by Philip Vander Elst
Despite the central role played by State controlled central banks and financial institutions in bringing about the conditions which led to the global credit crunch of 2008, free markets and capitalism, rather than government failure, have taken all the blame for that complex crisis, and Marxism and other varieties of socialism are once again attracting the enthusiastic support of many young people in our universities and colleges.
Unfortunately, however well-intentioned, this renewed interest in hard-core socialism, and the belief that it offers relevant solutions to our existing problems, ignores the lessons taught by the many failed socialist experiments of the 20th century, some of which are described by two American economists: Kevin D. Williamson, in his recent paperback, The Politically Incorrect Guide to Socialism, and Thomas J. D. Lorenzo, in his equally informative and well-documented new study, The Problem with Socialism.
What, in this context, but on a narrower front, I wish to do in this article, is to draw the attention of open-minded Left-wing readers to the significant but little known and highly relevant fact that for decades, Western capitalist technology sustained the failed economic experiment of Soviet Communism, rescuing it from the full consequences of its inherent systemic weaknesses, until its final collapse in 1991.
This failure of the Marxist model in post-1917 revolutionary Russia, and its subsequent parasitical dependence on Western capitalism, was set out in detail in my paper, Capitalist Technology for Soviet Survival, published in 1981 by the Institute of Economic Affairs. All I have room for here, a generation later, is to provide a brief summary of some of the relevant arguments and evidence presented in that paper. That this should be necessary nearly 30 years after the fall of the Berlin Wall, was recently underlined by the views expressed by Fiona Lali, president of the Marxist Society at London University’s School of Oriental and African Studies (SOAS), during a recent interview on Radio 4’s Today programme.
Asked about the failure of Soviet Communism, following her previous comment that capitalism had outlived its usefulness, “she claimed that it had ‘never had the chance to develop’ because of interference from the West.” Not surprisingly, the British historian Dominic Sandbrook, from whose article in the Daily Mail this quotation is taken, commented: “My real thoughts about Ms Lali’s version of history are not fit for publication,” and one can easily understand his incredulity.
To begin with, the widespread belief on the Left that Soviet Communism took over an oppressive society and a backward rural economy that it subsequently and heroically transformed into an advanced and powerful industrial state, improving workers’ rights and the living standards of the mass of the population in the process, is the very opposite of the truth.
Whilst pre-revolutionary Russia was backward compared to Britain, Germany and the United States, her economy was developing rapidly and her society was undergoing significant liberalisation in the last decades of Tsarist rule. During 18 of the last 25 years before the outbreak of the First World War in 1914, Tsarist Russia enjoyed the highest rate of industrial growth in the world, and by 1913 was overtaking France as the world’s fourth industrial power. As for the progress of liberalisation, here below is a summary of what had been achieved that will startle many readers, coming as it does from the pen of a great Russian historian and political scientist of Hungarian origin, the late Professor Tibor Szamuely, a former Red Army veteran imprisoned by Stalin, and a former Vice-Rector of Budapest University and Lecturer in Politics at Reading University until his untimely death in 1971.
To quote from his pamphlet, Communism and Freedom, published by the Conservative Political Centre in September 1969: “Few people in the West realise to what extent before the Revolution, in the early years of the 20th century, Tsarist Russia had full freedom of the press – no censorship: even Bolshevik papers and books were freely printed – full freedom of foreign travel, independent trade unions, independent courts, trial by jury, a fairly advanced system of social legislation, etc. Tsarist Russia had a parliament, a Duma, with MPs elected from various parties, including the Bolsheviks. This was not a full parliament in the English sense of the word (the executive was not responsible to parliament), but today, on the whole, pre-revolutionary Russia would be regarded as a model democracy, and compared to most of the hundred and twenty-odd countries inhabiting the United Nations Organisation, one of the fifteen or twenty most liberal states in the world.”
After decades of Communist rule, by contrast, with its concentration of all power, ownership, and resources in the hands of the omnipotent Marxist State, tens of millions of people had died in internal repression under Lenin and his successors, the seeds of liberty and democracy had been totally stamped out, trade unions had become the passive and subservient organs of the Communist Party, corruption had become universal, and the mass of the population had been reduced to a condition of penury, misery, and serfdom.
Here are just a few key facts about the material conditions of life under Soviet Communism.
According to such scholars as Professor Sergei Propokovich, Dr Naum Jasny, and Mrs Janet Chapman, for instance, the real wages of Soviet industrial workers in 1970 were hardly higher than in 1913. Similarly, the Swiss economist, Jovan Pavlevski, calculated in 1969 that the real wages of Soviet industrial workers attained the level of 1913 only in 1963. Pavlevski also found that the real incomes of Soviet agricultural workers in 1969 were only 1.2 per cent higher than in 1913. In addition, let it be remembered, unlike the pampered Communist elite, with their posh apartments, countryside villas, and privileged access to imported luxury goods, Soviet citizens had to endure the daily misery of constant shortages of the most basic necessities, like washing powder, razor blades, meat and vegetables, and many other items we take for granted in the West.
This picture of the generally low living standards suffered under Soviet Communism between 1917 and 1991 darkens further when one includes the evidence of the widespread poverty that existed among old people and the inhabitants of some of the most backward former Soviet republics. Thus according to Ilja Zemstov, a former professor of sociology at the Lenin Institute of Baku (Azerbaidjan), writing in 1976, one in two retired persons in the Soviet Union lived in poverty, and in the Soviet republic of Azerbaidjan, 75 per cent of the population lived below the poverty line and there were more homes without water, electricity and toilets than in the whole of Western Europe. Other scholars, also writing in the 1970s, calculated that about half of all housing in the Soviet Union was without running water or sewerage, and living space per person was only about half that available in Western Europe.
But perhaps the most telling single fact revealing the economic bankruptcy of Soviet Communism, was the spectacular failure of its inefficient and unproductive collectivised agricultural sector. Despite only representing about 3 per cent of the total agricultural area of the Soviet Union, the tiny private holdings cultivated in their spare time by Soviet collective farmers provided one-third of the country’s total agricultural output.
Far from Soviet Communism never having “had the chance to develop” because of interference from the West, as Fiona Lali believes, the endemic economic failure and oppressive character of the Soviet Union flowed inevitably from its Marxist model of economic and social development. A society in which the State owns and controls every sector of the economy, and is the sole landlord, employer, doctor, educator, and welfare provider, cannot fail to be destructive of freedom, personal incentives, creativity, and entrepreneurship, whilst monopolistic government central planning, reflecting the limited knowledge and political priorities of the ruling bureaucracy, inevitably stifles innovation and technical progress. That is why the negative experience of Soviet Communism was repeated in every other Communist revolution and country during the last century.
Given these truths, the idea that Western interference hindered the outworking and therefore the success of the Communist experiment in the Soviet Union, is absurd. As will be shown below, the exact opposite was the case. In one form or another, Western capital, “know-how” and technology actually pulled Soviet Communism’s chestnuts out of the fire in nearly every decade of the Soviet Union’s existence, principally by compensating it for its above-mentioned systemic inability to generate significant levels of indigenous technological innovation.
Whilst there was nothing inhere