COMPASS Journal of the Communist League;
No.92. November 1991
Web edition 2002

The current issue of’ Compass’ comprises an open letter sent on behalf of the Communist League to the "New Communist Party"

AN OPEN LETTER TO THE "NEW COMMUNIST PARTY     At a recent meeting organised in London by the 'New Communist Party', some speakers expressed the view that during the Khrushchev-Brezhnev era the Communist Party of the Soviet Union was pursuing a Marxist-Leninist, socialist course, and has pursued a revisionist, anti-socialist course only since about 1985.

    I should like to express the opinion that this view cannot be reconciled with known facts.

    One of the essential features of a socialist society is that production is planned in the interests of the working people. But from 1955, only two years after Stalin's death, revisionist economists like Evsei Liberman were writing in Soviet economic journals of the 'necessity' of freeing the economy from 'excessive' centralised direction and giving greater freedom to the directors of enterprises to decide what and how much the enterprises in their charge should produce:     By September 1965 Liberman's basis thesis had been adopted by the Central Committee of the Communist Party:     In fact, the 'indices' of the 'economic reforms' ceased to be directives, binding on the enterprises, and became mere 'guidelines' which enterprises could follow or not as they chose:
    "Control figures will be handed down to the enterprises, not as precise directives, but rather as guidelines for drawing up their plans".
    (E. G. Liberman: 'Plan, Direct Ties and Profitability', in: 'Pravda', 21 November 1965).
    So, as enterprises were transferred to the 'reformed' system, they proceeded in practice to plan their own production - even to the types and qualities of commodities they would produce:
    "These enterprises (i.e., those working under the reformed system -WBB) now draw up their production plans themselves".
    (V. Sokolov, M. Nazarov & N. Kozlov: 'The Firm and the Customer', in: 'Ekonomicheskaya Gazeta', 6 January 1965).

    "Enterprises decide what range of goods to produce in terms of physical quantities and total value of sales and other economic indicators".
    (B. I. Braginsky: 'Planning and Management in the Soviet Economy', in: 'The Soviet Planned Economy'; Moscow; 1974; p. 125-26).

    This system was known euphemistically as:
    "planning 'from below"'.
    (R. Belousov: 'The Chief Thing is Economic Effectiveness' in: 'Pravda,
    13 November 1964).
    Under this system, the state can influence the economy not directly by means of economic directives, but only indirectly by the kind of 'economic levers' that are used by the state in orthodox capitalist countries:
    "The attempt to make broader use of economic levers and economic stimuli in planning of a welcome reaction against the administrative conception of a plan".
    (L. Alter: 'Incentives must be linked with the Long-Term Planning of an Enterprise', in:
    'Voprosy Ekonomiki', No. 11, 1962).

    Profit as the Regulator of Production

    The abolition of centralised economic planning as the regulator of production required its replacement by a different regulator, which could only, be profit, defined by contemporary Soviet economists as
    " . . . the difference between the price and the cost of production".
    (L. Gatovsky: 'The Role of Profit in a Socialist Economy', in: 'Kommunist'. No. 18, 1962).
    So, under the 'economic reform' profit became the regulator of production:
    "Production will be subordinated to changes in profits".
    (G. Kosiachenko: 'Important Conditions for the Improvement of Planning', in: 'Voprosy Ekonomiki', No. 11, 1962).

    "Under conditions of cost accountability, the sum total of economic levers in the long run influences the enterprise through . . . profit".
    (B. Sukharevsky: 'The Enterprise and Material Stimulation', in: 'Ekonomicheskaya Gazeta', No. 49, 1965).

    "In the profitability controversy some economists have based their objections to making it a regulator of social production on the contention that profit is a capitalist category. Such objections, of course, are untenable".
    (A.Sukharevsky: 'On Improving the Forms and Methods of Material Incentives', in: 'Voprosy Ekonomiki', No. 11, 1962).

    So, under the 'economic reform':     and the supreme criterion of the efficiency of an enterprise is the index of profitability - that is, the profit made by an enterprise in a year as a percentage of its total assets:     Profit, the regulator of Soviet production since the 'economic reform', is realised not in the production of commodities.but in their sale:     Thus, regulation of production by profit means, in fact, regulation by the market:     It means regulation by the forces of supply and demand which operate in an orthodox capitalist country:     Soviet economists who supported the 'economic reform' claimed, like their counterparts in orthodox capitalist countries, that these market forces, operating through the profit motive, regulate social production in such a way as to satisfy - as far as existing productive resources at a particular time will permit - the requirements of the people:     It is admitted by these economists that the 'demand' to which production may be geared through the market is 'effective demand', the demand expressed in terms of the money which potential consumers are able and willing to expend on the market for commodities:     The basing by enterprises of their production plans on their assessment of the market has brought about the development of such features of orthodox capitalist countries as market research:     salesmanship:     and advertising:     Clearly, the rate of profit made by an enterprise could have no reality if production assets of varying amounts continued to be allocated to enterprises by the state without cost, as had been the Soviet practice under socialism. Consequently, in order to make the rate of profit a reality, the ‘economic reform' introduced the practice of charging enterprises for the use of their production assets (including natural resources such as land, minerals and water). This principle was endorsed by the Central Committee of the Communist Party in September 1965:     In 1965 the annual payments to the state for the use of production assets averaged 15% of the value of the production assets being used by the enterprise.
(L. Vaag: 'According to a Single Rate of Profit', in: 'Ekonomicheskaya Gazeta', No. 45, 1965).

    Later, an alternative method of payment for production assets was introduced: the payment of a lump sum. This could be paid out of the enterprise's own funds or financed by means of a bank credit repayable with interest.

    As in the case of production assets, the rate of profit made by an enterprise could have no reality if finance of varying amounts continued to be allocated to enterprises without cost, as had been the practice under socialism. In order that the rate of profit could be made a reality, therefore, it was necessary that finance be made available to enterprises exclusively in the form of bank credit, repayable by the enterprise with interest:     This principle was included in the 'economic reform' introduced in September 1965:     By 1976 more than 50% of the circulating assets of enterprises came from bank credits:     and in 1967 the standard rate of interest was raised to 4 to 4.25% for short-term loans and to 4.5 to 6% for long-term loans.
(A. H. Hermann: 'East-West Finance', in: 'The Banker', Volume 121, No. 546; August 1971; p. 878).

    Consequently, where an enterprise is in process of repaying a bank credit, the rate of interest becomes the lower limit of permissive profitability for the enterprise:

    As in an orthodox capitalist country, under the 'economic reform' bank credit is normally advanced to an enterprise only against security:     The rate of interest on credit was fixed at a high government level in order that it could be utilised -- as in orthodox capitalist countries - as an ‘economic lever' to influence the economy:     In Soviet revisionist propaganda of the 1960s, the means of production were still being presented as 'publicly owned'. But the Statute on the Socialist State Production Enterprise, adopted by the USSR Council of Ministers on 4 October 1965, gives an enterprise rights of possession over the production assets it holds:     Consequently, the acquisition of production assets by an enterprise is described as 'purchase':     That the terms 'rights of possession' and ‘purchase' are not here being used in-exactly is shown by the fact that the Statute gives the enterprise-the right to lease or sell the means of production it 'possesses':     The transfer of the ownership from the state to an enterprise is not its transfer to an agency of the state, for the 'socialist state production enterprise' is described as an     And:     Indeed, Soviet revisionist economists were at pains to dismiss allegation that the enterprises are not really independent as "groundless bourgeois propaganda":     Furthermore, the property rights of an enterprise are vested in its director:     The director of a Soviet enterprise has thus been, since the ‘economic reforms' of the 1960s, the effective owner of the means of production (other than natural resources), and has full legal responsibility for their operation:     And since this responsibility is primarily to ensure that the enterprise under his control makes the maximum possible rate of profit, he, in Marx's words,     As a writer in the 'Harvard Business Review' expressed it' in 1971:     In February 1971 the 'Institute of Management of the National Economy' was opened in Moscow as the first Soviet 'business school'. (Z. Katz: 'The Nachalik (Executive) Class in the USSR'; Cambridge (USA); 1073; p. 25).

    The writer in the 'Harvard Business Review' already quoted comments:

    Under the 'economic reform', the director of a Soviet industrial enterprise was appointed by and could may be dismissed by the state - in practice, until quite recently, by a decision of the leadership of the Communist Party:     Under the former socialist system, a worker could be dismissed only for grave misconduct (usually involving a criminal offence in connection with his work) and then only with the consent of the trade union committee at the enterprise:     An important element of the 'economic reform' was to give the managements of enterprises relatively unhindered powers to dismiss workers as part of a rationalisation programme:     Under the socialist state which formerly existed in the Soviet Union, the working class was the collective owner of the principal means of production.

    With the 'economic reform' of the 1960s, however, as has been shown, the Soviet working class was expropriated of these means of production, which became the property of a new class of Soviet capitalists in the shape of the directors of industrial enterprises.

    This process is essentially a repetition of that which Marx, describing the original development of capitalist society out of feudal society, called the primitive accumulation of capital:

    We may call this repetition of the process of primitive accumulation in the Soviet Union the secondary accumulation of capital.     Marx demonstrated that a worker who does not have access to any means of production of his own has no way to live except to sell his labour power, his capacity for work. Since, as has been said, the Soviet workers have been expropriated of the means of production which they owned under socialism, they now have no way to live except to sell their labour power to the new class of Soviet capitalists:     The term 'dispose over' is clearly a euphemism for 'sell'.     Marx pointed out that the value of labour power is determined, like that of any other commodity, by the amount of socially necessary labour time required for its production, that is, by the value of the means of subsistence conventionally - in a particular society at a particular time - required for the maintenance of the worker and his dependents. Although Soviet revisionist economists may deny that, in their society, labour power is a commodity with a value, they admit that 'the expenditures of labour on the cost of reproducing labour power' is 'assessed in value terms' which are precisely equivalent to the value of labour power as analysed by Marx:     In a competitive labour market the price of labour power (i.e., the level of wages) fluctuates like the price of any other commodity around its value in accordance with the relation of supply to effective demand on that market:     Where and when there is a relative shortage of particular kinds of labour power, enterprises compete with one another for this labour power:     In this competition for labour power, enterprises make use of such attractions as bonuses and welfare services. Already in 1972 revisionist Soviet economists admitted that the high mobility of Soviet workers was due to the competitive search for better conditions:     The Soviet labour market was given concrete form in 1967 by the establishment of labour exchanges called 'Manpower Utilisation Agencies':     Marx held that in a capitalist society real wage levels tend to rise with the development of the productive forces. The aim of the capitalist class, however, is to try to ensure that, if real wages grow, they grow more slowly than the growth of the productivity of labour. In these conditions, the proportion of national income accruing to the working class falls despite the rise in real wages, i.e., exploitation increases. This is naturally also the policy of the Soviet capitalist class:     This aim was achieved during the period of the 9th Five-Year Plan' (1971-75), when average wages rose by 20% while the average productivity of labour rose by 23%.
(A. N. Kosygin: 'Guidelines op cit.; p. 13, 18).

    Naturally, therefore, most revisionist Soviet economists agreed that the one aspect of 'centralised economic planning' which should be retained is State control of wage levels:

    "Centrally established basic rates and salaries constitute, as before, the basis of wages. . . .
    State regulation of wages is necessary.
    The new system of economic stimulation of production preserves the state regulation of wages".
    (A.Sukharevsky: 'The Enterprise and Material Stimulation'; op. cit.).

    Managerial Salaries

    The managerial and higher technical personnel of a Soviet industrial enterprise receive monthly salaries. The salary of an enterprise director was in 1974 up to 7.2 times the basic wage rate of the average shop floor worker:     However, the wage/salary differential between shop floor workers and management personnel formed only a minor part of the actual income differential between these categories; as will be shown, the greater part of the latter accrued from differentials in 'bonus payments'.     Under the socialist system which formerly existed in the Soviet Union, the prices of commodities were fixed by the state. Although in fixing the price of a commodity, its value was taken into account, the actual price was determined in accordance with the state's assessment of social requirements. Thus, over a considerable period of time, the price of vodka was fixed above its value in order to discourage its consumption; on the other hand, the price of clothing was fixed below its value to assist the working people in the purchase of clothes. As a result, vodka enterprises made an above-average rate of profit, while clothing enterprises made a below-average rate of profit.

    But the rate of profit could become a reality, could function as the regulator of production, only if this 'voluntaristic' method of fixing prices were abandoned, and prices were brought into line with values. In the propaganda campaign which preceded the 'economic reform', therefore, the demand was put forward that prices should be brought into line with values:

    The new 'State Committee for Prices' established under the 'economic reform' was charged with elaborating a new system of prices,     The 'price reform' was put into force first for wholesale prices on 1 July 1967, resulting the raising of wholesale prices by an average of 8% for industry as a whole, and by an average of 15% for heavy industry.
(L. Maizenberg: 'Improvements in the Wholesale Price System', in: 'Voprosy Ekonomiki', No., 6, 1970).

    Some wholesale prices were, in fact, raised by large amounts -- e.g., that of coal by 78%.
(V. Sitnin: 'Wholesale Prices: Results and Tasks', in: 'Ekonomicheskaya Gazeta', No. 6, 1968).

    The aim of this price reform was stated to be that of creating conditions under which each ‘normally functioning enterprise' could function profitably':

    In fact, the wholesale price reform brought about a rise in industrial profit considerably higher than had been anticipated:     But the wholesale price reform was only a first step in the 'price reform', the fundamental aim of which was that prices should fluctuate according to the varying relation between supply and demand on the market. The next step, therefore, was to give enterprises the power to fix prices themselves:     The difficulty of reconciling this conception with the fiction that centralised economic planning, including price control, was being maintained, was solved by presenting the central 'planning organs' as issuing "price norms" while leaving enterprises to fix 'concrete prices':     Naturally, these 'concrete prices' often departed fundamentally from the ‘price norms' issued by the central 'planning organs':     In order that profit could function as the regulator of social production under conditions where production is planned by the enterprises themselves, each enterprise must retain sufficient of the profit it makes to enable adequate material incentives to be drawn from it to influence the directing personnel of the enterprise responsible for making that profit:     In consequence, the average proportion of an enterprise's profit retained by enterprises rose between 1966 and 1969 as follows: 1966: 26%
1967: 29%
1968: 33%
1969: 40%
(N. Y. Drogichinsky: op. cit.).

‘Economic Incentives'

    Under socialism wages were, as far as was possible, proportional to the quantity and quality of work performed, while other material incentives were based on fulfilment or over-fulfilment of the economic plan.

    The abolition of centralised economic planning and the establishment of the profit motive as the regulator of social production required the replacement of this system of material incentives to the personnel of an enterprise by one based on the rate of profit made by the enterprise and drawn from that profit:

    In the four years from 1966 to 1969, the average size of the material incentive funds of enterprises rose four times.
(N. Y. Drogichinsky: 'The.Economic Reform in Action', in: 'Soviet Economic Reform: 'Progress and Problems'; Moscow; 1972; p. 207).     As has been shown, under the 'economic reform' profit became the motive and regulator of social production. But, seeking to present themselves at this time as continuing to 'build socialism', the Soviet revisionists described this profit as:     Although denying that 'socialist profit' arises from exploitation of the working people, the definition of 'profit' given by revisionist Soviet economists since the 'economic reform':     -- is virtually identical with that given by Marx for surplus value (profit in the broad sense) in an orthodox capitalist society:     So, tacitly accepting that 'socialist profit' does not differ in essence from profit in orthodox capitalist countries, revisionist Soviet economists fell back on the argument that there is nothing wrong in principle with profit in orthodox capitalist countries; what is wrong - and what distinguishes it from 'socialist profit' is -- they say, its distribution:     This argument will be examined in the next two sections.     If profit was to be in reality the motive and regulator of Soviet production, then the lion's share of the bonuses paid out of an enterprise's ‘material incentive fund' had to go to those personnel of an enterprise whose economic decisions primarily determined the rate of profit made by the enterprise -- that is, to the personnel of the management:     The size of bonuses paid to managerial personnel is determined outside the enterprise, by the state:     the prime criterion for determining the size of the bonuses paid to managerial personnel being the rate of profit made by the enterprise:     On the other hand, the size of the bonuses paid to the workers of an enterprise is determined offically by the director.:     The size of the bonuses paid to the workers of an enterprise is very different from size of those paid to managerial personnel.

    Soviet official statistics show that in 1966 management personnel received 43.9% of the material incentive fund, while workers received 50.7%.
(N. Y. Drogichinsky: op. cit.; p. 194).

    But about this time the personnel engaged in industry was classified as

    It follows that 1% of the personnel received 12.3% of the bonuses if they were in management, and 0.5% if they were workers. Thus, on the average each member of the management received almost twenty-five times the bonus received by each worker.

    In fact, the distribution of 'socialist profit' under the Soviet ‘economic reform' differs in no way from the distribution of profit in orthodox capitalist societies where profit-sharing schemes are in force.

    The 'economic reform' required each enterprise to maximise its profits and minimise its production costs. But this aim conflicts with the social need to minimise the environmental pollution arising out of production:     As a result, since the ‘economic reform' environmental pollution in the Soviet Union has reached dangerous levels, as in orthodox capitalist countries:     Soviet environmentalists agree that one of the two chief causes of atmospheric pollution is motor transport:     and that the difficulty in producing a non-noxious motor vehicle is economic, not technical:     They proposed, therefore, that     But, in fact, exactly the opposite occurred. The 'Five-Year Plan' for 1971-75 envisaged:     In Stalin's view the national policy of the Communist Party of the Soviet Union should include assistance from the Russian Federation to the periphery:     In fact, however, differences in the economic, social and cultural levels between the Union Republics - as shown in official statistics of industrial productivity, per capita national income, per capita living space, etc. increased after the 'economic reform'.
('Narodnoe Khoziaistvo SSSR v 1960 Godu'; Moscow; 1961;
'Narodnoe Khoziaistvo SSSR v 1970 Godu'; Moscow; 1971;
V. N. Bandera & Z. L. Melnyk: 'The Soviet Economy in Regional Perspective'; New York; 1973).

    In economically backward Uzbekistan, for example, cotton growing for ‘export' to the industrialised Union Republics was made the basis of the Uzbek economy:

    This policy led to an actual decline in food production per capita in Uzbekistan:
Food Production in Uzbekistan (kilograms per capita)       1959     1965 Meat:         18.1     14.5
Milk:         95.0       89.7
Grains:      62.2       59.3
Potatoes:   24.8      16.1
Fruits:         23.4     19.0
(V. S. Nekhai: 'The Production of Foodstuffs and the Level of Consumption in Relation to Population', in: A. M. Aminov (Ed.): 'Razvitie i Sovershenstvovanie Sotsialisticheskikh Proizvodstvennykh Otnoshenii v Period Stroitelstva Kommunizma'; Taskhkent; 1968).
    In the days of socialism in the Soviet Union, investment was allocated in a planned way to enterprises by the state without charge. Since the 'economic reform, however, enterprises have to buy new means of production and only in exceptional cases have investment funds been provided for this purpose by the state:     By 1970 - 78.8% of total investment was coming from the enterprises’ own funds
(I. Shur: 'Long-term Credit in Industry'; op. cit.).

    The establishment of 'production development funds' in enterprises brought about a large increase in the enterprises' funds available for investment: from 120 million rubles in 1964 to 4,000 million rubles in 1967 -- an increase

    Any investment made by an enterprise over and above the funds available in its production development fund must normally be obtained in the form of a bank credit, repayable with interest. But by 1974 only 3.3% of investment was being effected through bank credits, as a result of:     In determining its investment policy, an enterprise is, of course, guided by its assessment of what will maximise its rate of profit:     Despite the great increase in the size of enterprises' funds available for investment since the 'economic reform', the growth rate of investment has declined markedly:
                    43%             42% ('projected')         25%     This, of course, is in line with the practice in orthodox capitalist countries in conditions of monopoly, where maximum profitability frequently accrues from continuing to operate means of production after they have become obsolescent.     As in an orthodox capitalist country, the search for maximum profitability brought about a rise in the productivity of labour, brought about:     and widespread redundancy. Enterprises:     From 1964 on, 'surpluses of labour' -- a euphemism for unemployment were being reported from various regions of the country:     This unemployment occurred particularly among young workers. In 1964 two-thirds of school-leavers in Rostov district and more than half in Kursk district failed to find jobs within the 'planned period'.
('Pravda', 23 July 1965).

    This situation was reflected in the establishment in 1966 of a 'Youth Employment Service',
('Pravda', 6 February 1966).

    with unemployment, in 1930:

    and in a campaign to persuade women workers to cease working on the grounds that 'a woman's place is in the home':     Marx showed that the economic laws of capitalism lead to the concentration of capital, of means of production, in increasing amounts in the hands of individual capitalists.
    The proportion of Soviet enterprises with a gross output in excess of 500,000 rubles rose from 61.8% in 1960, to 70.8% in 1963., to 74.8% in 1963.
('Soviet Economy Forges Ahead'; Moscow; 1973; p. 176).

    Already by 1967 concentration of capital had reached a much higher level than-in the most advanced orthodox capitalist countries:

Proportion of enterprises employing more than 500 workers:

USSR     West Germany     Britain     USA     France     Japan
24.4%         1.8%                 1. 5%         1.4%     0.5%         0.3%

Average Number of Workers per Enterprise:

USSR West Germany     USA     Britain     France     Japan
    565             83                 48         45         18             17

(I. Kvasha: 'Concentration of Production and Small-Scale Industry', in: 'Voprosy Ekonomiki', No. 5, 1967).

Soviet economists admit that smaller enterprises in the Soviet Union suffer from the same disadvantages described by Marx in the case of orthodox capitalist countries:     Marx points out that the economic laws of capitalism lead to the centralisation of capital, of means of production, that is, their concentration in the hands of a decreasing number of capitalists, and the process of centralisation of capital is stimulated by the role of the banks. While relatively unprofitable enterprises could be put into liquidation under 'bankruptcy laws' which were similar to those in orthodox capitalist countries, most such enterprises were 'reorganised' by merging them with one or more other enterprises:
    Soviet Monopoly Capitalism
    Lenin revealed that, as a result of the operation of economic laws inherent in the capitalist economy, competitive capitalism gave way, at a certain stage of its development, to monopoly capitalism or imperialism, in which a relatively small number of capitalist groups with monopolistic power dominate the economic life of society. In the Soviet Union such large groupings with monopolistic power are called 'production associations':
    "The systematic establishment of production associations is a necessary requisite for improving the organisation of production and management. . . . The need for setting up production associations (combined works) was emphasised in the 24th Congress decisions".
    (N. Y. Drogichinsky: op. cit.; p. 221-22).
    By 1973 some 5,000 'production associations' had been formed.
(B.Gubin: 'Raising the Efficiency of Socialist Economic Management'; Moscow; 1973; p. 86).
Like monopolies in orthodox capitalist countries, Soviet 'production associations' could take the form of 'trusts' (i.e., cartels in which the enterprises within the 'production association' retain their managerial independence) or of 'firms' and ’combines' (in which the enterprises within the 'production association' have a single managerial apparatus, with the smaller enterprises functioning as subsidiaries:     Since the 'economic reform', the average rate of profit in Soviet enterprises has increased from 16.7% in 1961-65 to 21.3% in 1966-70.
(N. Y. Drogichinsdy: op. cit.;.p. 208).

    and the average profit per worker has increased as follows:

    In the period 1971-75 total profit amounted to:     an increase over the period 1966-70 of:     The formation of 'production associations' has greatly accelerated rationalisation and its attendant 'releases of surplus labour':     One of the principal advantages possessed by a monopoly is its ability to maintain its prices (and so its rate of profit) at a higher level than would be possible under conditions of competition. Thus, Soviet economists were compelled to admit that the formation of monopolistic production associations' led to a tendency for prices to rise, i,e., a tendency to inflation:     And, as in orthodox capitalist countries, Soviet monopolies do not hesitate to use their control of the production of a particular commodity to create artificial shortages for the purpose of increasing their prices and profits:     As a result of all these factors, Soviet monopolies succeeded in significantly raising their rates of profit during the 1960s:     In the 1970's Soviet revisionist economists and politicians were still maintaining that, despite the 'economic reforms', Soviet society continued to operate on the principle of     although it was admitted that this principle     As has been shown, these 'deviations' included the receipt by managerial personnel in Soviet industry of bonuses which were up to 100 times those received by shop floor workers. Such huge differentials can, by no stretch of the imagination, be reconciled with the principle of 'distribution of income according to quantity and quality of work performed'. They represent, in Marxist-Leninist terminology, the exploitation of the working class.     Marx made it clear that, by reason of the anarchic character of production in a capitalist society and the fact that, in such a society, the workers receive in wages the equivalent of only as part of the value they produce, every capitalist society faces a market problem. By 1965 Soviet revisionist economists were admitting that the Soviet economy was facing such a market problem:     One attempt to alleviate the Soviet market problem has been the great expansion of credit sales:     This market problem brings about pressure to find markets abroad for goods which cannot be sold at home:     In 1967 fuel, raw and other materials, and foodstuffs constituted 62.5% of Soviet exports.
(M. Senin: op. cit.; p. 99).

    But the production of such commodities for export is significantly less profitable than the production of manufactured goods:

    Naturally, therefore, Soviet revisionist economists urged that steps be taken to change the pattern of Soviet exports in the direction of manufactured goods:     The Communist Party of the Soviet Union, founded as a political party representing the interests of the working class, has been said since 1961 to represent the interests of 'the entire Soviet people':     But in a society which contains classes with antagonistic interests -and it has been shown that the Soviet Union had become such a society by the 1960s -- it is impossible for a single party to represent the interests of the entire people' and any claim to do so must be dismissed as mere demagogy.

    And where a capitalist class exists, as in the Soviet Union since the 1960s, a political party which does not represent specifically the interests of the working class must represent the interests of the Soviet capitalist class.

    Consequently, since the 'economic reform' the Communist Party of the Soviet Union represented the interests of the Soviet capitalist class.

    According to Marxism-Leninism, a state is essentially a machinery of force by which one social class rules over the rest of the people. The Soviet State established in Russia by the revolution of November 1917 was officially described as a machinery of force in the hands of the working class, as the dictatorship of the working class'.

    In 1961, however, the leaders of the CPSU declared that the Soviet state was no longer the dictatorship of the proletariat, but had become an organ representing the interests of 'the entire people':

    But Marxism-Leninism teaches us that in a society which contains antagonistic classes -- and, as has been demonstrated, Soviet society has been such a society since the 1960s -- the state can only be the machinery of rule of the dominant social class, and any claim that it represents the interests of 'the entire people' must be dismissed as mere demagogy.

    Since the Soviet revisionist leaders admit that the Soviet state is no longer the dictatorship of the working class, it must be the machinery of rule of the new capitalist class.

    But Lenin demonstrated that monopoly capitalism -- such as came to exist in the Soviet Union after the 'economic reform' -- inevitably develops into state-monopoly capitalism, in which the state ceases to be the machinery of rule of the capitalist class as a whole and becomes that of the most powerful groups of monopoly capitalists, and in which the intervention of the state extends into every facet of social life:

    Thus, the Soviet revisionist Prime Minister Aleksei Kosygin described in 1965 how the industrial Ministries would 'rely on' the trusts, firms and combines in their respective fields, and would 'hand over' to them many operative functions:     Furthermore, the Soviet state which came into being through the 'economic reform' of the 1960s, was not of the 'parliamentary democratic' type such as exists in Britain at the present time.

    Within 'parliamentary democracy' the legal right exists for the formation of political parties with the declared aim of transforming the structure of society; and the legal right exists for such parties to hold public meetings and demonstrations, to publish journals and leaflets, to contest elections, and so on.

    But in the Soviet society of the 1960s, 1970s and early 1980s such rights did not exist. The Communist Party of the Soviet Union representing, as has been shown, the interests of Soviet monopoly capital was the sole legal political party and functioned as 'the leading and guiding force of Soviet society':

    Consequently, the Soviet state of the 1960s, 1970s and early 1980s was  despite its false trappings of red flags -- a fascist-type state in which the Communist Party functioned essentially as did the fascist parties in Fascist Italy, Nazi Germany and Falangist Spain. The theses that the Communist Party of the Soviet Union remained a Marxist-Leninist Party and the Soviet Union remained a socialist society until the mid-1980s cannot be reconciled with the known facts.

W. B. Bland,
For the Communist League.



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