State Capitalism: A Critique

A term which has seen widespread use in left discourse, especially relating to the former USSR and to China today is “state capitalism”. With relation to the USSR specifically, the theory has seen three different versions

  1. The anarchist/left-communist version which sees states as essentially oppressive in nature and believes that the victory of a vanguard party will lead to the rise of a new elite and a “dictatorship of the party” which will then exploit the workers and use them as a means of extracting surplus value.
  2. The “Cliffite” version which argues that the USSR degenerated into state capitalism during the Stalin period due to the rise of a new class or “nomenklatura” which enriches itself by extracting surplus value from the proletariat.
  3. The CPC/PLA version, which believes that the USSR became state-capitalist due to the rise of revisionism in the CPSU, which had become dominant by 1956. A variant of this theory attaches the actual restoration itself to the 1965 “Kosygin” reform, which is alleged to have broken down the central planning system and reintroduced the profit motive into the Soviet economy.

It is my belief that Versions 2 and 3 can only be applied by heavily revising Marxist theory on capitalism, while Version 1 essentially adheres to an ahistorical and idealist definition of capitalism. What’s more, even if state capitalism could exist, it is clearly not applicable to the former USSR. It is therefore my belief that the state capitalism thesis is incorrect in its current widespread application as a means of describing certain socialist states. However, it must immediately be made clear that this piece shall in no way dispute the charge that the CPSU became revisionist in the 1950s, and that this ideological revisionism played a role in the eventual dissolution of the USSR. A discussion of Soviet revisionism and its implications will be made at some point in the future. What is disputed here is the theory that the “rise to power of revisionism means the rise to power of the bourgeoisie”, as Mao Zedong put it, and thus the immediate restoration of capitalism.

First of all, it should be noted that state capitalism was used by Lenin in some of his analysis to describe a mode of production existing within the new Soviet social formation in which the Soviet state used private entrepreneurs and leased state-owned facilities to them as a means of developing the forces of production. The lack of centralization in the Russian social formation under the Empire (and during the brief period in which Russia was a bourgeois republic) provided great problems for the advance of socialism in Russia, which was the reason why Lenin claimed that the establishment of state capitalism in 1918 “would be a step forward as compared with the present state of affairs in our Soviet Republic.” [1] Indeed, the establishment of state capitalism as a means of centralizing industry was a success – by the 1930s, three of the four non-socialist modes of production Lenin described as existing in Russia (patriarchal economy, private capitalism and state capitalism) had ceased to exist, while small commodity production had been limited to the private plots of the peasantry. The socialist mode of production was in command of the Soviet social formation, and the logic of socialism was clearly what underpinned the Soviet economy.

When monopoly capitalism is dominant, state capitalism serves a very different purpose. State capitalism’s predominant function in most Western European social formations is as a means of maintaining essential but unprofitable industries – railways are a good example in many countries. As railways become more labour-intensive, they tend to become too prohibitive in cost to be run by anything other than a body like the state in capitalism, which is why where privatization has happened (in Britain and Japan for instance), it has largely occurred on the basis of subsidies (Japan) or the continued national ownership of the railway tracks (Britain). This essentially amounts to privatization of profit to the bourgeois class and the socialization of the losses accrued by these industries. Some nations may have larger state capitalist sectors (Compare Sweden to Britain or America, for example) but in the last instance, monopoly capitalism is the mode of production which determines the social formation.

In no way is it evident that Lenin ever believed that this state capitalism could become the dominant mode of production in any social formation, and particularly not the Soviet; indeed, he was quite clear that the danger to Soviet socialism lay in the continued existence of private capitalism under the NEP and the rise of a petit-bourgeois class in the USSR. Speaking of left-communist opponents of the use of state capitalism, Lenin said “they reveal their petty-bourgeois mentality precisely by not recognising the petty-bourgeois element as the principal enemy of socialism in our country… they betray their failure to understand that the Soviet state differs from the bourgeois state economically.” [2]

If Lenin’s description of state capitalism leaves little room for any theory that sees it as a dominant mode of production, the works of Marx and Engels leave even less. The term “state capitalism” was not in general use at the time Marx and Engels were writing, and neither of them saw socialism put into action during their own lifetimes. Thus the social practice which further theory on the role of the state in capitalism would have been built on was not evident in their works. Nevertheless, it is very clear from their writings that they saw capitalism as a multipolar system.

Michael Goldfield and Melvin Rothenberg’s “The Myth of Capitalism Reborn”, published in 1980 at the height of a backlash within Marxism-Leninism to Version 3 pointed out that according to Marx, capitalism cannot simply be the rule of one single capitalist group, quoting him as saying: “All thought of a common, all-embracing and far-sighted control of the production of raw materials gives way once more to the faith that demand and supply will regulate one another. And it must be admitted that such control is on the whole irreconcilable with the laws of capitalist production, and remains for ever a pious wish, or is limited to exceptional cooperation in times of great stress or confusion” [3] Capitalism can never be truly organized, because it is characterized by anarchy of production: “Competition is nothing but the inner nature of capital, its essential characteristic, appearing and realized as the reciprocal interaction of many capitals with one another, the inner tendency as external necessity” [4] The drive to maximize profit is absolutely necessary to capitalism.

Thus state capitalism as the dominant tendency in a social formation is an impossibility – the logic of capitalism can only operate through “many capitals”, not as one organization which can apparently subvert the objective laws of the capitalist system (such as the boom/bust cycle, the tendency of the rate of profit to fall, etc.). To forget this is to ignore Marxist theory on circulation of capital, and to take up a metaphysical, anti-dialectical analysis. What ultimately arises when capitalism is created is, as Marx and Engels put it in describing the transition to capitalism from feudalism, “free competition, accompanied by a social and political constitution adapted to it, and by the economical and political sway of the bourgeois class.” [5]


In practice, the accusation of state capitalism cannot be verified any more than it can in theory. Version 3 places much emphasis on the Kosygin reform, but on closer inspection it cannot be properly seen as having abolished the planned economy and restored capitalism at all. Even the Liberman proposal (which the Kosygin reform was a watered down version of) did not propose giving enterprises the kind of autonomy they achieved in Yugoslavia under Tito, for instance. The essential change was that the number of targets by which central planning was reduced from 20-30 to eight. One of these was indeed profit, as many of the state capitalism theorists have pointed out, but profit was not the primary indicator used for planning – this remained “realized output”, another way of saying the total quantity of products sold. Even if the Kosygin reform did mark a shift rightwards, it was largely repealed in the early 1970s, due to what Szymanski calls “undesirable enterprise behaviour under the somewhat more flexible and decentralized conditions” [6]. Reforms throughout the rest of the 1970s tended to increase centralization even further, with targets having been raised to around 14 or 15.

Labour-power cannot be seen as having become commodified before or after the Kosygin reform – with the repeal of the NEP in 1928 and the subsequent shift leftwards, what unemployment did exist in the USSR was abolished and remained largely non-existent until around 1989-1990. To quote Sam Marcy: “It is true that there is a certain amount of “unemployment,” which some pro-Chinese theoreticians claim to be the indubitable proof that capitalism has, in fact, been restored. But this is the kind of unforgivable exaggeration which no serious capitalist economist, however full of hatred for the Soviet Union, has yet been able to make. The “unemployment” that exists in the USSR results from technological changeovers and the inefficiency of the bureaucracy in finding new employment, but the reality of the situation is that there is a labor shortage in the Soviet Union, the very reverse of what these theoreticians are trying to prove. The world capitalist economic crisis has, of course, affected all socialist countries, including China. But these stresses are the results of external influences from the world capitalist market and do not arise out of the internal dynamics of socialist construction.” [7]

Furthermore, any firing of a labourer in the USSR by a manager had to be approved by both the factory and the local trade union, and even when workers were laid off, they had the option to appeal their firing by the enterprise – according to figures cited by Szymanski, appeals had a success rate of about 50%. [8] The existence of more or less guaranteed employment undercut the existence of any labour market considerably. In addition, living standards were rising by 69% a year from 1960 to 1967, the period in which capitalism was supposedly restored – if this were so, we should have expected to see a reversal of this trend, such as that which was seen during the actual restoration of capitalism from 1988-1991. [9]

Although labour markets are the key determinant of whether capitalism exists in a given social formation, it is also easily provable that commodity and capital markets did not exist in the USSR either. From 1955 to 1975, the price of all commodities shifted from a base number of 100 to 101 in 1975. This period saw a slight increase in the price of food, while luxury goods which were held at a higher price slightly decreased in value. Rationing was maintained for housing, automobiles and certain other goods to prevent their price being bid up by the wealthiest in society. State banks loans, the state budget and production funds provided the capital to be utilized by each enterprise, with strict regulations put on the use of each. [10]

While the theory of Version 3 at least has an economic basis behind it, this cannot be said for Version 2, which apparently sees the restoration of capitalism as having been created with seemingly no change in the economic basis of society at all other than perhaps the rise of a “bureaucracy” which now mysteriously appropriated wealth for itself. Version 1 is at least consistent in seeing “state capitalism” throughout the entire history of the USSR, but it usually fails to substantiate this view except through picking upon individual phenomena and taking them as indicative of a wider degeneration at work.

Version 2 and 3 both suggest that capitalism could be restored in the USSR and its allies with effectively no-one noticing, with perhaps the sole exception of in Georgia where riots followed the publicizing of Khrushchev’s secret speech condemning Stalin. They depart from materialism in seeing the line of the leadership as determining relations of production, and they depart from dialectics in believing such a dramatic shift in direction could occur as swiftly as it did and with seemingly little premonition. The dialectical viewpoint is one of quantitative changes producing an eventual qualitative change, something which can more clearly be seen by the ideological degeneration of revisionism in the USSR and the restoration of capitalism from the mid 1980s onwards.

The Question of New Modes of Production

The usual notion of historical materialism is that it describes the trajectory of class struggle from “primitive communism” through slavery, feudalism, capitalism, socialism and towards advanced communism. While this is a good generalization, it is also true that Marx at times theorized other modes of production aside from these. The most famous of these is the controversial “Asiatic mode of production”, best summarized as kind of “state feudalism”, but others have also existed, usually as a means of describing certain pre-slave formations. These are the rather obscure “Germanic” mode of production, which describes a peculiar kind of household production based largely within the family unit and without the level of commerce associated with most kinds of simple commodity production, as well as the even more obscure “Slavonic” mode of production, which appears from what little evidence I could find of it to resemble a more communistic “Asiatic mode of production” without the aspect of the city/countryside contradiction.

Perhaps the best known recent attempt to theorize a new mode of production has been the categorization of socialist states as “bureaucratic collectivist”, a term that has become most associated with the Third Camp Trotskyist Max Shachtman. The term is echoed by George Orwell’s description of “oligarchal collectivism” in 1984. A theoretical statement of the theory of bureaucratic collectivism is surprisingly difficult to find, but a few generalized points can be made about it – that it effectively sees a new bureaucracy as having taken power in the USSR (and in some states today – the DPRK has been referred to as such before, amongst the myriad of imaginative terms applied to it) which was anti-socialist but also anti-capitalist. This new mode of production is, however, just as exploitative as capitalism and is also less efficient, which means the theory of bureaucratic collectivism often represents a theory through which socialist states can be seen as qualitatively “worse” than capitalist states.

Aside from the problems already outlined with this analysis, the theorization of a new mode of production has to be based in really existing processes coming into being. Presumably, to justify the creation of a new mode of production, new objective laws would have to be found that do not represent capitalism, socialism or any previous mode of production. If the mode by which workers were supposedly exploited was via their labour-power being bought by a bureaucratic class, there is little to tear it apart from what capitalism is seen as being – in particular the “state capitalism” theory.

Overall, theories which try to paint the USSR, its allies and other socialist states as anything other than their actual character too often resemble a kind of utopianism which insists that “real socialism” won’t face the difficulties that these societies had to endure. While this may be easier to put forward as a quick retort to reactionary attacks on socialist states, it similarly confirms in the minds of anti-communists that they are correct in their campaign of distortion against socialism. It is necessary to defend the historical (and current) achievements of socialist states, while still being prepared to criticize and learn from the mistakes of the past.


[1]: Lenin, V.I. (1974). “”Left Wing” Childishness and the Petty-Bourgeois Mentality” from Works, Vol.27. p.334. Progress Publishers. Moscow.

[2]: Ibid, p.335

[3]: Goldfield, M. & Rothenberg, M. (1980). quoting Karl Marx, Capital, Vol.3 in The Myth of Capitalism Reborn:  A Marxist Critique of Theories of Capitalist Restoration in the USSR. p.94. Line of March Publications.

[4]: Ibid. p.95, quoting Karl Marx in Grundrisse

[5]: Marx, K. & Engels, F. (1976). “The Communist Manifesto” from Collected Works, Vol.6 . p.489. International Publishers. New York.

[6]: Szymanski, A. (1979). Is The Red Flag Flying?: The Political Economy of the Soviet Union. p.40. Zed Press.

[7]: Marcy, S. (1976). The Class Character of the USSR. [ONLINE] [Accessed 8th July 2014]

[8]: Szymanski, A. (1979). Is The Red Flag Flying?: The Political Economy of the Soviet Union. p.50. Zed Press.

[9]: Aurthur, J. (1977). Socialism in the Soviet Union. p.78. Workers Press. Chicago

[10]: Szymanski, A. (1979). Is The Red Flag Flying?: The Political Economy of the Soviet Union. pp.41-44. Zed Press.

Capitalism As It Really Is

A few internet searches ago, I found myself in front of an article that claimed China is not capitalist. Since this is a fairly heterodox viewpoint both within the Western left and amongst most liberals, I was curious as to how they would argue this viewpoint. Immediately the alarm bells were set off, however, when the article seemed to be arguing that the main criterion for capitalism was a tendency towards liberal democracy. Things got worse as capitalism was defined as a system which seeks to maximize individual liberty, and finally, China was defined not as capitalist, socialist or “communist”, but as “corporatist” and “mercantilist”. In the spirit of my first post, in which I committed myself to achieving the “clarity and style associated with most sciences” in relation to Marxism, I decided that because of the issues involved with discussing capitalism, socialism, and other terms of crucial importance to Marxism, new posts would be required to explore in more detail some of the current issues surrounding usage of the terms in question, and in particular to attack the metaphysical mindset which has become so prevalent in this discourse.

The classic Marxist definition of capitalism is based on the exploitation of the producing class through wage-labour – when labour-power has become a commodity like any other to be sold on the market, and used to produce surplus value for an exploiting capitalist class. See for example, The Communist Manifesto: “The essential condition for the existence, and for the sway of the bourgeois class, isthe formation and augmentation of capital; the condition for capital is wage-labour. Wage-labour rests exclusively on competition between the labourers” [1] or Wage-Labour and Capital: “[C]apital presupposes wage labour; wage labour presupposes capital. They reciprocally condition the existence of each other; they reciprocally bring forth each other.” [2]

This is in opposition to slavery (where the bodies of the producing class are directly owned by the exploiting class) and feudalism (where the producing class is usually either free but tied to the land, as in the case of serfdom, or where the producing class is exploited via rents and taxes, as in peasantry), as well as to early classless societies, socialism and communism. Hence, not all markets imply capitalism, and equally, capitalism does not necessarily imply markets as such, except in labour (An issue I shall discuss in the future). It is important to emphasize this definition, because it has become distorted and widened in modern discourse. In particular this is characteristic of the right, and of the Austrian school, who will be the main focus of critique in this piece.

The general assumption of “libertarians”, most of whom tend to be associated with Austrian economics, tends to be that “liberty” is the highest good. They of course fail to ask the question as to whom this liberty is for and what is done with it. This liberty always tends to be in the first place “negative” liberty, i.e. freedoms “from”, and reinforces the balance of power existing within present day capitalist society, seeing the “right” to private property as being innate and not having been achieved via the ruthless and dictatorial expropriation of the commons by the emerging capitalist class.

In Bukharin’s excellent critique of Böhm-Bawerk and the Austrian school in general, he identifies three methodological foundations which separate Marxian economics from Austrian – objectivism/subjectivism, historical viewpoint/unhistorical viewpoint and production/consumption. The end result of all three of the latter viewpoints is that Austrian economics bases itself in an individualist and psychologistic problematic, one which can only view economics through the narrow lens of the bourgeois consumer – or through the “Robinsonades” of the classical economists. Contrast the Marxist viewpoint: “Society (as is consciously or unconsciously assumed) is not an arithmetical aggregate of isolated individuals; on the contrary, the economic activity of each specific individual pre-supposes a definite social environment in which the social relation of the individual economies finds its expression. The motives of the individual living in isolation are entirely different from those of the “social animal” (zoon politikon). The former lives in an environment consisting of nature, of things in their pristine simplicity; the latter is surrounded not only by “matter” but also by a peculiar social milieu. The transition from the isolated human to society is possible only by way of the social milieu. And indeed, if we were dealing only with an aggregate of individual economies, without any points of contact between them, if the specific milieu which Rodbertus has so appropriately termed the “economic community” should be absent, there would be no society. Of course, it is theoretically quite possible to embrace a number of isolated and remote economies in a single conception, to force them into a “totality” as it were. But this totality or aggregate would not be a society, a system of economies closely connected with each other with constant interaction between them. While the former aggregate would be one we had artificially constructed, the second is one that is truly present. Therefore the individual economic subject may be regarded only as a member of a social economic system, not as an isolated atom. The economic subject, in its actions, adapts itself to the given condition of the social phenomena; the latter impose barriers upon his individual motives, or, to use Sombart’s words, “limit them.”” [3]

The subjectivist approach of many Austrians becomes evident in their effort to extend the definition of capitalism to include commodity and capital markets as well as labour markets, thus defining all market societies as essentially capitalistic. A classic example is the definition of “laissez-faire capitalism” by Murray Rothbard: “the right to unrestricted private property and free exchange”. [4] Using this definition, the Austrian economist is able to see capitalism in anything which seems “free” of the state and thus which allows unlimited rights to private property on behalf of the “individual”. Böhm-Bawerk manages to go even further in his definition, echoing the view that the “stone of the savage as the origin of capital” [5] and thus capitalism is inherent to any society. This ahistorical definition renders the concept essentially useless for any kind of analysis. The Austrians resemble those whom Marx chastised as “[E]conomists who smudge over all historical differences and see bourgeois relations in all forms of society. One can understand tribute, tithe, etc., if one is acquainted with ground rent… one must not identify them.” [6] The flattening of all class society into capitalism of course serves the purpose of making capitalism seem eternal and unchanging.

Ironically, the opposite tendency has also become prevalent amongst many Austrians – that capitalism has in fact never existed in a “pure” form, and thus all existing capitalism isn’t “real capitalism”. There is in fact some accuracy in this statement, since libertarians perceive capitalism as meaning a completely “free market” – the accuracy stems from the fact that “free markets” have never and can never exist. Capitalism historically emerged via a process of primitive accumulation which expropriated the peasantry and created “free labour”, which was then employed in the growing capitalist industries. All this was additionally based on imperialism and colonization – primarily of the Americas at first, but later extending to Asia and Africa. While it is all very well for rightists to see capitalism as an ideal, those intent on studying history scientifically rather than through mystical conceptions must seek to discover the logic of capitalism as it actually functions, not as irrefutable axioms claim it exists.


The libertarian view of the state is essentially that it acts as an obstacle to the development of the “free market”. There is a divide within the libertarian tradition as to whether the problem of the state can be resolved or not – “anarcho-capitalists” claim that the state must be done away with altogether, while “minarchists” favour a limited state for the protection of private property, prosecution of fraud, defence of the nation and other “nightwatchman” responsibilities. Whichever view is taken, this conception of the state does not take account of how the state actually functions within capitalism. The dictatorship of the bourgeoisie can only be enforced by means of a large (and growing) state, which seeks to reproduce the relations of production through its state apparatuses – whether they are repressive or ideological. Marxist-Leninists have indicated this direction for decades. For example, in Lenin’s preface to The State and Revolution, he points out that the First World War had accelerated the “transformation of monopoly capitalism intostate-monopoly capitalism”. [7] This process has nothing to do with the actions of the state alone and everything to do with real material processes, as well as the impossibility – and in fact, undesirability to the bourgeoisie – of the removal of state support for capitalism. The chances of a perfectly “free market” ever existing within capitalism are about as probable as the existence of a perfectly round triangle.

Nevertheless, the expanding state is often used as “proof” of the desire of government to implement socialism and destroy “free enterprise”. Frequently, this argument verges on conspiracy theory – for example, in Loyd Wright’s foreword to Fabian Freeway: High Road to Socialism in the U.S.A., written in 1966: “The American people have been and are complacently unfamiliar with Communism’s helpmate, Fabian Socialism. For over fifty years but especially since the middle nineteen-thirties there have been insinuated into high places in our government at Washington men whose collaboration in this socialistic movement has been greatly responsible for breaking down our constitutional form of government and substituting therefor [sic] the Socialist idea of centralized government.” [8] How exactly “centralized government” is a “Socialist idea” is unclear, unless we are to take all powerful states with large degrees of intervention in the economy as “socialist” – a foolishness which would see us class Ancient Egypt, for example, as being a socialist social formation thousands of years before the idea even existed. Underlying this paranoid vision of capitalism being destroyed from within by a conspiracy of traitors – something which very few communists argue can actually happen – is an unspoken yet extreme voluntarism which sees power in the abstract as a corrupting force which inevitably drags actors towards favouring “centralized government”. Unfortunately, this same idealism is not restricted to the right, as we shall see in the future.

Sometimes, instead, the 19th century will be offered as an example of “real capitalism” as opposed to the present, which is usually classified as “corporatism” or “crony capitalism”. What is in fact being brought to attention is the transition from competitive to monopoly capitalism. But the 19th century scarcely offers a freer market even on the terms of libertarians. Until the 1860s, tariffs were never less than 50% of the overall income for the U.S. budget, undermining a key point in any “free market” – that goods should be allowed to cross borders as freely as possible and that free trade benefits all. In Britain too, it was only by the mid 19th century that free trade began to be seen as beneficial – Britain had industrialized behind huge tariff walls, as well as maintaining a highly “interventionist” proto-workfare program in the form of the Poor Laws, used to regulate the reserve army of labour directly.

Present day examples of “the free market” at work do little more to prove these arguments. The Republic of Korea not only relied heavily on protectionism and U.S. foreign aid to reach its present prosperity, but also used extensive central planning. Singapore not only relied heavily on subsidies to direct investment into crucial industries, but also has also de facto nationalized land (as does Hong Kong), with the state supplying 85% of housing through its Housing Development Board. Even Chile, which is often hailed as a “free market” success story (despite its flagrant use of state violence against the proletariat supposedly being at odds with libertarian values) suffered a financial crash in 1982 so severe that the government was forced to nationalize large swathes of the banking sector. The end result of this crash was that it took until the late 1980s for income to recover to the level it had reached under Allende in the early 1970s. Heavy government assistance to exporting industries and the introduction of capital controls were the end result of this fiasco, and significantly damage the myth that relative “laissez-faire” policies can be beneficial to the bourgeoisie, let alone the masses. [9]

The idea of “corporatism” is often used to describe the present stage of capitalism, and indeed often to separate the present era from capitalism altogether. It is, however, gravely misunderstood by most of those who use it. Corporatism is essentially the idea that a state should be unified as a “body”, and thus that classes should collaborate for the greater good – often that of the nation. For this reason, it has often been associated with fascism. The idea of corporatism alone has nothing to do with monopoly capitalism, which is the correct term for the present mode of production.

Nevertheless, the notion of corporatism is just that – a notion. It is an ideological one – in the last instance, the state always serves the interests of a ruling class. In the case of “corporatism” as it has historically manifested itself, this has always been in the interests of the bourgeoisie. Contrary to the libertarian notion that fascism is “socialistic”, Parenti points out: “In both Italy in the 1920s and Germany in the 1930s, old industrial evils, thought to have passed permanently into history, re-emerged as the conditions of labor deteriorated precipitously. In the name of saving society from the Red Menace, unions and strikes were outlawed. Union property and farm cooperatives were confiscated and handed over to rich private owners. Minimum-wage laws, overtime pay, and factory safety regulations were abolished. Speedups became commonplace. Dismissals or imprisonment awaited those workers who complained about unsafe or inhumane work conditions. Workers toiled longer hours for less pay. The already modest wages were severely cut in Germany by 25 to 40 percent, in Italy by 50 percent. In Italy, child labor was reintroduced.” [10] “Corporatism”, then, for all its alleged aspirations of representing all classes, is in the end bourgeois capitalism in crisis: “Fascism is a false revolution. It cultivates the appearance of popular politics and a revolutionary aura without offering a genuine revolutionary class content. It propagates a “New Order” while serving the same old moneyed interests. Its leaders are not guilty of confusion but of deception. That they work hard to mislead the public does not mean they themselves are misled.” [11]

The class root of libertarianism is to be found in petit-bourgeois consciousness. Szymanski notes that while the petit-bourgeoisie can be won over to anti-capitalist positions due to their hostility to the haute-bourgeoisie, the absence of a strong leftist movement tends to leave the petit-bourgeoisie prone to joining tendencies with a “distinctively middle-class, anti-big business, anti-working class, pro-“little guy” appeal”, but these inevitably serve the interests of the haute-bourgeoisie in the end [12]. This has in practice manifested itself in the form of libertarians often acting as “useful idiots” for fascist and right wing authoritarian regimes, such as the apologia of Ludwig von Mises for fascism: “It cannot be denied that Fascism and similar movements aiming at the establishment of dictatorships are full of the best intentions and that their intervention has, for the moment, saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history.” [13]. Though he goes on to say fascism can only be an “emergency makeshift”, it is made clear that fascism is to preferred over socialism and that fascism acted as a liberating force compared to the “barbarian peoples on both sides of the Urals” [14]. The “right” to private property is held higher than any other.

The libertarian view of capitalism is at its core a petit-bourgeois fable, one which turns the story of capitalism into a heroic saga of the “little guy” seeking to build a living for himself, and being crushed on both sides by the twin pincers of state-sponsored “corporatism” and big business, and by “welfarism” and “socialism” on the other hand. Libertarian idealism, however, is increasingly inept at disguising the true material roots of capitalism and its basis in the exploitation of wage-labour.


[1]: Marx, K. & Engels, F. (1976). “The Communist Manifesto” from Collected Works, Vol.6 . p.496. International Publishers. New York.

[2]: Ibid. (1977). “Wage-Labour and Capital” from Collected Works, Vol. 9. p.214. International Publishers. New York.

[3]: Bukharin, N. (1927). Economic Theory of the Leisure Class. [ONLINE] [Accessed 7th July 2014]

[4]: Rothbard, M. (2006). For A New Liberty: The Libertarian Manifesto. p.28. Ludwig von Mises Institute. Auburn.

[5]: Bukharin, N. (1927). Economic Theory of the Leisure Class. quoting “Colonel Torrens”, whose view of capitalism is essentially based on the same premises as Böhm-Bawerk. [ONLINE] [Accessed 7th July 2014]

[6]: Marx, K. (1993). Grundrisse: Foundations of the Critique of Political Economy. p.105. Penguin Classics.

[7]: Lenin, V.I. (1974). “The State and Revolution” from Works, Vol.25. p.387. Progress Publishers. Moscow.

[8]: Martin, R.L. (1966). Fabian Freeway: High Road to Socialism in the U.S.A. p.vii. Western Islands Publishers.

[9]: Chang, H-J. (2007). Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism. pp.11-14. Bloomsbury Press.

[10]: Parenti, M. (1997). Blackshirts and Reds. pp.6-7, City Lights Books

[11]: Ibid. p.17.

[12]: Szymanski, A. (1978). The Capitalist State and the Politics of Class. p.83. Winthrop Publishers.

[13]: von Mises, L. (1985) Liberalism. p.51. Cobden Press.

[14]: Ibid. p.49

Surveying the Terrain

We bear the distinction of having been born into an age in which meticulously constructed theoretical frameworks are very much out of fashion. They come under attack from two immediately visible directions, the first of which attacks in its own self-interest and the other, most likely, from simple naiveté. The first attack originates from the victors of the last century, who seek to preserve their status indefinitely. We do not need any new theory, they proclaim, for liberal democracy and capitalism have provided the answer – the only answer, in fact, which is humane and moral. Any deviation from this path will lead down the “road to serfdom” as Hayek phrased it. Instead we should realize that we are living through the Kojevian-Fukuyaman “end of history”, and capitalism is the final stage of socio-economic progress.

The second attack is mounted from an angle which often claims to be in opposition to the first attack. Their problematic has a place in which to discuss capitalism as a system, and even occasionally to engage in an open critique. Nevertheless, this second manifestation, which at first seems to come to the aid of modern day radicals, is in fact a Trojan horse – while it deplores capitalism and possibly even liberalism, it makes any resistance to its hegemony futile by eschewing all “grand narratives”.

The first attack of course comes from bourgeois scholarship and the right, the second from postmodernism and the belief that we have entered a stage of history in which there are no truths. The only way in which to create change is simply subjectivized resistance to structure. That this hostility to grand narratives has in itself become a grand narrative is perhaps a feat of irony which many postmodernists would appreciate, but this does not make it any less true. What have been the real results of this adoption of postmodern thought, however unconsciously? That unity in thought has been disparaged more than ever, and eclecticism lifted to the position of a virtue. The left equivalent of the modern “pick and mix” attitude shown by many invested in American democracy (i.e. that they are “liberal” on this issue, “conservative” on this one) is that many of today’s radicals – in the First World at least – are “single-issue” people wholly focused on one cause, as opposed to recognizing the need for struggle as something with a central premise. Quite simply, radicals need a methodology if they are to become adept critics of our present reality. Luckily, such a methodology has already been established.

This framework – the one which not coincidentally has endured the majority of these attacks – is Marxism. Marxism has provided the impetus for almost all successful revolutionary leftist change since its codification as a revolutionary analysis. Why is this? Multiple reasons can be posited, perhaps, but the strongest appears to be that Marxism is in the wider sense of the word a science. Marxism does not construct fantastic utopias and plough Elysian Fields, but instead develops its analysis from the real material state in which we find ourselves. As Marx and Engels wrote, just as Marxism was clearly becoming a “science”, “Communism is for us not a state of affairs which is to be established, an ideal to which reality [will] have to adjust itself. We call communism the real movement which abolishes the present state of things. The conditions of this movement result from the premises now in existence.” [1] Marxism is radical in that, properly understood, it is holistic in its materialist mode of thought – it applies the logic of materialism to history, the area in which bourgeois discourse most evidently sinks into idealism.

And yet, today Marx is once again acceptable, in principle at least. One can call oneself a Marxist, and be considered relatively “normal”. The popular conception for all but those avowed in rightist ideology is of – ironically – a well intentioned dreamer. Marx was the man who gave hope to the working classes of the world, but of course, he failed to “take account” of “human nature”. Communism was “good in theory, but bad in practice”. We’ve all heard the “common sense” notions that pervade discourse around communism today, and which in fact betray a complete lack of critical ability. They divorce Marx from his real content – a proper reading of Marx would soon give any curious reader an idea of what Marx thought of the idea of a “human nature”, as well as showing the absurdity which results from trying to force an impenetrable divide between theory and practice where there is in fact a dialectical relation. They also ignore the social practice which has further developed Marxism in the late 19th and 20th century. But in that case, how can we recover this content? How can we discover what Marxism really is?

Here we run into a problem, for it is not a simple matter to discover Marx’s position on a single issue through reading him directly. If you wished to read what Marx thought of, say, feudalism, you could not simply pick up a book by Marx on the topic and have done with it. Marx’s writings on many subjects were scattered throughout his corpus, and throughout the 40+ years in which he wrote them. It gets worse for those in search of a “pure” Marxism, straight from the source, for in an important sense, there isn’t one Marx but several. In being Marxists, what are we to do about this conundrum? To take an example do we endorse the accelerationism of Marx in On the Question of Free Trade, in which he gave strong support to free trade as a means of aggravating the already latent contradictions within the capitalist mode of production, or are we followers of the later Marx, the Marx of Capital, who gave support to social reforms aimed at alleviating the misery of the working class while still holding that socialist revolution was as necessary as ever? Anyone who wishes to be a Marxist, and to understand Marxism, will have to confront the contradictions which exist within Marx’s complete works.

Returning to the point I made a few paragraphs earlier – that Marx is now no longer “taboo”, at least not in the immediate sense – what can we say of Lenin? Marx may be the head-in-the-clouds visionary in the common consciousness, but Lenin is something else entirely; he put Marx into action. For this, he is pilloried as a “demagogue”, or at the very kindest a revolutionary who lost touch and became corrupted by power after the October revolution. Even within the left, Lenin’s name is poison to many – particularly those who favour Makhno’s Ukraine, or the Kronstadt uprising. And while we’re discussing Lenin, what of Stalin and Mao, who are another level of magnitude upwards again and are seen by many in the West as equivalent to Hitler? There are many reasons why this has occurred, but a key one is that Marxism-Leninism, which has theoretically and practically extended the utility of Marx’s framework, was a real threat to capitalist hegemony for a considerable length of time. By the 1970s and 1980s, Marxism-Leninism had coloured much of the globe red – officially at least. It still survives today, in theory, in 5 existing states – to what extent it does so in practice will be a topic for further exploration both in Marxist discourse and perhaps on this blog itself.

Lenin as a theorist is an easier proposition than Marx – more collected and more consistent, and further aided by the publication of several Progress Publishers compilations of his works on specific topics – “state capitalism” in the transition to socialism for example. Lenin’s influence has gone beyond Marxism-Leninism itself, to the point where imperialism has become an accepted theoretical concept amongst almost the entire left, even if they often omit certain aspects of it – the existence of a labour aristocracy being a major example. And yet, in many cases, Lenin only extended already existing strands of thought within the works of Marx and Engels. The embryonic form of the vanguard party can be found in the Communist Manifesto, Engels wrote of an aristocracy of labour in letters, and Lenin’s militant materialism in Materialism and Empirio-Criticism is an obvious inheritance from the Anti-Duhring of Engels.

The height of the first wave of socialism, 1983
The height of the first wave of socialism, 1983

The real question underlying politics for a Marxist-Leninist is quite simple, who is to rule, and whom they are to rule – Lenin’s shortening of it created the memorable “who, whom?”. And when we speak of what it means to rule, it is of course crucial that we think of power in materialist terms. The abstract “power” that Lord Acton warns corrupts so easily does not exist in the real world, one in which power has both positive and negative application and can be used constructively. Class struggle is the motor of history – power which reinforces the dictatorship of the proletariat, which weakens the bourgeoisie, capitalism and imperialism serves a real positive purpose. That which delays or obstructs victory in the class war is the power we must seek to be rid of. Zizek pointed out that “[L]ike an authentic conservative, a true Leninist is not afraid to pass to the act, to assume all the consequences, unpleasant as they may be, of realizing his political project.” [2] There are no “beautiful souls” in politics – not successful ones anyway.

To return to the question of Lenin, Marxism-Leninism has proven itself through social practice as the most effective means of creating a revolutionary socialist society. Although there were (and are) deep-set problems in the “actually-existing” socialist states, we have a working model which we should be prepared to uphold, albeit with great criticism. We must be prepared to distinguish between criticism from the left and criticism from the right. For a great example of this, we can take a comparison of Mao’s critique of Stalin, one which saw the good in Stalin and his achievements while also highlighting the genuine faults he had as a historic figure. Compare this to Khrushchev’s narrative at the 20th Congress of the CPSU, in which the problems of socialism in the USSR are reduced to the “cult of the individual” and the noxious, toxic effects which stem from it. Why did the “Secret Speech” gather such acclaim in the West? Not just because it sought to confirm everything liberals and left anti-communists had been saying about Stalin, but also because it was not Marxist. The “cult of the individual” was a psychologistic, bourgeois theory, completely wedded to the idea of ‘Great Men’ determining history, or at best, presenting an image for the masses to follow blindly. How could the leader of a socialist state, with Marxism-Leninism as its guiding principle, commit such follies? These ideas did not just “fall from the sky” as Mao would have said – they had a real class basis.

Even within the “Left”, we are assailed with ideology that clearly bears marks of bourgeois or petit-bourgeois influence. Anti-Marxist theories that posit “state-capitalism” as a dominant tendency within a social formation, or that try to forge a new mode of production out of “bureaucratic collectivism” are rife. Concepts such as the “cult of personality” or “totalitarianism”, which reflect a method of analysis that begins not from class and the class struggle but from the state, and from a voluntarist perspective on power, are accepted as “leftist” criticism of socialist states. To understand how this can be, we can return to the conclusion of Marx and Engels over 150 years ago that “The ideas of the ruling class are in every epoch the ruling ideas, i.e. the class which is the ruling material force of society, is at the same time its ruling intellectual force. The class which has the means of material production at its disposal, has control at the same time over the means of mental production, so that thereby, generally speaking, the ideas of those who lack the means of mental production are subject to it. The ruling ideas are nothing more than the ideal expression of the dominant material relationships, the dominant material relationships grasped as ideas.” [3] Maybe we can call the last section of the quote an example of the “economistic” Marx, but the overall principle stands truer than ever.

The key to finding not a “pure” Marxism – one does not exist – but a Marxism which is revolutionary and can be put into operation in the conditions of the 21st century, lies in understanding the Marxist method and applying it. Progress in this direction was made by the French philosopher Louis Althusser, who made great strides in defining Marxism as a science, even while recognizing the problem which lies at the heart of creating a stable Marxist methodology – “[W]e have it, and where it is: in Marx’s theoretical works, in Capital, etc. – yes, and of course this is the main thing, we can find it there, but not in a theoretical state!” [4] It is necessary to reverse engineer, to some extent, a working method from the practice which Marx, Engels, Lenin and other theorists such as them have already undertaken. Dialectical materialism, which is the basis of this method, has largely been a secondary concern, lagging necessarily behind the advances of the science of history, historical materialism. Nevertheless, we have a literature on which to base our study – Marx’s Theses on Feuerbach (1845), Engel’s Anti-Duhring (1878), Lenin’s Materialism and Empirio-Criticism (1909) and philosophical notebooks (1914), Stalin’s Dialectical and Historical Materialism (1938), and Mao’s On Practice and On Contradiction (1937), as well as much of Althusser’s attempts at turning Marxism-Leninism into a fully rigid and consistent science.

"Long live Marxism-Leninism!"
“Long live Marxism-Leninism!”

Nevertheless, to come full circle, we are supposedly living in the “end of history”, and despite the many criticisms leftists (and other besides) have made against Fukuyama, there is a kind of persistent defeatism that still haunts the left today; Walter Benjamin called it “left-melancholy”. However much left anti-communists such as Chomsky would like to pretend that the fall of the USSR was a “small victory for socialism and democracy” [5], the reality of the situation is that it has given great succour to anti-socialist and anti-communist forces throughout the world, and created the impression that “communism is dead”. Stalin foresaw the consequences of a Soviet collapse 60 years before it happened: “What would happen if capital succeeded in smashing the Republic of Soviets? There would set in an era of the blackest reaction in all the capitalist and colonial countries, the working class and the oppressed peoples would be seized by the throat, the positions of international communism would be lost.” [6] However, history is not one simple march forward without retreat. It may seem odd that this was once, in effect, a common belief amongst Marxist-Leninists – that in the 1970s there was a major debate over whether a socialist state could indeed be turned back to capitalism at all. An example is Jonathon Aurthur’s discussion in Socialism in the Soviet Union, one of a number of books published in the late 1970s arguing in opposition to the theses of the CCP and PLA that the USSR was still a socialist state (albeit run by a party with a severe case of revisionism): “Marxist literature takes for granted the irreversibility of the victory of socialism”. [7]

In contrast to this, Lenin’s critique of “Junius” (the pseudonym of Rosa Luxemburg) made clear, in discussing the imperialist world war, that “it is undialectical, unscientific and theoretically wrong to regard the course of world history as smooth and always in a forward direction, without occasional gigantic leaps back.” [8] Many were the times when the advance of capitalism was thrown backward by aristocratic counterrevolution, or at least by so many “Thermidors”. We should not be surprised to face the same problems in attempting to build socialism. The reason this belief that socialism was invincible to capitalist restoration arose is precisely through the lack of such restoration for so long – the only socialist states which had been turned back to the capitalist path were states such as the Hungary of Bela Kun, which had barely managed to construct anything resembling socialism to begin with before being crushed.

With all this said, what then should be the aim of Marxist-Leninists today? I would say it varies depending on location and circumstance. The collapse of capitalism is probably not going to begin in the United States, or the United Kingdom – it will begin, much like the first wave of socialist revolutions did, in the weakest link in the imperialist chain. In 1917, that just happened to be Russia. This time, it’s even more difficult to see what that weakest link could be – perhaps India? After all, there is already an active Naxalite movement there which is making strong progress against a weak Indian central government. Wherever the next wave begins, there are things which can and need to be undertaken, in the First and Third Worlds.

The first objective must be the creation of an ecumenical movement within Marxism-Leninism. Other than Trotskyists, Marxist-Leninists are perhaps the most split-prone and fractured tendency there is, currently. We have to set limits to any attempt to reunify Marxist-Leninists, however. It is no good to seek, for example, a merger with the CPUSA, the CPB, the PCF or any of the other old “Moscow”-orientated parties, because they are riddled with revisionism, and have been for a long time. Our policy towards revisionist parties must be resolute criticism while seeking to absorb elements from them that can be brought to a genuine Marxist-Leninist perspective. The principle of democratic centralism should be given special emphasis today; that we should have freedom of discussion and the ability to ponder differing courses of action, but that there should be unity in action. This freedom of discussion will be the lifeblood that will give the vanguard party real strength, and the ability to stay connected to the masses.

Secondly, it is necessary for any new Marxist-Leninist movement to be as critical, of outside concepts and of its own, as the successful movements of the past have been. This will necessarily take the form of the vanguard party being prepared to undertake the monumental task of inculcating revolutionary class consciousness outside of the most class conscious elements of the proletariat. This shouldn’t be as hard as it was in the past, nevertheless – today, in Europe at least, there is little real popular support for capitalism as a mode of governance in of itself. The problems come with proposing an alternative, which is why defence of socialism and the dictatorship of the proletariat is an absolute keystone of developing a successful movement. This point is also probably the juncture at which I should interject with my own propositions on the matter, and what I aim to achieve by starting this blog in the first place.

Marxist academia has in recent years seemed to follow the growing trend towards obscurantism and complexity. That this has happened is a testament to the corrupting influence on the intellectual strata that capitalism and capitalist discourse generally has. Nevertheless, this makes it more necessary than ever to reclaim Marxist theory as a powerful weapon of critique, and to recognize that we are waging class war not just on the economic or political level, but on the theoretical as well. It is true that sometimes we will have recourse to the creation of complex theoretical structures to explain certain phenomena, but nevertheless, Marxist theory has a dual purpose in that it also aims to create a real movement behind itself. Marx’s 11th thesis on Feuerbach, one of his most famous statements, bears repeating here: “The philosophers have only interpreted the world in various ways; the point, however, is to change it.” [9] While I cannot hope to change the world as a single individual, I nevertheless have a few clear objectives, the first of which is to contribute to a clearing away of the obscurity and mysticism into which Marxism has fallen in recent years. Marxism should aim for the clarity and style associated with most sciences, while retaining the insight that dialectical and historical materialism contain. If Marxism lives up to its claim of being a science, its principles should be applicable in the most basic form to a wide range of political situations. Where there is no existing work, Marxists should seek to plunge forward and extend Marxist theory into previously unknown territory.

Another more obvious objective shall be to draw non-Marxists into Marxism, to show why Marxist analysis is the best methodology and why socialism, and ultimately communism are the best systems. At the same time it will be necessary to take on the angle from which anti-communists argue and particularly to give a defence of socialism as it has manifested itself so far. This is no easy objective given the omnipresence of the notions that the USSR, PRC and related states were “totalitarian”, “authoritarian”, “police-states” and so on. However, no matter how difficult the task, it is necessary to undertake this analysis because it is at the heart of why anti-communism remains so powerful. This will perhaps be one of the most difficult tasks of the new Marxist-Leninist movement, and it cannot be approached lightly – the image of many socialist leaders of the 20th century in the West is still of “dictators” and “autocrats” no different from Hitler, Mussolini, Pinochet, Rhee or any other capitalist ruler.

Building on both of these objectives, Marxism-Leninism in particular must be delineated clearly, and the many manifestations of deviationism or revisionism revealed and criticized. There are many such deviations from Marxism-Leninism – economism, humanism, historicism, voluntarism, positivism, vulgar sociologism etc. All these deviations, however, have in common the fact that they stem from faulty analysis based either in idealism or crude, metaphysical materialism. Even the great thinkers of Marxism and Marxism-Leninism were not free of these deviations on occasion, though it is also necessary to see deviations as something apart from revisions of Marxism-Leninism. No-one is, of course, perfect, and it will be necessary to criticize Stalin or Mao, to criticize Lenin, even to criticize Marx and Engels themselves where mistakes were made.

Two deviations have proven especially damaging to socialism in the past. The economism-humanism couplet, as Althusser called it, is at the heart of almost all existing revisionisms in some form or another. They might seem odd bedfellows – after all, doesn’t humanism lift “Man” to the highest pinnacle, and doesn’t economism seek to subject this humanism to the idea that communism is built by expanding the productive forces and thus that objective forces are central and dominate “Man”? In fact, this is not such a strange combination. Once one accepts the “theory of productive forces”, and that productive forces should be given primacy over relations of production, class struggle ceases to be relevant in building socialism. All that matters is how developed and industrialized an economy is. Thus it makes sense to negate the class struggle entirely, and take up an analysis based in the idea of “Man”, whether it is one which draws from bourgeois sources, or from the “young Marx” of alienation and species-essence. It also leads to the negation of other struggles – feminism, LGBTQ+ liberation, anti-racism are no longer afforded the same attention and importance, because after all, aren’t we all human? Do we not all face the same struggles as human beings first and primarily?

It would be wrong to say this battle against anti-Marxist deviations has not already been fought – economism was the trend which the Cultural Revolution, one of the most determined battles against revisionism Marxist-Leninists have ever undertaken, often sought to spar with. Nevertheless, the ultimate victory of the revisionist tendency in the CCP must be taken into account in seeking to create a movement that can withstand the corrupting force of revisionism. The economism-humanism couplet does not always appear unified – for example, Juche has a heavy ideological element of humanism and voluntarism to it, giving primacy to “Man” as the one who determines everything through his will, while largely lacking economistic deviations. Similarly, while “Deng Xiaoping Theory” is one of the most obvious economistic deviations from Marxism-Leninism there is, it maintains a broadly anti-humanist perspective and was still theoretically wedded to the concept of the dictatorship of the proletariat. The classic example of the humanism-economism couplet is the rightist revisionism of the CPSU, a tendency which emerged from 1945 onwards and was built on the theory of productive forces in combination with the idea of a “state of the whole people”.

To offer something of a conclusion to this rather haphazard article – one which has tried to cover perhaps more ground than it could hope to in the limited word count I set myself – what I hope to achieve is to make clear that communism, far from being the “totalitarian twin” of fascism, and far from being simply a utopian dream that doesn’t factor in material concerns, is a real and relevant movement that offers the best hope for the working classes of the world and their allies. The contradictions of capitalism are mounting in intensity, not declining, and there is potential for a “perfect storm” based in both the aggravation of imperialist contradiction and the problems of ecology to create the gravediggers of capitalism in the 21st century. Certainly one cannot say that the future of capitalism looks quite as bright in 2014 as it did in 1994.


[1]: Marx, K. & Engels, F. (1965). The German Ideology. p.47. Laurence and Wishart, London

[2]: Zizek, S. (2001). What Can Lenin Tell Us About Freedom Today? [ONLINE] [Accessed 24/6/2014]

[3]: Marx, K. & Engels, F. (1965). The German Ideology. p.60. Laurence and Wishart, London

[4]: Althusser, L. (2005).”On the Materialist Dialectic” from For Marx. p.174. Verso.

[5]: Chomsky, N. (2001). Face to Face With A Polymath, Frontline [ONLINE]–.htm [Accessed 24/6/2014]

[6]: Stalin, J.V. (1954). “Speech at the Seventh Enlarged Plenum of the E.C.C.I” from Works, Vol.9. pp.28-9. Foreign Languages Publishing House. Moscow

[7]: Aurthur, J. (1977). Socialism in the Soviet Union. p.3 Workers Press. Chicago.

[8]: Lenin, V.I. (1974). “The Junius Pamphlet” from Works, Vol.22. p.310. Progress Publishers. Moscow.

[9]: Marx, K. & Engels F. (1976). “Theses on Feuerbach” from Collected Works, Vol.5. p.8. International Publishers. New York