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Perestroika and the future of socialism - part 2
Monthly Review, April, 1990
PERESTROIKA AND THE FUTURE OF SOCIALISM--PART TWO
Last month in this space we dealth with the troubles in the Soviet Union that preceded and led up to glasnost and perestroika. The facts on the severity of the crisis that emerged in the 1970s and 1980s are clear enough. The puzzling question is why regression set in after so many years of social progress and impressive achievements in industrialization.
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Bourgeois economists have an easy answer to this question. They have claimed all along that central planning of an economy would come a cropper: it couldn't deliver the goods and was bound to fail. In recent years, quite a few prominent economists in the Soviet Union and Eastern Europe have joined the bandwagon in blaming central planning for the economic woes of their societies. It is now common for critics in the Soviet bloc to argue that even though national planning was serviceable in the past, it long ago outlived its usefulness. Not only is an administered economy intrinsically inefficient, they maintain, but its failures inevitably loom larger the more it attempts to extend its functions from basic industrialization to the satisfaction of consumer needs.
It seems to us that this kind of blanket condemnation of central planning is based on the implicit assumption that Soviet practice reveals the essential nature of a centrally planned economy. What is missing and what needs to be understood is that the Soviet way of running an economy evolved under very special historical circumstances. There was pitifully little experience to rely on, nor was there time or opportunity for the trial-and-error experiments essential to the rational construction of a new economic system. Furthermore, what was at stake was not only a desire to build socialism but the simultaneous need to industrialize the nation--each a formidable enough task in its own right. And both were undertaken under the continuing actuality or threat of invasion by one or more hostile capitalist powers.
Not only were the blueprints for a new order missing, so were trained and experienced administrators of a socialist persuasion. In large measure, the available personnel with administrative knowhow came from the old state apparatus, ridden with bureaucratic and semi-feudal traditions. All in all, the Soviet planning system was designed and introduced under economic and social conditions that bordered on the chaotic.
The Soviet Union did not have to embark on central planning and massive industrialization when it did in the late 1920s. An important part of the leadership, led by Bukharin, advocated a slower and more gradual course. But once the decision was made, it was inevitable that certain consequences would follow from the initial goal of an incredibly rapid acceleration of economic growth under unusually strained conditions: a vast increase in the economic role of the state, extreme centralization of decision making, harsh regimentation of the population.
The state and the economy thus became fertile ground for the emergence of a huge bureaucracy which in turn shaped and controlled its members, teaching them ways of operating and giving them jobs and special privileges they soon became masters of extending and protecting. Although changes were later made from time to time in some aspects of organization and planning, the system inherited by Gorbachev and which he set himself the task of overhauling remains essentially the one forged under Stalin in economic and social conditions very different from today's.
It was not only the bureaucracy and its way of functioning and protecting its interests that survived from the time of Stalin but also the ruling ideology which developed to rationalize its existence and that of the system it served. Planning was elevated to the status of a science, invented in the Soviet Union and available for adoption by the rest of the world. Planning was guided by alleged laws of socialism--actually rationalizations of existing practices but proclaimed as eternal truths. This was part and parcel of a general tendency to project all aspects of Soviet society--the Communist Party, its monopolization of state power, the planning system--as inherent in socialism and the necessary model for any country taking the road to socialism.
For purposes of the present discussion it is crucial to keep this background in mind and to reject any notion that Soviet practice during this stormy period and central economic planning are one and the same, with its logical corollary that the present crisis of the Soviet economy and society is also a crisis of economic planning. The truth is rather that what led to the present plight of the Soviet economy is precisely those aspects that are peculiar to the Soviet experience and not any inherent characteristics of planning as such.
The forced-draft industrialization of the Soviet economy set in motion by the First Five-Year Plan would of course have been impossible if the necessary human and material resources had not been available within the borders of the Soviet Union. They were there, a rich potential supply of fuel, minerals, other raw materials, and a large pool of unutilized and underutilized labor. But none of these reserves was inexhaustible, and there was never any guarantee that needed inputs called for by the planners would be available in the right proportions at the right times. Unless this aspect of the planning process could be developed and steadily improved, there was always a danger of crises and/or slowdowns in the overall performance of the economy. And it was in fact precisely in this complex of problems that the tendency to declining growth rates discussed in last month's article had its roots.
