MARXISM DEBASED AND THE

DEFAULT IN TO MARKET SOCIALISM.

[DRAFT ONLY January. 1997. Comments welcome]

Abstract.

Today most discussions of socialism accept the market as an alternative to planning. So total is the rout that market socialism [MS] has now backslid into social capitalism. Demands for public ownership give way to please for economic democracy. The link between this retreat and the restoration of capitalism in the former workers states is clear. The new orthodoxy argues for capital markets, which means, ideally, private ownership.

Much of this discussion is abstract, mechanical/technical and ahistorical. Contemporary MS is not understood to be the latest instalment of a more comprehensive reformist attack, which began as early as the 1880's to preserve capitalism against planning which suspends or suppresses the law of value. This reformist current of `Western Marxism’/Menshevism revised Marx's dialectical method into a false dualism consisting of objective laws of history and subjective/voluntarist politics. It played a major role in undermining planning both in theory and in practice, especially in the 1920's, and contributed to the `fall' of Stalinist so-called "communism".

My approach is historical/dialectical - planning is the historic struggle of the working class to develop the forces of production against the market which manifests the law of value and bourgeois social relations etc. I argue that this approach fuses theory and practice as class struggle in which the Bolshevik party is the key. In this view planning in the USSR never got beyond a degenerated bureaucratic planning and fell far short of socialism let alone communism. The question of planning vs the market has therefore not been decided by the "end of communism" and can only be decided in the future by the outcome of the international class struggle.

Introduction.

There has been much commentary on Market Socialism [MS] in recent years since the collapse of "communism". Much of it has swung to the right under the impact of "more market" pressures. The new conventional wisdom is that the collapse of "communism" proves that socialism needed the market all along. "There was no alternative". [Blackburn, Nove and Thatcher, Bruz and Laski.] Those like Mises and Hayek who argued this position in the 1930's, and Nove and Kornai, who argued it in the 1970's, seem vindicated. Now the very concept of "socialism" has undergone a slippage back from nationalised property towards a modified private property. The key argument is the need for a capital market to overcome the "soft budget constraint". John Roemer, among others, has been vigorous in redefining socialism as not "soviets plus electricity" but "coupons plus votes". Market Socialism is now virtually the same as Social Capitalism [Keegan, 1993].

There has been much less opposition to this more-market triumphalism. Some have come out in defence of planning [Cockshott and Cottrell, 1989; Day, 1988; Laibman, 1992; Mandel, 1988; McNally, 1993; Ticktin, 1992]. Most of it is very academic or technical rehearsing the formal arguments against the market. Others reject planning along with the market. For example, Meiksins Wood critiques exchange-socialism but she also rejects planning as an economic regulator and opts for `economic democracy' [1995:290]. McNally in perhaps the strongest critique of MS so far accounts for MS's utopian history as linked to fetishised exchange relations. However McNally's `state capitalist' view of the USSR means that he himself falls foul of his own critique of "fetishist thinking on the left" since by his own definition, labour-power did not exist as a commodity in the USSR [1993:175].

A few writers have directly contested the basic assumption of the market socialists, that the "Russian experience" vindicates the market. But this is usually from a technical stance that argues that market as a allocative mechanism has been superseded by modern computers. Here the emphasis is upon a technical fix which makes non-market planning possible. In other words these writers accept the premise of the possibility of planning under "actually existing socialism". For them socialism becomes redefined as something like "glasnost plus supercomputers" [Cockshott and Cottrell, 1995; cf Laibman, 1992].

Even fewer have tackled the debate at the level of Marx's method applied to the actual class struggle. That is, recognising that "actually existing socialism" was the product of an international balance of class forces, and fell far short of genuine socialism as conceived by the Bolsheviks. Mandel accepts the premise that bureaucratic planning is not genuine socialism, but from a standpoint close to market socialism - "perestroika plus bourgeois democracy" [1992]. Richard Day, argues convincingly that Trotsky's advocacy of the market in the 1920's and 1930's was specific to the historic transition in the USSR, which fell short of socialism, and cannot therefore be used as support for the MS claims [1988].

Yet there is something missing from this defence of planning in the USSR. It seems that no one has openly adopted the method of the Bolsheviks against the Mensheviks on this question. None have taken up the question from a dialectical standpoint of the working class struggle for planning [Bolshevik], against the bourgeois struggle for the law of value [Menshevik]. James Lawler attempts to do this in claiming that Lenin argued, given Russian backwardness, for small peasant cooperation as the route to socialism [Lawler, 1995]. Nevertheless, I see his as a one-sided interpretation of the Bolshevik position because it makes a virtue out of necessity, something which Lenin did not intend in his writings on peasant "cooperation", a point I will take up later.

If I am correct in the above, why is the vast bulk of commentary on `market socialism' technical in nature? Is it because "planning" is also seen to be a technical question? Yet it would seem obvious to marxists that the question of planning vs the market is not a technical question but a social question which requires us to determine what historic social relations exist, and which laws of motion are expressed or contradicted by the market and the plan.

So treating the question as a technical question debases Marx's method of isolating historic social relations, and separates the question of the market/law of value on one side from the plan on the other. Both are then abstracted from the problem of the restoration of capitalism. Thus a serious discussion of the near-restoration of capitalism in the USSR in the 1920's, and the successful restoration in the 1990's become irrelevant. For example, Justin Schwarz does this in idealising the NEP and condemning planning for cutting the NEP short. This is because he sees the NEP as a technical experiment in cooperative production similar to the model that he promotes today. [Schwartz, 1996. cf. Schweickart, 1992]. But this is the Menshevik position against dialectics. What do I mean by this?

In the 1920's the dehistoricised doctrine of the law of value, as a technical fix (eg espoused by Bukharin callling on the peasants to enrich themselves) ignored the danger of capitalist restoration when the power of the market threatened thte survival of industrial production and hence the worker’s state. It was Stalin's forced collectivisation as the reinforcement of workers property relations that defended the state economy and virtually obliterated the market as the dominant means of allocating social labour. The restoration of capitalism had failed. Again, in the 1980's and 1990's the "return" of the law of value was equally clearly the mechanism of the restoration of capitalism. But this time there was no section of the bureaucracy or of the working class willing and able to resist the victory of the market. In both historical cases, the issue is clear. Market undernmined and weakened the plan to the point of collapse.

The dehistoricising of the market is therefore an ideological cover that also dehistoricises planning in order to promote the market as universally necessary for socialism. Hence the formal objection is that technically as a means, planning without the market works against socialism as the social end. Yet the real political objection is that planning as a technical means requires a revolutionary seizure of power and the dictatorship of the proletariat - horrors. But the success of this political operation of reducing historical questions to technical questions must find its rationale at the level of method, to which I now turn.

Importance of Method.

It is important to begin this argument with method. Why? On the face of it, method is irrelevant. History speaks to us clearly. The collapse of "communism" has apparently closed off the main road to socialism, and reactivated the parliamentary detour sign-posted "MS". Yet this begs the uestion of what "communism" is, or rather it takes for granted that we agree that communism isw dead. Thus "Communism", as currently understood by Western intellectuals, equals the universal failure of the `command' economy and state planning. For example the Socialist Register for 1991 is titled "Cojmunist Regimes: The Aftermath". I reject this assumption. I shall argue that `actual state planning' as it is understood in the USSR, or in the West, was not socialist planning, let along `communist'.

Moreover, I shall argue that MS in adapting to the ‘communism is dead’ theme of bourgeois ‘triumphalism’, shifts the onus of having to prove itself onto the apparently universal failure of socialist planning. I shall argue that MS, as bourgeois ideology actively subverted actual state planning. I shall argue that MS is not merely a petty bourgeois utopia dragged out of the backroom as a feasible option when planning suffered an historic setback [i.e. "communism" collapsed]. It is a brand of bourgeois default socialism that has historically opposed and pre-empted proletarian planned socialism. In other words MS as part of bourgeois ideology, in defending the law of value has actively undermined socialist planning. Ironically MS, despite its attempts to claim otherwise, is responsible for the fact that the planning that "failed", fell far short of socialism, and light years short of communism.

Fundamentally the rebranding of MS as part of the ‘post-communist’ ascendancy of bourgeois ideology is itself due to its successful struggle against real socialism. Yet to legitimate itself as the only road to socialism, and to masquerade as Market = Socialism, MS has to redefine the fundamentals of Marxism. To do this it has to revise Marx's method from ground up; that is to debase Marx. I shall argue then that MS has a long history of theoretical attacks on the basics of Marxism. MS did not begin in the 1930’s or the 1980’s, but had its origins in the 1880’s in the first attempts to revise Marxism in such a way that the market and socialism were compatible. To illustrate this argument I will need to survey some of the low points of this history. In other words MS is old as Western Marxism. (Or as I prefer, Euromarxism – that current of European Marxism that goes back to Marx’s time and which has its roots in the material interests of the labour aristocracy and bureaucracy, bribed by imperialist super-profits. Euromarxism usually expressed itself as a form of social imperialism – parliament at home, and imperialism abroad).

Therefore, it is necessary to look first at the role of Euromarxism historically in defusing proletarian socialism in Europe and North America [I include all the settlement colonies as part of the European expansion]. There is a clear link between revising Marx's method in the 2nd International and reformist politics. In the colonies and semi-colonies of European imperialism, currents of Euromarxism took root, as the local apologetics for social imperialism. I will argue that it was the export of Euromarxism that became the source of the Russian version of Euromarxism, Menshevism, and later, Stalinism. Menshevism took over the revision of Marx's method under the rubric of an inverted Russian social imperialism that argued for a rigid stageist concept of a national democratic revolution. Later Stalinism adapted this concept as that of "socialism in one country".

Because Menshevism and Stalinism were Eurocentrist deviations from Marxism under revolutionary conditions, it was these forms of revised Marxism that had the most direct impact on proletarian internationalism. The fate of Euromarxism's reformist project of MS therefore hinged on the viability of Soviet "communism" for over 70 years. This accounts the bourgeoisie's active interest in bringing about the end of "communism" and of scoring a historic propaganda victory for the Market over Planning.

So in the light of this discussion, what does the collapse of "communism" today actually prove? Does it vindicate conclusively Euromarxism's social-imperialist model that the market is necessary for socialism to be successful. Or does it prove that Marx, Lenin and Trotsky were right? And that fundamentally the market is incompatible with socialism?

Bolshevism vs Menshevism.

To come to any serious Marxist conclusions about MS today it is necessary to review the historic debates over the nature of Soviet "communism", in particular the debate in the 1920's over role of the market in building socialism. This means distinguishing between the methodology [and ultimately the class base] of the Bolsheviks and the Mensheviks. In particular I will consider the position of the leading Bolsheviks, Lenin and Trotsky, both of whom clearly advocated the use of market mechanisms as part of the transition to socialism. However, these leading Bolsheviks understood that the question of the market is not a technical question but a social question. Under the new workers’ state, the market was used as a technical means of allocating social labour because there was as yet no possibility of coordinating workers decisions administratively to achieve this task. In the workers’ state the market becomes a social question again only if it goes beyond this technical function, and becomes the road to the restoration of capitalism –ie.generalised commodity production and the law of value.

For the leading Bolsheviks then, dialectics enabled them to put the market in its place as a technical aid in the transition to socialism. As I argued above, however, for the Mensheviks the market was `naturalised’ so that it was a technical question just as it is presented in bourgeois ideology. As Marx complained in his Critique of the Gotha Progamme, this ‘naturalised’ view flows from the method of Ricardo and others, who fail to note the historical specificity of value production to capitalism. Under this ahistorical spell Bukharin saw no contradiction between the peasants "enriching themselves" and socialism. In his mind, the law of value did not contradict planning and class struggle to prevent the privatisation of the revolution was superfluous. Thus the Menshevik position can be traced back to the Eurocentric methodological rejection of dialectics which is consistent with the pre-Marxist ahistorical conception of the "market" and the law of value. Since the market becomes a natural/universal category, this then makes the realisation of socialism a technical/moral rather than social/political question.

Thus at the main crossroads of proletarian history, the failure of dialectics is linked to petty bourgeois currents actively countering proletarian struggles. It was these petty bourgeois currents that promoted MS as a diversion from revolutionary politics. First, I shall summarise the role of Euromarxism –the revisionist current that achieved a strong hold over European and semi-colonial working classes via layers of the state bureaucracy and petty bourgeois intelligentsia. I shall then use the debate on the law of value in the 1920's to demonstrate how, against the Bolshevik conception of `state capitalism' Stalinism revived the WM/Menshevik conception of MS by stages as the ‘national roads to socialism’ beginning with ‘socialism in one country’.

I will go on to argue that the fact that Stalin was forced to severely curtail the market in 1929 is evidence that the market is fundamentally incompatible with any form of centralised planning let alone socialism. Of course this means rejecting the notion that the USSR became state capitalist at this point. Not until the political counter-revolutions of the late 1980’s and 1990’s did the law of value begin to act directly to restore capitalism in the former Stalinist states. I shall conclude by arguing that the current default into MS by the post-fall `left' is a flagrantly ideological/technical utopian project.

Dialectical Method abandoned.

For Marx there must be a class basis to revisionism. The argument goes like this. Petty bourgeois socialists are utopian socialists. They want to reform capitalism’s exchange relations to conform to the fetishised ideal of equality. This reflects their class position separated from the capitalist social relation and from the theory and practice of Marxism. As a non-historic class their role in capitalist society is to promote harmony. This means they act as the "traditional" intellectuals of the bourgeoisie by incorporating the discontent of the subordinate classes. They have to explain this discontent as historically unnecessary, i.e. contingent on manageable [by them] forces. Their grasp of Marxism is superficial because they have no class interest in penetrating the surface appearance of capitalism and exploding the myth of a fundamentally harmonious society.

But Marxism is a revolutionary doctrine. Marx derived his dialectical method from Hegel and revealed capitalism to be a historically transitory mode in disequilibrium given an intrinsic contradiction and laws of motion expressed through and by class struggle. Marx never got to write his 3 printers sheets on dialectics to fully explain this derivation. But never mind, this reflected Marx's commitment to the actual process of reconstituting the concrete in thought and practice so that revolutionary change could occur. Lenin saw the significance of Hegel in a proper understanding of Capital. In his view no one had understood Marx because of ignorance of Hegel. To understand Marx, revolutionaries had to read and understand the whole of Hegel's logic!

Roman Rosdolsky subsequently claimed that after the publication of the Grundrisse, "academic critics of Marx will no longer be able to write without first having studied his method and its relation to Hegel [1973:xiii]. However, this was no guarantee of a Bolshevik method uniting theory and practice in the revolutionary vanguard party. Even so strong a defence of dialectics as that of Tony Smith fails to link dialectics decisively to revolutionary practice [1993:110]. Lenin’s aphorism: "There can be no revolutionary theory without revolutionary practice" is more than a mere injunction. It can only be put into effect within a revolutionary organisation that practices democratic centralism understood as full democratic debate over tactics, but total unity in practice.

If this is the case, then all attempts to rethink Marxism as a revolutionary doctrine must start with rejection of dialectics. The petty bourgeois intellectuals’ [PBI] interpretation of Marx is always rendered to fit do away with dialectics. They must revise Marx on the question of the actuality of contradiction, and hence disequilibrium; the revolutionary role of the working class; and of the Marxist `vanguard’ party. Their method is that of formal logic, empiricism and pragmatism.

Formal logic splits reality into fixed entities without reference to contradiction or laws of motion. Empiricism is an exclusive devotion to sensory observation as the basis of evidence. What cannot be observed becomes `metaphysics'. Empiricism becomes the basis of pragmatism –that which works in practice to reconcile classes and create equilibrium [Trotsky, 1975].

By using formal logic to renounce dialectics, the PBI turns production into an ahistorical given which is separated from the moments of exchange, distribution and consumption. "In so far as exchange is merely a moment mediating between production with its production-determined distribution on one side and consumption on the other, but in so far as the latter itself appears as a moment of production, to that extent is exchange obviously also included as a moment within the latter." [Marx, 1973:99]. What are moments in a unity - production, exchange, distribution, consumption - become "levels" or "spheres". "This again shows the ineptitude of those economists who portray production as an eternal truth while banishing history to the realm of distribution "[Marx, 1973:97].

This `ineptitude' suppresses the contradiction between use-value and exchange value [or between the forces and relations of production] that occurs in capitalist production, and which underlies and motivates capitalism's crisis-ridden development. So it can then be argued that potential disequilibrium and crisis can be overcome by state correction of distribution and exchange independently of production relations. The pseudo-resolution of contradiction therefore takes place in the same way that Hegel's apparent unity works, at the level of appearances as an exercise of the intellect [Marx, 1973:101-102]. The historical debates over the "law of value" and "crisis theory" therefore reflect a deeper concern to debase Marxist dialectics in favour of an empiricist concern for equalising/harmonising distribution and exchange. I shall argue that for the Euromarxists from Bernstein to Habermas, the debasing of Marx has the same purpose, to elevate the PBI as the agency of bourgeois reform, against the working class as agency of proletarian revolution.

Euromarxism.

Lets see how petty bourgeois class collaboration is always associated with a fundamental revision of Marxism. Already in his own lifetime he had harsh words to say about his two sons-in-law, Lafargue a Bakunist, and Longuet a Proudhonist [Mehring: year, page]. Proudhon didn't know any better because his schemes to reform capitalism preceded Marxism. But after Marx there was no excuse, as he forcefully reminded the Germany SDP in his Critique of the Gotha Programme. "Why revert?" he exclaims in exasperation. This revision was fundamental –the default from a production theory of exploitation to an exchange theory - but it was not codified until Bernstein wrote his infamous book about the importance of travelling towards socialism even if one never got there - his definition of `evolutionary socialism'!

Bernstein was the founding father of Western Marxism. For him Marx might never have existed. The law of value was not an actual law, which allocated social labour in capitalist production via the market, but a mental abstraction. Moreover, an abstraction good for all time. Here we have the inverted exchange-relations - commodities have `value’, but not necessarily the value of socially necessary labour-time congealed in them. The route to the marginalist theory of value is opened up. Here then is the methodological `refoundation' of Marxism in the revisionist swamp. Here is the theoretical base for market socialism in Europe, which is later joined to an evolutionary Marxism, which plots out the journey to socialism through several necessary, sequential, gradualist stages. Since the state is not implicated in reproducing social relations, but rather is instrumental in determining exchange relations, "market socialism" can therefore be engineered by the capitalist state.

Thus with Bernstein we already have a fundamental requirement of a debased Euromarxism - the naturalisation or dehistoricisation of the law of value. This pushes Marx back into the arms of Ricardo. Marx's method is abandoned. Instead of viewing capitalism as a historically specific mode of production with a limited life span, capitalism is once more a universal, natural economy. Why? Because commodity production is now universal! What distinguishes capitalism is no longer the unique social relations of production, but the extraction of profit from labour at the "level" of exchange. Fortunately says Bernstein such exploitation can be corrected politically and workers do not therefore have to overthrow the state! However this does require certain historical preconditions [which of course only PBI's are in the position to discern - at a price].

Hence Marx's rather abstract comments about pre-conditions for socialism, in the German Ideology or Critique of the Gotha Programme, for example, become misappropriated to provide spurious "historical" pre-conditions for the evolutionary road to socialism. Kautsky is most strongly identified with this evolutionary school. Similarly Plekhanov abandoned dialectics and imposed an historical stageist schema on the Russian revolution in isolation of imperialism. The fixation on objective stages blinded Kautsky, Plekhanov and Luxemburg to the "subjective" factor that they caricatured as Bolshevik "voluntarism". They saw the Russian revolution as premature and the Bolsheviks as `voluntarist', leaping beyond the prescribed bourgeois revolution to the socialist revolution. This was Euro-centrism [or more precisely the ideology of the petite bourgeois and labour aristocracy in Europe] which could only see an evolutionary socialism coming about via parliament in Germany [Salvadori, 1979:226-235].

There is a current within "Western Marxism", which seeks to find in Marx the origins of its idealism. In Bhaskar's view the "sins of Western Marxism" fed off the `original sin’ of Marx whose "monism, actualism, demoralisation and utopianism" (sic) blinded him to the need to spell out the dynamics of socialism [1993:350]. But Marx offered no blueprint, other than broad guidelines because he was a dialectician for whom theory and practice was united. Of what use would a blueprint be to those facing `many determinations' where the truth is concrete? Anti-marxists who cannot think except with blueprints prove the point conclusively. Moore, for example, chastises Lenin for breaking from Marx's `blueprints' offered in the Communist Manifesto and the Critique of the Gotha Programme and daring to mix socialism with commodities [1993 ix; cf Steel, 1992]. Such critiques of Marx's method reveal the essence of Menshevism or structural-functional Marxism. History is pre-ordained to follow an evolutionary schema.

What underlay this stageism was the break from dialectics that prevented German Marxism from uniting objective and subjective factors in the form of a vanguard party in the German revolution. Thus when workers and soldiers rose in revolt in 1918/1919 there was no revolutionary vanguard in existence. For the Spartacist leaders too, there was no need to build a vanguard because the evolution through stages did not require it. But it was Luxemburg, not the Bolsheviks who expressed "voluntarism" in her belief workers would spontaneously lead themselves to revolutionary victory. This deviation from Marxism had tragic consequences when the armed workers and soldiers accepted that a bourgeois republic was a necessary stage on the German road to socialism in 1919 and failed to complete the German revolution and come to the rescue of the Russian revolution. As well as setting the seal on the German defeat, it also condemned the Russian Revolution to its bureaucratic fate. So was the revisionist course set for Euromarxism in the period ever since.

Just as Euromarxism covers for its betrayal of the Russian revolution by blaming the Bolsheviks’ `substitution' for an immature working class, it covers for its betrayal of the European revolution by blaming the working class whose `spontaneous' class consciousness was not able to rise above bourgeois ideology. In both cases the working class falls short of, or fails to live up to, the PBI schematic prescriptions for the revolutionary subject. So today the working class is written off in advance as incapable of administration of a socialist plan [Habermas, 1990]. Well, it follows that if you can't make a socialist revolution, you damn well can't administer it either. As we shall see in the debates around the failure of planning in the USSR, Euromarxism substitutes the law of value managed by PBI to develop the historic pre-conditions for socialism, for workers’ administration of the socialist plan.

How did Euromarxism arrive at such a position? After all didn't Lukacs proclaim the working class as the revolutionary `subject', and invoke the role of the vanguard party in 1922, as did Gramsci from jail? But these isolated intellectuals could not develop an ongoing praxis. As Meszaros argues, it was Lukac’s inability to combine theory and practice which led him astray [1972:79-82]. Ultimately this intellectual isolation must be explained by the fact that the revolutionary situations in Europe came to an end as capitalism stabilised, aided by the Stalinist Comintern, which now subordinated the international revolution to "socialism in one country" [Trotsky, 1970].

"The power of `socialist' opportunism is in the last analysis the power of capitalism. During the first years after the war crisis (1918-21) when capitalism was swiftly sliding into the abyss, official Social Democracy was weakening and falling with it. These years of partial stabilisation of capitalism bring with them a temporary strengthening of Social Democracy. The defeat of the Italian workers in 1920-21, of the German proletariat in 1921-23, the defeat of the great strike in Britain in 1926, the defeat of the Chinese proletariat in 1927, whatever may have been their causes, have themselves become a cause of a temporary depression of the revolutionary wave in the upper levels of the proletariat. They have for a certain period strengthened Social Democracy at the expense of the Communist Party. And within the Communist Party they are giving a temporary dominance to the right wing at the expense of the left. The role of the labour aristocracy, the labour bureaucracy and its petty-bourgeois associates, becomes at such a period especially great and especially reactionary" [Platform of the Joint Opposition (1927), 1973:93].

The Russian revolution was contained and isolated, the Chinese revolution was betrayed by the Stalinists, and Europe entered a period of counter-revolutionary stagnation and the rise of fascism. In the face of the counter-revolution, Euromarxism revised Lukacs and Marx and abandoned the orthodox view of the proletariat as revolutionary subject. This fell mainly to Adorno et al of the Frankfurt School. Lukac's believed that despite the reification of working class consciousness, the combined effects of working class struggle and the intervention of Marxist science in the form of the revolutionary vanguard, would bring about revolution. Adorno et al turned reification into a totalising one-dimensional domination of the working class. The Frankfurt school wrote off the working class as revolutionary agency [including of course the revolutionary vanguard] and focused exclusively on the dominant bourgeois ideology. The preoccupation with ideology privileged "organic" intellectuals such as Adorno's Artists and later Habermas' `speech therapists'. The Frankfurt school itself fell victim to commodity fetishism when it abandoned dialectics and took up a one-dimensional intellectual critique of bourgeois ideology against universal reason.

Abandoning dialectics meant eliminating contradiction and crises. For Adorno and Horkheimer capitalism ceased to be in disequilibrium, and evolved into anauthoritarian state capitalism, or worse, in which the state dominated and destroyed the working class as the agent of socialist revolution. Hopes that state capitalism could prepare the ground for socialism were lost in the post-war period, when capitalism and Stalinist socialism came to be seen as increasingly totalitarian [Arato, 1978:21]. The Frankfurt School succumbed to the mystery of surface forms of the state, notably fascism and Stalinism, as well as the post-war capitalist boom, all of which became reduced to the authoritarian manipulation of subjects in the Weberian sense. Gone was any attempt at applying a Marxist critique of political economy to capitalist imperialism in crisis, or to the bureaucratised workers' states.

Thus the Frankfurt School continued in the tradition of Euromarxism to reject dialectics. The historic specificity of the use-value#exchange value contradiction was lost. The commodification of `culture' as consumption became autonomous from the complex unity of the moments of production, exchange, distribution and consumption. Now, for Marx, bourgeois ideology is reproduced by commodity fetishism [Lukac’s reification], which is itself reproduced by production. It is not one-dimensional but rather an expression of commodity production and the contradiction between use-value (forces) and exchange-value (relations). Reification [or hegemony] can therefore be interrupted and broken as the complex unity of production, distribution, exchange and consumption are disrupted during crises and wars. The concomitant revolutionary upheavals demonstrated that the working class, in the period from 1917 to 1945, was more than ever prepared to act as the revolutionary subject notwithstanding the counter-revolutionary roles played by social democracy and Stalinism.

Therefore it was not a hegemonic ideology, [or the failure of the working class to spontaneously break from it], that caused the defeats during this period, but the lack of a leadership grounded in Marxist dialectics. What was crucially lacking was a revolutionary Marxism capable of destroying the hold of Euromarxist and Stalinist/Menshevik revisionism over the working class. Once more a convenient concept of a one-dimensional [as opposed to two-dimensional or contradictory] capitalism rendered capitalism equilibrating, and the working class incapable of revolution. In its place came the BPI as philosopher kings whose idealist `overcoming' turned ‘intellectual reason’ [today Habermas' functionalist notion of `communicative reason'] into a Hegelian re-solution of the contradiction.

Russian Marxism.

Unlike Western Europe where Marxism became distorted by the layers of labour aristocrats and bureaucrats who blunted their revolutionary Marxism on the privileges of imperialist super-profits, Russian Marxists were much more faithful to Marx's method. The reason was that Russia was a backward state undergoing rapid capitalist semi-colonial development under an autocratic Tsarist regime. The Marxists cut their teeth opposing the Narodniks claim that the Russian peasantry was the agent of socialism. [If anything, as Rosdolsky points out, the Russian Marxists were too orthodox, reading Capital too literally, e.g. interpreting the Reproduction Schemes In Vol.2 of Capital as evidence of crisis-free capitalist development, instead of its opposite, the necessary contradiction between use-value and exchange-value.] Nevertheless, it was Russian Marxists who understood best the debt Marx owed to Hegel and the significance of the dialectical method for Marxism. The material conditions were such that a unity of theory and practice brought an extraordinary flowering of Marxism applied to the conditions in Russia.

While Plekhanov plodded on with the Euro-Marxist stageist conception of Russian capitalism, Lenin and Trotsky developed new thinking on the course of the revolution in Russia. Their thrust was to apply the Marxist method to the specific concrete conditions of Russia within world capitalism during its imperialist stage. It was no accident that it was semi-colonial Marxists who attempted to fill in part of the gap left by Marx who did not live to complete his books on World Trade, the State and International Relations. This was nothing less than an attempt to complete Marx's project of reconstituting the concrete in thought! By contrast with Western Marxists who confused Marx's abstractions with reality [Luxemberg, Buhkarin. cf Bhaskar's comments (1993) on the failure of Marx to engage in ahistorical abstraction]. Russian Marxists gave us the first modern theorisation of backwardness, the uninterrupted revolution, permanent revolution, and the theory of uneven and combined development.

Lenin saw Russia as requiring a bourgeois revolution led by the working class and the peasantry because a strong indigenous bourgeoisie capable of leading a bourgeois revolution was not being [and could not be] developed by imperialism. This was the basis of his view that the bourgeois revolution in Russia would, writing in 1905, be uninterrupted [Knei Paz, 1978:170]. He rapidly drew back from that position, but his analysis which became the basis of the Bolshevik position, not just of the party, but of the social conditions, concluded that Russia was the `weakest link' in the imperialist chain. The `weakest link' argument meant that the conditions for revolution would arise first in Russia. Because of its ‘backwardness’, the intense contradiction of rapid capitalist development coming up against an autocratic semi-feudal comprador Tsarism, would see workers and peasants propelled into struggle to lead a very radical bourgeois revolution.

However, said Lenin, without the aid of socialist revolutions in the more advanced, especially European states, the revolution in Russia could not make a transition to completed socialism. Here Lenin was true to every aspect of Marx's method. In the absence of an economy in which the preconditions for socialism - ie. developed forces of production - prevailed, socialism could not fully replace capitalism. So from all this we conclude that for Lenin, the Russian revolution was never conceived to be more than one link in the chain of world capitalism, a link that by itself could not leap over the barriers of backwardness and realise socialism in one country.

But it was Trotsky who developed the analysis of backwardness in the epoch of imperialism to its highest point in Bolshevism. In "Results and Prospects" written in 1906 Trotsky developed a powerful theory of "uneven and combined development" that explained and broadly predicted the outcome of the October Revolution. While Trotsky agreed with Lenin about the special conditions that prevailed in Russia, he took them to their logical conclusion. He rejected the Leninist formula "Democratic Dictatorship of the Proletariat and the Peasantry".

Why, said Trotsky, when workers and peasants must lead the Bourgeois revolution, should they forfeit power to a weak bourgeoisie so that it could put workers and the peasantry back under the yoke of its imperialist masters? Like Lenin, Trotsky could see that the concrete conditions in the Russian semi-colony would force workers and peasants rise up again to complete the Revolution of 1905. But unlike Lenin, he saw the necessity to raise the demand for `permanent revolution' at the outset in order to prepare the vanguard to lead workers and poor peasants beyond the bourgeois revolution to the socialist revolution. Later, after the terrible betrayal of the Chinese Revolution in 1927, Trotsky was to generalise this analysis of permanent revolution to all backward states undergoing national democratic revolutions in the epoch of imperialism [Trotsky, 1969].

I think Lenin and Trotsky both contributed equally to the formation of Bolshevik/Leninism, a fertile and successful development of Marxism in which theory and practice were united in struggle. Despite Trotsky's failure to understand the importance of `centralism' in the party until the events of 1917 and Lenin's failure to see the need for an `uninterrupted' revolution until April 1917, together they were the main leaders of the October Revolution.

Given this history, the discussion about whether Lenin ever conceded that socialism could be built in one country is bizarre. Such a claim can only reflect the total incomprehension of Marx's method and its brilliant and resolute application by Lenin and Trotsky. Raising this question is an attempt by Stalinists to cover up for Stalinism. The old theme of Kautsky that the Russian revolution was premature, or of Luxemburg, that the Bolsheviks substituted for the workers etc, all goes back to Menshevism in Russia, and various currents of Western Marxism from Bernstein and Kautsky onwards. This was Stalin's position until October 1917, and he openly reverted to that position upon usurping power. [Platform of the 1927 Opposition: 88, 109]

But Stalin could hardly revert back to a pure Menshevism in practice without abandoning the bureaucracy's caste privileges. So the stage of "socialism in one country" – extended to "national roads to socialism" – was added to the Menshevik historic schema. Initially, building on the desperation of the NEP as a holding operation until European revolution came to the rescue, Stalin made a virtue out of necessity. NEP and the market were not just crutches to help the wounded workers state limp along until a European revolution interceded, but an essential component of building socialism. What Stalin had to do then was to edit Lenin to enlist his authority for reverting to the law of value as a natural law and hey presto, ‘market socialism’ in one country! When he discovered that the law of value was not a universal abstraction in the minds of Berstein and Bukharin, but a powerful force for the restoration of capitalism, he had to act to save his own skin.

The dialectical unity of theory and practice fused in the Bolshevik vanguard party produced the Russian Revolution. The concrete conditions in Russia after 1902, when repressive conditions prevented fully legal work, also forced into the open the question of the party organisation. In a constant struggle with the Mensheviks there came into existence a Bolshevik organisation as a basis of democratic centralist application of Marxist method, theory and Programme. The Bolshevik revolution rubbed Euromarxism’s nose in its own schematic dogma. It was not the voluntarism of the Bolsheviks but that of the Mensheviks [and Euromarxists] that led to the isolation of the revolution and its bogging down in the swamp of petty bourgeois backwardness. Nor was it voluntarism that enabled the Bolsheviks to adapt to the market – state capitalism, the NEP etc – without abandoning the workers’ state. The social revolution had taken place and the workers’ state was in power.

Bolsheviks on the Market.

Much is made of the Bolsheviks use of the market and the notion of ‘state capitalism’ after the revolution. Yet resort to the market was a necessary step back to ensure the survival of the new regime. So was reliance upon small peasant cooperation under Workers and Peasants Inspection. But neither the market, nor peasant cooperation, were panaceas for Russia's desperate plight. On the contrary, Lenin and the Left Opposition always made the planned development of heavy industry the backbone of the transition to socialism and vitally necessary until such time as the world revolution corrected Russia's backwardness. Lenin’s last article "Better Fewer, But Better" makes this clear:

"The general feature of our present life is the following: we have destroyed capitalist industry and have done our best to raze to the ground the medieval institutions and landed proprietorship, and thus created a small and very small peasantry, which is following the lead of the proletariat because it believes in the results of its revolutionary work. It is not easy for us, however, to keep going until the socialist revolution is victorious in more developed countries merely with the aid of this confidence, because economic necessity, especially under NEP, keeps the productivity of labour of the small and very small peasants at an extremely low level...Thus, at the present time we are confronted with the question - will we be able to hold on with our small and very small peasant production, and in our present state of ruin, until the West-European capitalist countries consummate their development towards socialism?...What tactics does this situation prescribe for our country?…We must strive to build up a state in which the workers retain the leadership of the peasants, in which they retain the confidence of the peasants, and by exercising the greatest economy remove every trace of extravagance from our social relations...in this alone, lies our hope. Only when we have done this shall we, speaking figuratively, be able to change horses, to change from the peasant, muzhik horse of poverty, from the horse of an economy designed for a ruined peasant country, to the horse which the proletariat is seeking and must seek –the horse of large-scale machine industry, of electrification... [Lenin CW 33, 498-502 cf. Platform of Joint Opposition 1927:33]

It was always clear to Lenin and the Bolsheviks that the workers' state must control the market, or the market would take control the workers' state. But when Stalin and Co took power, they based themselves increasingly on the middle peasants and NEPmen. The party composition changed from mainly working class to mainly petty bourgeoisie. The Left Opposition was left fighting for a balanced plan, while the right argued that the market was a universal feature of socialism and that the peasants should enrich themselves. For the Left Opposition, Preobrezhensky argued that the law of value and the market were in contradiction:

"This is the nub of the question. Whoever does not understand that the urgent task is to gather enterprises into one system of state economy which is unified, consciously directed and turned in a planned way in the direction which is vital to us, does not understand that in the struggle against the private capitalist sector, the state socialist sector will otherwise suffer an inevitable defeat." [Documents of the 1923 Opposition: 54-55].

These warnings went unheeded by the bureaucracy but not by the working class. Preobrezhensky again:

"Since comrade Lenin left his work the Central committee has made several mistakes including some major ones. These mistakes have one feature in common and can be given a general characterisation. This common characteristic of the Central Committees mistakes lies in that it has not proved able (as it was able when Comrade Lenin was at its centre) to predict well in advance this or that process which had spontaneously ripened, and to react to it at an early stage by making turns and to do so in such a way as not to stop half way with them...What is dragging us out of this somnolence? The working class. It is dragging us out of this somnolence by its strikes, in other words the party is being spontaneously urged on to change its course." [Documents of the Opposition 1923: 67-68]

The Left Opposition rooted in the working class kept alive the Bolshevik method of Lenin and Trotsky against the Menshevik/Stalinist bureaucracy:

"Bolshevism by its very nature contradicts bureaucratism. It is linked with the masses. It is active and practical and cannot tolerate the ossification that we had when the strikes occurred. Such bureaucratism is thus anti-Bolshevik and contradicts the essence of our party...Why did our divorce from the working class come about? Because in the process of the development of the NEP we had an economy that was developing spontaneously and bureaucratism was growing up in our party." [DLO 1923:74-75; cf DLO 1927:8-9]

It is clear that the Menshevik/Stalinist position was to abandon planning for the market. Moreover, against the Bolshevik position, the Mensheviks encouraged the formation of a new capitalist class. Right from the outset therefore it is bureaucracy that leads to market, not vice versa. The Bolshevik position was to encourage an alliance between workers and small peasants, and to eliminate the growth of speculation and wealth in the Kulak and NEPmen. Yet it is obviously true that the failure of the European revolution to mature in time left the Bolsheviks with no option but to resort to the market as a necessary lifeline under very difficult conditions [DLO 1927:40].

But it was one thing to resort to the market under conditions of extreme difficulty in an isolated and backward country, quite another to claim that the market was a necessary feature of social planning even in the most ideal circumstances! The bad faith of the Euromarxists and Mensheviks in making this claim is staggering. Not only did they oppose the Bolshevik revolution, (and in the case of Stalin and Kamenev attempt to subvert it) and prevent a European revolution from coming to its rescue, they consolidated the hold of a bureaucracy over the new workers’ state. Then, to cap it off, when the Left Opposition prediction came true, and the market threatened to overcome the bureaucratised workers’ state, it was Stalin's abolition of the market, and not the market itself, that got the blame for the final collapse of "communism".

Thus the current revivalist Market=Socialism has a long and bloody history. Nove covers for the not so new right Hayek and Mises, to claim that planning a complex society requires a market [even if not private property (Mises/Hayek)] otherwise a bureaucracy must develop. Against this compare the genuine Mensheviks, Kornai, Polanyi, Habermas, Blackburn, Kagarlisky etc. who find a place for the market in healthy planning, with Trotsky, Ticktin, Mandel, and McNally who reject the place of the market except in a subordinate role in the transition to socialism. It is clear today that the Mensheviks have adapted to the ‘new right’ by saying that markets are necessary to plan complex societies. In doing this they reject dialectics and the working class' capacity for social administration. They conflate backward bureaucratic planning with genuine democratic workers planning. They act out the self-fulfilling prophesy, that the socialist plan, crippled by the market, creates a bureaucracy, and leads to the downfall of the plan, and the restoration of the market!

Restoration of capitalism today.

If the MS pushers can claim that it was Stalin's rejection of the market that ultimately caused "communism" to collapse, that claim completely falls down in the face of capitalist restoration today. Not only did the market undermine a healthy workers plan from the very start, it failed to correct the problems which bureaucratic planning created over the period since. Every attempt to introduce market mechanisms to overcome the defects of ‘bad planning’, created more problems than they solved. Gorbachev's idealist notion of introducing Perestroika was a full-blown acceptance of the failure of bureaucratic planning and the attempt to use the market to achieve a balanced "market socialism". What happened?

In each of the former Stalinist states, state regimes came into existence committed to restoring capitalist social relations. The state ceased to allocate social labour for use, abolished the plan, the monopoly of foreign trade, and allowed a new class of capitalists to invest in production for exchange-value. The introduction of a convertible currency and private property allowed the law of value to re-assert itself. As the law of value became the dominant mechanism of allocation of social labour, the planned economy collapsed and was replaced by capitalist economies. While the restoration of capitalism is far from complete in these states, the massive destruction of the forces of production as a precondition for capitalist investment makes it clear that the market is not the road to socialism.

If we summarise the soviet experience, the historic fact is that a real workers plan has never been tried. The Market Socialists are basing their case on a bungled bureaucratic plan, which they themselves helped to create. Even so, bureaucratic planning on the basis of workers property is vastly superior to the most ambitious MS scheme put forward today. Why? MS is a subterfuge directed against planning because planning requires the proletarian seizure of power, as the necessary, though not sufficient, condition for the transition to socialism. MS must defeat planning to defeat the seizure of power. Without the seizure of power there can be no bureaucratic planning let alone genuine workers planning.

Yet planning is insufficient for socialism in the absence of workers political control of the plan. Therefore what is necessary and sufficient is not the market, but full democratic workers' administration of the plan. According to the technical `fixers' this is possible with new techniques that would replace the market as a "coordinator" of supply and demand. However, they too miss the point. The debate is not about planning but social revolution. So today it is not a technical question of computers replacing the market mechanism, but the development of the forces of production so as to allow workers democracy. However, unlike those who posit the possibility of workers democracy without a revolutionary overturn, this can only happen if the computers along with the rest of the means of production are in the common ownership and control of the working class.

In the light of the collapse of the Stalinist states, socialists today look for the MS as a ‘bolt hole’ to retreat to. So Robin Blackburn says that "what went wrong in Russia" was that Trotsky's advice to use the market as the ‘brain’ of the plan was dumped by Stalin when the kulaks began to rise up and challenge his power. Therefore, Mandel, Blackburn and Kagarlisky want to go back to their idealised mental model of "market socialism" as the way forward today. This post-Stalinist Menshevism has the advantage of also being serviceable both in Western capitalist countries where the struggle today is about defending the welfare state via `democratic' control of the market without a seizure of power! And in the collapsed Stalinist states, not all is lost! If workers stop the rot towards free market capitalism at some point where market and state can coexist, then yippee - market socialism.

So where does this leave the current default to MS? The only reason that it has any credence at all, is that Euromarxists are on the defensive, always going on about the "crisis of Marxism" and the post-modern threat. Otherwise why would anybody argue about the feasibility of a socialism that depended upon creeping public ownership through pension plans eg. a Roemer plan for "coupons plus votes", class neutral supercomputers, the old Fabian demand of economic democracy along with nationalised property [Meiksins Wood, 1995; Schweickart, 1992, Schwarz, 1996] or a "fourth way" [Alexander et al], all at a time when all over the world the more-market movement has brought about the collapse of the bureaucratically planned economies, undermined and eroded public ownership, state intervention and welfare states. Actually existing capitalism today proves beyond question that it needs the law of value to survive. It can only tolerate `reforms' in periods when its profits are rising. It is unlikely that international capitalism will experience a period of renewed accumulation this side of another great depression and more major wars. To be sowing illusions about MS in this period is like pissing into our gunpowder.

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