviets, mstSting on
difference between them was merely over which countries showed the most being the Ieading force in the world communist movement, dJd not at alllike
promise and how actively the process of encouraging such non-revolutionary the challenge to their Jeadership. By the early 1960s the Chinese were openly
progressive processes should be pursued . ln the last half of the 1950s, the accusing the Soviets of revisionism (i.e. of having betrayed the baslc principies
Chinese were guided by the spirit of the Bandung Conference which tried to of Marxism-Leninism), andas a result were de [acto claiming to be the new
build unity among all the newly independent countries of Asia and Africa, centre of the world revolutionary movement. Soviet displeasure wttll tlle
no matter how reactionary, in order to struggle more effectively against mcreasingly independent course the Chinese were taking was the major cause
imperialism. During this period, the Chinese insisted on not supporting of the withdrawal of Soviet technicians and blueprints in 1960, the cessation
intervention or interference in the in te mal affairs of established Third World of other forms of Soviet assistance, and the drastic cut (by two-lhirds) in
govemments. See, in this regard, Chou En-Lal's speech at the Bandung Soviet ex ports to China. In 1961 Albania was likewise cut off by the Soviets
Conference in April 1955. 11 because of its support for the Chinese positions. This made it clear to otller
In the frrsl half of the 1960s, the Chinese changed direction and tried to socialist countries and parties that the U.S.S.R. was insistent on the isolation
create a coalition of progressive Third World counlries, including Cambodia of China. These measures were clear cases of Soviet hegemonism. 14
and Indonesia, lo constitute a militant anti-imperialist force . This third force Although in many ways So"iet assistance to China in the 1950s was Iess
was to be based on both socialist and non-socialist countries. China's major generous than her assistance lo Eastem Europe, especially in that China alone
partner in this endeavour, Sukamo's Indonesia, had the biggest Communisl had to pay the Soviets for their share of the joint stock companies and pay
Party of any non-socialist country in the world. The lndonesian Communist for Korean War military assistance, it would not be correct to conclude tllat
Party's programme looked toa peaceful transition to power and a gradual the Soviet Union hadan imperialist relationship with China in the 1950s.
transition to socialism. It was not until July 1967, two years after the Party Clúna benefited considerably from the technical assistance provided and, as
was smashed, that the Chinese stopped supporting these principies and backed was clearly shown by the post-1957 Chinese actions, she was able to act
the reconstructod lndonesian Communist Party's new insistence on armed thoroughly independently of Soviet desíres. The relationship between the two
struggle as the onJy way to power. 11 until J958 while clearly not a manifestation of social irnperialism could fairly
The Chinese in the 1960s insisted on more active support for both revo- be called one of Soviet hegemonism. As long as the Chinese followed tlle
lutionary forces (Algeria, Cuba up to 1966, and Vietnam) and non-revolut- development poücies preferred by the Soviets and generally supported Soviet
ionary anti-imperialist forces (Cambodia, Bunna and Indonesia until 1965) foreign policies, the Soviets gave them considerable support. But when they
than the Soviets were willing to extend. Thcy challenged the Soviets' more bcgan to pursue independent development policies, such as tlle Great Leap
cautious interpretation of peaceful co~xi stence, by eventually arguing that Forward, and began developing an independent and more rnilitant foreign
only world revolution can stop world war since the logic of imperialism policy, the Soviets cut back on assistance and exports in order to put pressure
results in inter-imperialist war, and in any case if nuclear war were to break nn the Chinese to tow the line. When tlle Chinese refused to accept Soviet
out it would give rise to revolution. leadership in economic and foreign poücy questions and tried rather aggres-
In the late 1950s the Soviets and Chinese also disagreed on the questions rvely to convince other communist parties that the Chinese position was
ofTaiwan and tl1e Chinese border with lndia. During the 1957-58 confront- correct and that the Soviets were lending towa.rds revisionism, tlle taller
ation between China and Taiwan plus the U.S . over tlle islands of Quemoy responded by taking drastic sanctions against China, trying to isolate her in
and Matsu, tlle Soviets counseUed a de~scalation of hostility while the lhe world communist movement. This clearly reflected Soviet hegemonisttc
Chinese tried lo puU them into more active support of their cause. Again in flllhcies.
1959-60, after lhe Chinese had suppressed thc feudalled insurrection in Tibct
and incorporated tlle province fully , a confrontation between India and
China developed over their common bordcr. The Soviets, in spite of Chinese Cuba
pleas for support, remained neutral, counselhng a peaceful settlement
altllough Soviet maps supported the Chinese definition of the border. In the lk:fore 1960 approximately 70 per cent of all Cuban trade was wtth the U.S.A.
subsequent 1962 border war between India and China, the Soviets continued Cuba was as integrated into the American economy as most of the U.S. states.
to remain neutral , but actually supplied India with planes. Needless to say, When the U.S.A. imposed a total prohibition on exports to and imports from

186 187
IJ the Red Flag Flying? Soviet Relations with the Socialist Third World

Cuba in an attempt to overthrow her new revolutionary regime, the Soviet

Union immediately stepped in to prevent the collapse of the Cuban economy,
thus allowing the Revolution to consolidate itself.
The Soviet Union has remained Cuba 's principal trading partner ever sin ce
In the period 1972-74,36.6 per cent of all Cuban exports and 52. 1 per cent
of all her imports were with the Soviet Union. The percentage of total Cuban
irnports from the U.S.S.R. has been more or less constant since the mid 19601 ~.e;
'"" o
~:-s..,.,
~::S ...
But the percentage of total exports going to the U.S.S.R. has declined signill :::¡~S:::
!:¡ -~ • 4)

cantly (from 45.8 per cent in 1964-67 to 36.6 per cent in 1972-74). 15 The
Cubans have been increasingly able to find altemative markets for their
~c.o::=~vf"-~V'l~MV'lf"--f"-N
......, ~ E::::>~oq -~ . ~"1~~~~ -~
.....
exports while remaining heavily reliant on the U.S.S.R. to provide them (at 1 a '()- .s: '-
... -V'l>DV'l-M\DV'l('IOO\
"' -a -.t - oN~M
r-- C'l "
......' oo .., .!3 .
subsidized rate) with the goods necessary for their development. ·e
The Soviets have been consistently exporting far more to the Cubans than o
~ :¡:)

~" ti
-
the Cubans have to them. ln 1960-63 th~ ratio of Cuban imports from tl1e S:::

~~ ... 51:::1. 4)
U.S.S.R. to her exports to that country was 1.58; in 1964-67, 1.57; in 196R 71
2.03; and in 1972-74, 1.67. Clearly the Soviets have been heavily subsidizintt .S
~§ ... ~V'IOOOO\C'IM\DO\C'IOOO\ CIO
Cuba by providing a large share of her vital imports without a retum.
One way the Soviets have provided a major subsidy to the Cubans has been
lo;;'-!~ ... ~~~<"!~C!~~-:C"!\C?
'-!(.)~t:MNC'IOOV'IC'I _ _ _ MM ·i...o
by consistently buying Cuban sugar at more than the world price. In 1965 -70 ~;t;~~
-
t:l
.E
they paid 261 per cent of the world market price for Cuban sugar, which
amounted toan average annual Soviet subsidy of S 173 million ayear. In ~
1960-70 as a whole, they paid S 1,168 milüon to the Cubans over and abovr :-s :¡¡ 2o
the prevailing world market prices for Cuban sugar (see Table 9.1). The Soviol ~ 1:::1.~ :¡:)

price for Cuban sugar from 1965 to 1973 was 6.1 1 U.S. cents a pound. Until '-!~S::: -8MC'I88 _ _ _ _ _ ...!!!
u
~§R
M ,......M ~ ........... ,.......,..
~
1972 this was considerably above the world price. In 1972 the world sugar M~~-.ó-.ó-.ó-.ó-.ó-.ó-.ó-.ó
price went above the Soviet price (to 7.3if) for only the second time and
the Soviet price was then renegotiated upward to about J J cents a pound,
once again significantly above the world price level. 16 The Soviets have con
.s:
- ~
.D
8.:.
u
·¡;o
•
-d
4)

-~
CIO
sistently renegotiated the sugar price upwards whenever the free market prlct o '()- >-
~~Q. :a
-8.
f"-
has come to exceed the agreed u pon price between the two countries. A
....
0\ '-!~~
-
4)

renegotiation occurred in 1974 when the world price sky rocketed tempor 6
..::! ,O :() .; u
~:§~ ~~"'!<"!"!C"l~C"l~~C"l
~-g
- -.s:
\D
arily to 29.7q. Thus, even in the period of exceptionally high world sugar MOMMC'IMV'IMC'I-~
u><
0\ E 0\f"-OOC'IC'It'-C'IO--a 'u..::!
prices (1974-76), the Soviets paid 25 per cent more than the world markel N--NC'IC'IMC"'' .... M
~ o
price for their sugar irnports from Cuba. 17 The predetermined and stable prlell
.; 3
~~
.D d
(except for upward adjustments) for Cuban sugar paid by the Soviet Union 8 ...,
.........
o
·¡:¡
and other COMECON countries has allowed the Cubans to plan production E :::>
o S:: ~5
and projects paid for by their sugar exports. The Soviet guarantee of sugar .!:: '-!'o-~ ¡¡ g ¡;
E ..., .u ·s:
prices and its subsidy have enabled socialist Cuba to avoid the inherent t!o ::s s::: S f"-V'IM\D0\0-0\0\('1§
\D"<tMO\V'IM~f"-VM
~a ~
discrimination and economic dislocations normally suffered by Third World Q. o-~ cu VMC'IO\OOM Vf"-M
u
~:::E _;MNO.....:C'i.....:M.....:.....:M
8· .:¡
agricultura! exporters in capitalist world markets. .§ E
... d,g
The Soviets also subsidize and offer a guaranteed market for the Cubana•
second major export, nickel. They have consistently bought Cuban nickel 11
twice lhe world price, providing another important source of the island's
....
u u
~
;::1
o\fJ) -.s: od
~:.Q
.• u
~:au
~
>-
~
income. Soviet guaranteed purchases of sugar and nickel have been especlall)f :0 ·s: ~ O-NM~V'l\Df"-000\0
\D\D\D\D \D\D\D\D\Dr-- ;::1
.S
~~ ~ .....
0\0\0\0\0\0\0\0\0\0\0\
.,...._....,._.., ....., ...... _.................. ~~
important to Cuba because of the intemational boyco tt initiated by the U.S
govemment and transnational corporations. Pressurc from the United Stalet
•

188
189
Is the Red Flag Flying? Soci.alist Re/ations with tlle Soc1alist Third World

goes so far asto prohibit the import of other countries' steel, etc. if it contains is their habit with socialist countries with which they disagree . This has taken
Cuban nickel. Without Soviet purchases, it is doubtful whether the Cuban the form of reductions in economic assistance when Cuba has been too
Revolution could have survived the impossible economic situation it was put actively opposed to Soviet policies, and corresponding increases in assistance
in by the u.s.U1 when the two parties concur. For example, at the heigllt of lhe quarrel
The Soviets also provide most of Cuba's imports of petroleum, minerals, between Moscow and Havana in 1967-68 when the Cubans were giving active
fertilizer, steel, machinery, trucks, tractors and other agricultura! machines, as support to revolutionary movements in Latín America and attacking the
weU as other raw materials and many basic foodstuffs such as grains. A Jarge reforrnism of the continent's communist parties, irregularities and delays
19 appeared in Soviet deliveries of fue! and other crucial goods to Cuba. There
number of Cuban faetones ha ve been built w1th Soviet assistance. In 1971
there were about 3,000 Soviet technicians and military advisers in Cuba. In were delays in the signing of new trade agreements and the Soviets even began
1973 about 1,500 Cubans were undergoing advanced technical trainiog in the to press for payment of interest on new creclils.26 Al the end of 1968, after
U.S.S.R. (85 per cent of them engineers and techniclans)_'1° The Soviets the quarrel had been resolved, these rather minor economic sanct1ons were
from the beginning committed themselves to all-round development of the removed and Soviet assistance became more generous than ever. In the
Cuban economy ?1 In 1973 they again demonstrated tlteir commitment to the early 1970s the two countries became closer politicaUy lhan ever beforc.
development of Cuba by granting about S300 million worth of technical aid Cuba al long last accepted Soviet economic advice about the need to
to mechanize the sugar harvest, and to modernize and expand nickel, elec- emphasize material incentives, careful economic planning and not too head·
tricity, oil refmeries, textile and metaUurgjcal operations (this credit to be long industrialization, while at the same time reducing somewhat her support
repaid from 1976 to the year 2000).22 Toa large extent because of Soviet for adventurist guerrilla movements and her attacks on Latin American
aid ln its multitudinous forros, Cuban industry has grown at a respectable communist parties.
rate. Heavy industry increased 2.9 times from 1958 lo 1975. In the period The peak of Cuban-Soviet disagreement had occurred in 1967-68. In
3
1970-75 the rate of industrial growth was 11 per cent per armum? January 1966 the Tricontinental Congress of world revolutionary forces,
The fust Cuban.Soviet trade agreement, signed in 1961, stipulated that thc mcluding both the Chinese and the Soviets, was held in Havana. 8oth these
Cubans would pay for Soviet imports 80 per cent in Cuban goods and 20 per powers had hopes of emerging from the conference as the leading force in tlle
cent in convertible currency. As it became clear that the Cubans would not struggles of Third World revolutionaries. 8ul an alliance of North Korea,
easily be able to pay, the Soviets increasingly gave the Cubans credits for theh North Vietnam, the National Liberation Front of South Vietnam and Cuba
purchases. These credits have virtuaUy amounted to grants because ofthe emerged to isolate both the Soviets and Chinese. 8oth were excluded from the
repeated deferrnent of repayments and their interest-free nature. In 1973 all l!..xecutive Secretaria! of the Tricontinental organization {the only communist
outstanding repayments on Cuba's debt to the Soviet Union were postponed countries represented on this body were Cuba as secretary-general, North
until 1986. These repayments were then to be spread out over a 25 year Korea and the National Uberation Fronl of Soufu Vietnam). However, they
period, repaid without interest and in Cuban products. In addition an agree· were bolh given seats on fue Committee of Assistance and Aid lo lhe
ment was signed granting Cuba generous export credits for the 1973-75 National Uberation Movements and of Struggle against Neocolonla(jsm. This
period to be repaid on fue same terms.24 It is difficult to imagine more meanl they were being encouraged to provide money and military assistance
generous terms , short of outrigllt grants. Since past Cuban debt repayments lo Jiberation struggles while being denied a directing role. Neithcr the Chinese
have been put offwhen Cuba has had difficulty repaying, it can be assumed nor Soviets were happy wifu the outcome. January 1966, the very montll of
that the repayments, when and if they start in 1986, will not be a major the Tricontinenlal Congress, marked the sharp outbrea.k of antagonism
burden for her. hetween Cuba and China. This foUowed a sudden halt in Chinese rice sh.ip-
The Soviets have also provided military assislance to tlle Cubans. Up lo rnents to the island. The same period also marked the beginning of a detenor-
1971 they received aboul Sl.5 billion to modemize and build up lheir armed 4tion in relations between Cuba and the Soviets. The Tricontinental Congress
forces. Althougll most of thiS military assistance was formaUy granted on lndicated the emergence of Cuba as a third independent Commurust centre,
credit, for all practica! purposes the aid has been a gift.25 lt is clear that lhl1 more actively committed to armed revolutionary struggle in the Tlurd World
assistance lo Cuba has cost fue U.S.S.R. a Jot. There has never been a more than either the Soviets or the Chinese. 27 In the summer of 1967, Castro
generous programme of economic and military assistance to a Thlrd World loted in an interview with The New York Times that 'true Marxism-Leninism
country (wifu fue possible exception ofU.S. aid to its puppet regimes in 1 not communism as it is practised in Russia, Eastem Europe or Chlna.'211
South Korea and South Vietnam). In the period that foUowed {1966-68), tlle Cubans vocifcrously advocated
Soviet generosity to Cuba has transcended the often serious political "'wiet intervention on fue side of North Vietnam . They published Regís
differences they have had with each olher, especially in the pre-1969 period Debray's Revolution in the Revolution which was sharply critícaJ of both
However, the Soviets have from time to time put pressure on the Cubans, u lhc Chinese and Soviet theories of revolutíon and considerably more activist

190 191
ls the Red Flag Flying? Soviet Relations wftll tlle Soclalist Tllird World

than either. Cuba also sent Che Guevara and others to start a revolution in attempt at counter-revolution in Cuba. They also wanted the Soviets to inter-
Bolivia, and gave active support to many guerrilla struggles throughout Latín vene against the reformist forces in the Latín American communist partJes
America and Africa. They escalated their attacks on the traditional Latín Fidel Castro argued in August 1968: ·
American communist parties for being reformist, submissive, conciliatory,
and enemies of revolutionary armed struggle?9 The essential ~~g ~ wh~ther lhe Socialist bloc could permit the develop-
The struggle between the Cubans and the Soviets in 1966-68 was mani- ment of a polit1cal s1tuahon which mightlead to the breakdown of a
fested domestically by a purge of pro-Soviets from the Cuban Communist Soc~al~t country ... From our viewpoint, it is not permJSSJble and the
Party. Anibal Escalan te, a top leader of the pre-1959 Cuban Communist Soc1~st bloc_has the right to prevent it in one way or another ...
Party and about 40 other leading pro-Moscow Comrnunists were expeUed in 1 ask, m the light of the facts and in the light of the bit ter reaiity whic h
January 1968 from the Party, and many tried and sentenced as traitors. led the Warsaw Pact countries to send their forces to crush a counter-
revol~ti.on in. Cze~ho~lov~_and to su~port a minority there ... agamst
Members of this 'micro-faction' were accused of spreading pro-Soviet and
~ m¡y~nty w1t~ nghhst pos1hons; 1 ask 1f they will cease supportmg also
anti-Castro propaganda, passing secrets to the Soviets and pressuring the tn Latm Amenca those rightist, reformist, subrrússive, and conciliatory
Cuban leadership into adopting a pro-Moscow line. 30 l~ader~, enemies of revolutionary armed struggle who oppose the peoplc's
The fact that the Cubans didn't hesitate to take independent action in hberallon struggle. 31
support of Th.ird World revolution - even though they were in an extreme)y
vulnerable position vis-a-vis the U.S., reliant economically on the Soviet Union
and had been cut off by China- demonstrates that they are nobody's pawns. It is interesting to recall that the relations between China and Cuba deterior-
And the fact , in tum,that the Soviets exerted oniy minor economic pressure . ate~ sharply in January 1966 after the Chinese cut off vital imports of rice and
on them during tlús period, in spite of rather grievous insults and provocat- ms~sted that all future trade with Cuba would have to be balanced. The
ions, furthermore suggests that the Soviets are not a typical hegemorúc power C~nese .refu~d to subsidize the Cuban economy in any way because of Cuba's
insistent on submissive behaviour as the reward for their benevolence. fnendship wtth the U.S.S.R., even though the Cubans mamtained their inde-
The subsequent reconciliation between the U.S.S .R. and Cuba which pendence from both China and the Soviet Urúon. The Chinese economic
occurred in late 1968 was motivated more by the Cubans' actual experiences sanctions fo~owed caustic Chinese barbs against her. 32 This move by China
than by any pressure put on them by the Soviets. The failures of the Cuban m 1966 (which foreshadowed China's treatment of Albania and Vietnam in
economy were summed up as being a product of adventurist economic 1978) ~as comparable to similar Soviet actions agalnst other socialist
policies and attempts to sk:ip stages on the road towards fuU comrnunism. countnes_wh~se foreign poli_ci~s displeased the Soviet Union (Yugoslavia in
These failures convinced the Cubans that the Soviets were correct in their 1948, China 10 1960, Albarua m 1961 , North Korea in 1962, and Romania
economic advice to rely on more material incentives, more careful planning, In the late 1960s. lt shows that there is no qualitative difference between
an only gradual transition to communism and a more careful and balanced Chinese and Soviet treatment of weaker socialist countries.
industrialization policy. The failure of Che Guevara in Bolivia and the inablllty The reconciliation between Cuba and the Soviet Union after 1968 and the
of any guerrilla movements in Latín America to come close to success, Jike- especiaUy warm relations which have existed since 1973 by no means irnply
wise demonstrated the errors of the rather adventurist Cuban line in inter- that Cuba has a ~~e~ite status in relation to the Soviet Union. Nor do they
national affairs, and suggested that perhaps the more traditional Soviet and pomt to ~ reduction m Cuban commitment to aiding revolutionary struggles
Latín American C.P. approach to revolution was not totally bankrupt after In the Third World. All the evidence indica tes that the CUbans are legiti-
all. To persist in disastrous domestic and lntemational policies in the face of rnately thankful for the extremely benevolent Soviet assistance and ndvice
obvious failures would have been suicida!. And if foUowed long enough, it \ tnce 1960 and they tend genuinely to agree on most intemationaltssues
would have meant the discrediting of Cuba asan intemational revolutionary nowadays, while still giving crucial support to Th.ird World struggles. Here
force and probably the eventual coUapse of its socialist regime. By late 1968 the most outstanding ex~plc. is Cuban assistance to the revolutionary
it was becoming clear to the Cubans that Soviet policies were not as wrong truggl~ of the.M.P..L.A. 10 Angola (perhaps the best illustration of prole-
as they had thought, while Soviet benevolence in continuing to support Cube tanan m~ema~~nallsm since the raising of the lntemational Brigades during
in spite of the hostility between the two countries, carne to be regarded as th~ Sparush Ctvil War ofthe 1930s). Cuban assistance to the Angolan Revo-
evidence that the Soviet Urúon was a true friend. lutton was comparable_ to Soviet assistance to the Spanish Republic (when it
The Soviet intervention in Czechoslovakia in the middle of 1968 was abo WJS threate.n ed by Hallan and German fascist intervention in the 1930s) and
an irnportant influence on the Cuban leadership's decision to reverse its C:h.inese asststance to the .Democratic People's Republic of Korea {when 1t
course. The Cubans wanted the Soviets to promise the same kind of help to W'JS threatened by U.S. intervention in the 1950s). Cuba gave heroic support
them as they had provided the Left in Czechoslovakia, in the event of an "' the Angolan people's struggle against the C.l.A. and South African

192 193
ls rhe Red Flag Flying? Soviet Relariom wttll tite Soctalisr Third World

intervention in Angola, although it pul her in great jeopardy on account of her the socialist countries of the Titird World such as China and Cuba. Soviet
vulnerabilily lo the U.S. This indicates once again thal Cuba puls the interests economic relations with China in the 1950s, whilc considerably less benevo-
of the Third World revolutionary struggle above her own short-run state lent than its relations with Cuba in the 1960s and 1970s, and with Eastem
interests to a greater extent than either the Soviets or especially the Chinese. Europe after 1956, nevertheless p1ayed an importan! positlve role in the
Cuba is now on better tenns with the traditional Latm American cornmun· development of China without securing any economic advantages for the
ist parties than it has ever been. And while support has been extended to Soviet Union in retum. The massive and extremely gencrous economic
other roads for social change, particularly progressive nationalist military support of Cuba by the Soviets since 1960 is probably the leading case to
regimes in Peru and Panama and the electoral road in Chile {1970·73), Cuba disprove the thesis of social imperialism.
continues to train revolutionaries and give support to guerrilla actions such But, while there is no evidence that thc Soviet Union is social irnperialist
as those in Uruguay, Argentina and Nicaragua. Cuban backing for guerrilla m her dealings with the Third World socialist countries, there is a lot of
groups is, however, no longer granted to virtually any group seeking it, no evidence to show that it has tried to be hegemonic, during the 1950s and
matter how small or impossible the task, but has tended to be lirnited to just carly 1960s. The sanctions taken against China for her independent course,
the more serious major groups who produce results and have sorne chance of as well as the failure lo be as generous with her as with the other much
success. The Cubans by no means unconditionally back the traditional Latin smaller socialist countries, indica les Soviet hegemonism in the pre·1960
communist parties whom the Soviets still favour over other major leftist forcea period. Lesser sanctions taken against the Democratic People's Republic of
in Latin Arnerica.33 Korea in 1962·64 for becorning too close to China, and the minor sanctions
The attitude of the Cubans toward the Soviets, which by all indications is taken against Cuba in the 1966-68 period for its independent and extremely
based upon a genuinely independenl judgment (whether or not il is valid) can militant course, also reflect hegemonism . While Soviet relations with China
be summed up by the following quote from Fide1 Caslro's speech to the Fint tn the 1950s would appear to be as clear a manifestation of Soviet hegemon-
Congress of the Cuban Cornmunist Party in 1975: ism as exists, ils behaviour towards North Korea and Cuba have clearly been
rather minor aspects of overall Soviet relations with these two countries. The
There will be many changes in the future, the day will even come when Cubans in particular established themselves as an independent revolutionary
capitalism disappears in the United States, but our feeling of friendship for force subservient tono one, while the Soviets have consistently provided
the people that helped us in those decisive nnd critica] years, when we faced essential economic support to the revolutlonary regime.
starvat1on and extermination, will be everlasling. This adds to our gratitude lt would seem that the case of China is a special one, having to do wilh:
to the people that blazed the trail of lhe socialist revolution and that, at ( 1) its serious potential for becoming an alternativo world centre for the
the cost of millions of lives, freed the world from the scourge of fascism. communist movement; and {2) with the tendency for its independent
Our confidence in Lenin's Homeland is unbounded, because in the course development to occur earlier than any other communist movement or state,
of more than half a century the Soviet revolutíon has proved its adherence cxcept the Yugoslavs who were dealt with in a manner much more drastic
to the principies and consistent line of behnviour in its intemalional policy
lt has shown this not only in Cuba but also in Viet Nam , in the MiddJe titan the Chinese. Soviet treatment of the Chinese cannot be considered the
East, in the Portuguese colonies fighting for their independence, in Chile, archetypal case of Soviet relations with Third World socialist countries.
Cyprus, Yemen, Angola and every other part of the world where the While in the 19SOs the Soviets clearly tried to preserve their hegemony over
national liberation movement confronts colonialism and imperialism, as 11 thc world communist movement (including over the governing communist
once did in an exemplary manner wilh the heroic Spanish people. This parties of the Third World) by the l960s they carne, as a resull of consider-
incontestable truth has not been mvalidated by a smgle exception, and m able prcssure, to abdicate more and more from this role, becoming increasing-
the long run any slanderous attempt to deny history's objective facts will ly tolerant towards altemative perspectives m the world communist movement.
be useless. The U.S.S.R. has also made a decis1ve contribution to world Thc minor sanctions applied against North Korea and Cuba in the m1d 1960s,
peace, without which, in this epoch of growmg scarcity of raw materials compared to the serious sanctions taken against China earlier and the even
and fue!, the unperialist powers would have launched upon a new and more drastic sanctions taken against Yugoslavia in the 1940s, clearly indicate
voracious partition of the world . The mere ex1stence of the powerful o considerable reduction in Soviet hegemonism. Their admittedly unhappy
Sovi\:t Sta te makes this alternative irnpossible. lts detractors, who try to
tolerance of the major Eurocommunist parties m the 1970s, together with
deny this, are Like dogs barkmg at the moon 34
their conttnuing conciliatory gestures towards Chtna, indicate a stiU further
tlccline in Soviet hegemonism during that time. In summary, while there are
Conclusions ,1111 sorne minor elements of hegemonism m Soviet relations with Third World
\t!Cialist countries, these relations are in fact esscntially govemed by what the
There is no cvidence of social imperialism in Soviet economic relations with Soviets call proletarian intemationalism.

194 195
b the Red Flag Flyingl Soviet Relations with the Socialist Third World

Summarizing our fmdings about Soviet relations with the countries of Asia and pro-Sovietism in most of Eastem Europe and the smaller communist
Eastem Europe and the socialist and non-socialist countries of the Third partles outside of Westem Europe.
World , we can only conclude that there are both important similarities and
differences in them. Most importantly, in none of the three sets of countries
is there any substantial evidence to show that the Soviet Union is social
imperialist. In none of the three does the Soviet Union engage in exploitation References
through trade, econornic assistance or foreign investments. Nor does she, in
any of them, domina te their econornies in order to make them into raw l. Howard Sherman, The Soviet Economy, (Boston: Little, Brown and
material suppliers or economlc dependencies of the U.S.S.R. In al1 cases, Co. 1969) p.200; Robert Owen Freedman, Economic Warfare in the
Soviet involvement facilitates the autonomous economic development and Communist Bloc, (New York: Praeger, 1970), Chapter 4, p.l 07.
industrialization of these countries. She is not social imperialist. 2. Sherman, op. cit., p.l99; and Roy Grow, ' Soviet Economic Penetration
In sorne areas, nevertheless, namely Eastem Europe, the Soviet Union is of China, 1945-1960', in Steven Rosen and James Kurth, Testing
still hegemonic. And in others, namely the socialist countries of the Third Theories o[ Economic fmperialism, (Lexington, Mass: D.C. Heath and
World, hegemonism has been, albeit decreasingly, a major component of Co. 1974).
Soviet relations. While it was perhaps the dominant aspect of such relations 3. /bid.
4. /bid.
in the 1950s, it is clearly only a secondary component in the 1970s. As for
5. Freedman, op. cit., p. lll.
the non-socialist countries of the Third World, on the other hand, no sub- 6. Grow, op. cit.
stantial evidence can be found that the Soviet Union is, or attempts to be, 7. Grow, op. cit., and Freedman, op. cit., p. l 06ff.
hegemonic, although she clearly and correctly intervenes in support of pro- 8. AJan Lawrance, China's Foreign Relat1ons Smce 1959, (London:
gressive regimes and nationalliberation struggles. Routledge and Kegan PauJ, 1975).
This long exploration of the relationship between the Soviet Union and 9. Freedman, op. cit., p.118.
other socialist countries, as well as with the non-capitalist Third World, forces 1O. Peking Review, 2 August J 963, cited in Lawrance, op. cit., pp.85-ó.
us to conclude that the Soviet Union cannot be called a social imperialist 11. This speech was reprinted in the New York Times, 25 April 1955 ,
superpower. The Chinese are wrong. quoted in Lawrance, op. cit., pp. l65-8.
There are no mechanisms analogous to overproduction operating in the 12. Freedman, op. cit., Chapter 4 ; and Lawrance, op. cit., Chapter 2.
13. Lawrance, op. cit., Part IV.
Soviet economy which force the pursuit of overseas investment outlets, or 14. Freedman, op. cit., Chapter 3, especially p.79.
trade surpluses in order to facilitate the accumulation of capital. Soviet 15. United Nations, Yearbook of lnternational Trade Statisrics, (1975)
foreign relations generally benefit liberation and other progressive forces and various previous volumes.
against conservative and reactionary ones. Soviet overseas involvements do 16. Leon Goure and Julian Weinkle, 'Soviet-Cuban Relations: The Growing
not advance the economic interests of the Soviet Un ion at the expense of the lntegration', in Jaime Suchlicki, (ed.), Cuba, Castro and Re11olution
peoples of other socialist countries or of the Third World. The Soviet Union (Coral Gables: University of Miami, 1972); Carmelo Mesa-Lago, Cuba
does not seek or obtain expansionist oriented milltary bases overseas. And in the 1970s, (Albuquerque: University of New Mex.ico Press, 1974),
Soviet policies do not generally hinder the advance of the world socialist pp.13-20; Fidel Castro, 'The U.S.S.R ...Cuba Economic Agreements',
movement, although they haYe spread considerable dissension, and in places New World Review, 41 :2, ( 1973) p.60.
demoralization, among communists and progressives. 17. lnternational Sugar Organization, Sugar Yearbook, (London: 1976)
and the Food and Agriculture Organization, Trade Yearbook, 1976.
Soviet hegemonism, benevolent as it might often be, is still however a 18. Castro, op. c1t., p.60.
force in the world communist movement and especially among the socialist 19. Mesa-Lago, op. cit., p.ll; and Goure and Weinkle, op. cit., p.167.
COMECON countries of Eastem Europe and Mongolia . The Soviets still tend 20. Mesa-Lago, op. cit. , p.18.
to maintain that they have the best understanding of the correct road to 21 Goure and Wein.k.le, o p. cit., p.160ff.
socialism and communism, although they have grown more tolerant towards 22. Mesa-Lago, op. cit., p.20.
opposition in the Westem communist parties and in the East European 23. Fidel Castro, Speech to the First Congress o[ the Communist Party
countries, than ever before. Soviet hegemonism is gradually being eroded as of Cuba, (Moscow: Progress Publishers, 1976).
each communist party and socialist regime increasingly comes to decide its 24. Goure and Wein.k.le, op. cit., p.160; Mesa-Lago, op. cit., pp.20-l;
own policies. These policies, of course, often tend to converge in particular Castro, 'Tho U.S.S.R-Cuba Economic Agreements', op. cit., pp.55-60.
regions - for example towards Euro-Communism or revisionism in the major 25. Mesa-Lago, op. cit., p. l8.
26. Goure and Weinkle, op. cit., p.l68.
parties in the advanced capitalist countries, Maoism in much of South-east

196 197
Js the Red Flag Flying?

27. D. Bruce Jackson, Castro, the Kremlin and CommuniJm in Latín

Amuica, (Baltimore: John Hopkins Press, 1969), esp. Ch. 6; Foy Kohler. 10. The Soviet Union:
'Cuba and the Soviet Problem in Lalin A menea', in Suchlscki, (ed.). op. crt
28.
29.
/bid. p. l31.
!bid., pp.IJ0-2; M. Michael Küne, 'Castro's Challenge to Latin American
Retrospect and Prospect
Communism', in Suchlicki (ed.), Cuba, Castro and the Revolution
(Coral Cables, Florida: University of Miami Press, 1973).
30. Kohler, op. cit., p.J 32; Kline, op ctt., p.211 .
31. fbtd., p.214.
32. D. Bruce Jackson, Castro, the Kremlin and Communism in Latín
America, (Baltimore: Johns Hopkins Press, 1969), pp.32-3 ; Goldman,
Soviet Foreign Aid, (New York : Praeger, 1967).
33. Kline, op. cit., pp.2 18-20.
34. Fidel Castro, Speech to the Ftrst Congress o[ the Communist Party o[ In thls f111al chapter, 1 will attempt to su m up the evidence from the earlier
Cuba, op. cit., p.64. chapters about the class nature of the Soviet Un ion. l shall examine briefly
the historical development of Soviet society (speclfically the Stalin years),
look at the development of Soviet hegemonism and speculate about the
possible future of the Soviet Union. In conclusion , l willlook at the political
tmplications of this study for the world socialist movement.

The Oass Nature of the U.S.S.R.

Our long road through the available empirical data has led us to the inexor-
able conclusion that the Soviet Union is a sociaJist society, albeit a somewha t
distorted one. Markets do not have a logic of their own in the Sov1et Uruon
and so the laws of the labour market do not prevail. The Soviet economy,
mcluding labour allocation, is govemed by a central plan and not by the
pursuit of profit, as are all market capitallst formations. No exploiting class
controls the means of production nor domina tes the state and party.
To show that an exploiting class exists, lt must be demonstrated that the
people who are In Jeading roles operating the means of production cxcrcise
control over the production process in ways that benefit themselves al the
expense of the actual producers. Jt must be specifically shown that they
appropriute the economic surplus of the producers for theír own ends. This
ís not the case to any appreciable degree in the Soviet Union. Although the
salaries and fringe benefits of the managerial and govemment power
eh te are significantly greater than those of the average productive worker (by
u factor of four or five), this is very small compared to either the differential
between ruling class families and the productive classes in the Westem
ca pttalist countries or in comparison to the size of the economic surplus whích
lli d1sposed of in the U.S.S.R. The lugh and growing level of free goods and
~rvices, the rapidly rising standa.rd of living, and above allthe rapidly diminish-
mg economic inequality and the increasing depth and breadth of political
debate and participation are strong indicators that the power elite are not
benefiting at the expense of the productive masses. Moreover thc former
prerogutives and privileges of these people are steadily díminishing.

199
198
ls the Red Flag Flying? The Soviet Union. Retrospect and Prospect

Nothing like a social class of owners and controllers of industry, such as In sum, the Soviet Union must be categorized asan authentically socialist
exists in the capitalist countries, is present in the Soviet Union. Although the country, albeit one in which party and state officials play the central role
professional intelligentsia are able to give their children a chance sorne three both in initiating decision making and in day-to-day operation of the economy.
times greater than that of the manual working class, to make it into the There appears to be a distortion in the Soviet Union's state socialism towards
inteUigentsia (even then half the recruits to this stratum come from the concentration of power and toa lesser degree privileges, m the hands of
working class), there is no inheritance of top managerial or govemment experts - engineers, economlsts, scientists, professionals, technicians and
positions. In fact about 75 per cent of top positions continue to be filled specialists in general. Compared toa decentralized socialism, such as the
by people from backgrounds outside the intelligentsia. While the occupants Chinese (circo 1966-76), these latter strata in the U.S.S.R. appear to be
of leading managerial and govemmental positions do ha ve significan! privi- playing a disproportionate role vis-a-vis common working people. For the
leges in comparison to factory workers, in relative terms these are far less most part, however, it seems that their superior decision making role is not
than in the West. They are also fully compatible with the offtcial Soviet view so much used for their own personal benefit, as to guide Soviet society
that ~ey are necessary as incentives to motívate workers and students to according to their almost technocratic ldeology of efficiency and scientific
take on the responsibilities of leading roles (an argumcnt not unlike that of expertise. The slate socialism of the Soviets has a strong technocratic, rather
the functionalists in the West). These facts do not amount to evidence for the tlUln bureaucratic or charismatic bias, enabling it to be categorized as a
emergence of a new ruling class which exploits U1e workers. technocratic state socialism
The pie tu re which has emerged from this study is that Soviet society can
best be seen as composed of the following social strata: (1) the peasantry
who are the poorest and least influential group; (2) the manual working class, Stalin
who, economically and politically, are conSJderably better off relative to
peasants, white collar employees, managers and the professional intelligentsia, ll is peculiar that many Marxists who maintain a consJstently materialist
than are their counterparts in Western capitalist countries; (3) enterprise pos1tion when analysing the development of capitalist or pre-capitalist
managers and Party and state officials, most of whom have humble back- societies (always looking for class forces and class struggles to explain
grounds, and relatively (compared to the West) few privlleges vtS-a-vis the historical developments) resort to explaining developments in the Soviet
industrial worklng class; (4) the lower leve! white collar employees, who have Union from the 1920s to the 1950s largely in terms of individual personali-
litUe influence or privileges; and (5) the professional intelligentsia who are ties - 'Great Men', personal motivations, power hunger, and so on. This is true
definitely the most privileged group in Soviet society as well as the most of both apologists for Stalin and their arch opponents the Trotskyists. The
socially cohesive. lt is important to note that, unlike the case in capitalist reason for using these latter (and un-Marxist) categories, when analysing
societies, occupants of the most powerful economic and political positions the transitional years ofSoviet history, lies in the intense political comrnit-
are not the same as those who have the most privilege. (n sum, the picture ments, loyalties and bittemesses experienced by various Marxist parties and
emerges of a petty bourgeoisie, who the Soviets themselves call highly factions during these years. They consequenUy feel the need either lo legiti-
educated workers (and who much of the New Left would have referred toas mate among the masses (who are not always fuUy conscious Marxists)
'new working class'), led by technical experts and scientists who play an what was happening in the Soviet Union by attributing super-human charac-
important, but not politically leading, role in the Soviet Union ; an industrial te ristics to Stalin, or conversely to attempt to win widespread support for
working class, which is relatively privileged and powerful; and a group of movemen ts antagonistic to the Soviet Union, among people who make no
managers and officials who do not form a distinct social class, Jet alone a pretence of accepting the materialist conception of history. The bitterness
ruling class. of the struggles between the mainstream communist parties of the world
There appears to be a high leve! of political support for the Soviet system and their social democratic and Trotskyist opponents outlasted the death
by the producing classes, as well as a high leve) of political participation. The of Stalin and continues to colour analyses of Soviet history. The personal
working class plays a central and growing role in both basic society-wide experiences of the post-1953 Soviet leadership, bitter about the treatment
decision making and in day-to-day operation of the enterprises where they they had received during the Stalin years, resulted in Khrushchev's denunci-
work and the communities in which they live. There appea r to be consider- .ahon of the cult of personality in 1956. Thls analysis by the post-1953
able obstacles to the power elite making decisions which run against the basac: leadership (which subsequently becarne entangled in the Sino-Soviet split,
interests of the masses or which reverse the trend of the last 20 years towarda with the Chinese essentially defending Stalin) has reinforced the tendency
greater equality and popular democracy. It is most likely that greater actual 1
to ignore historical materialist categories in the analysis of Soviet history.
power resides with the producing classes than with a small power elite of Almost three decades have passed since the death of Stalin. Sufficient
managers and officials. time,surely, for the world Marxist movement to gain enough distance from

200 201
Is the Red Flag Flying? The Soviet Union : Retrospect and Prospect

the events of which he was at the centre, to evaluate objectively the meaning years on the class structure and development of socialism.
of the policies and events which occurred in the years when he was the The l930s and l940s, when the country was under severe intemational
leading figure in the world com.munist movement. Justas an objective and domestic pressures, were the heroic period of Soviet history. Decision
analysis of the role of other revolutionary figures - Cromwell or Robespierre making undoubtedly became highly centralized at the expense of both Soviet
- had to wait a respectable number of years after their deaths, so too must and Party democracy. Economic inequality also increased. But, at the same
a scientific analysis of the meaning of Stalin. time, the last vestiges of private capitalism were eliminated, ilie country was
Although emotions shou1d by now have dled down to the point where an industrialized (with all that this meant for rising levels of consumption), and
objective analysis is possible, the consequences of a scientific understanding the working class expanded until it became a majority of ilie population. The
of U1e Stalin period remain considerable for the fu tu re of ilie worJd comm- people, also, were educated in basic Marxist principies. And ilie institutional
unist movement. What if ilie analyses of Westem anti-Marxist, or Trotskyist, framework was consolidated, something which was to be ilie basis for greatly
or social democratic organizations are correct? What if Stalin really was one expanding popular participation after the mid 1950s. In the period of Stalln's
of ilie two most brutal despots of the twentieth century - responsible for leadership the Soviet Union successfully repulsed ilie Nazi invasion and
the destruction of workers' power in the U.S.S.R. and ilie creation of a new destroyed fascist ru le in central Europe (90 per cent of all German World War
bureaucratic class; responsible for ilie putting to deaili of millions for 11 casualties were caused by the Soviets). The U.S.S.R. was the only country
resisting his whims; and responsible for dealing with boili domestic issues and able to resist the Nazi blitzkrieg. Th.is success must in good part be attributed
foreign communist parties to the detriment of the development of socialism to the popular support and unity of Soviet leadership (they had no Quislings
in ilie Soviet Union and ilie advance of the Communist movement overseas? or Petains, the purges of the late 1930s, excessive as they were, had seen to
If all this is so, very serious questions are necessarily raised about the liber- iliat), and the ability of the Stalin leadership to inspire confidence in the
ating promise of Marxism. If the mainstream of ilie world Marxist movement Soviet people.
foUowed Stalin's leadership for 30 years in spite of these gross injustices and This period also saw the coming to power of communist pa.rties in a dozen
abuses, are Marxists, now or in the future, ever to be trusted to cometo oilier countries and their becoming major poUtical forces in Westem Europe,
correct analyses and inspire the workers' movement towards communism? as well as in many Third World countries. On balance, ilie net gains for
lf ilie revolutionary situation in ilie U.S.S.R. could so evolve in the l920s intemational and Soviet Com.munism during iliis peñod were considerable.
iliat it tumed into its opposite, what is to stop this from happening after In order to account for iliese achievements in ilie period of Stalin's leader-
revolutions in other countries? Perhaps it is better that we do not support a ship, iliree lines are commonly taken. The fust argues Stalin was a genius
revolutionary process at all. Indeed if ilie claims, now accepted by virtually who more or less single-handedly fought against all odds to win these great
allleftists not closely associated willi Albania or China (boili of which victories. This is the position of most Maoist groups. The second maintains
continue to celebrate Stalin) are true, the Marxist Left faces terrible that the communist parties of ilie world, especially the Soviet Union's, were
embarrassment. so strong, their líes with the masses so firm, and ilie working class and
While it is undoubtedly true that Stalin sometimes demonstrated personal peasant movement so overwhelming Ulat, in spite of Stalin's arbitrariness and
characteristics of rudeness, arrogance and distrust, iliat he sought to increase venality, these great victories were accomplished. This is the position of ilie
his own power (which became considerable), and that he was quite often U.S.S. R. 's current leadership and of most non-Maoist communist parties. The
vindictive, mistaken and caught up in the collective paranoia of this period UUrd line of argument alleges these accomplishments were bought ata cost
in which ilie Soviet state was the most threatened, these factors can only be which made their achievement not worth the effort. The suffering of ilie
incidental to the material forces which were at work in the Soviet Union from peasants during forced collectivization was not justified by the result of rapid
ilie 1920s to the 1950s and which acted to produce ilie policies followed, as industrialization; the Chinese Revolution was distorted by Stahn's influence;
well as ilie results obtained. The policies in ilie period of Stalin's leadership, the Western communist parties became bureaucratized and betrayed their
as weU as the mechanisrns for decision making and mass involvement, were revolutionary roles; millions died needlessly in the war against Hitler because
dictated in their broad oullines by the situation and were not the product of of Stalin' s bungling etc. This position is commonly held by Trotskyists and
Stalin's personaJ motives or psychological state. On the contrary , the person· Social Democrats.
alities and motives of Stalin and the other leaders were socially formed A11 three of these positions raise serious problems and all must be rejected.
according to the requirements of the situation, and ilie leadership itself wa! Materialism cannot accept the Great Man or genius ilieories of history. Honest
socially selected on the basis of the effects of iliese two elements. Justas Marxists must recognize as great achievements the Chinese Revolut1on, the
Marx did a class analysis of Napoleon Ili , we must do a class analysis of ilie new socialist regimes in Eastem Europe, ilie growth of the Westem communist
Stalin period in order to uncover which class forces were operating through parties, the destruction of Hitler, the industrialization of the U.S.S.R. and
Stalin's leadership and what the effects were of the policies of the Stalin ~o on. To assume that these achievements could have been accomplíshed in

202 203
Is the Red Flag Flying? The Soviet Union . Retrospect and Prospect

spite of venal and arbitrary leadership makes no sense. Leadership is produoed time when they were vitally necessary for survival. Stalin, unllke Trotsky and
by the sJtuation in which it occurs. Classes and in~titutions develop the Zinoviev, did nave a realistic sen se of what couJd be done in the un favourable
leadership they need in order to accomplish what they want to achleve. conditions of the 1920s and how to inspire people to do it. !lis slogan of
Stalin's leadership, then, must be credited with being one which realized the Socialism in One Country gave Party members hope that tl1ey could succeed,
great advances ofthe Soviet Union in the 1920s to 1950s period. And the even m the face of the defeat of revolutionary forces m Europe and China.
nature of that leadership, including its harsh characteristics, must in tu m In contrast, the Trotsky-Zinoviev position that a socialist transforrnation in
be accounted for by the material forces at work in the U.S.S.R. and the world the U.S.S.R. had to wait until a revolution in Europe, was seen as defeatist
at the time. and demoraliz.ing. Stalin carne to symbolize commitment to building the
lf the Soviet Union was to survive and Communist leadership be preserved, future.
the stumbling around of the flrst ten years after the Revolution had to be The subsequent conllict between Bukharin and the group around Stalin in
ended. The country had to industriali.ze rapidly, fustly to adequately feed, 1927 centred on whether rapid industriallz.ation and collectivization of the
clothe and house its population and thereby prevent growing disaffection, peasantry should be undertaken. Bukharin argued the New Economic Policy
and secondly to build a military machine that could successfully defend the had lo be contlnued indefmitely, allowing the Kulaks to carry on enriching
country agaJnst any repeat of the invasion by the leading capitalist powers lhemselves, and that only a slow process of industrialization must be under-
that had occurred during the Civil War of 1918-21. Since the working class taken. The Stalin group, on the other hand, felt that the U.S.S.R. could not
who had made the Revolution was only made up of a small percentage of a afford go-slow economic development policies. ln 1928 Stalin made a speech
still basically peasant country, the regime's active social basis was not a1l that which predicted that the country only had about 1O years to mdustrialize
large. This was unlike the situation in China where most of the 2? ~ear . before the likelihood of being invaded again, and that only rapid industrializ-
struggle was carried on by the peasantry. Thus the process of raptd mdustrta- ation would crea te a military machine capable of saving socialism. Again, most
lization, dictated by the desperateness of the situation, had of necessity to be of the Party genuinely rallied behind the Stalin leadership which was committ·
largely a top down process. ln fact, in the countryside, the collectivization of ing lhe Party to the heroic effort of modemizatíon of agriculture, industry
agriculture occurred with considerable class struggle between the poor and tne military.
landless peasants and the rich employer farmers (the Kulaks). The upheaval To explain the struggles among the Trotsky, Bukharin and Stalm groups
caused by collectivization and the sharp struggle waged by both sides around as being essentially personal intrigues on the part of Stalin to gam absolute
il, together with the rapid growth of cities, created a potentially .explosive power i.s poppycock. Very real issues were at stake. Historical hindsight
siluation. Peasant rebellions, spontaneous rioting of new urban rnigrants, allows an objective evaluation which puts the poücies of the group around
divisive factionalism in the Soviets and the Party, and the rapidly worsening Stalin in a most favourable light. lt was the objective situation dictating
intemational situation, could easily have paralysed the country and ensured certain policies that was responsible for the victory of the Stalin group. And
defeat at the hands of foreign invaders. 1t might even have provoked a new the group allowed its position to evolve under pressure of the Soviet masses
civil war which the Bolsheviks could have lost. and Party members who needed a leadership which would articula te thelr
Careful studies of the factional battles in the C.P .S.U. in the 1920s show enthusiasm to move ahead, even against the greatest odds. Stalin provided
thal Stalin emerged as leader because he obtained the genuine support of that leadership and inspiration and it is for this rcason that he became and
most of the Party's Leadership, as well as the confidence of its rank and ftle. remained the key leader.
Virtually the en tire Party supported the move to isolate and oust Trotsky Soon after the triumph of the Stalin group in the C.P.S.U., a cult of
from the leadership because of a widespread feeling thal he aspired lo be a personality began to develop around the person of Stalin. In 1929 the
Soviet Napoleon. Trotsky had only joined the C.P .S.U. in the summer of U.S.S.R. publicly celebrated bis birthday. Soon cities and mounlains were
1917, a few months before the Revolution and after 15 years of factional being renamed after him, bis picture became omnipresent, statues were
battles and hostility with Lenin and the Bolsheviks. He was distrusted by erected to him in every town. Al1 this happened before a seríous case couJd
virtually all because he had not shared the Bolsheviks' harsh experiences of be made of despotic leadership on his part. Was the cult of Stalin {which carne
underground üfe in the pre-revolutionary period, and because of bis long to supplement the cult of Lenin created after the latter's death in 1924) a
history of independent radicalism and bis oralorical abilities and positio~ as result of the man's own vanity? Again, materialists must Look to material
head of the Red Army. The general feeling among nearly all the Bolshevik factors for an explanation of both the L.enin and the Stalin cults.
leaders was that he did not have a sufficiently realistic sense of what had to The personality cult around Stalin (and that around L.enin) served the
be done in a period of retreat for both the Revolution in the U.S.S.R.ll!'~ function of winning the support of the peasantry and thc new working class.
for the world revolutionary movement as a whole. They also felt that bis mee• ln lieu of the peasants' fundamental involvement in making the sociaJist
ant factional activity in the Party spread disunity and underrnined morale at a revolution, the Bolshevik regime had to be personalized for it to wln their

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loyalty. Even in China and Cuba, where there was authentic massive peasant could well become impossible. lt is far easier to preserve a sraws quo than it is
support, the charlsma ofMao and Fidel have played important roles. It to transform social relations radically . Thus far more unily and enthusiasm
would seem that any revolutionary regime has to have a period of personaliz- are necessary in revolutionary situations than in times or stabillty.
ation in which the charlsrna of its leading f¡gure is necessary in order to create Suppression of opposition is far more importan! 10 such periods. This 'law of
legitirnacy. Such a personality cult has no necessary relation to the actual transformation' is independent of mode of produclton and simply reflects
degree of decision making power of the principal leader, as the role of Mao a common-sense understanding of the need for legitimation and of the factors
Tse·tung immediately before the Cultural Revolutlon showed. The personality which produce enthusiasm.
cult, instead, serves a key social function when circumstances don't allow for Becoming aware of the draining effects of inter-party rivalry and intra-
the much slower development of the cla.ss-conscious understanding and party factionalism, the Lenin leadership (supported enthusiastically by
struggle needed to win people toa socialism without individual heroes. Such Trotsky) first suppressed the other left parlies (the Menshevaks, Anarchists
early post·revolutionary regimes, notably Cuba and the Stalin period in the and Left Social Revolutionaries) as they became obstructionist, and then in
U.S.S.R., might then best be called 'charismatrc state socialism'. 'Socialism' 1921 banned organized factions in the Communist Party itself. This did not
because the productive classes in the last analysis really do have power; mean that the Party discouraged an active interna! democratic llfe. 1t only
'state' because the initiative and day-to-day operational control resides with meant that Party members now became committed to supporting actively
state and party officials; and 'charismatic' because the public personality of official Party policies once adopted. Commitment to the Party as a whole
the leading figure plays such a key role in the legitimacy of the regirne. was placed before commitrnent to one's faction. These measures also did not
The successful accomplishment of mobilizing a people to achieve a mean that the one party state created by the suppression of the other parties
difficult end (such as protracted people's war, or the rapid and radical was non-democratic. The Party, by its overwhelmingly working-class base in
economic and social transformation of a society) requires a considerable the 1920s, continued to express that class's interests. Under Lenin's leader-
unity of leadership as well as suppression of opposition, in order to generate ship the C.P.S.U. had devised a mechanism which combined centralization
the solidarity and enthusiasm necessary for the task. Whether the costs of (with its solidarity and enthusiasm generating, and hence transforming, ability)
such unity and suppression are judged legitirnate depends solely on how with democracy.
important the goals are considered. All societies are periodically faced with Such was the política! situation that the Stalin teadership found in exist-
the need to generate solidarlty and hence to repress opposition. The United ence when it succeeded Lenin. The need to generate enthusiasm and solidarity
States, for example, has periodically gone through such times. During the intensified with the rapid collectivization and industrialization of the 1930s,
War of lndependence, British Loyalists in Uberated areas were not only and became even more necessary with the growing threat of foreign invasion
forbidden to express publicly their opinions, but were actively persecuted. in the late !930s. These pressures led decis10n making to become more and
During the late J790s, supporters of the French Revolution and opponents more centralized.
of the framers of the U.S. Federal Constitution were denied freedom of the This danger of foreign invasion during the late 1930s should not be
press and were arrested. During the Civil War, the Bill of Rights was suspended underestimated. Japan, ltaly and Germany formed an alliance in 1937 - the
for Confederate sympathizers in the North, and after that War, civil Uberties Antí·Comintem Pact (also known as the Axis)- explicitly directed against
were denied to the leaders of the Confederacy. (Robert E. Lee did not have the Soviet Union and world communism. Japan had been rapidly expanding
his citizenship rights restored until the 1970s!) During World Wars 1 and 11, on the Soviets' eastern borders since its conquest of Manchuria in the early
neutralists and groups sympathetic to the Germans (e.g. the l.W.W. and the 1930s. Germany had been re-arming and expanding since 1935. ln 1938 the
Socialist Party in 1917) were suppressed. And of course, during the 1950s British and French agreed to let Germany annex Czechoslovakia which lay
the American Communist Party was repressed, its leaders jailed and its right between the Soviet Union and Germany, rather than joining with the Soviet
to participate in elections revoked. Any leadership that is serious about its Union to fight to protect Czechoslovakia (as the Soviets offered to do if
goals, especially in a crisis situation which requires total mobilization, will do either Britain or France would support her). And, of course, in 1941 Germany
al1 in its power to create solidarity and popular enthusiasm by repressing mvaded the U.S.S.R. and within a few months was in the suburbs of Lenin-
those forces fostering disunity and demoralization. grad and Moscow. 1t was only when over 20 million Soviets were killed, that
The process of socialist transformalion is as important as any previous the German invader was fmally defeated.
progressive transformation (such as the U .S. War of lndependence and Civil 1t is almost certain that the intelligence services of Japan and Germany
War). lt requires at least the same degree of popular enthusiasm and solidarity were present in the Soviet Union in the 1930s and acting very much as U1e
as did these earlier events. To allow opponents of socialism, or even socialists North American C.I.A. did in Eastem Europe in the late 1940s, and how
who have radically different strategies, to organize actively against the leader- other branches of the U.S. intelligence operate (e.g. the F.B.l .'s Comterpro lo
ship will sap morale and enthusiasm to the point that social transformation mfiltrate and subvert the American left). In the late 1940s in Eastem Europe

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ls the Red Flag Flying? Tlle Svvtet Umnn R~trosput and Prosp~ct

the CJ.A. did all it could to get the Soviets and local communist parties to made, and what were the viable historical options, and what effects decisions
believe that sorne of their best leaders and cadres'were working with the C.I.A. had on classes. lf such an analysis is made, we see that, tn spite of the abuses
This was designed to encourage divisiveness and demoralization and to ofhls position and collective paranoia of 1937·38, Stalin conlinued
elimina te sorne of the most effective communist leaders. For a few years this broadly to express the interests of the Soviet working people (as opposed to
policy succeeded as witnessed by the purge trials of 1949 and 1950. The C.I.A. both the older capitalist or landlord classes and to the new rising strata of
planted stories and- given the atmosphere of paranoia induced by the real state bureaucrats and the professional intelligentsia). He must therefore be
threat of World War in this period - the purges mushroomed into treason considered, in the last analysis, to be their instrument. The objective results
trials of loyalleading communist figures. 2 of his period of stewardship amounted to a considerable advance along the
lt is very likely that, in the even greater period of tension induced by winding road to socialism, not only for the U.S.S.R. but also for the world as
imminent foreign invasion in the late 1930s, a similar planting of fabricated a whole.
stories by Japanese and German intelligence agents, to the effect that various The fact that the 1937-38 purges were primarily directed against the
honest cadres and leading figures were working for them, produced very leaders of the Soviet Union reflected the constant pressures acting on Soviet
similar results to what happened ten years later as a result of C.I.A. inter- leaders, including even the highest Party officials, to maximize production
vention. The extreme pressure which the Communist Party was under in and popular mobilization and to create the conditions for a successful
1937-38 predisposed its cadres to believe the worst. As a result, tens of military defence and socialist transforrnation. Which class or stratum in
thousands of sincere members, especial!y top leaders in the Party and top Soviet society could be considered to benefit and whlch incipient classes or
government and military officials, were executed and many thousands more strata to suffer from such pressures? Clearly not the bureaucratic stratum.
were demoted and irnprisoned. While the vast majority of people persecuted lndeed it is not surprising that Stalin's own proteges began to publically
in these years were innocent of any wrong doing and were loyal to the denounce him in 1956, for he was not their representative and did not defend
Communist Party,many of them had serious doubts about the correctness of their prerogatives. We must conclude that either Stalin was above class forces
the Soviet leadership's policies and thus potentially could have become rallying or that he was essentially the tribune of the working people, albeit sorne times
points for opposition. Secondly, those purged were mostly C.P.Ieaders or a harsh one. The latter analysis fits best into a historical materialist analysis
senior state or military officials, (substantial evidence in itself that there was of the facts, i.e. the U.S.S.R. was in fact a socialist society in the l930s and
nothing like a ruling class in the U.S.S.R. at this time). The unifying effect of 1940s.
the purges was illustrated when the Nazis invaded. Though the military The fact that there were abuses of power as well as collective paranoia
efficiency of the Soviet Army had been reduced by the purge of its general must not be attributed to Stalin 's personality. They are byproducts
staff in 1938, there was no split in the Soviet leadership d uring the war. All (negative to be sure) of the need to create both great unity anda cult of
Soviet leaders and virtually all Soviet military officers expressed the greatest personality to enhance legitimacy. The process of socialist transforrnation is
resolve to defeat the Nazis. The Soviet Union was unique in Europe in this not the best of aiJ possible worlds; in fact it is simply the necessary stage to
regard. As 1 have already stated, there were no Petains or Quislings in the create such a world - communism. AB a result, sorne people unjustly suffer and
U.S.S.R. The unified Soviet leadership was able to mobilize and inspire the there are negative consequences of otherwise positive developments. Abuses
Soviet people to defeat the Nazis. Although harsh and sometimes unjust of the personality cult and the danger of arbitrary decision maldng were the
methods were used and innocent people killed, this unity, greatly slrength- most serious of these negative consequences. It is rare that a crisis becomes as
ened by the purges, played an important part in the Nazi defeat. lt should be intense and prolonged as that experienced by the Soviet Union from 1928 to
noted that the massive purges and trials of Commurusts for treason which 1950 (a period of rapid social change and bitter class and international war·
swept the Soviet Union in 1937 and 1938 were ended by 1939, never to be fare). It ls therefore unlikely that the need for such a high degree of unity
repeated. This was an implicit admission that such witch hunts were divisive required in lhe first of the world's socialist revolutions, will ever recur. Jts
and in good part promoted by foreign agents. attendant abuses are therefore also unlikely to appear in future socialist
Between 1934 (the year of the assassination of Kirov, one of the top transforrnations.
Communist leaders) and the last of the three great Moscow treason trials in As we ha ve established, the basic course of Soviet hlstory from the 1920s
1938, Stalin became incredibly powerful. He began sometirnes to make through to the 1950s was dictated by the international and domestic situation
important decisions without consulting the Central Committee or Politburo. of the Soviet Union and the irnperative of preserving Bolshevik rule. 1t had
The centralization of decision making had reached extreme lengths. However little or nothing to do with the personality of Stalin. With the exception of
this should not be confused with the question of which class was in power in the scope, viciousness and paranoid nature of the 1937-38 purges, most of the
the U.S.S.R. in the post-1934 period. That question must be understood in basic decisions made by the Soviet leadership in this period tum out, with
terms of what class forces produced the situation within which decisions were historical hindsight, to have been the best possible choices, given the very real

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Js the Red Flag F/ying? Tire Sov1et Umon : Retrospect and Prospect

constraints of the situation and the limited number of viable options. Of of communism. lt may also be dueto the mterests of those in relatively
course, it would have been better, in the most perfect of all worlds, to ha ve privileged and powerful positions who want to preserve their prerogatives.
reüed on the masses, instead of on top leadership. But such poücies, given This disparity between the heroic period of the 1930s and 1940s and the
the degree of peasant resistance to the regime, would ha ve been suicidal in most recent penod of Soviet history reflects the fundamental difference
the 1930s. The system of material incentives was the only viable way to between the charismatic state socialism of the earlier penod and the techno-
motiva te quickly the new working class and the peasantry to the heroic cratic state socialism of the latter. Leadership in the first period was held by a
efforts necessary for industrialization. The intemational situation of the small number of revolutionaries, formed before and during the Bolshevik
1930s did not allow the luxury of a Great Leap Forward ora Cultural Revo- Revolut10n, who relied heavily on popular appeals to mobiJize the masses.
lution. (lt was the protection provided by the existence of the Soviet Union Tius Jeadersh1p used material incentives and recruitment into the C.P.S.U. to
that ensured the Chinese the space to perform these world historie experi- ensure the rapidly expanding strata of experts' service to the socialist state.
rnents in the next generation.) The de mise of Stalin, which coincided with the end of the heroic period, saw
The post-1953 leadership of the Soviet Union often likes to contrast a struggle between the declining forces of charismatic state socialism (led by
itself with the Stalin period by claiming responsibiUty for the growing top Party officials) and the ascendant forces of technocratic state socialism
democratization ofthe state and Party since 1953, the greater freedom of (based on the technical experts). Khrushchev's leadership thus marked a
public debate, expanded social services, greater equalization of incomes, transition period, not between socialism and capitalism, but between these
expanded workers' participation in industry, etc. In fact, however, these two forms of socialism. lt was marked both by a continuation of the style
measures,just as muchas the measures in the opposite direction in the 1930s, of direct popular appeal and by sudden changes in policy , characteristic of
were a product of the logic of Soviet society and the intemational situation. charismatic leadership. But this period also saw a consolidation of the position
They have no more lo do with the good intentions and personaüties of these of the scientists, engineers, economists, technicians, etc., whose struggle with
Jeaders than the earlier policies had todo with Stalin's. There is no reason to Khrushchev ultlmately resulted in his dismissal. The victory of this intelli-
believe that the course of post-1953 Soviet history would have been apprec- gentsia stratum led to the Brezhnev period (post-1965) in which routine
iably different if Stalin had üved another 25 years. At best, because Stalin gradual progress, a Jow leve! of popular mobililation and effic1ency and science
was tempered in the desperate period of the 1930s, his considerable personal dominated.
influence might have slowed down sorne of the democratizing measures of
the 1950s and 1960s and likewise slowed the tendency for the experts to
consolidate their positions. But it would probably not have blocked the The Origins of Soviet Hegemonism
income equalization measures, since the goal of motivating workers to up-
grade their skills and increase their devotion to job performance had been Soviet hegemonism, the attempt by the Soviet Union to dominate both the
achieved . world communist movement and the other socialist countries, is by no means
The principal contras! between the period of Stalin's leadership and the a phenomenon of the last generation. Its roots go back to the very founding
post-1953 period lies in the difference between the policies pursued by the ofthe Third lnternational in 19 19. Soviet hegemonism was far more pro-
Soviet state and Party and the viable historical options to speed the develop- nounced in the period from 1928 to 1958 than it has been since. In fact,
ment towards Communism. During the 1930s and 1940s it is difficult to since the mid 1950s, it has continually declined lo lhe point where most
conceive of altemative policies which would have more effectively speeded communisl parties opera te quite independently of Soviet desires and most
such a development. The irnmediate pursuit of this goal had to be postponed socialist countries with considerable autonomy from, where not actual
in the interests of saving the country and preserving the rule of the Bolsheviks. hostiüty to, the C.P.S .U.3
But since the destruction of fascism , the consolidation of popular support, lt was the great preslige of the Russ1an Revolution , the Bolshevik Party
and becoming a leading industrial and military power, there has been consid- and V.L Lenin himself that from the beginning gave such authority to the
erable room in which to pursue more directly the goal of communism and to pos1tions of the Russian Communist Party. The Russians had the only party
expand the direct day-to-day involvement of the masses in running their own in the world that was able to make a revolution . As such 11 was looked up
Uves (as the Chinese did during the Cultural Revolution). Compared to what lo by virtually all revolutionaries as a source of wisdom and guidance. This
would now seem to be historically possible (as borne witness to by the early tendency to have great respect for the ideas of Lenin and the Russian
Chinese, who are, it must be remembered, al a much lower leve) of industrial Communist Party on questions of theory, strategy, tactics and organization
development), the Soviets appear to be progressing somewhat slowly. This was Jegitimatcly based in the successes of the C.P.S.U. The world communist
may be due to the conserva ti ve altitudes of well-intentioned leaders who grew movement down to the mid-1950s continued to have strong reasons lo
to poUtical maturity during the heroic years of st rategic retreat from the goal respect the authority of the Soviet Union, not only because it represented

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the only socialist revolution in the world, but because in the post-1943 period communist movements, as weU as the overwhelming power of world capitalism.
it was the inspiration, if not the leader, of the rapid expansion of Marxist- The 1923-28 period of united fronts between the various socialist parties
Leninist regimes in Europe and Asia. Soviet hegemony, then, was nota thing corresponded correctly with a time of economic and social stability, in which
imposed on unwilling subjects or manipulated by a sinister Moscow, but revolutionary adventures were doomed to fall and the primary task was to
something enthusiastically and spontaneously generated throughout the build work.ing-class solidarity in preparation for a future crisis in which it
world by communists who needed an inspiration for their endeavours. would once again be viable lo try and seize power.
From the founding ofthe Soviet system in 1917 through to at least the ln 1928, at the Sixth Congress of the Comintem, the line of the world
1950s, one of the prime tasks of communists worldwide was the defence of communist movement under the leadership of the Soviets moved radically
the Soviet Revolution. They did all in their power both to undermine the to the left. The 1928 Comintem analysis saw a return to a period of economic
efforts of the capitalist powers to destroy the Soviet regime, and to lend what depression and of inter-imperialist rivalry and wars. This in tum would pro-
support they could to the Soviet attempt to consolida te socialism in the voke social upheavals and revolutionary situations. Consequently, the world
U.S.S.R. This goal was sometirnes taken to mean the acceleration of a given communist movement was redirected to prepare itself once again to lead
revolutionary situation (e.g. in the 1928-35 period), and at other times the insurrections and to accelerate the revolutionary process. This involved
building of broad popular fronts to isolate anti-communist forces (e.g., the combatting the social democratlc parties' non-revolutionary leadership of the
1935-39 and 194147 periods). Far from being a too! of the Soviet leaders working class since these parties would, unless discredited, cause revolutionary
to influence the policies of other countries in favour of Soviet interests,the opportunities lo be missed.
principie of defending the Soviet Union made considerable sense as part of The correctness of 1928 Comintern analysis was borne out by the out-
a world revolutionary strategy for all communist parties. The living exarnple break the very next year of the most serious economic crisis capitalism has
of a socialist revolution in the Soviet Union was a tremendous inspiration to ever experienced. This led to the Japanese, ltalian and German military
the revolutionary and working class movements throughout the world. lt was expansion into China, Ethiopia, Spain and Czechoslovakia in the mid-1930s,
much easier for communist parties to win recruits because they could point and flnally to the outbreak of all-out inter-imperialist war in 1939. Commun-
to an actual example of socialism that provided a real altemative to capita- ists had every reason to expect that such a situation would be a hot-house
lism. The existence of the Soviet Union was powerful propaganda both for for the growth of revolutionary forces. lndeed, in Spain, France, China and
the socialist vision ( even when the popular conception of what life in the elsewhere, the communist movement grew considerably during the 1930s
U.S.S.R. was like was exaggerated) and for revolutionary strategies and because of the Great Depression; and of course grew much more rapidly in
organizational principies of the local communist parties. Had the Soviet Union the wake of World War U, in virtually allthe countries affected by that war.
been overrun in 1919 or 1941, the world revolutionary movement would have Nevertheless, the 1928 Comintem strategy proved to be seriously faulty
suffered a grievous loss. The defeat of any other revolutionary movement regarding how to deal with reforrnist socialists and other non-revolutionary
could not possibly be compared in seriousness to the smashing of the Soviet progressive forces whom it called social fascists. lt also grossly under-
Revolution, as a setback for the world revolutionary movement as a whole. estimn ted the growth of radical rightist movements such as the fascists. These
All this is quite aside from whether the Soviet leadership ever did in fact carne to have great popular appeal, to the point of being able (in conjuction
manipulate the world communist movement to slow down a viable revolut- with the capitalist class) to smash the communist movement in many countries.
ionary process so that their country's own narrow interests would be advanced. Whether or not this period in Comintern policies was justifled, it would be
Although this might possibly have happened from time to time, it was not the difncult to interpret itas simply the Soviets cynlcally manipulating the
essence of the policy of the defence of the U.S.S.R. This policy clearly world communist movement for their own narrow defensive ends. If defend-
functioned to the advantage of the world communist movement which gained ing the U.S.S.R. was the only concern, it could have been done much more
far more from the Soviet Union sirnply because it existed, than might have efnciently by adopting reformist policies which did not antagonize the
been lost in a few specific cases because of missed opportunities. In fact, Western powers. lnstead the Comintern returned in 1928 to insurrectionary
for the most part, the actual policies advocated by the Soviet leadership politics despite the fact that this could only be expected to renew fears
corresponded to the needs of the world revolutionary movement independently among Western capitalists that the contmued existence of the Soviet Union,
of the need to preserve the Soviet Revolution as a living example. which was supporting domestic fúth columns pledged to overthrow them at
From 1919 to 1923, the Comintem under Soviet inspiration pursued the flrst opportunity, was such a danger that it had to be destroyed. lndeed,
policies of preparing for and leading i,nsurrections throughout the world. the new Comintem policy might weU have provoked them to invade the
Given the massive dislocations foUowing World War 1, this was a very reasonable Soviet Union once again as they had done in 1919 in su pport of the whites
policy which carne close to success in a number of cases (e.g. Germany and during the Civil War. The 1928 policies were clearly premised on the idea
1-lungary). 1t ultimately failed because of the inexperience of the local that revolution ín the West should be supported, regardless of what the

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Westem capitalists thought about the Soviet Union as a resuJt. . which had been, or were about to be, overrun by the Fascists. There is no
At the 7th World Congress of the Comintem in 1935 the world commurust doubt that thls retum to Third Period politics was dictated by the Soviet
movement still under the leadership of the Soviets but with considerable Jeadership without any genuine discussion and democratic decision making in
independe~t input based on the experience of both the Ch.inese and various the wor1d communist movement. 1t can be argued, however, that, detrimental
European parties, did a fundamental self-criticism of what had proved to be as the policy was i.n many cases, it was the correct or necessary li.ne for the
the uJtra-left errors of its Third Period (1928) line. These policies had clearly world communist movement to follow. This is so if one accepts, first, how
been ineffectual in stopping the growth of fascism or in producing a workers' important it was to preserve the Soviet Union as a socialist state, and second,
revolution in any country. This Congress developed the new policy of the the importance therefore of postponing a Nazi invasion for two years while
Popular Front, a coalition of all progressive working class and middJe ~lass the U.S.S.R. strengthened its defences.
forces - communist, sociali.st and liberal - who were opposed to fase¡~ Prior to the Munich agreement between Hitler, France and Britain in 1938,
and who favoured a defence of democratic rights {the rights of trade uruons, the Soviet Union since 1934 had done everything possible to build an anti-
mínimum wages, paid bolidays, civilliberties, unemployment insurance, old German alliance with Britain and France to stop Hitler. 1t signed a mutual
age pensions, fu Uemployment poticies etc.). By leading a massive popular defence treaty with France. 1t also promised to intervene in Czechoslovakia
movement which was not revolutionnry in its goals, the Comintern thought against the Germans, if either France or Brltain were to do li.kewise. And the
that the rapid world-wide growth of fascism could be stopped and the rol~ of U.S.S.R. joined the League of Nations at the same time as Japan and
communist parties enhanced to the point where they would eventually gam Germany left it. Despite all this, the Westem powers rejected the Soviets'
enough popular support to lead a revolutionary process. attempts to stop the Nazis in 1938. lnstead they decided to give in to Hitler's
The policies of the Popular Front produced considerable gains for the imperialist intentions towards Cz.echoslovakia, hoping that by agreeing toa
communist movement. The French Communist Party, as a result of the German eastemward expansion in the face of strong Soviet opposition, they
Popular Front victory in the 1936 elections, gained considerably as did the would succeed in keeping themselves out of war with Germany. They
French working class as a whole. The Spanish Communist Party also grew probably also hoped that this would create the conditions for a Soviet-
very rapidly in the course of the Spanish Civil War {1936-39), toa great extent German conOict which would greatly weaken both anti-Westem powers. ln
because of the Popular Front policies it foJJowed. But the greatest success of the face of thls betrayal by the French and British, the Soviets were Jed to
aJI occurred in China. After the adoption of the 7th Comintem Congress play the same game as the Westem powers, i.e. sign a non-aggression pact
analysis which dictated seeking an alliance of the four anti·im~erialist classes. with the Nazis that would tu m Hitler westwards, setting up the conditions
and foJJowing policies of rent reduction rather than conftscat10n of the land for a war between Gerrnany on the one side, and France and Britain on the
of rich peasants and the smalllandlords, the Ch.inese Communist Party other. The Soviets had every reason to expect such a war to be as prolonged
abandoned its pre-1935 Jeft-adventurist policies of rural Soviets and attac~s and devastating as World War r and to so weaken both sets of powers as to
on the nalional bourgeoisie and rich peasants, and began to grow very rap1dly. provoke working-class revolution in allthese countries. At the very 1east, such
lt even tually carne to power in good part be cause of 15 years of Popular a war would be expected toso weaken and distract Gerrnany as to put off,
Front strategies. The People's Republic of China in 1949 was initiatly modelled perhaps indef1nitely, a German attack on the Soviet Union.
on the People's Democracies of Eastern Europe created ayear or two before The Soviet Union, like the entire world, was surprised by the quick
- all built on Popular Front ideas of the aJJiances of various classes and a collapse of France in the face of the Nazi b/itzkrieg. lnstead of a protracted
gradual transition to a socialist economy. . . and exhausting war and a consequent growth of revolutionary movements,
The Comintem/Soviet policy which most fits the thes1s that narrow Sov1e1 Germany's qu1ck victory in the West resulted in greatly strengthening her war
self-interest set intemational Communist policy to the detriment of the world machine's material base which was then used agai.nst the Soviet Union in
revolutionary movement was probably the 1939-41 policy of considering 1941 . Nevertheless, the two year respite that the non-aggression pact gave
Nazi Gerrnany and the major Western capitalist powers as equal enemies of the Soviets alJowed the latter to double the size of their armed forces and
world revolution. During this period the world communist movement reverted modernize their equipment. It is very likely that, if the Nazis had attacked
to the policies of the Third Period ( 1928-35), abandoning the Pop~Jar Front the Soviet Union at the beginni.ng of the war, they would have been able to
(except in China). lt was terribly disillusioning for m~y Commumsts to have overrun the country (they carne very close to doing so even in 1941-42). They
to abandon the anti-fascist Popular Front strategy wh1ch had won them so rnight have then used the Soviet Union's economy as a base, permanently to
much sympathy in favour of a policy that did not consider Fascism as any consolida te lheir hold on alJ Europe and to conquer all of the Middle East,
special danger. During this period world communism was subordinated to the India and North Africa. As it tumed out, the Nazis arrogant assumption
interests of the Soviet Union to the detriment of the short-terrn growth of that the Soviet Union would collapse in a few months with mínima! German
the movement. This policy proved especially detrimental in those countries casualties (an expectation based on their racist theory of the inferiority of

214 215
Js the Red Flag Flying? The Soviet Un ion: Retrospect and Prospect

Slavs) proved to be fatal to them . Rather than a ~uick conquest ofthe Soviet world was a progressive one, which helped the growth of communist parties
Unlon, they became bogged down in a murderous conflict which led to their and progressive regimes even at the cost of growing U.S. hostility towards
defeat. By the end, about 20 million Soviets had been killed by the Nazis the U.S.S.R, as in Greece, Korea and Vietnam.
and 90 per cent of aJ1 German war casualties were on the Eastem Front. Another major accomplishment of the Comintem and the Soviet leader-
World War ll in Europe tumed out to be primarily a war between the Soviets &hip was the shlfting of the world revolutionary movement's emphasis to the
and the Gennans with aJ1 other theatres being virtual side-shows. (American countries of Asia, Africa and l.atin America. After the revolutionary wave
casualties amounted to only one per cent of Soviet casualties.) It was the in Europe receded in 1923, the attention of the world communist movement
Soviet Unlon that fought World War 11 and destroyed Hitler. The Red flag &hifted towards China, India, the Middle East and other parts of the colonized
was hoisted in Berlin and the world communist movement everywhere grew world. The liberation of Third World countries was given priority for the first
by leaps and bounds as a result. Looking back on it, it may weU be that the time. In the mid-1920s it was said that the road to Berlin and Paris lay
long-term result of the 193941 Comintem poUcies, in spite of the short- through Peking and Delhi. Theories of national Liberation were developed as
term setbacks in most countries that it represented for the communist move- the communist movement spread from Europe to the Third World; these
ment, was greatly to accelerate the growth of the movement in all countries, theories supported and inspired anti-imperiallst movements everywhere. The
owing to the breathing space it gave the Soviets to buUd the base necessary surge of communist activity, toa great extent inspired by the existence of the
to defeat Hitler. In any event the developments of 194448 certainly made Soviet Union and its hostility to the imperialist countries, was given further
Soviet policies look good to the common working people ofWestem Europe, impetus during and imrnediately after World War 11 when communist-led
and led lo a huge rise in support for many of the Westem communist parties. movements carne to power in China, North Korea and North Vietnam.
Popular Front policies were considerably modified in 1947 as a result of Communists became major forces in the national Liberation and anti-irnperia-
the Westem capitalist powers' growing hostility to the communist movement tist movements of many countries. Once again, as the revolutionary wave in
and the Soviet Union. The comrnunist parties were thrown out of the govem- Europe receded in the late 1940s, the major thrust of world communism
ments in ltaly and France and the Cold War against the Soviet Union was shifted to the Third World. The Soviet inspired communist movements, unlike
begun. This led the communist movement to retum to rather more militant the social democratic parties of the old Second lntemational and the Trotskyist
tactics than those pursued since 1941. Once again, this new tendency was not movement (both of which continued to focus on Europe and the other
so much dictated by the Soviet Union's narrow self-interest, as by the rapidly advanced capitalist countries) broke new ground in their emphasis on, and
changl.ng world situation. leadership of, anti-irnperialist and revolutionary struggles in Asia, Africa and
The rapid growth of communist forces, especially throughout Europe, latin America.
China and Vietnam, was a result of the continuing Popular Front policies of ln the Light of what thus appeared to most communists to be the wisdom
the immediate post World War ll period. This was also the case in China of Cornintern/Soviet leadership in the world communist movement from
where the Communist Party made every effort, short of capitulation to the 1917 through to the late 1940s, il is no surprise that deference to Soviet
Kuomintang, to u ni te anti-imperialist forces. These advances led to the West's leadership was forthcoming. lt was not until the 1950s and 1960s - in the
counter-attack (in the form of the Cold War etc.) on the communist movemen t face of the stagnation of the world communist movement, disagreements
and the Soviet Union. In fact had the communist movement not grown so between the U.S.S.R and the socialist regimes in Eastern Europe and China,
rapidly in Europe and Asia, the Western powers would not have seen the and the arguments about revolutionary strategy that developed within the
Soviet Union as such a threat. A good case could be made that the rapidly world movement - that Soviet hegemony broke down. In fact, Soviet
expanding world communist movement forced the Soviet Union defensively hegemony outlived spontaneous consensus about the wisdom of Soviet
to confront the U .S.A., when narrow self-interest would have dictated leadership by only a few years. Once local communist movements began to
abandoning communist parties everywhere except those in Germany, have doubts (stemming from the diverse nature of their own experience)
Czechoslovakia, Hunga.ry and Poland (the line of any fu tu re attack from the about Soviet policies for making revolution and consolidating socialist
West on the Soviet Union). regimes, a multi-centred world communist movement soon became a reality .
lt must be admitted that the Soviets continued lo advise the Chinese Party Soviet hegemony was in good part a product of the state of seige to which
to seek a coalition with the Kuomintang in which the Communists would be the intemational communist movement was subjected from 1928 through
the subordinate partner. They also did not provide material support to the to 1949. This was the period in which there was only one socialist regime, and
Chinese Communists apart from tuming over a considerable armoury of hence only one leadership that could speak on the basis of its successful
captured Japanese weapons to them in Manchuria. And they advised the experience, a leadership furthennore that had to be defended for the sake of
communist parties in ltaly and France not to attempt anned insurrection. the health of the world movement.
Nevertheless, in the imrnediate post-War period, the role of the Soviets in the The Third lntemational under Lenin introduced the idea of intemational

216 217
Js the Red Flag Flying? The Soviet Union : Retrospect and Prospect

discipline, i.e. the idea that the various communist parties of the world were undoubtedly made by the Comintem, in siding with one or another local
sections of the Third Intemational and subject to its discipline just as much leadership group, the net result of its intervention was unquestionably bene-
as regional and local party organizations within a nation were subject to ficia! in creating unity. One can see the difference that absence of an inter-
national party discipline. Since monopoly capitalist corporations and the national arbitrator with universally acknowledged prestige makes, in the
Jeading imperialist states operated on a world leve!, and there was one inter- disarray and mutual hostility of the revolutionary Jeftist groups of the 1970s.
national capitalist market, it was considered desirable for the world movement Again, it should be stressed that what aJJowed the Soviet Jed Comintern
to behave in a unified fashion. For this would confront international capital successfully to intervene to crea te unity in the local parties was its prestige,
as a single unified force. 1t was also considered wise for the experience of each wlúch was pretty much universally acknowledged by all factions.
party to benefit all the other parties which wouJd then not have to Jeam Allegiance to the Soviet Jed Comintem also had the effect, by holding out
separately the Jessons already Jeamed (most commonJy these Jessons were the living example of socialist revolution in the Soviet Union, of hindering
drawn from the Soviet Party, the only one to have made a successfuJ any opportunist policies from developing under the inducement of the short-
revolution). term advantages of reform. While the old socialist parties had only a vague
Having the intemational communist movement operate as a single force in conception of socialism, a conception that was easily malleable to suit
all countries had both negative and positive results. On the one hand, inter- political exigencies (it was easy for the ideas of Bemstein to become current
national discipline sometimes meant that policies inappropriate to local condit- in a party desirous of winning an election when there was no clear alternative
ions were forced on a local Party ( e.g. sorne of the insurrections directed by to capitalism generally recognized by the working class), the new Bolshevik
the Comintern in Central Europe and China in the 1920s). On the other hand, parties hada clear vision and inspiration in the Soviet Union. As a mode1
the greater revolutionary experience of the Comintem at times forced reluc- (even with its imperfections and romanticlzed character), it provided a very
tant local parties to ta.ke measures that benefited the growth of the world real altemative to Bernstein-type revisions of the socialist altemative. Even
movement ( e.g. the universal establishment of Leninist organizational princi- when the communist movement was following essentially reformist policies,
pies in the 1920s, or the ending of Jeft-wing adventurist tendencies in the as it was in 1935·39 and 1941-47, the livingexample ofthe U.S.S.R, and
early 1920s). Toa world socialist movement which, in 1914,had seen the (especially in the Jatter period) its active support of the armed struggle
major social democratic parties of Europe support their respective govemments against fascism and coloniaüsm wlúch was occurring in much of Europe and
in a war amongst one another, while the Bolsheviks had calJed for the sub- Asia, tended to Jceep the local communist parties true to their revolutionary
verslon of the war efforts of each country by the intemational working class, intentions.
the idea of one co-ordinated world revolutionary policy under the Jeadershlp The origins of Soviet hegemonism must be sought, then, not in the self-
of the proveo revolutionaries of the Soviet Union made considerable sense. It interested manipulations of Soviet Jeaderslúp, but rather in its historically
was further validated by the great triumphs of intemational communism in useful functions for the wor1d communist movement. The world movement
the 1940s. had every reason to look to Lenin and his successors for both inspiration and
Two very important consequences of intemational discipline under the concrete leadership, and accepting such leadership more often than not made
Jeadership of the Soviet party were the containment of factionaüsm and considerable sense. ln much of the world, it eventually proved itself by the
sectarianism , and a relative insulation from revisionism or reformist-opportun- rapid growth of communism. Leaving aside the mista.ken Soviet pressures on
ist degeneration of isolated parties acting under nationaJ pressures (as the the Chinese .communist Party in the immediate post World War n period, it
parties of the Second lntemational had been subject to). In country after was not untiJ the 1950s that a reasonable case could be made that unquest-
country, Comintem prestige and intervention succeeded in eliminating or ioned Soviet leadership in the world movement was becoming in balance a
containing the factionalism that had traditionally plagued the Jeft wing and negative force . With the defeat of Nazi Germany , the Soviet development of
sapped the energy of the revolutionary movement. This greatly facilitated the atom bomb, and the rapid spread of socialism (especially in China), the
the development of a unified and energetic revolutionary left. For example existence of the Soviet Union was no Jonger tenuous. Furthermore, as a result
in the U.S., disparate groups, originating in the I.W.W., the Jeft wing ofthe of the events of the 1940s, communist parties became dominant among revo-
Socialist Party and independent nationality based socialist currents, formed lutionary working·class and intellectual forces in many countries, at the
three different and mutually antagonistic communist parties. But these were expense of social democracy and syndicalism. There were now a number of
welded together by Comintem intervention into a single party. The continuing socialist regimes which had more or less by their own efforts made a revo-
factionalism within that unified party was then eventually eliminated by lution - in China, Vietnam, Yugoslavia, Albania and eventuaJJy Cuba. Thus
further Comintem intervention. revolutionary socialists could now Jook to these countries too as authorities
Similar processes occurred throughout the world lo force the various both on how to cometo power and how the revolutionary process ought to'
factions to cometo terms with one another. Although mista.kes were proceed after the selzure of power. In such a world, unquestioned Soviet

218 219
ls the Red Flag Flying? The Soviet Umon : Retrospect and Prospect

leadershlp was bound to collapse. This was especially so since the Soviets continue in linear fashion. There could well be limits to all these processes
sometirnes tended to put considerations of detente or co-existence with the imposed by the interests of the power elite of managers and officials and the
U.S. ahead of promoting revolution or anti·imperialist policies in a given professional intelligentsia in preserving their privileges. A1though there has
area. A factor whlch, initially, had been on balance a strong force for the been significant decentralization and egalitarianization, the high leve! of the
growth of socialism, had by the 1960s more often than not become a hind- productive forces and of support for the principies of socialism in the Soviet
rance to the revolutionary process. The most progressive course for the world Union suggests that more could be done in these areas. That more rapid
movement after the 1950s was one of polycentrism, with the different parties progress is not being made, may be because of a conservative rearguard
following more independent courses than they had had to pursue in earlier action by the power elite, and especiaJly the professional intelligentsia.
periods. Soviet resistance to no longer being the sote and leading centre of Opposition from these strata could well be expected to grow in the future,
the world movement caused considerable resentment in many circles - putting an end to further equalization and democratization. In such an event,
especially in China, the major Westem communist parties, and in much of a cultural revolution of the Chinese type would become a distinct possibility.
Eastem Europe. 1t resulted in sorne unnecessar;y splits and serious ongoing The continuing (if sometimes erratic) progress towards communism which the
mutual antagonisms in the world communist movement. Soviet regime has been making since the l930s, and the high level of popular
lt is not surprising that the leaders of the Soviet Communist Party resisted acceptance of the communist goal, have created a high expectation that
the trend to polycentrisrn forced on it by the other soclalist regimes and large continuing progress will be made toward democratization and equalization.
communist parties. They had aJl grown up taking for granted the idea that the Halting this trend would fly in the face of the officially expressed and widely
oldest and most experienced Communist Party was always the wisest, and accepted ideology. 11ús could well promote massive resistance to the power
should be deferred to. From their viewpoint it was Soviet wisdom and Soviet elite and professional intelligentsia. A process even more disruptive, and a
sacrifices that brought socialism to Eastem Europe and inspired the great struggle even more sharp, than the one in China in the late 1960s, could then
growth of communism in the West, as well as the Asían revolutions. lt is well ensue. A fulJscale violent revolution, however, is unlikely since no
natural that they regarded the Yugoslav, then the Chinese and A1banian and minority ruling class exists which would have its very existence threatened
finaJly the various Western parties, as upstarts and insufficiently appreciative by the masses. On the other hand, the threat of such an outbreak might force
of Soviet contributions and experience. There is no need to assume that sorne the power elite and professional intelligentsla into continually making con-
ldnd of self-interested bureaucratic or state capitalist class or stratum was in cessions to the manual working class. Each concession would strengthen the
control of Soviet foreign policy in order to explain the behaviour of the latter's role and weaken the position of the other two groups. There thus
Soviet leadership. As we have seen, they had no special econornic interest in seems a real possibllity in the Soviet Union of peacefuJ transition from a state
dominating other countries and thus no inherent reason to contain the world socialism, biassed in favour of technical experts, toa decentralized socialism
revolutionary process for the sake of a narrow Soviet self-interest. EspeciaJly and finaJly to fulJ communism.
given the relative reasonableness and moderation with whlch the Soviets A transition to capitalism, of either the state or market types, therefore
generaJly dealt with the successive chaJlenges to their hegemony (especially seems an increasingly remote possibility. There used lo be a distinct possibil-
after 1961), the analysis given here is fully adequate to account for the Soviet ity that the extreme measures the Soviets were forced to resort lo in the
tendencies toward hegemonism. 1930s and 1940s could have resulted in a perrnanent concentration of
decision making powers and privileges in the hands of a relatively small
number, and that this eventually would have resulted in state capitalism.
The Future of the Soviet Union There was a real danger tha t the practices of the 1930s and 1940s would lead
to the crystallization of a social class whlch would take control of the means
A purely linear projection of the trends of the last 20 years predicts a steady of production and disposition of the economic surplus. This danger, although
Soviet advance towards comrnunism . lf the trends in income equalization and it has not altogether disappeared, would now seem less and less Ukely as mass
expansion of free goods and services continue, something very üke a involvemenl and egalitarianization grows. As for a transition lo market
communist mode of distribution should exist in the Soviet Un ion by the first capitalism, as is in progress in Yugoslavia, this was a possibility in the 1960s
half of the twenty-flfSt century. A linear projection of the trends in the when markets and the pursuit of profits were given a larger role. However,
distrlbution between managers and manual workers, of day-to-day decision the subsequent reversa! of lhe trends of 1965-71 and the ascendancy of
making power in enterprises, also suggests a transition to real workers' self- cybemetic central planning in their place, would seem to have greatly reduced
management within a comparable period . Therefore, it is quite possible that a the probability of such a transition.
communal decentralized socialisrn will replace the current state socialism. The two most ükely futures for the Soviet Union thus seem to be a peaceful
However, it is problema tic whether the trends of the last 20 years will transitlon, lhrough decentralized socialism to communism oran attempt to

220 221
Is the Red Flag Flying? The Sovit'l Unlon Retrospect and Prosprct

further consolidate technocratic state socialism and to block all further another for the mantle of 'Maoist' orthodoxy. By ' Maotst', 1 mean he re those
progress towards communism. But this secon~ altemative m!ght well precip· who follow the positions (pastor present) of the Chinese Communist Party in
itate a cultural revolution which would establish a decentrahzed communal al1 things, rather than establishing their own lines on the basis of independent
socialism that would in tum eventually lead on to a transition to full com- and scientific analysis of concrete conditions. Their most acid venom is
munism. A materialist perspective which sees classes and class struggle reserved, not for capitalism, nor even for the 'revisionist' communist parties,
emerging from differences in the relationship to the means of production, but for one another. They have a considerable predisposition toread each
even under socialism, would seem to predict the latter as the most probable other out of the ranks of 'honest revolutionaries' at the drop of a hat, pinning
outcome. the label of 'revisionist' on them. Although a few of them at one point
showed a little promise, they have cancelled each other out, remained isolated
from the masses, and shown no objective differences from the myriad of tiny
lrnplications for the World Struggle Trotskyist groups spawned over the last 40 years.
The bank.ruptcy of 'Maoism' in the West is now apparent to all who care
The Chinese Communist Party is mistaken. The Soviet Union is neither the to open their eyes. Nowhere, either in the Westem capltalist countries or in
major, nor equal, nor even ascendant threat to the people of the w?rl~ and the Third World, outside of Albania and a few countries of South East Asia,
the revolutionary process in the Third World and the advanced capttaltst has a Communist Party or progressive movement with deep roots in the
countries. It is not a state capitalism of the fascist type (such as existed in the working class and peasantry come to support the Chinese position on t.he
1930s and 1940s in Germany). 1t is notan expansionist imperialist power. Soviet Union. The experience of the split in the Second International after
The Soviet Union is rather an authentically (but somewhat distorted) socialist World War 1 has not been repeated. Most authentic revolutionaries in the
country which is actively pursuing both domestic and intemational policies Third World - such as the Vietnamese, Koreans, Cubans, liberation movements
which are for the most part progressive. On balance it is a friend of progress- and other progressives in Black Africa and the Middle East - reject the Chinese
ive and revolutionary forces around the world. analysis. So do most class conscious workers in Westem capitalist countries.
AJthough communists and progressives can leam from the Soviet Union and 'Maoism' with few exceptions, remains pretty much based in the intelligentsia
gain from an alliance with it, it must not ne~essarily ~e t~en as the model f~r and those who have voluntarily left it to colonize the working class.
post-revolutionary societies in other couotnes. The dt~torttons produced by tts World communism made the rnistake of mechanically following the lead of
uniqueness in being the first socialist country and havmg had to start from. a a single country once before. The tailing of the Soviets and the uncritical
low leve! of productive forces, means that, although it must be respected, tl acceptance of their advice in the 1940s and 1950s led to sorne serious mistakes.
should not always be imitated . Although the Soviets do side with the more As a result of their experience with Soviet Jeadership, the Chinese reached
progressive and revolutionary forces in. the world •. they have. a tendency the correct conclusion that all communist parties are equal and that there
towards hegemonism (i.e. of trying to IJTipose thetr concept10n of the revo- should no longer be a centre to the world communist movement. We must
lutlonary and post-revolutionary process on others~. ~ince the~ have a lo~g digest the Chinese experience and their conclusion on polycentrism. We must
history of defending their national interest and avotdtng war w_¡th the Uruted. not fall into the trap of replacing mechanical acceptance of Soviet leadership
States mechanical acceptance of Soviet ( or for that mat ter Chinese) leadership with mechanical acceptance of the Chinese. In this we should be inspired by
could ~ean missing a revolutionary opportunity the Soviets (or the Chinese) the examples of the Vietnamese and Koreans, the two communist parties
might prefer not to see. Post-revolutionary regimes, most notably China:s. which more than any other in the last 25 years have proved themselves in the
have also suffered from the Soviet insistence that they , as the first and nchest struggle against imperialism.
socialist country, best know how to consolida te socialism and build commun- We have much to leam, and plenty to gain, from coalition with both the
ism. Thus although the Soviet Union is generally a friend and ally, it must Soviet Union and the People's Republic of China. But the growing Communist
not auto~atically be deferred to. Each communist party and progressive move· Movement around the world will have to do its own analysis, work out its own
ment must fmd its own bearings,lead its own revolution and advance along strategy and vision, and rely primarily on its own working class and organiz-
1ts own road to communism , illuminated, but not led, by the examples of ation. In the vitriolic polernics between the Chinese and Soviets, it is all too
those that have gone before. easy to lose one's bearings under the fire of being accused of being a revisionist,
The young revolutionary movements of the Westem capitalist countries opportunist, dogmatist, centrist, Kautskyite, ultra-leftist, Trotskyist, etc., by
which grew out of the New Left movement of the late 1960s have paralysed one or another sectarian tendency which feels that to be orthodox is more
themselves by mechanically foUowing the Chinese into the dead end of . important than building a revolutionary movement. But we must brave the
escalating polemics against lhe Soviet Union. ·~ao!st' group~ in th.ese countne5 fire and follow where scientific analysis and the concrete needs of revolutionary
have degeneratcd into the most vulgar dogmatism m compe tmg wtth one class struggle lead. We must support and involve ourselves in all progressive

222 223
ls the Red Flag Flying?

and revolutionary struggles, domes tic and intemational, regardless of how the Bibliography
Oünese or Soviets feel about them.

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Deutscher, Stalin: A Political Biography (New York: Oxford University Soviet Domestic Political Economy and Social Structure
Press, 1949); Bruce Franklin's lntroduction to Tite Essential Stalin
(Carden City, N.Y.: Doubleday, 1972); Anna Louise Strong, The Stalin
Era (New York: Mainstream, 1957); Robert Tucker, Stalin as a Arutiunian, 1u, V. 'Culture and the Social Psychology of the Soviet Rural
Revolutionary (New York: Norton, 1973); and Adam Ulam, Stalin: Popu1ation' in M. Yanowitch and W. Flsher (eds.), Social Stratification and
The Man and His Era (New York: Viking, 1973). Mobility in the U.S.S.R. (White Plains, N.Y.: lntemational Arts and
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Europe in the immediate post-war period, see Steven Steward, Operation Arutiunian, lu. V. 'The Distribution of DeclSion Making among the Rural
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following sources: Julius Braunthal, History o[ the Internacional, Vol.ll Harvard University Press, 1966).
(New York : 1967); Fernando Claudin, The Communist Movemenr; Barry, Donald, ~d Bennan, Harold. 'The Jurists' in H. Gordon Skilling and
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Brodersen, D. The Soviet Worker: Labor and Government in Soviet Society
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Brown, Emily Clark. 'Continuity and Change in the Soviet Labor Market' in
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Burnham, James. The Managerial Revolution (Bioomington lndjana: Indiana
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Communist Party of the Soviet Umon. 1/i:Jtory o[ the Communist Party o[ the
Sovret Un ion (Moscow: Foreign Languages Pu bbshing House, 1961 ).
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Deutscher, Isaac. Stalrn: A Political Biograplly (New York : Oxford University
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Deutscher, Isaac. The Un/inished Revolutron. Ruma 1917-1967 (New York:
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Fainsod, M. How Russia is Ruled (Cambridge: llarvard University Press,1963).

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224
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230 231
 Jndex

lndex 88-94, 204-S, 207-8, 211

Comrades courts, 87
Engels, Frederick, 15, 31, 33
Enterprises, 3 7-41, 104
Consumer goods, 40-3 E.P.L.F., 175-7
Control, 20-24,26,30-1,33 E.P.R.P., 174
(see also power) Eritrea, 174-78
Convertible currencies, 107 Escalante, Anibal, 192
Council of ministers, 37 Ethlopia, 159, 166-7, 172-8, 213
Crime, 50, 83 , 87 Eurocommunism, 137, 196
Cuba,33, 128 , 165,170-2, 176-7, Exarninations, 72-3
180, 185-95,2 19,223 Exploiting c1ass, 18,20-1 , 23,
Cult of personality, 205-6, 209 27~,31,34,46,52, 199
Cultural activities, 54, 64, 70
Adult education, 72 Capitalist class, (see exp1oiting Cultural Revo1ution, 1, 10, 29, 34,
Afghanistan, 152, 154, 160, 165 c1ass, capitalism) 96,206,210,222 Factionalism, 204, 218-9
Agriculture, 42 Castro, Fidel, 191, 193-4, 206 Czechos1ovalda, 86-7,96, 126, F.B.l., 207
Albania, 126-7,137-9,176, 187, Central Committee (C.P.S.U.), 37, 129-30, 132-3, 137, 139-47, Feudalism,13-5, 25,27,31,47
193, 219-20, 223 74 , 89-92 171, 192-3,207,2 13,215 Fitzgerald, Paul, 19
Algeria, 152, 165, 171 , 185~ Central 1ntelllgence Agency Food, 42-3
Arnin, Samir, 131 (C.I.A.), 170, 193 , 207-8 Debray, Regis, 191 Foreign aid (see econornic assis-
Angola, 166, 170-2, 180, 193 Chiang Kai-shek, 184, 216 Decentralized socialism, 15, 32, 34 tance)
Anti-Comintem Pact, 207 Chile, 152, 169, 194 Decision maJu.ng, 22, 25, 31-3, 34, Foreign investrnent (U.S.S.R.),
Anti-Parasite Law, 48 , 82, 87 China, 4-S, 7, 32·3, 82-3, 96, 89-91, 95-6, 200-1,209, 220 38,151,159-61
Argentina, 152, 194 126-8, 135, 137, 139 , 146-7, (see a/so operational control) Frank, Andre Gunder, 18-9, 131
Associations (Economic), 41 156, 158, 168-9, 171 -2, 176-8, Defending the U .S.S.R ., 212-3 Freedom of discussion, 83-4
Aswan Da m, 154 183-7 , 191 , 193-S , 201,204, Democracy, 29-30, 80-96, 200 Friendship pattems, 71-2
Autarchy, JOS 210,213-4,216-20,223 Democratic centralism, 207, 217-8 Friendship pipeline, 130
Auto ownership, 67-9 Chinese Eastern Ratlway , 135-6, 183 Detente, 185, 220, 222
Chou en-Lai, 186 Diplomatic relations, 169 German Democratic Republic, 126-7,
Baltic countries, 178 Class, 15 , 18-20,22, 24, 27,62-77, Dismissal of workers, 49-50, 54 130, 132-3, 135, 139, 143, 147,
Bandung Conference 186 200 Dissidents, 88 171
Bangladesh, 152, 164, 167-8, 180 Class consciousness, 22, 70 Djibouti, 176 Germany, 113-4, 134-S, 137-8,
Banking, 37, 40, 44, 160 Coal miners, 63 Dobb, Maurice, 18 143 , 145,147,158 , 176,193 ,
Baran, Paul, 57, 13 1 Collcctive farms, 4 7, 5 1 Domhoff, G. William, 24, 29 203' 207-8, 2 12-6
Bernstein, Edward, 219 Collective labour agrcements, 54 Dos Santos, Theodoro, 131 Gosplan,37,44
Bettelheim, Charles, 4, 1 9 Collective production, 14-S DuPuy, Alex, 19 Great Leap Forward, 184, 187,210
Bhilai steel mili, 1 58 Collectivization, 204, 207 'Great Man' theory ofhistory, 201,
Biafra, 143, 17 S, 177-8 Colonia1ism, 102 (also see Economic assistance, 107, 126-8, 203-4
Bilateral trade agreements, 107 imperialism, social imperialism) 151-60, 183-4, 187-90 Guevara, Ernesto 'Che', 192
Bonuses, 40, 66-8 Comecon, 104 ,1 10,1 20-37, Economic fluctuations, 44-6 Guinea, 152, 160, 165
Brenner, Robert, 19 147-8,196 Economic growth, 44-6, 131-3
Brezhnev, Leonid, 94, 111·2, 211 Comintem, 21 1-9 Economic inequality, 5, 51-52, Haile-Mariam , Mcngistu , 173 , 176
Bukhann, Niko1ai, 205 Communal socialism, 32 63-9. 195 Health care, 67, 82
Bulgaría, 124-6, 128, 130-S, Communism, 7, 2 1-3, 28, 34, 47, Economists, 86, 89 Hegemonism, (general), 103, 137,
138-9, 147 192, 196, 220 Education, 67,71-75,82-3,85-6 139, 147-8, 179-80, 187, 195-7,
Communist Party (M-L), [ U.S.A.] . Egalitarianism, 86, 95,200,210, 211-20, 222-4
CambodJa, 139, 168-9, 186 1, 4, S, 7 220 Household production, 14-5
Canada, 121 Communist Party of India (M-L), Egypt, 152, 155, 157, 164-5 , 176 Housing, 68, 87
Capital accumulation, 28, 107, 156 162 Elections, 25, 27·8, 80-2 Hungary, 26-7,29,33, 130, 132-5,
Capitalism, 13-5, 18-20, 22, 25-8, Communist Party of the Soviet Election of managers, 85 137 , 139, 140, 146-7,2 12
32, 34, 36,46-7, 106-7, 155-6 Union, 56, 68, 81 , 84, 86, Emmanuel, Arghiri , 1 1O

232 233
/s the Red Flag Flying? lndex

I.C.B.M.s, 114 72-6, 81-2, 91-4 National liberation movements, 161 , Producer goods, 43-46 (see also
I.M.F., 147, 168 Legal reform, 83, 85-6 166, 170-2, 180, 184-6, 191, investment)
lmperialism (general), 101-3, Legitimacy, 29,94-5,200,206, 193-4, 196,217,222 Production conferences, 55-6
139-40, 151 , 156, 164-5 208-9 New Bconomic Policy, 205 Production fund , 44
Incentives, 39-40, 141 , 191 ,211 Leisure, 69-70 Newspapers, 70, 83-86 Profit, 28,37-40,44, 46,48, 104
India, 152, 155, 157-65, 168, 178, Lenin, V.l. , 94, 101 -2, 107-8, 156, Nicolaus, Martin, 5, 19 Proletarian internationalism, 195
186-7, 217 185,205,207,211,219 Nigeria, 159, 175, 177-8 (see also hegcmonism)
lndo-Pakistan War, 164 Liberman-Kosygin Reforms, 38-41, Nomination processes, 81-2 Public debates, 82-88, 90
Indonesia, 156, 186 46,85 Non-aggression Pact (U.S.S.R- Public opinion formation, 83-88
lndustrialization of Eastern Libya, 176-7 Germany), 214-5
Europe, 131 -3 Life style differences, 69-71 Nuclear war, 111-7, 185 Rahrnan, Sheikh Mujibur, 167-8
lnftation, 19, 4 2-3, 48, 58 Li teracy policy, 83, 8 5 Rate of exploitation, 27, 47, 57-58
lntegration (Comecon economlc), Lon Nol, 168-9 Ogaden, the, 174-8 Rate ofprofit, 19,27,57-9,102
128-30 Operational control, 20-22, 24-25, Rationing, 42
Intelligentsia, 23-4, 33, 51, 56, Magdoff, Harry. 131 27, 32, 53-57, 199-201 Raw materials (exports and irnports),
62-77. 86-8, 96, 140, 200-1, Malenkov, G, 93 Orgarlic composition of capital, 103, 105-6, 108-10, 122, 125,
208,211 Mali, 152 51-58 154, 160
lnvestment (domestic), 38-40, 43- Managers, 23-4, 34, 40, 44, 52, Ownersltip, 20-22, 24, 33 Red Anny, 110, 117-37, 139,208,
46, 48, 58, 103 54-56,62-77,85-6,89, 91-4, 216
I.Q. Tests, 72 141, 191 Party, The, 26, 30, 33 (see also Repayment of foreign aid, 153-8,
lran, 152, 154, 156, 159 Manchuria, 136, 183,207,216 C.P.S.U.) 183-4, 187-8, 190
~a~ 152, 154, 160,165 Mao Tse-Tung, 4, 7, 206 Party Congresses, 89-90 Repression, role of, 206-7, 209
Israel, 143, 17 5 Maoism, 4, 7, 171 , 222-3 Party membership and recruit- Relations of production, 13-4, 22,
Marcuse, Herbert, 94 ment, 88-89,98,211 (see also socialism)
Japan, 207-8, 213 Market socialism, 32-4 Palcistan, 152, 156, 167-8, 180 Relative autonomy of the state,
Jointenterprises,l25,127,130-l, Markets, 18-20, 22, 29, 32, 36, PeacefuJ co-existence, 184-5 94-5, lOO
134-8, 154, 159, 160, 183-4, 41-52,59, 106 Peasantry, 14-5,24,27, 33, 47, 51, Restoration of capitalisrn, 34-5 , 139,
187 Marriagc patterns, 71-2 88, 139,200,204,210 141
Joint trading companies, 159-60 Marx, Karl, 31, 33, 202 People's Control Commissions 87 Revisionism, 140-5,218-9
Jurists, 86 Mcans of production, 13 , 21, 24, Petroleum, 124-5, 135, 138, 1S8, Revolution, 26-29,80-81,212
27-8 190 Revo1utionary Communist Party
Khrushchev, Nikita, 85, 89, 93-4, Mengistu (see Haile-Mariam) Petty Bourgeoisie, 23-4, 66, 76-7, (U.S.A.), 1, 4, 7
201,211 Methodo1ogy , 10-1 1 140, 145, 200 Revolutionary strategíes, 6, 185-6,
Korea, Democratic Peoples Michels, Roberto, 26 Plan, the, 3 7-48, 54, 104-6 191 -2, 194,212-9,222-3
Repub1ic of, 127, 137, 165, Military, the, 83-5,91,110-17 P.L.O., 166, 175 Right of national self-detennin-
184,191, 193, 195,2 17,223 Military assistance, 165-7, 170, Poland, 105, 124-130, 132-3, 135, ation, 177-8
Korean War, 184 177, 184, 190 139, 143, 147 Romanía, 126-7, 129, 132-4, 137,
Kosygi n, A, 94 Military philosophy, 111-2 PoHce,86 14 7-8, 171 , 193
Kulaks, 204-5 M1li tia, the, 87 Politburo, 74, 89-90, 92 Ruling class, 24-27, 29, 31, 80,
Milis, C. Wright, 29 Political struggles, 86-87 (see also power)
Labour allocation, 47-9 Ministers, 37, 66, 74,92 Pollution, 83, 85
Labour exchange, 49 Mode of distribution, 14 Polycentrism, 220, 223 Schachtman, Max, 8,47
Labour power, 15, 18-20, 46-57 Mode of production, 13 Popular Front, 212,214,2 17 Selassie, Haile, 172-3
Labour shortages, 47-50, 53 Mongolia, 128, 135, 184 Portugal, 170-2 Shekekino Plan, 50
Labour theory of value, 19, 42, Moore, Barrington, 94 Power elite, 24·32, 52, 74, 80, 94-5, Sihanouk, 168-9
104-5, 123 Morocco, 159 - 60 200-1, 209, 220 (see also Singapore, 159-60
Laclau, Ernesto, 19 Mozambique, 166, 171-2 1eadership selection) Sino-Jndian Border War, 164,
Latín America, 131-3, 191-4 M.P.L.A., 170-2, 193 Power (state), 22, 24-5 , 30-3, 62, 186-7
Leadership, 27-8, 202, 204, 206 Munich Agreement , 2 15 80-96, 199-200, 209 Sino-Soviet split, 183 7, 201, 21 t.,
Leaderslti p selection, 26-7, 29, Prices, 41 -53, 58, 67, 104, 123-4 223

234
S1avery, 13-5,25, 27, 31,47 Terms of trade, 104-5, 11 O, 123-6,
Social background of leaders, 91-94 162-4' 188-9
Social class, 22, 69-76, 200 Terror, 95, 174, 207-9
Social formation, 13-4, 28 Thlrd Penod, 213-5
Social imperialism (general}, 9, Tibet, 140, 186
101-3,110,117, 134,136, Trade, 104-110, 120-7 , 159-64,
139-40,147-8, 151,156,164-5, 188-90
179-80, 187, 194-7,222 Trade as a weapon, 126-7, 138,
Social mobility, 72-75, 93-94,200 164, 184, 187 , 190-2
Social wage, 67-8, (see also social Trade dependence (on the U.S.S.R.),
welfare) 120-3, 161 , 188
Social welfare, 54, 67-8 Transcaucasus, 178
Socio1ogy, Soviet, 10-11,69 Trials, (Moscow), 207-9
Sociatism, (general), H), 20-23, Tricontinental Congress, 191
25-34,42,47, 50, 80, 199-201, Trotsky, Leon, 33, 201-5,207
206, 208 Trotskyism, 4, 217
Socialist transformation, 34-5, Turkey, 152, 156
206-7,210,221-2 T.V. ownersh.ip, 69
Solidarity and enthusiasm, role of,
89, 206-7, 209 Underconsumption, 19 , 38, 48, 102
Somalia, 116-7, 165, 167, 174-8 Unemployment, 46-50
Soviet Academy of Sciences, 64, Unions, 48, 53-56, 86
86 U.S.A., 49 , 64-66, 69, 73, 75, 81,
Soviet Navy, 114-7, 178 83,105,111-7,122-3,135,
Soviet Tanks, 1 14-5, 17 1 139-40, 147, 151, 153, 155,
Sovieto1ogy, 8, 1O, 53, 88 157-8, 161-2, 164-6, 168-70,
Soviets, 81-2, 86-7, 96 174-76, 187-8, 190,206,216,
Spanish Civil War, 193,213-4 218, 220
Stalin, Joseph, 93-4, 201-11 U.S.S.R. history, 27,203-211
State, the, 22, 24-5, 27-8, 30-1,
80-8, 94-6 Vanguard class, 31
State capitalism, 15, 18, 27-8, 30-1 , Vietnam, 127-8, 137 , 165-6, 169,
34-5, 42 180,185-6, 191 , 193,2 16-7,
State socialism, 15, 24, 27, 32-4, 219, 223
201, 220
Sta te trading corporations, 104-5, Wage 1abour, 20, 23, 36, 46-57
107 Wages, 39, 47-8, 51-2, 54, 58,
Strikes, 53, 142 63-69
Struclural determination of state Wall newspapers, 86
policies, 94-5 Wallerstein, lmmanue1, 18-9
Subsu1tes, 42-3, 67 Warsaw Pact, 143-4, 146-8 (see
Sudan, 152, 176 a/so the military)
Sugar, 188-9 Will to power, 27-8
Surp1us (economic), 15, 18, 20, 27, Women , 48, 70 ,83,85
31-2 Worker participation, 53-7
S.W.A.P.O., 166 Working c1ass, 18 , 22-27, 29-34,
Swee~y, Pau1, 4 , 18-9, 57 42 ,5 1 -2,63,77,80 ,89,9 1~
Syria, 152, 165 199-200 , 209
Wor1d market, the, 104, 107,
Taiwan, 185-7 188-9
Tan~ania, 171-2 Wor1d War 11, 113-4, 203, 207,
Taxation,42 ,68 2 10,2 13, 217,219
Technocratlc sociaUsm, 33-4, 201, Yemcn, 176-7
210, 222 Yugoslavia, 32-3,38, 126, 135,
Tendency for the surp1us to rise, 137-9, 142, 146, 171 , 193,
57-9 219-20