Library:Economic problems of socialism in the USSR

Economic problems of socialism in the USSR
Author	Joseph Stalin
Written in	1951
First published	1951
Type	Booklet

Character of Economic Laws under Socialism

Some comrades deny the objective character of laws of science, and of laws of political economy particularly, under socialism. They deny that the laws of political economy reflect law-governed processes which operate independently of the will of man. They believe that in view of the specific role assigned to the Soviet state by history, the Soviet state and its leaders can abolish existing laws of political economy and can "form," "create," new laws.

These comrades are profoundly mistaken. It is evident that they confuse laws of science, which reflect objective processes in nature or society, processes which take place independently of the will of man, with the laws which are issued by governments, which are made by the will of man, and which have only juridical validity. But they must not be confused.

Marxism regards laws of science—whether they be laws of natural science or laws of political economy—as the reflection of objective processes which take place independently of the will of man. Man may discover these laws, get to know them, study them, reckon with them in his activities and utilize them in the interests of society, but he cannot change or abolish them. Still less can he form or create new laws of science.

Does this mean, for instance, that the results of the action of the laws of nature, the results of the action of the forces of nature, are generally inavertible, that the destructive action of the forces of nature always and everywhere proceeds with an elemental and inexorable power that does not yield to the influence of man? No, it does not. Leaving aside astronomical, geological and other similar processes, which human really is powerless to influence, even if he has come to know the laws of their development, in many other cases human is very far from powerless, in the sense of being able to influence the processes of nature. In all such cases, having come to know the laws of nature, reckoning with them and relying on them, and intelligently applying and utilizing them, human can restrict their sphere of action, and can impart a different direction to the destructive forces of nature and convert them to the use of society.

To take one of numerous examples. In olden times the overflow of big rivers, floods, and the resulting destruction of homes and crops, was considered an inavertible calamity, against which human was powerless. But with the lapse of time and the development of human knowledge, when human had learned to build dams and hydro-electric stations, it became possible to protect society from the calamity of flood which had formerly seemed to be inavertible. More, human learned to curb the destructive forces of nature, to harness them, so to speak, to convert the force of water to the use of society and to utilize it for the irrigation of fields and the generation of power.

Does this mean that human has thereby abolished laws of nature, laws of science, and has created new laws of nature, new laws of science? No, it does not. The fact is that all this procedure of averting the action of the destructive forces of water and of utilizing them in the interests of society takes place without any violation, alteration or abolition of scientific laws or the creation of new scientific laws. On the contrary, all this procedure is effected in precise conformity with the laws of nature and the laws of science, since any violation, even the slightest, of the laws of nature would only upset matters and render the procedure futile.

The same must be said of the laws of economic development, the laws of political economy—whether in the period of capitalism or in the period of socialism. Here, too, the laws of economic development, as in the case of natural science, are objective laws, reflecting processes of economic development which take place independently of the will of man. Man may discover these laws, get to know them and, relying upon them, utilize them in the interests of society, impart a different direction to the destructive action of some of the laws, restrict their sphere of action, and allow fuller scope to other laws that are forcing their way to the fore-front; but he cannot destroy them or create new economic laws.

One of the distinguishing features of political economy is that its laws, unlike those of natural science, are impermanent, that they, or at least the majority of them, operate for a definite historical period, after which they give place to new laws. However, these laws are not abolished, but lose their validity owing to the new economic conditions and depart from the scene in order to give place to new laws, laws which are not created by the will of man, but which arise from the new economic conditions.

Reference is made to Engels' Anti-Dühring, to his formula which says that, with the abolition of capitalism and the socialization of the means of production, human will obtain control of his means of production, that he will be set free from the yoke of social and economic relations and become the "master" of his social life. Engels calls this freedom "appreciation of necessity." And what can this "appreciation of necessity" mean? It means that, having come to know objective laws ("necessity"), human will apply them with full consciousness in the interests of society. That is why Engels says in the same book:

The laws of his own social action, hitherto standing face to face with human as laws of nature foreign to, and dominating him, will then be used with full understanding, and so mastered by him.

As we see, Engels' formula does not speak at all in favour of those who think that under socialism existing economic laws can be abolished and new ones created. On the contrary, it demands, not the abolition, but the understanding of economic laws and their intelligent application.

It is said that economic laws are elemental in character, that their action is inavertible and that society is powerless against them. That is not true. It is making a fetish of laws, and oneself the slave of laws. It has been demonstrated that society is not powerless against laws, that, having come to know economic laws and relying upon them, society can restrict their sphere of action, utilize them in the interests of society and "harness" them, just as in the case of the forces of nature and their laws, just as in the case of the overflow of big rivers cited in the illustration above.

Reference is made to the specific role of Soviet government in building socialism, which allegedly enables it to abolish existing laws of economic development and to "form" new ones. That also is untrue.

The specific role of Soviet government was due to two circumstances: first, that what Soviet government had to do was not to replace one form of exploitation by another, as was the case in earlier revolutions, but to abolish exploitation altogether; second, that in view of the absence in the country of any ready-made rudiments of a socialist economy, it had to create new, socialist forms of economy, "starting from scratch," so to speak.

That was undoubtedly a difficult, complex and unprecedented task. Nevertheless, the Soviet government accomplished this task with credit. But it accomplished it not because it supposedly destroyed the existing economic laws and "formed" new ones, but only because it relied on the economic law that the relations of production must necessarily conform with the character of the productive forces. The productive forces of our country, especially in industry, were social in character, the form of ownership, on the other hand, was private, capitalistic. Relying on the economic law that the relations of production must necessarily conform with the character of the productive forces, the Soviet government socialized the means of production, made them the property of the whole people, and thereby abolished the exploiting system and created socialist forms of economy. Had it not been for this law, and had the Soviet government not relied upon it, it could not have accomplished its mission.

The economic law that the relations of production must necessarily conform with the character of the productive forces has long been forcing its way to the forefront in the capitalist countries. If it has failed so far to force its way into the open, it is because it is encountering powerful resistance on the part of obsolescent forces of society. Here we have another distinguishing feature of economic laws. Unlike the laws of natural science, where the discovery and application of a new law proceeds more or less smoothly, the discovery and application of a new law in the economic field, affecting as it does the interests of obsolescent forces of society, meets with the most powerful resistance on their part. A force, a social force, capable of overcoming this resistance, is therefore necessary. In our country, such a force was the alliance of the working class and the peasantry, who represented the overwhelming majority of society. There is no such force yet in other, capitalist countries. This explains the secret why the Soviet government was able to smash the old forces of society, and why in our country the economic law that the relations of production must necessarily conform with the character of the productive forces received full scope.

It is said that the necessity for balanced (proportionate) development of the national economy in our country enables the Soviet government to abolish existing economic laws and to create new ones. That is absolutely untrue. Our yearly and five-yearly plans must not be confused with the objective economic law of balanced, proportionate development of the national economy. The law of balanced development of the national economy arose in opposition to the law of competition and anarchy of production under capitalism. It arose from the socialization of the means of production, after the law of competition and anarchy of production had lost its validity. It became operative because a socialist economy can be conducted only on the basis of the economic law of balanced development of the national economy. That means that the law of balanced development of the national economy makes it possible for our planning bodies to plan social production correctly. But possibility must not be confused with actuality. They are two different things. In order to turn the possibility into actuality, it is necessary to study this economic law, to master it, to learn to apply it with full understanding, and to compile such plans as fully reflect the requirements of this law. It cannot be said that the requirements of this economic law are fully reflected by our yearly and five-yearly plans.

It is said that some of the economic laws operating in our country under socialism, including the law of value, have been "transformed," or even "radically transformed," on the basis of planned economy. That is likewise untrue. Laws cannot be "transformed," still less "radically" transformed. If they can be transformed, then they can be abolished and replaced by other laws. The thesis that laws can be "transformed" is a relic of the incorrect formula that laws can be "abolished" or "formed." Although the formula that economic laws can be transformed has already been current in our country for a long time, it must be abandoned for the sake of accuracy. The sphere of action of this or that economic law may be restricted, its destructive action—that is, of course, if it is liable to be destructive—may be averted, but it cannot be "transformed" or "abolished."

Consequently, when we speak of "subjugating" natural forces or economic forces, of "dominating" them, etc., this does not mean that human can "abolish" or "form" scientific laws. On the contrary, it only means that human can discover laws, get to know them and master them, learn to apply them with full understanding, utilize them in the interests of society, and thus subjugate them, secure mastery over them.

Hence, the laws of political economy under socialism are objective laws, which reflect the fact that the processes of economic life arc law-governed and operate independently of our will. People who deny this postulate are in point of fact denying science, and, by denying science, they are denying all possibility of prognostication—and, consequently, are denying the possibility of directing economic activity.

It may he said that all this is correct and generally known; but that there is nothing new in it, and that it is therefore not worth spending time reiterating generally-known truths. Of course, there really is nothing new in this; but it would be a mistake to think that it is not worth spending time reiterating certain truths that are well known to us. The fact is that we, the leading core, are joined every year by thousands of new and young forces who are ardently desirous of assisting us and ardently desirous of proving their worth, but who do not possess an adequate Marxist education, are unfamiliar with many truths that are well known to us, and are therefore compelled to grope in the darkness. They are staggered by the colossal achievements of Soviet government, they are dazzled by the extraordinary successes of the Soviet system, and they begin to imagine that Soviet government can "do anything," that "nothing is beyond it," that it can abolish scientific laws and form new ones. What are we to do with these comrades? How are we to educate them in Marxism-Leninism? I think that systematic reiteration and patient explanation of so-called "generally-known" truths is one of the best methods of educating these comrades in Marxism.

Commodity Production under Socialism

Certain comrades affirm that the Party acted wrongly in preserving commodity production after it had assumed power and nationalized the means of production in our country. They consider that the Party should have banished commodity production there and then. In this connection they cite Engels, who says:

With the seizing of the means of production by society, production of commodities is done away with, and, simultaneously, the mastery of the product over the producer.

These comrades are profoundly mistaken.

Let us examine Engels' formula. Engels' formula cannot be considered fully clear and precise, because it does not indicate whether it is referring to the seizure by society of all or only part of the means of production, that is, whether all or only part of the means of production are converted into public property. Hence, this formula of Engels' may be understood either way.

Elsewhere in Anti-Dühring Engels speaks of mastering "all the means of production," of taking possession of "all means of production." Hence, in this formula Engels has in mind the nationalization not of part, but of all the means of production, that is, the conversion into public property of the means of production not only of industry, but also of agriculture.

It follows from this that Engels has in mind countries where capitalism and the concentration of production have advanced far enough both in industry and in agriculture to permit the expropriation of all the means of production in the country and their conversion into public property. Engels, consequently, considers that in such countries, parallel with the socialization of all the means of production, commodity production should be put an end to. And that, of course, is correct.

There was only one such country at the close of the last century, when Anti-Dühring was published—Britain. There the development of capitalism and the concentration of production both in industry and in agriculture had reached such a point that it would have been possible, in the event of the assumption of power by the proletariat, to convert all the country's means of production into public property and to put an end to commodity production.

I leave aside in this instance the question of the importance of foreign trade to Britain and the vast part it plays in her national economy. I think that only after an investigation of this question can it be finally decided what would be the future of commodity production in Britain after the proletariat had assumed power and all the means of production had been nationalized.

However, not only at the close of the last century, but today too, no country has attained such a degree of development of capitalism and concentration of production in agriculture as is to be observed in Britain. As to the other countries, notwithstanding the development of capitalism in the countryside, they still have a fairly numerous class of small and medium rural owner-producers, whose future would have to be decided if the proletariat should assume power.

But here is a question: what are the proletariat and its party to do in countries, ours being a case in point, where the conditions arc favourable for the assumption of power by the proletariat and the overthrow of capitalism, where capitalism has so concentrated the means of production in industry that they may be expropriated and made the property of society, but where agriculture, notwithstanding the growth of capitalism, is divided up among numerous small and medium owner-producers to such an extent as to make it impossible to consider the expropriation of these producers?

To this question Engels' formula does not furnish an answer. Incidentally, it was not supposed to furnish an answer, since the formula arose from another question, namely, what should be the fate of commodity production after all the means of production had been socialized.

And so, what is to be done if not all, but only part of the means of production have been socialized, yet the conditions are favourable for the assumption of power by the proletariat—should the proletariat assume power and should commodity production be abolished immediately thereafter?

We cannot, of course, regard as an answer the opinion of certain half-baked Marxists who believe that under such conditions the thing to do is to refrain from taking power and to wait until capitalism has succeeded in ruining the millions of small and medium producers and converting them into farm labourers and in concentrating the means of production in agriculture, and that only after this would it be possible to consider the assumption of power by the proletariat and the socialization of all the means of production. Naturally, this is a "solution" which Marxists cannot accept if they do not want to disgrace themselves completely.

Nor can we regard as an answer the opinion of other half-baked Marxists, who think that the thing to do would be to assume power and to expropriate the small and medium rural producers and to socialize their means of production. Marxists cannot adopt this senseless and criminal course either, because it would destroy all chances of victory for the proletarian revolution, and would throw the peasantry into the camp of the enemies of the proletariat for a long time.

The answer to this question was given by Lenin in his writings on the "tax in kind" and in his celebrated "cooperative plan."

Lenin's answer may be briefly summed up as follows:

a) Favourable conditions for the assumption of power should not be missed—the proletariat should assume power without waiting until capitalism has succeeded in ruining the millions of small and medium individual producers;

b) The means of production in industry should be expropriated and converted into public property;

c) As to the small and medium individual producers, they should be gradually united in producers' cooperatives, i.e., in large agricultural enterprises, collective farms;

d) Industry should be developed to the utmost and the collective farms should be placed on the modern technical basis of large-scale production, not expropriating them, but on the contrary generously supplying them with first-class tractors and other machines;

e) In order to ensure an economic bond between town and country, between industry and agriculture, commodity production (exchange through purchase and sale) should be preserved for a certain period, it being the form of economic tie with the town which is alone acceptable to the peasants, and Soviet trade—state, cooperative, and collective-farm—should be developed to the full and the capitalists of all types and descriptions ousted from trading activity.

The history of socialist construction in our country has shown that this path of development, mapped out by Lenin, has fully justified itself.

There can be no doubt that in the case of all capitalist countries with a more or less numerous class of small and medium producers, this path of development is the only possible and expedient one for the victory of socialism.

It is said that commodity production must lead, is bound to lead, to capitalism all the same, under all conditions. That is not true. Not always and not under all conditions! Commodity production must not be identified with capitalist production. They are two different things. Capitalist production is the highest form of commodity production. Commodity production leads to capitalism only if there is private owner-ship of the means of production, if labour power appears in the market as a commodity which can be bought by the capitalist and exploited in the process of production, and if, consequently, the system of exploitation of wageworkers by capitalists exists in the country. Capitalist production begins when the means of production are concentrated in private hands, and when the workers are bereft of means of production and are compelled to sell their labour power as a commodity. Without this there is no such thing as capitalist production.

Well, and what is to be done if the conditions for the conversion of commodity production into capitalist production do not exist, if the means of production are no longer private but socialist property, if the system of wage labour no longer exists and labour power is no longer a commodity, and if the system of exploitation has long been abolished—can it be considered then that commodity production will lead to capitalism all the same? No, it cannot. Yet ours is precisely such a society, a society where private ownership of the means of production, the system of wage labour, and the system of exploitation have long ceased to exist.

Commodity production must not be regarded as something sufficient unto itself, something independent of the surrounding economic conditions. Commodity production is older than capitalist production. It existed in slave-owning society, and served it, but did not lead to capitalism. It existed in feudal society and served it, yet, although it prepared some of the conditions for capitalist production, it did not lead to capitalism. Why then, one asks, cannot commodity production similarly serve our socialist society for a certain period without leading to capitalism, bearing in mind that in our country commodity production is not so boundless and all-embracing as it is under capitalist conditions, being confined within strict bounds thanks to such decisive economic conditions as social ownership of the means of production, the abolition of the system of wage labour, and the elimination of the system of exploitation?

It is said that, since the domination of social ownership of the means of production has been established in our country, and the system of wage labour and exploitation has been abolished, commodity production has lost all meaning and should therefore be done away with.

That is also untrue. Today there are two basic forms of socialist production in our country: state, or publicly-owned production, and collective-farm production, which cannot be said to be publicly owned. In the state enterprises, the means of production and the product of production are national property. In the collective farm, although the means of production (land, machines) do belong to the state, the product of production is the property of the different collective farms, since the labour, as well as the seed, is their own, while the land, which has been turned over to the collective farms in perpetual tenure, is used by them virtually as their own property, in spite of the fact that they cannot sell, buy, lease or mortgage it.

The effect of this is that the state disposes only of the product of the state enterprises, while the product of the collective farms, being their property, is disposed of only by them. But the collective farms are unwilling to alienate their products except in the form of commodities, in exchange for which they desire to receive the commodities they need. At present the collective farms will not recognize any other economic relation with the town except the commodity relation—exchange through purchase and sale. Because of this, commodity production and trade are as much a necessity with us today as they were, say, thirty years ago, when Lenin spoke of the necessity of developing trade to the utmost.

Of course, when instead of the two basic production sectors, the state sector and the collective-farm sector, there will be only one all-embracing production sector, with the right to dispose of all the consumer goods produced in the country, commodity circulation, with its "money economy," will disappear, as being an unnecessary element in the national economy. But so long as this is not the case, so long as the two basic production sectors remain, commodity production and commodity circulation must remain in force, as a necessary and very useful element in our system of national economy. How the formation of a single and united sector will come about, whether simply by the swallowing up of the collective-farm sector by the state sector—which is hardly likely (because that would be looked upon as the expropriation of the collective farms)—or by the setting up of a single national economic body (comprising representatives of state industry and of the collective farms), with the right at first to keep account of all consumer product in the country, and eventually also to distribute it, by way, say, of products-exchange—is a special question which requires separate discussion.

Consequently, our commodity production is not of the ordinary type, but is a special kind of commodity production, commodity production without capitalists, which is concerned mainly with the goods of associated socialist producers (the state, the collective farms, the cooperatives), the sphere of action of which is confined to items of personal consumption, which obviously cannot possibly develop into capitalist production, and which, together with its "money economy," is designed to serve the development and consolidation of socialist production.

Absolutely mistaken, therefore, are those comrades who allege that, since socialist society has not abolished commodity forms of production, we are bound to have the reappear-ance of all the economic categories characteristic of capital-ism: labour power as a commodity, surplus value, capital, capitalist profit, the average rate of profit, etc. These comrades confuse commodity production with capitalist production, and believe that once there is commodity production there must also be capitalist production. They do not realize that our commodity production radically differs from commodity production under capitalism.

Further, I think that we must also discard certain other concepts taken from Marx's Capital—where Marx was concerned with an analysis of capitalism—and artificially applied to our socialist relations. I am referring to such concepts, among others, as "necessary" and "surplus" labour, "necessary" and "surplus" product, "necessary" and "surplus" time. Marx analyzed capitalism in order to elucidate the source of exploitation of the working class—surplus value—and to arm the working class, which was bereft of means of production, with an intellectual weapon for the overthrow of capitalism. It is natural that Marx used concepts (categories) which fully corresponded to capitalist relations. But it is strange, to say the least, to use these concepts now, when the working class is not only not bereft of power and means of production, but, on the contrary, is in possession of the power and controls the means of production. Talk of labour power being a commodity, and of "hiring" of workers sounds rather absurd now, under our system: as though the working class, which possesses means of production, hires itself and sells its labour power to itself. It is just as strange to speak now of "necessary" and "surplus" labour: as though, under our conditions, the labour contributed by the workers to society for the extension of production, the promotion of education and public health, the organization of defence, etc., is not just as necessary to the working class, now in power, as the labour expended to supply the personal needs of the worker and his family.

It should be remarked that in his Critique of the Gotha Program, where it is no longer capitalism that he is investigating, but, among other things, the first phase of communist society, Marx recognizes labour contributed to society for extension of production, for education and public health, for administrative expenses, for building up reserves, etc., to be just as necessary as the labour expended to supply the consumption requirements of the working class.

I think that our economists should put an end to this in-congruity between the old concepts and the new state of affairs in our socialist country, by replacing the old concepts with new ones that correspond to the new situation.

We could tolerate this incongruity for a certain period, but the time has come to put an end to it.

The Law of Value under Socialism

It is sometimes asked whether the law of value exists and operates in our country, under the socialist system.

Yes, it does exist and does operate. Wherever commodities and commodity production exist, there the law of value must also exist.

In our country, the sphere of operation of the law of value extends, first of all, to commodity circulation, to the ex-change of commodities through purchase and sale, the ex-change, chiefly, of articles of personal consumption. Here, in this sphere, the law of value preserves, within certain limits, of course, the function of a regulator.

But the operation of the law of value is not confined to the sphere of commodity circulation. It also extends to production. True, the law of value has no regulating function in our socialist production, but it nevertheless influences production, and this fact cannot be ignored when directing production. As a matter of fact, consumer goods, which arc needed to compensate the labour power expended in the process of production, are produced and realized in our country as commodities coming under the operation of the law of value. It is precisely here that the law of value exercises its influence on production. In this connection, such things as cost accounting and profitableness, production costs, prices, etc., are of actual importance in our enterprises. Consequently, our enterprises cannot, and must not, function without taking the law of value into account.

Is this a good thing? It is not a bad thing. Under present conditions, it really is not a bad thing, since it trains our business executives to conduct production on rational lines and disciplines them. It is not a bad thing because it teaches our executives to count production magnitudes, to count them accurately, and also to calculate the real things in production precisely, and not to talk nonsense about "approximate figures," spun out of thin air. It is not a bad thing because it teaches our executives to look for, find and utilize hidden reserves latent in production, and not to trample them under-foot. It is not a bad thing because it teaches our executives systematically to improve methods of production, to lower production costs, to practise cost accounting, and to make their enterprises pay. It is a good practical school which accelerates the development of our executive personnel and their growth into genuine leaders of socialist production at the present stage of development.

The trouble is not that production in our country is influenced by the law of value. The trouble is that our business executives and planners, with few exceptions, are poorly acquainted with the operations of the law of value, do not study them, and are unable to take account of them in their computations. This, in fact, explains the confusion that still reigns in the sphere of price-fixing policy. Here is one of many examples. Some time ago it was decided to adjust the prices of cotton and grain in the interest of cotton growing, to establish more accurate prices for grain sold to the cotton growers, and to raise the prices of cotton delivered to the state. Our business executives and planners submitted a proposal on this score which could not but astound the members of the Central Committee, since it suggested fixing the price of a ton of grain at practically the same level as a ton of cotton, and, moreover, the price of a ton of grain was taken as equivalent to that of a ton of baked bread. In reply to the remarks of members of the Central Committee that the price of a ton of bread must be higher than that of a ton of grain, because of the additional expense of milling and baking, and that cotton was generally much dearer than grain, as was also borne out by their prices in the world market, the authors of the proposal could find nothing coherent to say. The Central Committee was therefore obliged to take the matter into its own hands and to lower the prices of grain and raise the prices of cotton. What would have happened if the proposal of these comrades had received legal force? We should have ruined the cotton growers and would have found ourselves without cotton.

But does this mean that the operation of the law of value has as much scope with us as it has under capitalism, and that it is the regulator of production in our country too? No, it does not. Actually, the sphere of operation of the law of value under our economic system is strictly limited and placed within definite bounds. It has already been said that the sphere of operation of commodity production is restricted and placed within definite bounds by our system. The same must be said of the sphere of operation of the law of value. Undoubtedly, the fact that private ownership of the means of production does not exist, and that the means of production both in town and country are socialized, cannot but restrict the sphere of operation of the law of value and the extent of its influence on production.

In this same direction operates the law of balanced (proportionate) development of the national economy, which has superseded the law of competition and anarchy of production.

In this same direction, too, operate our yearly and five-yearly plans and our economic policy generally, which are based on the requirements of the law of balanced development of the national economy.

The effect of all this, taken together, is that the sphere of operation of the law of value in our country is strictly limited, and that the law of value cannot under our system function as the regulator of production.

This, indeed, explains the "striking" fact that whereas in our country the law of value, in spite of the steady and rapid expansion of our socialist production, does not lead to crises of overproduction, in the capitalist countries this same law, whose sphere of operation is very wide under capitalism, does lead, in spite of the low rate of expansion of production, to periodical crises of overproduction.

It is said that the law of value is a permanent law, binding upon all periods of historical development, and that if it does lose its function as a regulator of exchange relations in the second phase of communist society, it retains at this phase of development its function as a regulator of the relations between the various branches of production, as a regulator of the distribution of labour among them.

That is quite untrue. Value, like the law of value, is a historical category connected with the existence of commodity production. With the disappearance of commodity production, value and its forms and the law of value also disappear.

In the second phase of communist society, the amount of labour expended on the production of goods will be measured not in a roundabout way, not through value and its forms, as is the case under commodity production, but directly and immediately—by the amount of time, the number of hours, expended on the production of goods. As to the distribution of labour, its distribution among the branches of production will be regulated not by the law of value, which will have ceased to function by that time, but by the growth of society's demand for goods. It will be a society in which production will be regulated by the requirements of society, and computation of the requirements of society will acquire paramount importance for the planning bodies.

Totally incorrect, too, is the assertion that under our present economic system, in the first phase of development of communist society, the law of value regulates the "proportions" of labour distributed among the various branches of production.

If this were true, it would be incomprehensible why our light industries, which are the most profitable, are not being developed to the utmost, and why preference is given to our heavy industries, which are often less profitable, and some-times altogether unprofitable.

If this were true, it would be incomprehensible why a number of our heavy industry plants which arc still unprofitable and where the labour of the worker does not yield the "proper returns," are not closed down, and why new light industry plants, which would certainly be profitable and where the labour of the workers might yield "big returns," are not opened.

If this were true, it would be incomprehensible why workers are not transferred from plants that are less profitable, but very necessary to our national economy, to plants which are more profitable—in accordance with the law of value, which supposedly regulates the "proportions" of labour distributed among the branches of production.

Obviously, if we were to follow the lead of these comrades, we should have to cease giving primacy to the production of means of production in favour of the production of articles of consumption. And what would be the effect of ceasing to give primacy to the production of the means of production? The effect would be to destroy the possibility of the continuous expansion of our national economy, because the national economy cannot be continuously expanded with-out giving primacy to the production of means of production.

These comrades forget that the law of value can be a regulator of production only under capitalism, with private ownership of the means of production, and competition, anarchy of production, and crises of overproduction. They forget that in our country the sphere of operation of the law of value is limited by the social ownership of the means of production, and by the law of balanced development of the national economy, and is consequently also limited by our yearly and five-yearly plans, which are an approximate reflection of the requirements of this law.

Some comrades draw the conclusion from this that the law of balanced development of the national economy and economic planning annul the principle of profitableness of production. That is quite untrue. It is just the other way round. If profitableness is considered not from the stand-point of individual plants or industries, and not over a period of one year, but from the standpoint of the entire national economy and over a period of, say, ten or fifteen years, which is the only correct approach to the question, then the temporary and unstable profitableness of some plants or industries is beneath all comparison with that higher form of stable and permanent profitableness which we get from the operation of the law of balanced development of the national economy and from economic planning, which save us from periodical economic crises disruptive to the national economy and causing tremendous material damage to society, and which ensure a continuous and high rate of expansion of our national economy.

In brief, there can be no doubt that under our present socialist conditions of production, the law of value cannot be a "regulator of the proportions" of labour distributed among the various branches of production.

Abolition of the Antithesis between Town and Country, and between Mental and Physical Labour, and Elimination of Distinctions between Them

This heading covers a number of problems which essentially differ from one another. I combine them in one section, not in order to lump them together, but solely for brevity of exposition.

Abolition of the antithesis between town and country, between industry and agriculture, is a well-known problem which was discussed long ago by Marx and Engels. The economic basis of this antithesis is the exploitation of the country by the town, the expropriation of the peasantry and the ruin of the majority of the rural population by the whole course of development of industry, trade and credit under capitalism. Hence, the antithesis between town and country under capitalism must be regarded as an antagonism of interests. This it was that gave rise to the hostile attitude of the country towards the town and towards "townfolk" in general.

Undoubtedly, with the abolition of capitalism and the exploiting system in our country, and with the consolidation of the socialist system, the antagonism of interests between town and country, between industry and agriculture, was also bound to disappear. And that is what happened. The immense assistance rendered by the socialist town, by our working class, to our peasantry in eliminating the landlords and kulaks strengthened the foundation for the alliance between the working class and the peasantry, while the systematic supply of first-class tractors and other machines to the peasantry and its collective farms converted the alliance between the working class and the peasantry into friendship between them. Of course, the workers and the collective-farm peasantry do represent two classes differing from one another in status. But this difference does not weaken their friendship in any way. On the contrary, their interests lie along one common line, that of strengthening the socialist system and attaining the victory of communism. It is not surprising, therefore, that not a trace remains of the former distrust, not to speak of the former hatred, of the country for the town.

All this means that the ground for the antithesis between town and country, between industry and agriculture, has already been eliminated by our present socialist system.

This, of course, does not mean that the effect of the abolition of the antithesis between town and country will be that "the great towns will perish." Not only will the great towns not perish, but new great towns will appear as centres of the maximum development of culture, and as centres not only of large-scale industry, but also of the processing of agricultural produce and of powerful development of all branches of the food industry. This will facilitate the cultural progress of the nation and will tend to even up conditions of life in town and country.

We have a similar situation as regards the problem of the abolition of the antithesis between mental and physical labour. This too is a well-known problem which was discussed by Marx and Engels long ago. The economic basis of the antithesis between mental and physical labour is the exploitation of the physical workers by the mental workers. Everyone is familiar with the gulf which under capitalism divided the physical workers of enterprises from the managerial personnel. We know that this gulf gave rise to a hostile attitude on the part of the workers towards managers, foremen, engineers and other members of the technical staff, whom the workers regarded as their enemies. Naturally, with the abolition of capitalism and the exploiting system, the antagonism of interests between physical and mental labour was also bound to disappear. And it really has disappeared in our present socialist system. Today, the physical workers and the managerial personnel are not enemies, but comrades and friends, members of a single collective body of producers who are vitally interested in the progress and improvement of production. Not a trace remains of the former enmity between them.

Of quite a different character is the problem of the disappearance of distinctions between town (industry) and country (agriculture), and between physical and mental labour. This problem was not discussed in the Marxist classics. It is a new problem, one that has been raised practically by our socialist construction.

Is this problem an imaginary one? Has it any practical or theoretical importance for us? No, this problem cannot be considered an imaginary one. On the contrary, it is for us a problem of the greatest seriousness.

Take, for instance, the distinction between agriculture and industry. In our country it consists not only in the fact that the conditions of labour in agriculture differ from those in industry, but, mainly and chiefly, in the fact that whereas in industry we have public ownership of the means of production and of the product of industry, in agriculture we have not public, but group, collective-farm ownership. It has already been said that this fact leads to the preservation of commodity circulation, and that only when this distinction between industry and agriculture disappears, can commodity production with all its attendant consequences also disappear. It therefore cannot be denied that the disappearance of this essential distinction between agriculture and industry must be a matter of paramount importance for us.

The same must be said of the problem of the abolition of the essential distinction between mental labour and physical labour. It, too, is a problem of paramount importance for us. Before the socialist emulation movement assumed mass proportions, the growth of our industry proceeded very haltingly, and many comrades even suggested that the rate of industrial development should be retarded. This was due chiefly to the fact that the cultural and technical level of the workers was too low and lagged far behind that of the technical personnel. But the situation changed radically when the socialist emulation movement assumed a mass character. It was from that moment on that industry began to advance at accelerated speed. Why did socialist emulation assume the character of a mass movement? Because among the workers whole groups of comrades came to the fore who had not only mastered the minimum requirements of technical knowledge, but had gone further and risen to the level of the technical personnel; they began to correct technicians and engineers, to break down the existing norms as antiquated, to introduce new and more up-to-date norms, and so on. What should we have had if not only isolated groups, but the majority of the workers had raised their cultural and technical level to that of the engineering and technical personnel? Our industry would have risen to a height unattainable by industry in other countries. It therefore cannot be denied that the abolition of the essential distinction between mental and physical labour by raising the cultural and technical level of the workers to that of the technical personnel cannot but be of paramount importance for us.

Some comrades assert that in the course of time not only will the essential distinction between industry and agriculture, and between physical and mental labour, disappear, but so will all distinction between them. That is not true. Abolition of the essential distinction between industry and agriculture cannot lead to the abolition of all distinction between them. Some distinction, even if inessential, will certainly remain, owing to the difference between the conditions of work in industry and in agriculture. Even in industry the conditions of labour are not the same in all its branches: the conditions of labour, for example, of coal miners differ from those of the workers of a mechanized shoe factory, and the conditions of labour of ore miners from those of engineering workers. If that is so, then all the more must a certain distinction remain between industry and agriculture.

The same must be said of the distinction between mental and physical labour. The essential distinction between them, the difference in their cultural and technical levels, will certainly disappear. But some distinction, even if inessential, will remain, if only because the conditions of labour of the managerial staffs and those of the workers are not identical.

The comrades who assert the contrary do so presumably on the basis of the formulation given in some of my statements, which speaks of the abolition of the distinction between industry and agriculture, and between mental and physical labour, without any reservation to the effect that what is meant is the abolition of the essential distinction, not of all distinction. That is exactly how the comrades understood my formulation, assuming that it implied the abolition of all distinction. But this indicates that the formulation was unprecise, unsatisfactory. It must be discarded and replaced by another formulation, one that speaks of the abolition of essential distinctions and the persistence of inessential distinctions between industry and agriculture, and between mental and physical labour.

Disintegration of the Single World Market and Deepening of the Crisis of the World Capitalist System

The disintegration of the single, all-embracing world market must be regarded as the most important economic sequel of the Second World War and of its economic consequences. It has had the effect of further deepening the general crisis of the world capitalist system.

The Second World War was itself a product of this crisis. Each of the two capitalist coalitions which locked horns in the war calculated on defeating its adversary and gaining world supremacy. It was in this that they sought a way out of the crisis. The United States of America hoped to put its most dangerous competitors, Germany and Japan, out of action, seize foreign markets and the world's raw material resources, and establish its world supremacy.

But the war did not justify these hopes. It is true that Germany and Japan were put out of action as competitors of the three major capitalist countries: the U.S.A., Great Britain and France. But at the same time China and other, European, people's democracies broke away from the capitalist system and, together with the Soviet Union, formed a united and powerful socialist camp confronting the camp of capitalism, The economic consequence of the existence of two opposite camps was that the single all-embracing world market disintegrated, so that now we have two parallel world markets, also confronting one another.

It should be observed that the USA, and Great Britain and France, themselves contributed—without themselves desiring it, of course—to the formation and consolidation of the new, parallel world market. They imposed an economic blockade on the U.S.S.R., China and the European people's democracies, which did not join the "Marshall plan" system, thinking thereby to strangle them. The effect, how-ever, was not to strangle, but to strengthen the new world market.

But the fundamental thing, of course, is not the economic blockade, but the fact that since the war these countries have joined together economically and established economic cooperation and mutual assistance. The experience of this cooperation shows that not a single capitalist country could have rendered such effective and technically competent assistance to the people's democracies as the Soviet Union is rendering them. The point is not only that this assistance is the cheapest possible and technically superb. The chief point is that at the bottom of this cooperation lies a sincere desire to help one another and to promote the economic progress of all. The result is a fast pace of industrial development in these countries. It may be confidently said that, with this pace of industrial development, it will soon come to pass that these countries will not only be in no need of imports from capitalist countries, but will themselves feel the necessity of finding an outside market for their surplus products.

But it follows from this that the sphere of exploitation of the world's resources by the major capitalist countries (U.S.A., Britain, France) will not expand, but contract; that their opportunities for sale in the world market will deteriorate, and that their industries will be operating more and more below capacity. That, in fact, is what is meant by the deepening of the general crisis of the world capitalist system in connection with the disintegration of the world market.

This is felt by the capitalists themselves, for it would be difficult for them not to feel the loss of such markets as the U.S.S.R. and China. They are trying to offset these difficulties with the "Marshall plan," the war in Korea, frantic rearmament, and industrial militarization. But that is very much like a drowning human clutching at a straw.

This state of affairs has confronted the economists with two questions:

a) Can it be affirmed that the thesis expounded by Stalin before the Second World War regarding the relative stability of markets in the period of the general crisis of capitalism is still valid?

b) Can it be affirmed that the thesis expounded by Lenin in the spring of 1916—namely, that, in spite of the decay of capitalism, "on the whole, capitalism is growing far more rapidly than before"—is still valid?

I think that it cannot. In view of the new conditions to which the Second World War has given rise, both these theses must be regarded as having lost their validity.

Inevitability of Wars between Capitalist Countries

Some comrades hold that, owing to the development of new international conditions since the Second World War, wars between capitalist countries have ceased to be inevitable. They consider that the contradictions between the socialist camp and the capitalist camp are more acute than the contradictions among the capitalist countries; that the U.S.A. has brought the other capitalist countries sufficiently under its sway to be able to prevent them going to war among themselves and weakening one another; that the fore-most capitalist minds have been sufficiently taught by the two world wars and the severe damage they caused to the whole capitalist world not to venture to involve the capitalist countries in war with one another again—and that, because of all this, wars between capitalist countries are no longer inevitable.

These comrades are mistaken. They see the outward phenomena that come and go on the surface, but they do not see those profound forces which, although they are so far operating imperceptibly, will nevertheless determine the course of developments.

Outwardly, everything would seem to be "going well": the U.S.A. has put Western Europe, Japan and other capitalist countries on rations; Germany (Western), Britain, France, Italy and Japan have fallen into the clutches of the U.S.A. and are meekly obeying its commands. But it would be mistaken to think that things can continue to "go well" for "all eternity," that these countries will tolerate the domination and oppression of the United States endlessly, that they will not endeavour to tear loose from American bondage and take the path of independent development.

Take, first of all, Britain and France. Undoubtedly, they are imperialist countries. Undoubtedly, cheap raw materials and secure markets are of paramount importance to them. Can it be assumed that they will endlessly tolerate the present situation, in which, under the guise of "Marshall plan aid," Americans are penetrating into the economies of Britain and France and trying to convert them into adjuncts of the economy, and American capital is seizing rawmaterials in the British and French colonies nd and thereby plotting disaster for the high profits of the British and French capitalists? Would it not be truer to say that capitalist Britain, and, after her, capitalist France, will be compelled in the end to break from the embrace of the U.S.A. and enter into conflict with it in order to secure an independent position and, of course, high profits?

Let us pass to the major vanquished countries, Germany (Western) and Japan. These countries are now languishing in misery under the jackboot of American imperialism. Their industry and agriculture, their trade, their foreign and home policies, and their whole life are fettered by the American occupation "regime." Yet only yesterday these countries were great imperialist powers and were shaking the foundations of the domination of Britain, the U.S.A. and France in Europe and Asia. To think that these countries will not try to get on their feet again, will not try to smash the U.S. "regime," and force their way to independent development, is to believe in miracles.

It is said that the contradictions between capitalism and socialism are stronger than the contradictions among the capitalist countries. Theoretically, of course, that is true. It is not only true now, today; it was true before the Second World War. And it was more or less realized by the leaders of the capitalist countries. Yet the Second World War began not as a war with the U.S.S.R., but as a war between capitalist countries. Why? Firstly, because war with the U.S.S.R., as a socialist land, is more dangerous to capitalism than war between capitalist countries; for whereas war between capitalist countries puts in question only the supremacy of certain capitalist countries over others, war with the U.S.S.R. must certainly put in question the existence of capitalism itself. Secondly, because the capitalists, although they clamour, for "propaganda" purposes, about the aggressiveness of the Soviet Union, do not themselves believe that it is aggressive, because they are aware of the Soviet Union's peaceful policy and know that it will not itself attack capitalist countries.

After the First World War it was similarly believed that Germany had been definitely put out of action, just as certain comrades now believe that Japan and Germany have been definitely put out of action. Then, too, it was said and clamoured in the press that the United States had put Europe on rations; that Germany would never rise to her feet again, and that there would be no more wars between capitalist countries. In spite of this, Germany rose to her feet again as a great power within the space of some fifteen or twenty years after her defeat, having broken out of bondage and taken the path of independent development. And it is significant that it was none other than Britain and the United States that helped Germany to recover economically and to enhance her economic war potential. Of course, when the United States and Britain assisted Germany's economic recovery, they did so with a view to setting a recovered Germany against the Soviet Union, to utilizing her against the land of socialism. But Germany directed her forces in the first place against the Anglo-French-American bloc. And when Hitler Germany declared war on the Soviet Union, the Anglo-French-American bloc, far from joining with Hitler Germany, was compelled to enter into a coalition with the U.S.S.R. against Hitler Germany.

Consequently, the struggle of the capitalist countries for markets and their desire to crush their competitors proved in practice to be stronger than the contradictions between the capitalist camp and the socialist camp.

What guarantee is there, then, that Germany and Japan will not rise to their feet again, will not attempt to break out of American bondage and live their own independent lives? I think there is no such guarantee.

But it follows from this that the inevitability of wars between capitalist countries remains in force.

It is said that Lenin's thesis that imperialism inevitably generates war must now be regarded as obsolete, since powerful popular forces have come forward today in defence of peace and against another world war. That is not true.

The object of the present-day peace movement is to rouse the masses of the people to fight for the preservation of peace and for the prevention of another world war. Consequently, the aim of this movement is not to overthrow capitalism and establish socialism—it confines itself to the democratic aim of preserving peace. In this respect, the present-day peace movement differs from the movement of the time of the First World War for the conversion of the imperialist war into civil war, since the latter movement went farther and pursued socialist aims.

It is possible that in a definite conjuncture of circumstances the fight for peace will develop here or there into a fight for socialism. But then it will no longer be the present-day peace movement; it will be a movement for the overthrow of capitalism.

What is most likely is that the present-day peace movement, as a movement for the preservation of peace, will, if it succeeds, result in preventing a particular war, in its temporary postponement, in the temporary preservation of a particular peace, in the resignation of a bellicose government and its supersession by another that is prepared temporarily to keep the peace. That, of course, will be good. Even very good. But, all the same, it will not be enough to eliminate the inevitability of wars between capitalist countries generally. It will not be enough, because, for all the successes of the peace movement, imperialism will remain, continue in force—and, consequently, the inevitability of wars will also continue in force.

To eliminate the inevitability of war, it is necessary to abolish imperialism.

The Basic Economic Laws of Modern Capitalism and of Socialism

As you know, the question of the basic economic laws of capitalism and of socialism arose several times in the course of the discussion. Various views were expressed on this score, even the most fantastic. True, the majority of the participants in the discussion reacted feebly to the matter, and no decision on the point was indicated. However, none of the participants denied that such laws exist.

Is there a basic economic law of capitalism? Yes, there is. What is this law, and what are its characteristic features? The basic economic law of capitalism is such a law as determines not some particular aspect or particular processes of the development of capitalist production, but all the principal aspects and all the principal processes of its development—one, consequently, which determines the essence of capitalist production, its essential nature.

Is the law of value the basic economic law of capitalism? No. The law of value is primarily a law of commodity production. It existed before capitalism, and, like commodity production, will continue to exist after the overthrow of capitalism, as it does, for instance, in our country, although, it is true, with a restricted sphere of operation. Having a wide sphere of operation in capitalist conditions, the law of value, of course, plays a big part in the development of capitalist production. But not only does it not determine the essence of capitalist production and the principles of capitalist profit; it does not even pose these problems. Therefore, it cannot be the basic economic law of modern capitalism.

For the same reasons, the law of competition and anarchy of production, or the law of uneven development of capital-ism in the various countries cannot be the basic economic law of capitalism either.

It is said that the law of the average rate of profit is the basic economic law of modern capitalism. That is not true. Modern capitalism, monopoly capitalism, cannot content it-self with the average profit, which moreover has a tendency to decline, in view of the increasing organic composition of capital. It is not the average profit, but the maximum profit that modern monopoly capitalism demands, which it needs for more or less regular extended reproduction.

Most appropriate to the concept of a basic economic law of capitalism is the law of surplus value, the law of the origin and growth of capitalist profit. It really does determine the basic features of capitalist production. But the law of surplus value is too general a law; it does not cover the problem of the highest rate of profit, the securing of which is a condition for the development of monopoly capitalism. In order to fill this hiatus, the law of surplus value must be made more concrete and developed further in adaptation to the conditions of monopoly capitalism, at the same time bearing in mind that monopoly capitalism demands not any sort of profit, but precisely the maximum profit. That will be the basic economic law of modern capitalism.

The main features and requirements of the basic economic law of modern capitalism might be formulated roughly, in this way: the securing of the maximum capitalist profit through the exploitation, ruin and impoverishment of the majority of the population of the given country, through the enslavement and systematic robbery of the peoples of other countries, especially backward countries, and, lastly, through wars and militarization of the national economy, which are utilized for the obtaining of the highest profits.

It is said that the average profit might nevertheless be regarded as quite sufficient for capitalist development under modern conditions. That is not true. The average profit is the lowest point of profitableness, below which capitalist production becomes impossible. But it would be absurd to think that, in seizing colonies, subjugating peoples and engineering wars, the magnates of modern monopoly capital-ism are striving to secure only the average profit. No, it is not the average profit, nor yet super-profit—which, as a rule, represents only a slight addition to the average profit—but precisely the maximum profit that is the motor of monopoly capitalism. It is precisely the necessity of securing the maximum profits that drives monopoly capital-ism to such risky undertakings as the enslavement and systematic plunder of colonies and other backward countries, the conversion of a number of independent countries into dependent countries, the organization of new wars—which to the magnates of modern capitalism is the "business" best adapted to the extraction of the maximum profit—and, lastly, attempts to win world economic supremacy.

The importance of the basic economic law of capitalism consists, among other things, in the circumstance that, since it determines all the major phenomena in the development of the capitalist mode of production, its booms and crises, its victories and defeats, its merits and demerits—the whole process of its contradictory development—it enables us to understand and explain them.

Here is one of many "striking" examples.

We are all acquainted with facts from the history and practice of capitalism illustrative of the rapid development of technology under capitalism, when the capitalists appear as the standard-bearers of the most advanced techniques, as revolutionaries in the development of the technique of production. But we are also familiar with facts of a different kind, illustrative of a halt in technical development under capitalism, when the capitalists appear as reactionaries in the development of new techniques and not infrequently resort to hand labour.

How is this howling contradiction to be explained? It can only be explained by the basic economic law of modern capitalism, that is, by the necessity of obtaining the maximum profit. Capitalism is in favour of new techniques when they promise it the highest profit. Capitalism is against new techniques, and for resort to hand labour, when the new techniques do not promise the highest profit.

That is how matters stand with the basic economic law of modern capitalism.

Is there a basic economic law of socialism? Yes, there is. What are the essential features and requirements of this law? The essential features and requirements of the basic law of socialism might be formulated roughly in this way: the securing of the maximum satisfaction of the constantly rising material and cultural requirements of the whole of society through the continuous expansion and perfection of socialist production on the basis of higher techniques.

Consequently: instead of maximum profits—maximum satisfaction of the material and cultural requirements of society; instead of development of production with breaks in continuity from boom to crisis and from crisis to boom—unbroken expansion of production; instead of periodic breaks in technical development, accompanied by destruction of the productive forces of society—an unbroken process of perfecting production on the basis of higher techniques.

It is said that the law of the balanced, proportionate development of the national economy is the basic economic law of socialism. That is not true. Balanced development of the national economy, and, hence, economic planning, which is a more or less faithful reflection of this law, can yield nothing by themselves, if it is not known for what purpose economic development is planned, or if that purpose is not clear. The law of balanced development of the national economy can yield the desired result only if there is a purpose for the sake of which economic development is planned. This purpose the law of balanced development of the national economy cannot itself provide. Still less can economic planning provide it. This purpose is inherent in the basic economic law of socialism, in the shape of its requirements, as expounded above. Consequently, the law of balanced development of the national economy can operate to its full scope only if its operation rests on the basic economic law of socialism.

As to economic planning, it can achieve positive results only if two conditions are observed : a) it correct y reflects e requirements of the law of balanced development of the national economy, and b) if it conforms in every way to the requirements of the basic economic law of socialism.

Other Questions

1) Extra-economic coercion under feudalism.

Of course, extra-economic coercion did play a part in strengthening the economic power of the feudal landlords; however, not it, but feudal ownership of the land was the basis of feudalism.

2) Personal property of the collective-farm household.

It would be wrong to say, as the draft textbook does, that "every household in a collective farm has in personal use a cow, small livestock and poultry." Actually, as we know, it is not in personal use, but as personal property that the collective-farm household has its cow, small livestock, poultry, etc. The expression "in personal use" has evidently been taken from the Model Rules of the Agricultural Artel. But a mistake was made in the Model Rules of the Agricultural Artel. The Constitution of the U.S.S.R., which was drafted more carefully, puts it differently, viz.:

"Every household in a collective farm . . . has as its personal property a subsidiary husbandry on the plot, a dwelling house, livestock, poultry and minor agricultural implements."

That, of course, is correct.

It would be well, in addition, to state more particularly that every collective farmer has as his personal property from one to so many cows, depending on local conditions, so many sheep, goats, pigs (the number also depending on local conditions), and an unlimited quantity of poultry (ducks, geese, hens, turkeys).

Such detailed particulars are of great importance for our comrades abroad, who want to know what exactly has remained as the personal property of the collective-farm household now that agriculture in our country has been collectivized.

3) Total rent paid by the peasants to the landlords; also total expenditure on the purchase of land.

The draft textbook says that as a result of the nationalization of the land, "the peasantry were released from paying rent to the landlords to a total of about 500 million rubles annually" (it should be "gold" rubles). This figure should be verified, because it seems to me that it does not include the rent paid over the whole of Russia, but only in a majority of the Russian gubernias. It should also be borne in mind that in some of the border regions of Russia rent was paid in kind, a fact which the authors of the draft text-book have evidently overlooked. Furthermore, it should be remembered that the peasants were released not only from the payment of rent, but also from annual expenditure for the purchase of land. Was this taken into account in the draft textbook? It seems to me that it was not; but it should have been.

4) Coalescence of the monopolies with the state machine.

The word "coalescence" is not appropriate. It superficially and descriptively notes the process of merging of the monopolies with the state, but it does not reveal the economic import of this process. The fact of the matter is that the merging process is not simply a process of coalescence, but the subjugation of the state machine to the monopolies. The word "coalescence" should therefore be discarded and replaced by the words "subjugation of the state machine to the monopolies."

5) Use of machines in the U.S.S.R.

The draft textbook says that "in the U.S.S.R. machines are used in all cases when they economize the labour of society." That is by no means what should be said. In the first place, machines in the U.S.S.R. always economize the labour of society, and we accordingly do not know of any cases in the U.S.S.R. where they have not economized the labour of society. In the second place, machines not only economize labour; they also lighten the labour of the worker, and accordingly, in our conditions, in contradistinction to the conditions of capitalism, the workers use machines in the processes of labour with the greatest eagerness.

It should therefore be said that nowhere are machines used so willingly as in the U.S.S.R., because they economize the labour of society and lighten the labour of the worker, and, as there is no unemployment in the U.S.S.R., the workers use machines in the national economy with the greatest eagerness.

6) Living standards of the working class in capitalist countries.

Usually, when speaking of the living standards of the working class, what is meant is only the standards of employed workers, and not of what is known as the reserve army of unemployed. Is such an attitude to the question of the living standards of the working class correct? I think it is not. If there is a reserve army of unemployed, whose members cannot live except by the sale of their labour power, then the unemployed must necessarily form part of the working class; and if they do form part of the working class, then their destitute condition cannot but influence the living standards of the workers engaged in production. I therefore think that when describing the living standards of the working class in capitalist countries, the condition of the reserve army of unemployed workers should also be taken into account.

7) National income. I think it absolutely necessary to add a chapter on national income to the draft textbook.

8) Should there be a special chapter in the textbook on Lenin and Stalin as the founders of the political economy of socialism?

I think that the chapter, "The Marxist Theory of Socialism. Founding of the Political Economy of Socialism by V. I. Lenin and J. V. Stalin," should be excluded from the textbook. It is entirely unnecessary, since it adds nothing, and only colourlessly reiterates what has already been said in greater detail in earlier chapters of the textbook.

As regards the other questions, I have no remarks to make on the "Proposals" of Comrades Ostrovityanov, Leontyev, Shepilov, Gatovsky, etc.

International Importance of a Marxist Textbook on Political Economy

I think that the comrades do not appreciate the importance of a Marxist textbook on political economy as fully as they should. It is needed not only by our Soviet youth. It is particularly needed by Communists and communist sympathizers in all countries. Our comrades abroad want to know how we broke out of capitalist slavery; how we rebuilt the economy of our country on socialist lines; how we secured the friendship of the peasantry; how we managed to convert a country which was only so recently poverty-stricken and weak into a rich and mighty country; what are the collective farms; why, although the means of production are socialized, we do not abolish commodity production, money, trade, etc. They want to know all this, and much else, not out of mere curiosity, but in order to learn from us and to utilize our experience in their own countries. Consequently, the appearance of a good Marxist textbook on political economy is not only of political importance at home, but also of great international importance.

What is needed, therefore, is a textbook which might serve as a reference book for the revolutionary youth not only at home, but also abroad. It must not be too bulky, because an over-bulky textbook cannot be a reference book and is difficult to assimilate, to master. But it must contain everything fundamental relating both to the economy of our country and to the economy of capitalism and the colonial system.

During the discussion, some comrades proposed the inclusion in the textbook of a number of additional chapters: the historians—on history, the political scientists—on politics, the philosophers—on philosophy, the economists—on economics. But the effect of this would be to swell the text-book to unwieldy dimensions. That, of course, must not be done. The textbook employs the historical method to illustrate problems of political economy, but that does not mean that we must turn a textbook on political economy into a history of economic relations.

What we need is a textbook of 500 pages, 600 at most, no more. This would be a reference book on Marxist political economy—and an excellent gift to the young Communists of all countries.

Incidentally, in view of the inadequate level of Marxist development of the majority of the Communist Parties abroad, such a textbook might also be of great use to communist cadres abroad who are no longer young.

Ways of Improving the Draft Textbook on Political Economy

During the discussion some comrades "ran down" the draft textbook much too assiduously, berated its authors for errors and oversights, and claimed that the draft was a failure. That is unfair. Of course, there are errors and oversights in the textbook—they are to be found in practically every big undertaking. Be that as it may, the overwhelming majority of the participants in the discussion were nevertheless of the opinion that the draft might serve as a basis for the future textbook and only needed certain corrections and additions. Indeed, one has only to compare the draft with the textbooks on political economy already in circulation to see that the draft stands head and shoulders above them. For that the authors of the draft deserve great credit.

I think that in order to improve the draft textbook, it would be well to appoint a small committee which would include not only the authors of the textbook, and not only supporters, but also opponents of the majority of the participants in the discussion, out-and-out critics of the draft textbook.

It would also be well to include in the committee a competent statistician to verify the figures and to supply additional statistical material for the draft, as well as a competent jurist to verify the accuracy of the formulations.

The members of the committee should be temporarily relieved of all other work and should be well provided for, so that they might devote themselves entirely to the textbook.

Furthermore, it would be well to appoint an editorial committee, of say three persons, to take care of the final editing of the textbook. This is necessary also in order to achieve unity of style, which, unfortunately, the draft text-book lacks.

Time limit for presentation of the finished textbook to the Central Committee—one year.