The planned economy of the Soviet Union

Towards a more balanced understanding of Stalin: this time from a book called Towards a New Socialism by W. Paul Cockshott and Allin Cottrell.

They argue quite persuasively that the full implementation of a communist economic system happened under Stalin. Through the five year plans beginning in the late 1920s the capitalist mode of extracting surplus value was replaced by a planned economy, in which surplus was controlled and allocated by the planning mechanism.

Under Soviet planning, the division between the necessary and surplus portions of the social product was the result of political decisions. For the most part, goods and labour were physically allocated to enterprises by the planning authorities, who would always ensure that the enterprises had enough money to ‘pay for’ the real goods allocated to them. If an enterprise made monetary ‘losses’, and therefore had to have its money balances topped up with ‘subsidies’, that was no matter. On the other hand, possession of money as such was no guarantee of being able to get hold of real goods. By the same token, the resources going into production of consumer goods were centrally allocated. Suppose the workers won higher ruble wages: by itself this would achieve nothing, since the flow of production of consumer goods was not responsive to the monetary amount of consumer spending. Higher wages would simply mean higher prices or shortages in the shops. The rate of production of a surplus was fixed when the planners allocated resources to investment in heavy industry and to the production of consumer goods respectively (pp. 4-5).

The key to this momentous shift was the old issue of compulsion: how do you encourage workers and peasants to engage in the new system? Under the circumstances of such rapid change and in the face of a sustained threat from international capitalism, that compulsion took the form of carrot and stick. Genuine revolutionary fervour characterised much of the effort, but for those less inclined to engage, forced labour, exile and ‘terror’ were deployed. Crucial to this process was the personality cult of Stalin, who embodied the sheer grit (thereby making up for what he lacked in oratorical skill) of the revolutionary ‘miracle’ required to adopt such a radically new economic system. Stalin was thereby able both to promote a deep sense of ‘participation in a great historic endeavour’, but he was also the ‘stern and utterly ruthless liquidator of any who failed so to participate’. I would add that this combination, along with the deep strength of the communist economic system, enabled the extraordinary recovery during the Second World War and the eventual victory by the USSR over Germany and fascism.


6 thoughts on “The planned economy of the Soviet Union

  1. Sigh … Deano. Please don’t trot out the old line about the communists providing the path to industrialisation. You hear it from starry-eyed liberals and jaded lefties; it’s neither original nor insightful. Nor is the unreflecting demonisation of Stalin,

    As for Stalin’s ruthlessness, so what? You can’t crush the bourgeoisie by being nice. More extensively, concerning the issue of compulsion, of what the Regulation Theorists call the ‘mode of regulation’, every socio-economic system needs it in some form. And no shift to a very different system happens smoothly. Witness the sheer devastation, brutality, mass murder if not genocide of the imposition of capitalism, especially in colonial countries but also at its points of origin. By comparison, what happened under Stalin was a Sunday picnic.

  2. Even the conservative Oxford Dictionary defines a kulak as:

    ‘a peasant in Russia wealthy enough to own a farm and hire labour. Emerging after the emancipation of serfs in the 19th century the kulaks resisted Stalin’s forced collectivization, but millions were arrested, exiled, or killed’.

    A little more than a cow, it seems.

    And lets not get into speculative, alternative histories, or musing over ‘historical accidents’, shall we.

  3. A kulak is “an affluent peasant who screws his or her neighbours”? Well, if you want to classify a family owning a cow as abusers who should be sent to Siberia, because some of their neighbours don’t own cows, sure.

    All good knock about stuff, no doubt, but there some serious issues here.

    1. By city standards a lot of ‘rich’ peasants would have seemed dirt poor. However, within the village, everybody would have been acutely conscious of any differences, in both standard of living and power.

    2. In England at the time of the enclosures, the income derived from a cow was roughly equivalent to a laborer’s wage. So owning a cow made big difference to a family’s standard of living.

    And then there is the Irish ballad ‘The Emigrant’s Letter’

    “There’s a woman on board who knows Katie by sight,
    And we talked of auld times ’til they put out the light.
    I’m to meet the good woman tomorrow on deck,
    And we’ll talk about Katie from here to Quebec,
    I know I’m no match for her, no not the least
    With her house and two cows, and her brother a priest.”

    3. In the Russian context the key issue was not the ownership of cows, but of horses.

    Before collectivisation, horses were the prime movers. As such they determined how much land a family could cultivate.

    Those who didn’t own a horse were beholden to those who did.

    This allowed the horse owners to lord it over poor peasants.

    Academics make a lot the fact that there was never an official definition of a kulak. This misses the realities of life in a village. Rich peasants didn’t get the nickname ‘fist’ for nothing.

    Decisions about who was and who wasn’t a kulak were taken on the spot, in the villages: not by Stalin, in Moscow.

  4. One can dehistoricize or fetishize industrialism/industrialization, or empire/imperialism, or the state/state-building, refrain from seeing these things in terms of class struggle. One can believe in “totalitarianism”, or erase the distinction between dictatorship or the proletariat and other forms of dictatorship (and then, condemning all dictatorship or tyranny or despotism or autocracy or authoritarianism, be a liberal or democrat or anarchist, or, supporting this fetishized dictatorship, be a fascist). In which case one is expressing the conservative or reactionary view of the petty bourgeoisie. Or one can see class struggle and fight accordingly.

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