Ted Grant

Crisis in Russia

Written: September 1965
Source: Militant, published in two parts: no. 9 (September 1965) and no. 10 (October 1965)
Markup/Proofread: Emil 2007

Part One

The great achievements of the planned economy in the Soviet Union have been reluctantly admitted by the publicists and spokesmen of the capitalist class. Compared to the barbaric conditions and low level of culture and science under the rule of the Tsar, of the capitalists and landlords, of the Russian state before the October Revolution, immense progress has been made. In place of the illiteracy of Tsarism we have the Soviet Union spending 16 times as much on education as Britain, four times as much per head of population. The achievements in space exploration are too well known to require comment. Occasionally items appear in the capitalist press, especially the non-popular press, indicating the striking strides being made by the Soviet Union. Last year Russia produced 85 million tons of steel as against Britain's 26 million tons. Yet in 1929 Russia produced less than one third of the steel produced by Britain. As against the technical poverty of the past, brilliant innovation and invention, as against slavish acceptance of the technical superiority of the West, creativity and initiative, all play their part in the industry of the Soviet Union. The Times, the Financial Times and British Industry, the journal of the Confederation of British Industry (uniting within its ranks the British capitalists) have articles dealing with the advances in Soviet steel production, showing that new processes of continuous steel production are more advanced than anything in the world.

According to official Soviet figures the rate of economic growth in the Soviet Union was 9.3 percent in the first half of this year; labour productivity increased by 5.4 percent in industry, and industrial trial costs were cut. This is an immense advance in comparison with that of capitalist America even at a time of boom.

These few facts are a crushing refutation of the capitalist propaganda against nationalisation of the economy. But just because Russia was so backward and because of the isolation of the revolution from the modern economies of the West, monstrous distortions were introduced into the Soviet economy. As against the equality introduced by Lenin and Trotsky, Stalin in the counter-revolution of the bureaucracy against the working class, introduced new privileges in the sphere of consumption, of the untrammelled rule in industry and the state of this “new aristocracy.” All the Socialist gains of the revolution were destroyed except for the state ownership of the economy, and the principle of a planned economy in place of private ownership of industry and the land, the anarchy and chaos of capitalism.

Problem unsolved

It was the failure of capitalism to provide the basis for the development of the economy and of society which doomed it to destruction. But the revolution taking place in a backward country could not solve the problems of a transition to Socialism. The seizure of power by the Stalin clique, paved the way for new contradictions to appear in Russian society. While state ownership provided the means of an unprecedented leap forward by removing the impediment of capitalist ownership, the loss of control by the working class resulted in an uneven development with a whole host of new contradictions.

The Russian bureaucracy, the new elite of millions of officials of the party, state, industry, agriculture and the army transformed the society created by the revolution. The very successes in production gave them the opportunity to increase their share illegitimately and against all the teachings of Marxism. For a time because of the exceedingly low level of production, they played a relatively progressive role. But the more industry has developed, the greater the steps forward taken by Soviet society, the more the dead hand of these usurpers and parvenus has become apparent. From being an instrument despite themselves, of the movement forward of Russian industry and society, they have become a monstrous obstacle and impediment. More and more they are becoming a parasitic excrescence on Russian society.

A development of a state towards Socialism, Marx and Engels explained, requires the harmonious control and checking of industry and the state by the working class and of the people as a whole. Bureaucracy and red tape, privilege and inequality, foster new contradictions. It is impossible to manage an economy the size of the Soviet Union and with 500,000 giant enterprises, without the constant criticism, vigilance and creative activity of the masses themselves.

The idea of a “planned” economy controlled and ordered by a handful of bureaucrats from the top is a monstrous contradiction of the elementary ideas of a Socialist economy. Now the very successes of the Soviet Union have landed the “new overlords” into a frightful impasse. Stalin died conveniently just at the time when he was preparing a new frightful purge of millions as his “solution” to the contradictions and crises of Soviet society. His successors Malenkov and Khruschev tried reform from the top to prevent revolution from the bottom, but without altering the privileges of the ruling caste. The standard of living of the masses has increased. The open terror of Stalin's secret police has been abolished. Without allowing control from the bottom, nevertheless Khruschev tried to decentralise the control of industry from Moscow, to wider sections of the bureaucracy in the main regions of Russia. This gave an impetus at first, production once again leaped forward, but as the Marxists predicted within a few years it has involved industry in Russia in even greater contradictions. Instead of one centralised bureaucracy controlling industry, 16 bureaucracies appeared and proliferated, adding new burdens of chaos, red tape and difficulties before the Russian economy. One of the reasons for the removal of Khruschev was the new crisis in the Russian economy caused by its growth. From de-centralisation the bureaucracy has passed to re-centralisation, adding further confusion and chaos in the “plan”.

Agriculture fails

The most dismal failure has been in the field of agriculture. Russia has six times as many people in proportion in agriculture as the United States, but still has not been able to solve even elementary problems of food production. She will have to spend £300 to £400 million in gold this year in buying wheat. In the last two years she has had to spend similar sums of precious foreign exchange. And this for the country that used to be the granary of Europe!

The process of disease and decay, the stifling atmosphere produced by bureaucracy is illustrated by items that more and more are creeping into the Russian press. The crisis is revealed in the consciousness of the bureaucracy itself, which feels that more and more it has become a terrible brake and impediment on Soviet society, hampering and restricting its growth.

Waste, incompetence, corruption and favouritism appear in addition to the other evils of a society shot through with privilege and inequality. The latest is that the planners have not succeeded in developing sufficient power resources to cope with the increase in factory production. Consequently power and electricity in European Russia will have to be rationed. Naturally the worst burden will fall onto the shoulders of the “consumers”. Mr. A. S. Pavlenko said in an article in Pravda of 17th August that the fuel shortage was being aggravated as the production target of the 7-year plan was not being fulfilled.

Effects [of] nationalism

Here is a concrete instance of the effects of the reactionary nationalist position of the Russian bureaucracy. Three quarters of the coal and water resources of the Soviet Union are in Siberia and the East. Had there been a real workers’ democracy in the Soviet Union, they would have organised a Federation with China after the victory of the Chinese Revolution. Tens of millions of Chinese could have been organised for emigration to Siberia as they have emigrated to Manchuria in the last decades. With the assistance of hundreds of thousands of Russian technicians, this could have been the basis of an enormous leap forward in production, for the benefit of the peoples of both Russia and China. The bureaucratic rule in both countries stood in the way of such a beneficial international collaboration between the two countries.

Part Two

The “theory” of Socialism in one Country best expressed the interests of the usurpers of power from the working class. The decades of Stalinist bureaucratic rule have seen the opening of a chasm between the social strata on top and the mass of the people at the bottom. “Them and Us” has become the basis of Russian society. Alcoholism to drown peoples’ sorrows has become a scourge of society. Izvestia, the official journal of the Soviet Government features the current campaign against drunkenness, and has published articles by doctors, lawyers and police officers. The journal of the Soviet Academy of Science, Voprosy Filosofii recently published a survey by two sociologists. They found that of 152 homes they visited in Tula, a famous revolutionary centre, 64 contained icons. 24 workers out of 136 questioned said they did not even bother to read political literature. 39 never even read the newspapers. 88 never read magazines, 54 did not read books, 24 did not even listen to the radio, 68 never watched television, and 27 never went to the cinema.

Political work

More than half spent their spare time playing dominoes, cards or lotto. On collective farms the situation was even worse. 247 families representing 12 percent of the population of four collective farms were also interviewed. On political work the interviewer found that they spent less than an hour a week. Far back in 1922 the average was 2.5 hours a week. Women interviewed spent on average 25 minutes in comparison with an hour in 1922.

40 years of bureaucratic rule have produced glaring contrasts between the lives and standards of the bureaucracy and the mass of the people. “Why should I pay 80 kopeks for a small long-playing record? This money goes towards providing a life of delights for actors who already own sumptuous villas and cars.” says a letter to Komsomolskaya Pravda, the paper of the Communist Youth. Another letter to the Latvian journal Soviet Youth says [that] thousands of people have been condemned to a life in the slums while others have five-room flats, cars and villas equipped with the latest gadgets. Thus the benefits of the immense progress is mainly wolfed by the greedy officialdom.

Passive resistance

Even more neglected than the people in the cities are the peasants in the countryside. Oilskins, an absolute necessity for the peasants in some villages have not been seen in the shops for more than a year. This according to the daily newspaper Selstaya Zhizn (“Country Life”). A woman journalist sent by the paper reported the above. She also reports the famine of consumer goods. Television sets, washing machines, motorcycles and various types of furniture are practically unobtainable. A milkmaid told the correspondent she queued all night for a washing machine but failed to get one as only five had been received by the co-op store.

Long ago Trotsky explained that the problem of food production could only be solved by industry facing the village. This meant the production of tractors, as well as consumer goods for the needs of the peasants. Otherwise, as the last few decades have demonstrated, the peasant without incentives and feeling exploited and cheated, replies by passive resistance.


But the ordinary worker and consumer in the town is not treated much better. Goods of shocking quality are turned out for the mass market. As an example Izvestia of 4th June criticised the nylon stockings produced in Russia. They were baggy and drab, came in odd sizes, were sold in unmatched pairs and a peculiar colour. Shoddy goods are piling up in the shops which are practically unsaleable to the tune of hundreds of millions of pounds.

Because of bureaucratic control the consumer was the last consideration of the managers of industry and the state.

However the inefficiencies of the system are reaching such a scandalous level, that the bureaucracy is searching frantically for some way out. According to some Russian economists more than one third of the national effort is wasted every year. One fifth to a quarter of firms failing in their plans. The cynicism and carelessness, the greediness at the top, percolates right through society to the bottom. Two young girls, unloading bricks in Moscow “fulfilled” their planned quota by unloading bricks so fast that 30 percent were broken.

Administrative red tape is so all-embracing that the Russian mining industry employs many more times the administrative staff to miners than the American industry. One small factory, which is typical, employed 54 administrative staff for 270 employees.

The real solution to the problem would be a restoration of Soviet democracy, with full control and participation in the management and organisation of production by the workers and peasants. This is a road which it is impossible for the bureaucracy to take as it would be the end of their privileges. One might as well expect the capitalist class to take to the road of Socialism! Not being able to see this obvious solution to the problem, the bureaucracy is searching for new methods, which will still further enhance their status and income. Greater initiative is to be given to the factory managers, and naturally an incentive in a share of the profits. On the 8th of July, Dyakov, a deputy Premier in the Russian Federation announced that this would apply to all garment and footwear industries in Moscow and Leningrad. These measures which it is suggested should be further extended may give a temporary impetus to the development of production. But they will involve the Russian state and economy in new contradictions.

Russian Hungary

Meanwhile the search for solutions, to what is an insoluble problem, as always is resulting in new disagreements at the top. Since the removal of Khruschev the “collective leadership” at the top have disagreed on the policy to be pursued. Thus the journal Party Life declares: “Collegiality is not an aim in itself, and should be exercised only within the limits of real need.” Any attempt to turn the Central Committee into a “talking shop” according to them was said by Lenin to be “the greatest evil, to which an end must be put at any cost, as quickly as possible, stopping short at nothing.” This is a warning to those in the C.C. who disagree with the present policies now being implemented. In the next period the heightened contradictions within the Soviet Union will bring forward another “arbiter” akin to Khruschev. A system of totalitarian rule such as that in the Soviet Union inevitably calls forth the need for a “boss” to decide. This permeates the system from top to bottom. But again this will not provide a solution.

The Russian people are becoming more and more critical of the system of bureaucratic absolutism. It hampers and restricts in every field of human endeavour. In science, art, production, education and every sphere of life. The zig-zagging from one side to the other is an indication of the instability of the system. The Hungarian revolution has shown the way. Sooner than many people would dream the Russian bureaucracy will face their own Hungary. A planned and harmonious system of production, with full rights for the working people, the pure ideal of Marx and Lenin, of Engels and Trotsky, will be instituted in the Soviet Union. Such a result would be the most dreadful thing of all for the world imperialists. They fear a workers’ democracy and the example it would give more than anything on earth.