The nature of the Russian ruling class (1969)

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Discussion sur la nature de la classe dirigeante en Russie menée dans le Parti socialiste de Grande-Bretagne (SPGB).

« This Conference recognises that the ruling class in state capitalist Russia stands in the same relationship to the means of production as does the ruling class in any other capitalist country (viz. it has a monopoly of those means of production and extracts surplus value from the working class) and is therefore a capitalist class ».

Comrade Crump (Manchester) said the issue here was not whether or not Russia was State capitalist–all members agreed on that–but is the ruling class in Russia a capitalist class. His branch felt that the way the Party tended to speak about the Russian ruling class reflected a weakness in our theory of « state capitalism » and « social class »: it seemed that we were not prepared to face up to calling the ruling class in Russia capitalist. Those who were against this had argued that « capitalist » has come to have a more or less definite meaning in socialist discussion over the years–those who were direct employers or investors in shares or government bonds. But this was not necessarily so. The capitalist class were those who monopolised the means of production and accumulated capital. It was irrelevant that the Russian rulers may have led Spartan lives. They were a capitalist class, even though they were not direct employers, because they monopolised the means of production and accumulated capital.

Comrade Hardy urged the Conference to go slow on the Manchester resolution that seemed to say that in Russia the top political and managerial people were the capitalist class because they were the rulers. Marx held that a capitalist was a person who owned enough money and commodities to have a business employing hired labour. There were various types of capitalist–the small working capitalist, the larger one carrying out purely capitalist functions, shareholders in joint stock companies, State bondholders, directors. All these made up the capitalist class. Manchester’s view was at variance with that put forward by Engels in Socialism Utopian and Scientific on the evolution of State capitalism. Engels held that when the State took over industry the capitalists would be forced out of control in favour of salaried employees. He took this to be the end of capitalism, but he was wrong on this.
Private enterprise and investment in Russia were not unimportant and Russian factory managers were themselves involved in it. Millar estimated in 1963 that about a quarter of all industrial (ie non-agricultural) investment in Russia went through private or non-official channels. Manchester branch had suggested that bondholding in Russia was disappearing. It was true that the old forced loans had gone but they had been replaced by savings bonds. The Russian government had been very successful in building up private savings in this way and paid 3% tax free.
Engels had argued that the capitalist class being thrown out of both joint stock companies and State enterprises in favour of salaried employees meant the beginning of the end of capitalism. But in fact in Britain the capitalists never were entirely replaced and have come back in increasing numbers. One reason for this has been the effect of inflation of workers’ incomes. In order to combat this they have enrolled some as directors for the big salaries, pension funds, golden handshakes etc, and other perks. It was not true that in Britain the typical director was a salaried employee: he was a wealthy capitalist. What was the ambition of salaried people in Britain and Russsia? To become wealthy capitalists in their own right. They had not only the ambition but also the opportunities. This applied to politicians and even Trade Union leaders as well. It is certain that in Russia, in addition to the one quarter of private capitalism, managers and Party officials were using the set-up to make money on the side. Russia was going through g reat changes. The question was in what direction? He would suggest tentatively towards the mixed State/private set-up–as in Britain

Comrade Zucconi said that, as Djilas had pointed out in his The New Class, the Russian ruling class had a different background to that in America or Britain. In 1917 most of the capitalists left Russia so that the Bolsheviks had to develop State capitalism, raising some of the capital through State bonds. It was not correct to say that only those who owned industry or employed labour were capitalists. The bureaucrats in Russia were privileged in that they could use their control of capital to channel surplus value in their own interests. In this there was no difference between them and Paul Getty. In Russia there was a class enjoying the fruits of the labour of the Russian workers. A capitalist was a capitalist whether he got his surplus value from direct ownership or political control.

Comrade Knight said the top managerial strata were a significant part of the capitalist class in Russia. They had a vested interest in exploiting the workers and accumulating capital, not for themselves but also for the State.

Comrade D’Arcy said the resolution was premature. The Party had always avoided saying there was a capitalist class in Russia. We asked not who got the surplus value but where did it come from. It was confusing to say that the bureaucracy were the ruling class because of their nepotism and money-making sidelines. They may be becoming capitalists, but it was wrong to speak as if this had already happened. In Russia the monopoly of the social capital was exercised not by private individuals but by the State. Private enterprise was still illegal in Russia and so could not be carried on properly. The capitalist class had not yet emerged. All we could speak of was an embryonic capitalist class which at some later stage would plunder the State industries. Bureaucracy would break down into private wealthy individuals.

Comrade Baldwin: Engels had pointed out in his Origin of the Family that the State was not only an instrument of class oppression but also that with the development of industry it tended to become the ideal personification of the capitalist class. In Russia in the absence of private capitalists the State had taken over their function. This was why we spoke of State capitalism there.

Comrade Buick said there were private capitalists in Russia but were they the ruling class? They were not and we might need a new name to describe those who exploited the workers through political control. The Party had already accepted that a class could own collectively and a chapter in our pamphlet Russia 1917-1967 explains how this was so in Russia. In Russia the individuals who made up this class got an income not as direct employers or as bondholders but from the bloated salaries, perks, bonuses, etc that went with their jobs.

Comrade Cook: This was the old argument of where you draw the line between « ownership » and control. The bureaucrats were using their control to become owners. When control was legalised it then became ownership. The question was would what was now illegal in Russia become legalised so that the bureaucrats turned their control into ownership. The situation was fluid.

Comrade Young quoted Tony Cliff about Trotsky’s mistake in equating State ownership with socialism which prevented him realising the State capitalist nature of Russia. The « official persons » in Russia were a capitalist class eating up surplus value.

Comrade Lawrence said it was not a question of the size of a person’s income or of whether capital was in private or State form. We should look at the historical background of the capitalist class in Russia. Clearly those who monopolised the means of production and accumulated capital were the Russian capitalist class. It had been argued that development in Russia would make capitalism there more like that in Britain. But there was no reason why it should. Capitalism in Russia had a different historical background. The State had always dominated and control had always been centralised there. Whereas in Britain the rising bourgeoisie had broken the power of the autocratic State. This had never happened in Russia. Thus we would expect the State to play a dominant role in the development of capitalism there.

The resolution was carried 30-3, with 10 abstentions.

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