Posts Tagged ‘philosophy’
The Bolshevik Revolution and the First Four Congresses of the International
Chapter Four of “On the Marxist Program”
(a) The Bolshevik Revolution
The victory of the Bolshevik revolution was the most momentous event in the history of the modern world. It vindicated the program of permanent revolution from the time of Marx to the epoch of imperialism. The slogans for Peace, Land and Bread, summed up the Transitional Program. They were immediate demands, but could be won only by a socialist revolution. Peace was the demand that the workers in uniform refuse to fight, turn their guns on their officers and form rank and file soviets. It ended the war, stopped the counter-revolution of Kornilov and built the Red Army. Land was the democratic demand to win over the poor peasants by expropriating land and turning it over to the tillers. This caused a split in the peasantry along class lines and opened the way for a class alliance with the proletariat. Bread was the transitional demand to meet the basic needs of the workers and poor peasants that could be won only by workers’ expropriation and control of industry. All led necessarily to the seizure of power and construction of a workers’ state. Read Review of China Mieville’s October: The Story of the Russian Revolution.
Marxism was vindicated in its fundamentals. First, only the proletariat, leading the poor peasantry and other oppressed people, could rescue humanity from capitalist decline and reverse the destruction of crises and wars by means of revolution. All class compromises in or outside parliament led to betrayal. Second, only the vanguard party and program could inject the vital revolutionary subjective factor into transforming the objective factor. All workers parties that attempted to appease the petty bourgeois or labour aristocracy had to be split and the working-class majority won to the vanguard party. Third, the workers’ state was a class state of the armed independence of the workers based on soviets and militias and not mere bourgeois workers governments based on a majority of workers votes. This distinction is manifest in the slogan of ‘The Dictatorship of the Proletariat’!
The victory of the Bolshevik revolution was met by a wave of enthusiasm from workers the world over, and became the stimulus for the formation of vanguard parties in many countries. This wave became the basis of the new 3rd International which was formed in February 1919. Its program debated in the first Four Congresses to 1924 summed up the lessons of the permanent revolution in flesh and blood. The new international was devoted to building world revolution not merely as an extension of the Russian revolution but as the necessary condition for its survival. Read Trotsky, Lessons of October.
(b) The First Four Congresses: 1919-1922
Trotsky’s main writings during the period of the first four congresses are collected in the First Five Years of the Communist International published in 1924. In his Introduction he states that the First and Second Congresses of March 1919 and July 1920 were under the “aegis of imperialist war.” But “war did not lead directly to the victory of the proletariat in Western Europe. It is all too obvious today just what was lacking for victory in 1919 and 1920: a revolutionary party was lacking”.
Writing in April 1919, Trotsky compares the German revolution to the Russian Revolution. There are similarities, but the differences are key. Germany was an advanced imperialist country and both the proletariat and the bourgeoisie were mature and powerful classes. When the armed workers opened the German ‘February’ in November 1918, the bourgeoisie were forced to concede a ‘republic’ led by a Social Democratic government which suppressed the revolution in the “July Days” of February 1919, assassinating its main leaders Liebknecht and Luxemburg. The treacherous role of German Social Democracy proved in Trotsky’s words – “to be the most counter-revolutionary factor in world history.”
This caused Social Democracy to split, but in the absence of a revolutionary party the proletariat was without a “revolutionary combat organisation…It was compelled to not only fight for power but to create its organization and train future leaders in the very course of this struggle.” Clearly, unlike the Russian “July Days”, events were taking on their own momentum without the guidance of an established vanguard party to avoid a showdown before the conditions for revolution had been prepared. Nonetheless Trotsky regarded the “political and cultural level of the German workers” as capable of rising to the task of winning workers from the treacherous SPD and the Kautskyite USPD, and to build the Spartacist League into a Bolshevik-type party that could lead the revolution to victory.
Writing in May 1919 Trotsky in Thoughts on the Progress of the Revolution draws up a balance sheet of the progress of the revolution so far. He critiques the Mensheviks’ evolutionary view that the revolution would begin in the ‘West’ and move ‘East’.
But events clearly disproved the two-stage ‘mechanical Marxism’ by beginning in the East (Russia) and moving West. Russia led first with the proletarian revolution in 1917 being neither an ‘accident’ or ‘adventure’. The betrayal of the Constituent Assembly in Germany (the Menshevik icon of ‘democracy’) in early 1918 led to the formation of a Communist Party with the slogan “All power to the Soviets”. In Hungary and Bavaria, the workers had the impudence to emulate the Bolsheviks and form workers governments with a “truly genuine democracy in the form of the rule of the victorious proletariat.” “Thus, the proletarian revolution after starting in the most backward countries of Europe, keeps mounting upwards, rung by rung, toward countries more highly developed economically”.
Thus, imperialist war not only disrupts the illusions in peaceful, evolutionary capitalist development, it reveals the interconnectedness of all countries in the imperialist system. While bourgeois democracy resists revolution in the West, its absence facilitates revolution in the East. Underneath the forms of democracy are the relations of oppression between oppressor and oppressed states. The imperialist ruling classes can ‘buy’ the ‘class peace’ with bourgeois democracy and delay civil war in the most developed countries, but cannot delay it in the more backward, oppressed countries which the imperialist bourgeoisies plunder for super-profits.
(c) The programmatic gains of the First Four Congresses
In his Report on the Fourth Congress (to the Communist Fraction of the 10th All-Union Congress of the Soviets,) Trotsky summarises the international situation of the world labour movement. The three prerequisites for socialist revolution are the level of productive technique, working class maturity and a class-conscious vanguard.
First, capitalism is overdue for replacement by socialism. “…25 years ago and more, the replacement of the capitalist mode of production by socialist methods would have already represented objective gains, that is, mankind could have produced more under socialism than under capitalism.”
Second, the working class “must become sufficiently powerful in the economic sense in order to gain power and rebuild society”. “The working class in all countries plays a social and economic role sufficiently great to be able to find a road to the peasant masses, to the oppressed nationalities, and in this way assure itself of the majority. After the Russian revolution this is not a speculation, not a hypothesis, not a deduction, but an incontestable fact”. (307).
Third, the ‘subjective factor’. “[T]he working class must be conscious of its power and must be able to apply this power.” “During the post-war years, we have observed in the political life of Europe that the working class is ready for the overturn, ready in the sense of striving subjectively toward it, ready in terms of its will, moods, self-sacrifices, but still lacking the necessary organisational leadership”.
Trotsky presents this leadership as the role of the party. “In the most critical year for the bourgeoisie, the year 1919, the proletariat of Europe could have undoubtedly conquered state power with minimum sacrifices, had there been at its head a genuine revolutionary organization, setting forth clear aims and capably pursuing them, i.e., a strong Communist Party. But there was none. On the contrary, in seeking after the war to conquer new living conditions for itself and in assuming an offensive against bourgeois society, the working class had to drag on its back the parties and trade unions of the Second International, all of whose efforts, both conscious and instinctive, were essentially directed toward the preservation of capitalist society.”
In his balance sheet of the Third Congress Trotsky calls the Congress the “highest school of revolutionary strategy” because it seeks answers to the failure of revolution outside Russia. “Many of us imagined the task of overthrowing the bourgeoisie much simpler than it actually is, and as reality has now proved to us.” While the bourgeoisie is now parasitic on the forces of production it is desperately fighting for survival, expending economic resources in propping up its state, the task of overthrowing the bourgeoisie is not a “metaphysical” or “mechanical one” but one which, “…requires for its fulfilment: revolutionary energy, political sagacity, experience, broadness of vision, resoluteness, hot blood, but at the same time a sober head. It is a political, revolutionary, strategic task.”
In Trotsky’s Report on the Fourth Congress, he states that the Congress faced two big “intimately interrelated tasks”, to defeat centrism (social democrats, Mensheviks, etc.) and to win the majority of the working class. First, the CI demanded a “complete break with the bourgeoisie” programmatically. Second, the CI argued that this could only happen by means of the tactic of the united front which can win workers from bourgeois parties and centrist parties linked to the bourgeois program of class collaboration. Trotsky addresses the centrists, ““You do not believe in our revolutionary methods and in the dictatorship. Very well. But we Communists propose to you and your organization that we fight side by side to gain those demands which you are advancing today.” This is an unassailable argument. It educates the masses about the Communists and shows them that the Communist organization is the best for partial struggles as well”. (Report, 323)
Communists raise their full program in every united front. The tactic is subordinated to the strategy, not vice versa! Trotsky says: “From the united front flows the slogan of a workers’ government. The Fourth Congress submitted it to a thorough discussion and once again confirmed it as the central political slogan for the next period. What does the struggle for a workers’ government signify? We Communists of course know that a genuine workers’ government in Europe will be established after the proletariat overthrows the bourgeoisie together with its democratic machinery and installs the proletarian dictatorship under the leadership of the Communist Party.”
Trotsky then concludes that the Fourth Congress recognised a majority workers’ government in a bourgeois state as a genuine transition to the dictatorship of the proletariat only if it was carried into power by the majority of workers in a revolutionary situation capable of using it as a platform to seize power. In other words, a workers’ government must be actively transitional to soviet power. “That is to say, a moment may arrive when the Communists together with the left elements of the Social Democracy will set up a workers’ government in a way similar to ours in Russia when we created a workers’ and peasant’ government together with the Left Social-Revolutionaries. Such a phase would constitute a transition to the proletarian dictatorship, the full and completed one.” (ibid 324)
In summary, the first four Congresses mark the rapid development of a new Communist International learning from the experience of the war, revolution and counterrevolution in Europe between 1918 and 1922 to test its program and correct its errors. The result was the affirmation of the vital role of a democratic centralist vanguard party armed with the tasks and methods to break the masses from reformism and centrism by means of the tactic of the united front on all immediate and democratic demands, and at the same time raising the transitional program that posed the theory/program of permanent revolution. The demand which captured the essence of this program was the Workers’ Government.
Terminal Crisis
Chapter 9 of “On the Marxist Program” ILTT Draft Program (last revised July 2022)
Starting with Marx, crisis is a crisis of reproduction of the conditions of capitalist production. Capitalism can survive so long as it has not exhausted its capacity to impose and restore those conditions. It can do so unless the proletariat intervenes and takes power. Thus, the crucial factor in resolving capitalist crises is: which class has power. The current crisis marks terminal decline of
capitalism, as the looming environmental catastrophe means capital can no longer reproduce its
conditions for existence.
As we have seen capitalism for the whole imperialist epoch has been over-ripe for its replacement by
critical factor for the ability of the proletariat to take power is the existence of an internationalist
revolutionary party. Without that party, capitalist crises become more and more destructive of the
conditions for capitalism’s reproduction, including the destruction of accumulated wealth (dead labor)
and the labor power or living labour. The future of humanity therefore is a race between living labor
(the proletariat) and dead labor (accumulated capital). Either capitalism dies or humanity dies.
(a) Marx, Lenin and Trotsky on Crises
The experience of the economic crises of the 20th and 21st centuries vindicate Marx, Lenin and Trotsky. Lenin developed Marx’s theory of the anarchic self-expansion of capital to explain the rise of imperialism and the inevitability of the First Inter-Imperialist War. That war failed to solve the problems of restoring profits as the Bolshevik Revolution opened a new period in which the world’s workers threatened to take power. Imperialism used social democracy and its state forces to suppress the revolution, ultimately resorting to fascist movements to suppress the still-powerful proletariat. Trotsky as the main surviving Bolshevik leader saw the rise of fascism as the mortal enemy of the working class and its program of Permanent Revolution, and expected that if global revolution did not result from the 2nd inter-Imperialist War, then Marxism itself as a revolutionary theory/program would be found wanting.
Had Trotsky survived the war he would have quickly drawn up a balance sheet. He would have recognised that the 4th International in the Second inter-Imperialist war betrayed the international working class by adapting to the Stalinist 3rd International with terrible consequences as in Vietnam. The Stalinists succeeded in destroying the best Trotskyist cadres during and after the war, sucking workers in the “democratic” imperialist countries into popular fronts with their own capitalist ruling classes against the fascist powers. This divided the international working class and led, as we have seen above, to the abandonment of the Bolsheviks’ program on imperialist war in the majority of the Fourth International (FI).
Trotsky would have concluded that while imperialism survived the war, this was only a temporary respite. The crisis of Marxism was not the same as its bankruptcy. The crisis of Marxism was now the crisis of revolutionary leadership of the Fourth International. The Post-war boom was the result of unprecedented destruction of the forces of production in the ‘30s and ‘40s. Yet it did not resolve capitalism’s tendency to crises. Despite Stalinism’s betrayals, workers’ property survived the war in Russia, and in the semi-colonies, imperialism was forced to go through a formal ‘de-colonisation’. In some countries this struggle for independence would lead to the formation of bureaucratic workers states. The FI, reneging on the most important part of the program on war, would have to be rebuilt to prepare for the inevitable onset of a new, bigger crisis. The 1946 and 1948 international meetings would have drawn up honest balance sheets and repudiated the social imperialist deviation of the European and US sections. This correction did not take place.
The first major test of a rebuilt international would have been drawing these lessons to vindicate the
Transitional Program for the post-war boom. Like the end of the First inter-imperialist war, workers, despite their historic defeat, were after the Second inter-Imperialist war, able to organise and demand
some concessions in a period of new capital accumulation and prepare for the inevitable new, bigger
crisis. The new crisis came in the ‘60s with the end of the ‘post-war boom’. In the absence of Trotsky
and a healthy International, the response to the crisis revealed the bankruptcy of theory and program
of the official Fourth International. We can see this clearly in the debate between Ernest Mandel and
David Yaffe over the onset of a new crisis of falling profits.
(b) Debates over the post-war ‘structural’ crisis from 1970s to today
Mandel, the chief theoretician of the Pabloist USEC had an empiricist multi-cause theory of crisis,
(contingency was all the rage) which when boiled down was left with underconsumption, i.e., a distributional theory of crisis not unlike David Harvey’s theory today. Yaffe accused Mandel of capitulating to a state-centred Keynesian economics consistent with the FI’s capitulation to Stalinism. In fact, the post-war boom had disoriented most Marxists, worsening the crisis of Marxism. The defence of ‘democracy’ against fascism and the defence of the Soviet Union got conflated into the defence of Stalinism as a petty bourgeois fraction of the working class embedded in the capitalist state alongside classical Social Democracy (as for example ‘Eurocommunism’). The ‘boom’ was explained as the result of ‘democratic’ capitalism managed by Social Democracy, and its end resulted from, not from inflation as a symptom of the LTRPF, but the revival of neo-classical economics and neo-liberal regimes.
Hence Marxism was increasingly diluted, the left moved right across the world tailing democratic mperialism. In the UK it tailed the retreat of the imperialist Labour Party from Harold Wilson to the Blairite “third way”, and the US Democratic Party from the ‘Great Society’ to Bill Clinton. The Pabloists or all colors who followed Mandel called Yaffe and Co ‘fundamentalists’ when they claimed the ‘neoliberal’ upturns of the ‘80s and ‘90s were largely speculative. Neo-liberal ‘reforms’ destroyed constant and variable capital to raise the rate of profit but this was not sufficient to restore pre-crisis levels of profitability in production. Over-accumulated capital was diverted from production to speculating in existing values. Neither did capitalist restoration in Russia, China in the early 1990s help solve capitalism’s crisis. Russia and China were not super-exploited neo-colonies of the US bloc but became new imperialist powers to rival the declining US. Cuba and Vietnam restored capitalism and became capitalist semi-colonies under the influence of the imperialist Russia/China bloc.
Debates among Marxists about the nature and causes of crisis, continue to reflect the need to attack
Marxism to undermine its revolutionary theory and practice by refuting its ‘laws of motion’ – the laws that explain the drive for capital accumulation. We can see this in the positions taken on the Law of Value (LOV) and the Law of the Tendency of the Rate of Profit to Fall (LTRPF). Those who defend both laws (fundamentalists) see the current crisis as demanding a socialist revolution while those who reject both laws (empiricists) explain the current crisis as resulting from wrong policies that can be corrected with democratic socialist reforms.
The debate between Michael Roberts and David Harvey is instructive. Roberts argues that Harvey rejects the LOV and therefore the LTRPF. Capitalist crises are therefore not necessary but contingent on powerful elites controlling the distribution of income. This is shared with the radical neo-Ricardian school that says that exploitation occurs at the level of distribution. And therefore, we need a politics of re-distribution! Roberts explains that the capitalists’ power is to make profits, but when the laws of motion necessarily destroy the conditions for this, they are powerless to stop their money losing value without a massive attack on workers to restore those conditions. We argue that the structural crisis of the 1970’s to today demonstrates that capitalism can no longer accumulate sufficient value as capital, so that the crisis is not contingent but necessary; and further, we would argue, terminal.
The “Global Financial Crisis” of 2007/8 proves that the structural crisis that ended the post-war boo is worsening. Since the 1960s the capitalist world economy has failed to destroy sufficient surplus capital to restore the conditions for a new period of capitalist accumulation. Nor can Russia and China as new imperialist powers evade the decline of the capitalist world economy as they are necessarily subject to its laws of motion. This means that in the epoch of imperialism, spanning the period from the turn of the 20th century until today, capitalism has been in inexorable decline. Despite its attempts to restructure and re-divide the global economy and resolve depressions with world wars, each crisis gets deeper and longer. Each world war merely postpones the day of reckoning. The build-up of the explosive contradictions that are just beneath the surface of the neo-liberal veneer, will burst forth to bring its life to an end. The owners of the big chunks of capital are desperately trying to suppress those contradictions by state-backed financial speculation in existing values. But this is now expressed as multi-trillions of ‘fictitious’ capitals resulting in impossibly high levels of debt that can never be exchanged for actual new value expropriated from labor power as profit. We can see this explosion in the making as capitalism’s ability to restore profits now drives it towards the final destruction of the forces of production and with it, nature.
(c) Marx on Ecological Crisis
Once we factor in the many positive feedbacks driving global warming it is obvious that we face the prospect of human extinction. Once the ecosystem which capitalism takes for granted begins to collapse, capitalism itself will collapse. Capitalism only exists as a mode of production by a constant process of exploiting nature to the point of destruction. Marx recognised this early on. There was a limit to the ability of capital to replenish or restore nature when it could deplete and destroy nature for profit. Marx concept of metabolic rift is based on the best science of his day already revealing the depredations of capitalist agriculture. It is a model for understanding the ecological rift between capital and nature.
Contrary to popular wisdom, Marx was not a fan for environmental destruction. Rather he based his whole theory on the contradiction between nature and society, expressed as between use-value and
exchange-value. Use-value being the natural process of producing for use (though this ‘nature’ is
conditioned by the requirements of capital); exchange value as being the requirement that use-values were commodified as exchange value. Commodities would only be used if they were bought and sold on the market. This contradiction is the seed of capitalist development which accumulates riches at the top and accumulates impoverishment at the bottom. Inevitably capital would destroy nature and itself unless labour as part of nature fought back and restored a harmonious relation between nature and society. (Climate Crisis: From Capital to Commune).
The only unanswered question is how soon this will happen and in what form. Global warming is already destroying the conditions for production as the ‘external’ costs of pollution, degradation, and exhaustion of raw materials impact back on declining profits. The costs of wars to control this declining resource base on human life as part of nature is producing a rise in resistance to this inevitable social collapse. There is no prospect of the capitalist ruling class taking any responsibility for preventing this collapse. It is necessary for the proletariat to take the lead in this task. Marxism holds that under capitalism the class relation between capital and labor generates the motive force for class struggle between the proletariat and capitalist class that, through workers strikes, occupations and insurrections, will end in socialist revolution. As capital exhausts its historic capacity to develop the forces of production, it inevitably destroys nature including the ecological conditions for human existence. The proletariat in fighting to overthrow capital, must take the lead in drawing all other oppressed people into the struggle for survival. These include all forms of labour, producing value or not, unemployed, undocumented, self-employed, skilled or unskilled, white or blue collar etc., plus all those who are outside the formal capital-labour relation but whose labour is appropriated by capital. Its Transitional Program must address itself to bringing all oppressed peoples, and groups behind the banner of socialist revolution, because without them there can be no revolution.
Women as the majority of workers, as members of an historic sex-class, still perform domestic labour for no payment as domestic slaves, and continue to face ongoing gender oppression. As domestic slaves, they do not directly create value but contribute their unpaid labour in reproducing the value of labour power. Contrary to Marx and Engels, who expected the inclusion of women as wage workers alongside men to make them more equal, they remain doubly exploited as domestic slaves and a floating section of the reserve army of wage labour, where their working conditions lag well behind those of men. Colonial and semi-colonial workers, (including self-employed, unemployed and migrant workers) peasants and poor farmers are the big majority of the world’s workers and doubly oppressed as unpaid slaves and wage workers. They are the largest section of the global reserve army, super-exploited since their labour can earn no more than a poverty income. Indigenous peoples who remain colonized in some form, partially embedded in their pre-capitalist social relations, are oppressed by capital, and have their labour and land exploited by capital. There will be no socialist revolution that does not include the representatives of working women, semi-colonial and indigenous workers in the vanguard of the proletariat, and which does not make the liberation of all oppressed from the threat of extinction, and the realization of communism, its goal.
Since Marx, Marxists have maintained that capitalism is a living contradiction between labor and capital, which can be suppressed indefinitely unless transcended by socialist revolution. Today, however, we do not see any prospect of capitalism ‘stabilising’ as it did briefly after the First Imperialist and Second Imperialist wars. Today, the decomposition of capitalism is so advanced that we are justified in using the term “terminal” crisis to mean that capitalism cannot restore profitability because it is destroying its own conditions of existence. Whether this takes the form of fascist attacks on workers and oppressed to resolve the crisis of falling profits, failure of production as the ecosystem collapses, or expansion of many local and regional wars into a Third Imperialist World War, the outcome is the same. The proletariat and other oppressed people facing death and destruction have nothing to lose but their chains. Led by a revolutionary international communist party, they have everything to win; the survival of the human, and other threatened species, in a global socialist, and ultimately, communist world.
Critique of Michael Roberts on China’s Socialist Transition
December 20, 2024
Socialism with Chinese Characteristics Lü Yanchun (吕延春), Northeast Chinese Households (关东人家), 2005
| China is now at the center of the world. The biggest economy in terms of industrial output, the largest manufacturer, and its population as measured by purchasing power parity, or PPP, (how much of the real wage does a McDonald’s burger cost) is already at a higher living standard than the USA. By every economic metric it is the only major power that has grown economically by more than 5% a year in the 21st century. How do we explain this? For most Marxists there are two basic positions – China is either capitalist or socialist. Some however, argue that it is undergoing some intermediary ‘transitional’ position between them. The transition option is used by those who want to reject the reality that China is an imperialist world power, and keep alive the dream that it has some progressive, pro-socialist characteristics. In this case China’s growth must be explained not by its restoration of capitalism which is globally in decline but by its ‘transition’ to socialism. |
Foremost among those who argue China is undergoing a ‘transition’ is Michael Robertsthe British based Marxist well known for his defence of Marxist economics and the law of value, most notably against Michael Heinrich, (see In Defence of the Labour Theory of Value). He has also defended Marx’s key law of the tendency of the rate of profit to fall, the LTRPF, against David Harvey, who rejects it as the necessary cause of crises of overproduction, and ultimately setting the historical limits of the capitalist mode of production. Roberts’ defence places him directly in the tradition of Marx for whom value is the product of social labour, and the LTRPF the expression of the ultimate contradiction – the class struggle between the proletariat to retain the labour value it produces, and of the capitalist ruling class to extract surplus labour value.
However, the class struggle is not only over the rate of exploitation during the production of value. It is mediated by the state which rules on behalf of the ruling class to reproduce these exploitative class relations. To understand China today we have to determine for which class does the state rule. Transition in the historical context of China’s revolution can only be from the rule of capital to the rule of labour. The transition ends when the law of value as the basis for setting prices of production in the world market is replaced by the workers’ plan which sets prices based on social labour time. Roberts however, argues that the ‘transition’ to socialist planning was ‘trapped’ after the state opened up to the market from the late 1970s, because the Law of Value (LOV) is as yet not ‘dominant’ in the state.
So for Roberts there was no transition back to capitalism because the state could ‘manage’ the LOV so that it did not ‘dominate’ the economy. We argue that Roberts arrives at his conclusion by confusing levels of analysis. Marx’s abstract model of capitalism where the state is left out of the picture is superimposed on the real world of 21st C state monopoly capitalism. Roberts claims the state intervenes in the market to suppress the domination of the LOV when its actual role is to manage the LOV on behalf of the capitalist ruling class. How is this different from the rest of the monopoly capitalist states in the epoch of imperialism? We will show that since 1992 when the CPC decided to reintroduce the LOV to set the prices of production within the global economy, it has become a monopoly capitalist state, and that particular historical circumstances (many historical determinations) drove it to become imperialist. To make the transition from monopoly state imperialism today we need a socialist revolution that will expropriate all capital (‘public’ and ‘private’) and develop the conditions necessary to build socialism, the first stage of communism, which in ending class society, and therefore the state, will usher in communism itself.
No workers’ revolution means no socialism
We say that there is no evidence that China was or is socialist. China did not have a workers’ revolution which is the necessary condition for socialism. The revolution in 1949 was a peasant revolution led by a Stalinist party comprised of bureaucrats modeled on the degenerated revolution in the USSR after 1924 when the bureaucracy aligned with the peasantry and advocated a ‘bloc of four classes’, workers, peasants, petty bourgeoisie and bourgeoisie. The CPC took power after it defeated the bourgeois nationalist forces of the KMT which fled to Formosa (Taiwan). In that event the revolution was based on an alliance of only two classes, the peasants and the petty bourgeoisie. Trotsky had anticipated the possibility that such a petty bourgeois revolution, led by Stalinists based on the peasantry, would find it had to go further than it intended and expropriate the bourgeoisie, leading the bourgeois democratic revolution itself.
In fact Trotsky had already been proven right. It had happened in Eastern Europe after 1945 when Stalin’s plans to form popular fronts (the ‘bloc of four classes’) with the national bourgeoisies fell through as they all reneged on such a bloc as soon as the Cold War iron curtain came down. For those who understood Trotsky on Ukraine, these states became extensions of the Stalinist USSR where the bourgeoisies were expropriated by the bureaucracy rather than the workers. They were therefore characterized as deformed-at-birth workers’ states in defence of workers’ property.
Was the situation in Eastern Europe analogous to the Chinese Revolution? We say yes. In both cases the bourgeoisie decamped to join the Cold War and the Stalinist bureaucracies had no option but to nationalise private property as state property. The Chinese revolution was also deformed at birth as workers’ played no role in the revolution having been suppressed since the counterrevolution when the KMT liquidated the CPC leadership in 1927. So what resulted in 1949 was a petty bourgeois bureaucratic revolution that by 1951 was forced to expropriate the bourgeoisie, at the same time making sure the working class played no active role in the advance of the revolution towards socialism.
The petty bourgeois bureaucracy held state power balancing between the only two classes that could act as the ruling class – either the bourgeoisie or the working class. The petty bourgeoisie was a class intermediate between the two capitalist classes – the proletariat and bourgeoisie, which were locked in a class struggle over the production of value. The bureaucratic state was neither capitalist, nor socialist, but rather a ‘transitional’ state in which the petty bourgeoisie had to return to capitalist rule or go forward to proletarian rule. Resolving this class transition was pressing given the new state had to solve the dilemma of restoring capitalism without succumbing to recolonisation by imperialism.
Therefore, as a petty bourgeois formation the state bureaucracy had an interest in administering the state to advance and consolidate its power by becoming the new national bourgeoisie. This would involve restoring capitalist social relations ruled by a ‘socialist state’. The CPC at the head of the bureaucracy decided to do this gradually in the name of “Socialism with Chinese Characteristics”. The decision became more urgent as the bureaucratic plan which suppressed workers’ democratic participation failed to raise productivity and the economy began to stagnate.
CPC restores capitalism
Within the CPC the Maoist faction campaigned to enforce greater worker productivity in the name of the revolution. This campaign was a disaster that led to mass famine. By 1978 further stagnation in the economy prompted a rival faction around Deng to call for a return to capitalist market forces – that is, the LOV – to set the prices of production as the basis of market exchange. However this would only work if China re-joined the world market in which world prices would guide the application of the LOV. Labour-power would become a commodity in the market and socially-necessary labour-time would be the economic measure of value and surplus-value (or profits). This in turn would set the prices of production which included the share of profits.
In 1992 the 14th Congress took the decision to allow the LOV to set prices in the whole economy including the state owned sector to increase labour productivity. The rule of the LOV was carefully managed. Private investment in production on the land and in industry was now allowed subject to capital controls which restricted private trade and investment abroad. More importantly, tariff free economic zones for Foreign Direct Investment (FDI) were now established within strict limits including the requirement of joint ownership to prevent foreign takeovers, and the transfer of intellectual property to allow China to develop the forces of production.
For Marxists who recognize the LOV as determinant under capitalism, the CPC decision in 1992 is the qualitative point at which capitalism was restored in China. The bureaucracy led by the CPC was now converted from its role in the state as an intermediary bureaucracy serving the petty bourgeoisie, into a new ruling capitalist class serving collective capitalism. This ended the period of ‘transition’ from a Stalinist-led peasant revolution forced to expropriate the Chinese bourgeoisie, to a bourgeois counter-revolution that restores the national bourgeoisie. Everything the bureaucracy had done over this transitional period in the name of ‘socialism’ was to create the conditions for the restoration of capitalism. This was managed within the framework of a state controlled by the Stalinist CPC presenting the return of capitalism as a ‘bloc of four classes’ as a necessary condition for socialism.
Of course, there have been many attempts to insert extraneous conceptions of China to explain its capitalist growth as some ‘exceptional’ aspect of its ‘transition’ to socialism. As we have seen, Michael Roberts claims that while China has established a capitalist market, its growth is not explained by market forces as such, but by the state which does not represent the private capitalists. He argues that the state sector of the economy plans production for use and not profit. The private sector exhibits the usual laws of motion of rising and falling profits typical of the capitalist world market while the ‘public sector’ can escape those laws. What is ‘exceptional’ is its ability to avoid the ‘domination’ of the LOV and create a surplus that is not distributed as profits to private owners, but accumulated as a sovereign fund. This enables China to subsidise the production of commodities more cheaply than its capitalist rivals and at the same time make millions of workers ‘middle class’.
This claim is therefore a sort of ‘Marxist’ variant of US propaganda that calls China a ‘cheat’ in under pricing its exports (and therefore its currency) and massively underwriting the infrastructure and development of its many, and growing, economic partners. Only the authoritarian CPC can manipulate prices of production by intervening in the private market. For Roberts, so long as the state is not formally ‘dominated’ by the market, this is a good thing. It shows that something progressive has emerged from the legacy of the peasant revolution that may contribute to the transition to socialism. What needs to happen is that workers have to progressively impose workers’ democracy on the CPC to socialise planning and ‘dominate’ the LOV! If we were to extend such reformist dreams from China to the BRICS+ then ‘win win’ economics can spread across the globe creating a wave of new middle classes, and the transition to international socialism can be completed on the installment plan.
From the ‘abstract’ Capital to the ‘concrete’ real world
But how can a state which is so influential in re-establishing and regulating the LOV in the market not be ‘dominated’ by the LOV which operates as the determinant of prices in the global market? How is it possible for a nation state not to be fully integrated in capitalist production of value and surplus value when it contributes to the prices of production of everything that China produces globally up and down the value chains? As we noted, Roberts’ claims the state does not produce profits because profits can only accrue to the private owners of capital.
For Marx, ‘capital’ could only exist in the form of different capitals; otherwise, there was no more compulsion to accumulate. Consequently, capital could only exist in the form of ‘different capitalists’, that is, a social class constituted so that each part of it was, by compelling economic interest, tied to the survival of ‘its’ own unit of production or circulation. Consequently the ‘thirst for profit’ of each part of that class and the ‘drive to capital accumulation’ are identical, the second one being only realizable through the first (the attempt at profit maximization of each unit or firm). If there is no competition, and the allocation of resources are not left to the decisions of individual capitals and the ‘invisible hand’ of the market’, then there is no capitalism. Capital cannot exist as one capital, the state. (Carchedi and Roberts, 2023, 219)
Roberts fails to translate the level of abstraction of Marx’s three volumes of Capital (and the ‘Fourth’ on Theories of Surplus Value) to the real world. The real world comprises concrete social relations that are the result of ‘many determinations’ originating from the operation of the laws of motion. Prices of production which assumed the ‘free competition’ and averaging out of the profit rate that Marx used to demonstrate the operation of the LOV in the circuit of capital was never intended to correspond to the concrete reality of capitalist development. The working out of prices of production in the real world are NOT determined by an abstract market, but by the class struggle in which theory is subjected to practice.
John Smith in his Imperialism in the 21st Century has a useful discussion of how Marx’s method anticipated the way the LOV works in the epoch of imperialism. (224-251) Production of value requires the exploitation of labour, as Capital demonstrates, but due to the monopoly ownership of capital its distribution is now characterised by super-exploitation where wages are paid below their value. That is, the value of labour power as a commodity with a use-value to produce surplus value is determined by a class struggle in which monopoly capital can exercise power over labour power to set its price and extract super-profits.
In fact, we argue that in the real world competition has never been free from the intervention of state power in service of corporations. From its inception to its decline and decay the capitalist state has always played the role of manager and broker in establishing and maintaining the production and circulation of capital. Originating in genocidal wars against pre-capitalist peoples to extract rent from privatised property, its epoch of decay ends in more genocidal wars over land and rent, so that production becomes parasitism where monopoly rents accrue to corporate warlords who monopolise production, distribution and exchange.
Roberts, by projecting Marx’s abstract level of analysis in Capital onto the actually existing world in which the state is the overseer and regulator of the LOV, is blind to the rise of state monopoly capitalism in the transition from so-called ‘competitive’ capitalism in the 19thC to monopoly state capitalism in the 20thC.
“Moreover the view that the likes of China and Vietnam are a new form of capitalism, ‘state capitalism’, suggests that world capitalism is now today stronger than it ever was before in history. Alongside the decline of the imperialist powers, state capitalism has apparently a new and sensational phase of the development of the productive forces, in a backward country like China, and thus much more impressive even than anything Marx described for 19th century capitalism. (Carchedi and Roberts 2023, 218)
What is State Capitalism?
Roberts’ method applies abstract assumptions to arrive at his ahistorical conclusions. A ‘new form’ of state capitalism in China arising out of the deformed workers’ state cannot be dismissed until it has been put to the test of ‘many historical determinations’ that make up that history. First, China after 1949 was not (on Roberts’ own figures) a backward country relative to the GDP growth of capitalist semi-colonies, keeping pace with the South Korean ‘tiger’ and well ahead of India. Marxists agree that state planning in the degenerated or deformed workers states, despite the limits imposed by bureaucratic planning, generally allowed the forces of production to develop beyond the semi-colonial world. Second, let’s identify the historically specific conditions that allowed China to restore capitalism as a new ‘state capitalism’ in the late 20th century and launch a ‘sensational phase of development’ despite the decline of world imperialism. We argue that the CPC took the decision to restore capitalism in 1992 and on the basis of its historic legacy of deformed state planning combined with the prevailing late capitalist development of state monopoly capitalism in the world economy.
To explain this development we need to understand the role of state monopoly capitalism over the last century or so. Before we do that we need to say what ‘state capitalism’ is. The first case is ‘state capitalism’ was used by Lenin to explain the necessity of using market forces (the LOV) to determine prices in Russia under the New Economic Policy in the attempt to solve the ‘scissors crisis’. Lenin explained that this was ‘state capitalism’ to counter the charges that Soviet Russia was restoring capitalism. Far from it, prices of production set by the market were ‘dominated’ by a healthy workers’ state which had not yet degenerated under the Stalinist bureaucracy. The struggle of the Left Opposition against this bureaucratic degeneration called for the defence of workers’ democracy to ensure workers’ control of the state. These historic conditions never existed in China and bear no resemblance to state monopoly capitalism today!
Second, we agree with Trotsky (see Carchedi and Roberts footnote 21 p256) in giving no credence to the renegades of Trotskyism who abused his name while he was still alive by claiming that ‘state capitalism’ had been restored in the Soviet Union between 1929 and 1939. Workers’ property in Russia was the legacy of a workers’ revolution and the bureaucracy was forced to defend that property rather than the LOV. Trotsky denounced those who refused the unconditional defence of the SU claiming that capitalism was restored when workers’ property was still being defended against the LOV. We argue with Lenin that no scientific concept of ‘state capitalism’ exists outside the reality of State Monopoly Capitalism.
State Monopoly Capitalism
Trotsky argued in Revolution Betrayed,that the political revolution that overthrew the bureaucracy would restore a healthy workers’ state. But he could not exclude the possibility that the capitalist counter-revolution would bring about the restoration of capitalism in Russia. State property could be easily adapted to the operation of the LOV in the epoch of state monopoly capitalism. The personnel of the bureaucratic state would overnight convert to the role of capitalists in the new state to serve the interests of collective capital. The main object would be to restore the private ownership of property. New state policies to manage the productive, distributional and monetary tasks would serve to regulate the market as a whole to produce capital goods, infrastructure, and the accumulation of capital. Concretely, the state would enter into the productive circuit to facilitate the formation of constant capital (plant and machinery etc) and variable capital (wages and the social wage).
Marx had anticipated growing state intervention on behalf of capital in its administration of the public debt which emerged in the 19th C to further the concentration and centralization of capital by taxing wages and accumulating savings. For Lenin the role of the state was central, in fact defining, to the age of state monopoly capital. State intervention in the market competition for existing value was proof that the laws of motion of capitalism could not be avoided. First value had to be produced by labour to be exchanged and accumulated by finance capital. The LTRPF would cause recurring crises of overproduction and the imperialist powers which resort to the counter-tendency of paying labour less than its value.
The extraction of super-profits and absolute rent would inevitably create deeper crises and wars between rival national blocs of capital. As a result the LTRPF downloaded deepening crises onto the backs of workers so that the class struggle would erupt into revolutions and counter-revolutions. In summary, the short 20th century from 1917 to 1992 was ultimately all about imperialism destroying the Bolshevik revolution and restoring its hegemony over the capitalist world to re-divide the spoils among the victors.
While the LOV always dominated the history of capitalism, in both corporations and states, it does not do so under the same conditions. The revolution at the beginning of the short 20thC was an historic defeat of global capitalism. Yet the counter-revolutionary end to the Cold War in 1992 which restored capitalism to Russia and China did not completely destroy the legacy of the revolution. Those who celebrated that counter-revolution as the end of ‘socialism’ and a victory for capitalism did not anticipate the contradictory blowback of the legacy of the former bureaucratic workers’ states. Notably the relatively high level of development of the forces of production, and the centralized command economy, that helped restore capitalism and create new imperialist rivals in the ‘great game’ for Eurasia and the World.
The counter-revolution in the revolution enabled the new capitalist states to benefit from the decay and decline of global capitalism. China was able to restore capitalism’ without submitting to ‘recolonisation’ and imperialist domination. This explains its ability to convert a transitional petty bourgeois national revolution into a state monopoly capitalist counter-revolution with the capacity to regulate and manage the LOV within the limits of rising organic composition and the LTRPF. But these benefits will be illusory for the great mass of workers and peasants. China’s rapid rise is creating a reactionary response in the West which is already on the brink of world war over the repartition of Eurasia with escalating wars already on three fronts between the two imperialist blocs around the US and China.
So the legacy proved progressive only in the sense that it allowed China to escape re-colonisation and quickly adapt a dynamic state monopoly capitalism to develop the forces of production over a two decades leap in growth. As part of that legacy it carried with it the inescapable terminal crisis of overproduction in a dying and decaying global capitalist world. The question is this, how long can China’s state capitalist management of the LOV create growth in the productive forces within the BRICS bloc and further the pre-conditions for socialism, before the inevitable determination of the laws of motion of capitalism explode the contradictions of class war, crises and inter-imperialist wars on the lives of workers and poor farmers? The answer is surely that only the world’s working classes can resolve this question by rising to the struggle to take power and plan a new society without exploitation, ecological destruction and nuclear war.
Roberts on China transitioning to socialism https://www.redreview.ca/p/prc-75-today-the-transition-to-socialism
Roberts on China as a transitional economy to socialism https://www.jstor.org/stable/pdf/48713461.pdf
Carchedi and Roberts (2023) Capitalism in the Twenty-First Century – Through the Prism of Value. Pluto
` John Smith ttps://www.researchgate.net/publication/281225444_Imperialism_in_the_Twenty-First_Century
ILTT Draft theses on imperialism https://www.cwgusa.org/?p=3021
Living Marxism 