I find it helpful to think about the bourgeois epoch as a period of transition between individual production carried on separately and directly social production. This transition is essentially the replacement of the conditions of individual production with the conditions of directly social production.
Contrary to most Marxists who neatly divide up this transitional period into capitalism and socialism, I make no necessary division. The transition can unfold under the rule of the bourgeoisie or under the rule of the proletariat. If the transition takes place under the rule of the bourgeoisie, we call it capitalism; if it takes place under the rule of the proletariat, we call it socialism. This means in theory, at least, there is no sharp fixed or fast division between the two forms of transition. The distinction between capitalism and socialism is political: which class rules.
This makes it very hard to tell just by looking at various “socialisms” that have emerged in the 20th century and say with a fair degree of precision whether they were socialist or capitalist. To give an example of what I mean: Folks who know more about the subject than I do nevertheless sharply disagree whether the Soviet Union was socialist or capitalist or even a completely different animal altogether. There is no real consensus on how to classify the Soviet mode of production among Marxists.
I have tried to finesse this problem by suggesting the SU was a capital — not “capitalist”, but the thing itself: a giant capital.
The peculiar thing about a capital as a unit of production is that it has none of the features we normally associate with a capitalist economy. Internally, a capital has no money relations; production is carried on according to a plan; there is no tendency toward over-production, unemployment or crises we take as essential to the definition of capitalism.
These features of a capitalistic economy are expressed in the exchange relations between capitals, not in their internal operation.
All forms of directly social labor look alike
If you observed the operations of a capital internally , it would be hard decide whether it was a capitalist organization or a commune – both are essentially identical in their operation internally, forms of directly social labor.
To give an example: a cooperative managed by the workers essentially will function identically to a capitalist firm. This is so true that it only takes the briefest examination of the operation of a cooperative to understand how superfluous the capitalists are to modern capitalist production. There is nothing the capitalist does that the workers can’t do themselves cooperatively.
Assuming I am correct on this, it may be impossible to really tell whether the SU was a socialistic or a capitalistic society. In either case the SU would still have functioned pretty much the way it did.
This leads to a rather disturbing conclusion: Insofar as the actual operations of the Soviet mode of production was concerned it was entirely irrelevant which class was actually in power. In truth, there are only so many ways you can manage directly social production. Technically, both a capital and a commune work the same way. Politically, of course, it makes all the difference which class is actually calling the shots, but technically politics is irrelevant.
The ambiguity of class rule
This might explain why even as the classification of the SU as socialist or capitalist is very controversial, so has been the classification of what we call fascism. Even my personal working definition of fascism — a state managed capitalist economy — begins to look very ambiguous. Indeed, many communists define the SU as state-managed capitalism.
To nail down the difference between capitalism and socialism in practice, we now have to nail down things that are by their very nature fuzzy and ambiguous: class rule.
Honestly, how do you tell which class is actually in power? What evidence do you have that one or the other class is ruling class.
But there is a problem that is even more intractable than that one: Even if you could establish that a particular society is ruled by the working class, does the rule of the working class guarantee the society is socialist? In fact, we all know that the working class can act as its own capitalist? Is it possible to have capitalism without capitalists? Fascism without either capitalists or capitalist private property?
If the technical condition of directly social production do not allow us to differentiate between capitalism and socialism, the political conditions offer even shakier grounds for differentiation than the technical conditions. Literally, we could have a completely fascist society without either capitalists or capitalist private property.
Fuzziness
We assume we can tell the difference between fascism and socialism, but the reality is that it is mostly a matter of individual prejudice. Look at the Democratic People’s Republic of Korea or even the People’s Republic of China. There is no consensus even among communists over how to characterize these societies.
We just make it up as we go along. We talk a lot of shit about what a socialist society looks like, but the reality is that the markers most communists employ use to differentiate capitalism from socialism are pretty fuzzy.
I just want to put this out there because a lot of people think they know what communism is but actually rely on very fuzzy definitions. They can’t even agree on whether the defunct SU was socialism or not, much less classify China. The definitions most communists take as settled and obvious begins to break down the moment we apply any critique to it.
Definitional issues
But let me state something else: every characteristic we think defines socialism is wrong. We are looking for socialism in the wrong place.
I think I have made the case that the alleged markers for a socialist community are not as persuasive as they appear. We can’t look at the technical conditions of production and tell whether the society in question is capitalist or socialist. Further, we cannot look at the political condition of the society as a whole, i.e., which class is actually ruling. and tell the difference.
Even if we discovered a society where production is based on a community of social producers, and even if these social producers ruled through their own association, we still could not determine with a high degree of confidence whether the society was in fact capitalist or socialist based solely on these characteristics.
Whether a society is capitalistic or socialistic has nothing to do either with its technical conditions of production nor the form of state. Certainly these characteristics are important — no society can be socialistic without them — but they are not, of themselves, sufficient for definitively classifying the society in question as socialistic.
Accumulation versus free development
If I am correct about this what additional characteristic is necessary for the society in question to be classified as socialistic? I think Marx offers a clue in his discussion in the so-called fragment on the machine. Socialism, Marx seems to be saying, aims for,
“The free development of individualities, and hence not the reduction of necessary labour time so as to posit surplus labour, but rather the general reduction of the necessary labour of society to a minimum, which then corresponds to the artistic, scientific etc. development of the individuals in the time set free, and with the means created, for all of them.”
What distinguishes a socialist community from a capitalist community is not its technical or political conditions, but whether labor time is reduced to a minimum to make room for the development of individuals, rather than accumulation. Marx actually doubles down on this assertion by quoting an anonymous writer:
“‘Truly wealthy a nation, when the working day is 6 rather than 12 hours. Wealth is not command over surplus labour time’ (real wealth),‘ but rather, disposable time outside that needed in direct production, for every individual and the whole society.’”
In my opinion, the only way to tell whether a particular society is socialist is whether or not labor time is being reduced for everyone.
Communism is free disposable time and nothing else.
The Real Movement 
This argument carries the startling implication that communism will never be possible until all serious military threats to communist society are gone. In other words, “communism in one country” amidst a sea of hostile capitalist powers would never work. Let me explain why….
Imagine an alternate reality where it was unambiguous to everyone that workers controlled production and politics in the Soviet Union—maybe there was no Civil war in this alternate reality, or the “Workers’ Opposition” was successful in this reality, or there was some other change to set it on an entirely different course, who knows? Further, imagine that it is unambiguous to everyone that this alternate-reality Soviet Union has production carried out as the directly social production of use-values to be rationed out. In other words, imagine the Soviet Union of every true communist’s or anarchist’s dreams.
Would workers in this alternate-reality Soviet Union vote for more free, disposable time for themselves rather than accumulation? Let’s taboo those terms for a moment because they are a bit abstract and ask a more concrete question: is there any objective NEED that these workers MUST decide to produce beyond their own food, shelter, clothing, medicine, and other useful subsistence goods? Yes. Military equipment. They MUST build truckload upon truckload of military equipment if they don’t want to get enslaved by Nazi Germany.
Now, on the one hand you could say that, if workers are in control of this decision to produce military equipment for its qualities as a use-value (for defending themselves from Nazi slavery), then in a way there is no contradiction between spending 4 hours each day producing military equipment and spending those same 4 hours freely disposing of their time as they see fit. Building military equipment IS how they see fit to voluntarily spend those 4 hours, in light of the direct usefulness of the end product.
They are not being enslaved by the need to produce “value” here for the sake of accumulation in the abstract. They have freely chosen to produce these directly useful armaments for themselves because they are directly useful in this context. And yet, we can all agree that having to spend 4 hours each day in a munitions factory looks, ON THE SURFACE, a bit like the old “production for accumulation’s sake,” and we can all agree that this would probably not be as fun or mentally or physically stimulating as some other activities that workers would freely choose for themselves if they weren’t faced with the objective circumstance of a hostile foreign power.
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Actually, the thing that would make this voluntary activity really seem like “accumulation for the sake of accumulation” is that preparing for the threat of war would also require building up means of production—research, innovation, heavy industry, etc.—before the military armaments could be built. And you’d never be able to reach a point of sufficiency and “rest on your laurels” because the Nazi Germans next door (or the United States in today’s world) will always be racing ahead ever more in terms of innovation and arms buildup, so you are in effect forced to race against them—not necessarily in terms of producing value as competing capitals, but in terms of producing military use-values. On the ground, this will seem to many workers like all this buildup of heavy industry is “accumulation for the sake of accumulation” or “value-competition among competing state-capitalist powers” even if it has a directly useful long-term reason behind it.
For this reason, I’ve become more skeptical of the idea of state-capitalism and more sympathetic to all self-described “socialist” regimes. I used to be a hardcore anarchist purist. Now, not so much. I will admit that it certainly appears like the state is the new exploiting capitalist in power in places like Stalinist USSR, North Korea, etc. And it may very well still be the case. But I’m not as sure as I used to be because I realize now that it would be very difficult to distinguish the following two scenarios in practice:
1. Workers are under a state-capitalist dictatorship and are forced to work themselves to death producing heavy industry, military goods, and consumer goods for the sake of accumulating value and enriching the nomenklatura.
2. Workers are more or less in control and have political institutions that represent the majority opinion, and yet workers still continue to work themselves to death because they are willing to do so for its own practical benefits, such as building up their means of production and their military use-values that they will need to defend themselves.
I’m even sympathetic to the idea that the USSR was more in line with scenario #2 up until about the late 1970s. Until then, yeah, the secret police did some really horrible things—treating fellow revolutionaries with differences of opinion as if they were no better than outright counter-revolutionaries, and sending ex-soldiers to gulags based on mere suspicion of having been tainted by Western ideas, etc. And workers had raw living standards, for sure. But how much of that was due to objective circumstances of being under threat and needing to produce USE-VALUES at full steam ahead, and feeling like they could not risk any disunity on this point?
How much work was really being skimmed off by Stalin and company for elite consumption? Not much. Say what you will about Stalin and his ilk, but it’s not like they were living in palaces and being waited on hand and foot. Yeah, they had quasi-timeshares in various dachas and got chauffers to drive them around. Whoop-de-do. What percentage of total Soviet labor-time did those perks actually consume? Not much, I would think. Especially compared to the standards of Western capitalists, the Soviet nomenklatura lived pretty frugally…until the 1980s. At that point, factory managers and other nomenklatura got the ability to award themselves bonuses based on production, which gave them a reason to push for more production for its own sake—i.e. push for value production in the abstract (regardless of the direct usefulness of the production). Interestingly, that’s about when their economy started falling apart….
Even North Korea…yeah, it seems like a horrible place by all measures. But how different would it really look if workers were actually in power, but in the same context of feeling threatened by military annihilation at a moment’s notice? You don’t think that a popular, worker-controlled government in the midst of such encirclement could be just as paranoid and heavy-handed as one controlled by elites? You don’t think a worker-controlled economy focused on the direct production of use-values would voluntarily choose to dispose of its free time building so much military technology? Maybe priorities would be slightly different. I have a hard time imagining a true worker-controlled economy that would allow peasants to starve while the nuclear program went full-steam ahead. But if you’d imagine that workers would freely choose to divert all military labor to the production of consumer goods to make their country into some paradise of Western consumerism, or that they would voluntarily convert all of that military production labor into “anything goes” disposable free time, you’re out of your mind.
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I am not sure if this is an objection to reducing hours as much as an objection to trying to create a socialist society in a less developed country. Very difficult to compete militarily when your infrastructure is relatively backwards. In any case, the SU wasn’t in this position in the 50s-60s-70s. It was actually facing a massive surfeit of labor. It could have easily reduced hours of labor and still maintained a strong deterrence.
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I’m not so sure I see this surfeit of labor in postwar Soviet society that you are talking about. It appears to me that there were still massive shortages of some basic consumer goods that people wanted (one reason why people in the Eastern Bloc were tempted to ditch the Soviet bloc). Labor devoted to developing that part of the economy doesn’t seem like it could have been dispensed with.
Also, before the late ’70s, I’m not aware of a lot of labor that was devoted to producing luxury goods for the elite. So I don’t think you could have found much labor to cut there either. Maybe I’m wrong on that. Any idea where one might be able to find a public breakdown of Soviet 5-year plans from that time period?
As for labor devoted to military production and innovation, in hindsight some of it seems silly because there ended up not being a large-scale WW3 after all, but a lot of that has to do with the fact that the Soviet deterrence was as credible as it was. Cutting military production and innovation then seems an awful lot to me like if, in Civ4, you reach rifling and cut off your research slider to chase a culture victory. Your virtual citizens will be very happy about all of the spending on culture…until your neighbor who has continued on to mechanized infantry comes and stomps you right before you can win your culture victory.
Let’s say the Soviet Union had reduced the labor devoted to military production and innovation to a trickle starting in the 1950s—let’s say, just enough to service and replace existing equipment. That would have meant missing out on ICBMs. What about the 1970s? Slacking off then would have meant little to no computerized systems.
In 1991 and 2003, the U.S. went to war with a state armed with non-computerized, ’70s-era Soviet technology—and the results were not pretty. BUT: the Soviet Union had nuclear ICBMs, though. Surely that would have made the difference? I don’t know…how effective are nuclear ICBMs without a whole computerized early warning system and command & control system? We’ve never had to find out, but I have my doubts.
As for the idea that “the Soviet Union could have reduced hours of *compulsory* labor and still developed things like computers for the military out of *voluntary* labor”…well, that’s the 64 thousand dollar question, isn’t it? To most people, that assertion would just seem wacko. If voluntary labor were always as plentiful and effective as labor motivated by some political threat (Soviet labor) or contrived sense of economic desperation (capitalist wage-labor), then capitalist society would have NEVER had a legitimate world-historical role to play, and all the bourgeois apology of capitalism and explanation that people have to be extrinsically motivated to do useful things for others would never ring true to ordinary people’s everyday experiences as having a grain of truth in it.
I thought that scientific socialism acknowledged that, at a certain point in human history, compulsory labor is functional, optimal, and necessary for developing the means of production—a necessary evil. Then, it is hypothesized, there will come a time when this is no longer optimal—when either:
A. a society without compulsory labor will be able to demonstrate an even faster development of the means of production, or
B. when developing the means of production (and also means of military defense) simply won’t matter anymore due to superabundance of goods and lack of military threats.
Scenario A seems plausible if we should come to a time when we can objectively diagnose the fact that we are spending most of our labor time on “bullshit jobs” that need to be done only to serve existing relations of production—such as any accounting of transactions or “who owns what.” And it’s obvious that there is a LOT of labor piddled away on this currently. Have you tried to buy a house lately? The legalese and paperwork is ridiculous! Certainly, almost all existing retail and legal tasks could be avoided under communism, and people currently engaged in those occupations could switch to sharing some of the load in other (still necessary) tasks.
I think “ordinary people” would be more convinced of the “bullshit jobs” hypothesis if they could see a breakdown of exactly how many yearly labor-hours per person are spent on various concrete tasks. Rather than have to take David Graeber’s word for it that 90% of tasks are bullshit, they could judge for themselves which of these concrete tasks are “bullshit” and which are not and come to their own estimate of the amount of “bullshit work” being done in the current economy. I don’t know how one would even begin to gather such data. Perhaps you could take existing data on how much MONEY IS SPENT on various services in the economy per person yearly and reverse-engineer the actual labor-hours spent (including time spent in training and education for the tasks). I’m personally not up to the task. But it would be extremely helpful.
Then we could simply say, “the average American spends 10 labor-hours each year producing the F-35” and let people judge for themselves whether this is a good trade-off of their time or not. It might seem obvious to us that the F-35 only exists to defend overseas investments of yuppie elite American pricks, but it is possible that some communists would still like to have the F-35 to defend communist society, and would like to have it produced regardless.
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Google Kornai labor hoarding
The entire ugly story of the failure of planned production is there.
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Here is a more complete answer:
In 1989, I had the opportunity to participate in a university program where the Soviet Union’s perestroika was being studied. At the same time, I studied the early years of the Soviet Union from 1917 to the decision to undertake collectivization and industrial development. Basically, I was simultaneously looking at the beginning and end point of the Soviet model — although I did not realize at the time that the SU was on the verge of collapse.
As part of the study to come to grips with perestroika, I happened upon Janos Kornai’s discussion of the so-called shortage economy from 1979. In that paper Kornai makes an astonishing argument: the Soviet model was resource constrained, not demand constrained.
To explain this requires some adjustment in our thinking, because we are used to an economy characterized by chronic overaccumulation of capital — what some call chronic overproduction of goods and services. In order to give you an idea what this means, let me state this problem (incorrectly) as a Keynesian might: In an economy suffering chronic over production, firms are constantly throwing more goods on the market, while, owing to their limited subsistence, the working class cannot absorb what they have produced. The result is that demand always lags supply.
Again, this is not actually what is happening, but only how the Keynesians describe it: too little demand for goods.
Not so with a resource or (perhaps) supply constrained economy like the Soviet Union. Again to simplify the problem let me restate it as Kornai does: a resource constrained economy is characterized by chronic over-employment of labor power, rather than by chronic underemployment and unemployment. Over-employment of labor power was a tendency built into the planning mechanism, which seeks total mobilization of national resources to continually expand production at the fastest possible rate, no matter the economic costs of this expansion. A consequence of the planned character of production is that demand for resources, including labor power, grows almost insatiably. As Kornai puts it, “Demand for resources, including demand for labor, necessarily has to grow as long as it does not hit the supply constraint.”
As one commentator on Kornai’s hypothesis, Carolyn Kadas, explained in a 1990 paper, state enterprise managers are under constant pressure to fulfill the plan. They are juggling the need to generate profits, meet domestic and foreign export output goals, contain costs of production, and address the demands of workers over wages and working conditions. At the same time, the writer explains, they are expected to introduce technological innovations that reduce the demand for labor in the production of goods. Managers tend “to avoid the conflict brought about by the threat of lay-offs … instead of insisting on profit and efficiency”. In other words, managers have a political interest to retain superfluous labor in case the additional labor power is necessary to reach their production goals. The kicker: “managers claimed that if they had the right to fire workers (which they do in theory), they could manage to continue operating (and to pay better) with one-half to [one third] of their current work force.”
A planned economy that maximizes output sooner or later runs into the problem that, eventually, too much labor is being employed in production. The problem is further compounded by the fact the prices are set by plan, not the market. The role of exchange value in regulating production is limited. This situation is difficult to understand for a worker in a capitalist economy since individual firms would resolve this sort of “overemployment” by huge layoffs of workers; the workers would be thrown into the streets and left starving. But this capitalist solution would have resulted in exactly the sort of catastrophe we saw when the SU planning mechanism finally collapsed: forty percent unemployment or more.
In any case, google Kornai. Much of his work is the basis for my analysis.
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I see no problem with the “shortage economy” in principle. That’s a good thing! It’s a symptom that the economy truly is geared towards the production of use-values rather than abstract value. Previous societies centered on the production of use-values (such as feudalism) witnessed problems with shortages too. Not enough food being produced, etc. The big difference between this and capitalist overproduction is that capitalist overproduction is a needless, man-made problem stemming from relations of production. Shortages of use-values, on the other hand, are simply a symptom that a society is not yet productive enough to wrest from nature every use-value that is desired.
Whereas overproduction is a demoralizing problem with no straightforward solution (aside from social revolution), underproduction of use-values is a straightforward technical problem that can be progressively ameliorated. If your society has a shortage of use-values, it is a good sign that your society is at least on the right track.
If the Soviet economy really was a “shortage economy,” then that is a huge blow against the theory of state-capitalism and a huge argument in favor of the idea that the Soviet Union was actually some sort of workers’ state (if perhaps a “degenerated” or “bureaucratically hijacked” one).
Maybe I am not understanding this correctly, but it seems like there are some contradictions in what you wrote above.
It sounds like you are claiming that workplaces identified possible ways that they could increase productivity and output the same or more use-values using less labor, but that workplace managers avoided implementing these innovations because they were afraid that the laid-off workers would revolt.
But rebellious laid-off workers are the state’s problem if they act up, not any individual workplace’s problem, no? Why should any individual workplace care about whether laid-off workers become political troublemakers? Plus, if there really were resource shortages, then that implies that there were labor shortages. Why would workers be overly concerned about being laid-off if there were many other job opportunities? If the Soviet economy was permanently “running hot,” then that should have signaled to managers the need to shed labor at any opportunity, not hoard labor! To the extent that the state leaned on individual managers, the state would have been telling them to shed labor to free up workers for producing things in short supply, not hoard it out of fear of rebellious unemployed workers!
Perhaps each workplace was “hoarding labor” for emergencies, just in case it looked like they would not be able to meet the planned quota and needed to throw the extra workers into the productive process at the last second. This just sounds like bad planning, either from the individual workplace manager (failing to shoot for safe buffers of output above the quota in the first place to deal with emergencies) or the central planning committee (giving all workplaces unrealistically high production quotas).
If I were a central planner, I would not automatically consider an unfulfilled quota to be a legitimate reason for hoarding labor if other workplaces need that labor more urgently. And you’d be able to tell that other workplaces need that labor even more urgently because resource bottlenecks would point back to these workplaces not producing enough of the use-value in short supply.
Sure, let’s say everything is “in short supply” relative to the unrealistic 5-year plan’s quota. It shouldn’t matter. It should still be obvious which goods are *relatively* in shorter supply. If tire producers are almost keeping up with the 5-year plan (producing, let’s say, 90% of the tire quota), but rubber producers are only hitting 75% of the quota, then I’d be encouraging the tire producers to shed labor so that they can be re-apportioned to sectors like the rubber sector. Another symptom that would make this absolutely crystal clear is that you’d see tire workers standing around idle much of the time for lack of rubber. “But, but, but, we haven’t hit our tire quota, so that’s why I’m hoarding these workers!” If I were a central planner, I wouldn’t accept that as an answer. I’d be able to point to many other sectors, like the rubber sector, where the workers were still working flat-out.
Just like under capitalism there is an “average rate of profit” that tells owners how they are doing *relative* to other owners, under use-value production it should not be hard to identify an “average rate of quota fulfillment” and its reciprocal, the “average rate of capacity utilization.” So, if the rate of quota fulfillment in your sector is 80%, then the effective capacity utilization is 125% (i.e. you’d need 25% more capacity above the current 100% to reach the quota). If the average quota fulfillment across the entire economy is 50% (and thus the average effective capacity utilization is 200%), then that is a signal that your sector doesn’t need labor as urgently as the typical sector does, and that you should be actively trying to shed labor. Sure, you are not hitting the quota in absolute terms, but in relative terms you are hitting it better than the typical sector, so you should shed some of your labor.
Calculating things in relative terms in this way would give the central plans some resiliency against being pegged too high or low on an absolute scale. As long as the relative proportions of typical, socially-necessary labor were correctly identified for each output, then it wouldn’t really matter how high the targets were set in an absolute sense. Not as much would be riding on the central planners’ math.
(By the way, I can’t believe that I’m coming up with any ideas that Soviet central planners didn’t already know).
In any case, given a certain target level of use-values that the central planning committee wanted produced, the problem was obviously a lack of available labor-time, not a surfeit of labor-time.
Sure, you could say that the central plan itself was bad and unrepresentative of people’s wants and that people were being told to produce unwanted things. But then we are back to trying to figure out what exactly could have been cut. And I just don’t see that there was any obviously wasteful use-value output that could have been cut. Not consumer goods (workers were impatient to have even more of these!) Not military goods. Not means of production. And not (very many) luxury goods.
For all of the lack of formal representativeness in the system, it seems to me like, before the 1980s, the central plan was pretty much trying to get things produced that workers wanted (after setting aside production for things that workers may not have consciously wanted in the short-term, but which they needed for their long-term well-being (such as military defense) and long-term ability to produce the consumer goods that they wanted (heavy industry, means of production)).
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Read it again. You are not even close.
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