Was Marx intellectually responsible for what happened in Russia and eastern Europe, beginning with 1917? A discussion of Khatkhate’s position on socialism, inspired by Kornai’s ideas in his review article, “Janos Kornai’s Odyssey to the Never, Never Land” (EPW, 28 March 2009), and a brief outline of socialism as envisaged by Marx.

Paresh Chattopadhyay (paresh.chattopadhyay@ internet.uqam.ca) is with the Faculty of Human Sciences, University of Quebec, Montreal.

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Odyssey to the Never, Never Land” (EPW,

28 March 2009). He should be praised for

introducing this eminent Hungarian eco

nomist – who is less known in India com

pared to many other economists of the

west, particularly of the Anglo-American

world – to the readers of this journal.

However, we have problems with his pres

entation. What stands out here is not so

much an analysis of Kornai’s central eco

nomic ideas based on the latter’s intense

experience with the economic organisa

tion of the eastern European countries un

der communist party rule – which would

have greatly benefited students of eco

nomics in India – but Khatkhate’s strong

ideological position. The following lines

concern Khatkhate’s article insofar as it

deals with what its author considers as

“Marx’s intellectual responsibility” in

what happened in Russia and eastern

E urope (and China, Vietnam ...) in recent

years, beginning with 1917. In other words,

the present article is exclusively concerned

with Khatkhate’s treatment of Marx, con

sidered as the intellectual source of the

regimes in question. This article is divided

into three sections. The first gives an

a ccount of Khatkhate’s position on social

ism, inspired by Kornai’s ideas, the second

o ffers, in a nutshell, the barest outline of socialism as envisaged by Marx in order to set the record straight, and the third d iscusses Kornai’s Marx connection.

Kornai-Khatkhate Position

Right at the start we are struck by the a uthor’s manner of presentation. He uses equivalently the terms “Marxism”, “Leninism”, and “Marxism-Leninism”. We are not sure if he is aware that these equivalences come directly from the once-famous “discourse” of the great seminarist successor of

was strongly entrenched in the central ideas of Marx” and that “this was the premise with which Kornai started”. He then adds:

Kornai convincingly argues that elimination of property, market and the replacement with public property and bureaucratic coordination – all emanated from Marx and were faithfully followed by Lenin.

On his part, Kornai (in his book, The S ocialist System (1992)) has written:

The Socialist System in this book exclusively signifies the system in the countries run by the communist party…The official leadership of every country (ruled by the communist party) declared while in power that the system was socialist. Why seek a label for these countries other than the one they apply themselves? (1992: 10-11).

Paradoxically though, nothing could have pleased the rulers of these regimes – including Lenin himself – more than to be characterised as the f ollowers of Marx leading and governing “socialist” regimes.

The problem is that Khatkhate does not verify such loaded statements on Marx by referring to any text composed by Marx himself, and takes at face value what Kornai has said. This Kornai-Khatkhate position shared by the partisans of the r egimes, this uncritical acceptance of the claims of the regimes at their word r eminds one of what Marx (and Engels) wrote in the mid-1840s:

While in habitual life every shopkeeper knows very well the distinction between what a person p retends to be and what he really is, our historiography has not yet grasped this trivial knowledge. It believes each epoch at its word what it says of itself and imagines itself to be.

(The term “shopkeeper” is in English in the manuscript.)

Socialism in Marx

In order to establish Marx’s “intellectual responsibility” for what happened in the regimes in question we have first to see what are (in Khatkhate’s words) “the c entral ideas of Marx” on socialism and to what extent these particular regimes were “strongly

DISCUSSION

e ntrenched in these ideas”. To start with, as a materialist, Marx did not believe that a society could be created by “ideas”. As the Communist Manifesto (1848) famously declared:

the theoretical propositions of the communists are in no way based on the ideas invented or discovered by this or that world reformer; they are only the general expression of the actual conditions of an existing class struggle, of a historical movement which is going on before our eyes.

For Marx it is the existing capitalist society itself which through its own contradictions creates the necessary conditions for the rise of the s ociety after capital. Naturally, Marx did not leave behind a “blue print” or what he mockingly called “a recipe for the future cook-shop” (1873). However, there are, spread over his writings, enough materials for offering us a fair idea of the kind of society he thought would succeed capital.

Going through Marx’s (own) texts one discovers what has been almost systematically downgraded, if not blatantly suppressed, by the “Marxists” as well as by his denigrators, that Marx’s perspective of the society after capital is profoundly human and immensely emancipatory. Right from the start of his adult life Marx viewed the present society as inhuman where an individual’s own creation appears as an alien power and dominates her/him and the i ndividual’s separation from other individuals appears as the individual’s real existence. “So long as the human being has not recognised him (her)self as human b eing and has not organised the world h umanly, the community will appear under the form of alienation, its subject, the human being, will appear as a self-alienated being”, wrote Marx in one of his early notebooks (1844) (1932: 536; emphasis in original). About two decades later Marx wrote in the same vein in his so-called “sixth chapter” of Capital I (published posthumously much later):

To the same extent as the productivity of labour develops, grows the amassed wealth confronting the labourer as the wealth dominating him, as capital. The world of wealth confronting him expands as the world alien to him and dominating him; his subjective poverty, destitution and dependence increase in the same proportion in opposition to him (1988: 126-27; emphasis in manuscript).

Following this logic, Marx put in stark opposition two societies – “human society” and “bourgeois society” in what could be called his “Manifesto of New Materialism”

The “first step” in the revolution is the establishment of the (class) rule of the proletariat considered as the “immense majority” of society, the “conquest of democracy”. However, the revolution does not end there. It is “epochal”. The process continues over a long period, a “period of revolutionary transformation” of the capitalist society into socialist society during which the workers “have to pass through a series of historic processes transforming circumstances and men” till the whole bourgeois mode of production along with the bourgeois social order is superseded (Marx 1847, 1848, 1871, 1875). The proletariat along with its rule – the last form of state – ceases to exist, wage labour and commodity production end. I ndividuals remain simply as producers of goods corresponding to social needs. C lasses

come to an end. The outcome of the labourers’ self-emancipatory revolution is the socialist (communist) society – a “union of free individuals” – based on the “Associated Mode of Production” with “associated i ndividuals” as opposed to the hitherto e xisting “Capitalist Mode of Production” with alienated individuals.

Integrally related with this is the social ownership of the means of production. (There is no state ownership here passing for “social ownership”; state, the embodiment of repression, has ceased to exist.) In sharp contrast with the “false” or “illusory” community which as an autonomous power had hitherto subjugated singular individuals, there arises now the “true” community where “universally developed individuals” dominate their own social relations (Marx and Engels 1845-46; Marx 1844, 1857-58, 1872). Individuals cease to be subject to “personal dependence”, as under pre-capitalism, as well as to “material dependence”, as under capitalism, and as universally developed “social indivi duals” gain “free individuality” (Marx 1857-58). For those who have some knowledge of the Kornai-Khatkhate “socialist” r egimes, it does not require any special mental effort to see that Marx’s “idea” of socialism – presented here in a nutshell (on the basis of a careful reading of Marx’s own texts) – has absolutely nothing in common with these regimes.

Kornai’s Marx Connection

However, there is another side of Kornai’s writings of which Khatkhate speaks very little – preoccupied as he is to establish Marx’s “intellectual responsibility” for these regimes by invoking Kornai’s authority. And here Kornai, it seems, unwittingly and unintentionally, rejoins Marx. This is Kornai’s deeper or “esoteric” side as

o pposed to his “exoteric” side, seen in his rather crude empiricism while taking at face value the “socialist” claims of the particular regimes – which we saw above. (These are Marx’s terms, and are drawn from his 1861-63 manuscripts where he critiques Adam Smith in the theory of competition.) We refer here to Kornai’s outstanding analysis of the “economic laws(s) of motion” of the societies in question. Kornai distinguishes between two types of economy. In what he calls the “classical capitalist economy” it is the “demand constraint”

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DISCUSSION

that is binding while what he calls the “socialist economy” – whose prototype is the “post-NEP USSR” – it is the “resource constraint” which characterises it. While the demand constraint in the first case gives rise to overproduction and a “reserve army of labour” in the process, the resource constraint in the second case results in labour shortage. In contrast with the capitalist economy “shortage plays a central role” in the “socialist” economy. And referring to his own work he calls it “a descriptive theory of shortage economy” (1980: 5, 41).

Kornai underlines the “initial state of backwardness and poverty” of these countries “with many pre-capitalist features” – affecting also their military and defence preparations – which placed them seriously behind the advanced countries which they had to overtake and surpass. “What technical progress does take place under classical socialism”, writes Kornai, “consists exclusively of copying innovations introduced in developed capitalist countries”, and “even this development proceeds haphazardly” (1992: 22-24, 294). Hence the “expansion drive”, “investment hunger” and the “atmosphere of growth at a forced rate” (1980: 27, 63, 191; 1992: 160-61). It so happens that the development process of these societies which Kornai analyses so well strikingly resembles what Marx shows as the accumulation process of capital in a situation of backwardness with quasi-stationary technical change corresponding largely to what Marx calls “formal subsumption of labour under capital” where the extraction of absolute rather than relative surplus value as the form of exploitation of the labourers prevails. It seems Kornai has completely overlooked this aspect of Marx’s accumulation analysis. Let us have a brief look at it.

While studying the “law of motion of capital” the focus of Marx’s analysis of accumulation quite legitimately was on the accumulation process in advanced capitalism. This accumulation under what Marx calls “real subsumption of labour under capital” is associated with continuous revolutionisation of the method of production and increase in “relative surplus value” through the higher productivity of labour leading ultimately to the crisis of overproduction and “industrial reserve army”. And this corresponds to Kornai’s “classical capitalism” under “demand constraint”, for the

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analysis of which Kornai has high praise

for Marx (1980: 235). Khatkhate of course

does not mention this. Marx, however, also

analyses – to a lesser extent, though – capi

tal accumulation taking place at an early

phase of capitalism where the method of

production of the pre-capitalist economy

remains largely unaltered over a period. In

this situation of the “formal domination of

capital” with largely unchanging composi

tion of capital, accumulation takes place

resulting in the “growth of capital without

the growth and development of labour’s

productive power” (Marx 1953: 633; 1976:

165-66). As Marx underlines, for a long

time, capitalism existed without the crisis

of overproduction and the reserve army of

labour, when “technical progress was slow

and the progress of capital accumulation

was constrained by the natural limits of the

exploitable labouring population” (1965:

1148). Here the needs of accumulation

would exceed the existing labour supply

which of course would mean labour short

age and more than full employment of la

bour. To illustrate this Marx mentions Eng

land during the whole first half of the 18th

century and over a larger period earlier

(1987: 561). And precisely this corresponds

to Kornai’s “classical socialism”.

Now, Marx’s analysis applies to a capital

ist economy. Our point of course is that all

of Kornai’s “socialist” countries, including,

in the first place, their prototype, the USSR,

were in fact capitalist from Marx’s material

ist standpoint whose criterion for charac

terising a social formation is its r elations of

production, which in the case of capitalism

are wage labour and commodity produc

tion on a social scale. The societies under

consideration – however different their

phenomenal forms compared to “western”

capitalism, entirely explicable by the spe

cific conditions of their origin and continual

existence – were all based on wage labour

and commodity production. And the very

existence of wage labour – by definition

signifying workers’ separation from the

means of production – meant that private

property in the means of production con

tinued to exist in these countries, the formal

juridical appearance of “public property”

only serving as a legitimising cover. Eco

nomic backwardness and the initial hostile

military environment of the USSR dictated

the urgency of rapid economic development

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