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■Our First English Publication

"Socialism" Stalinist or Scientific
The Marxist Theory of State Capitalism

Written by Hiroyoshi Hayashi & Kennichi Suzuki,
Translated by Roy West

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All of essays in this book were taken from the two collections of writings on state capitalism listed below:

Hayashi Hiroyoshi, 1938-
Genso no "shakaishugi"-kokka shihonshugi no riron
[Fantasy "Socialism"-A Theory of State Capitalism]
Tokyo: Wing, 1998.

Suzuki Kennichi, 1943-
Hasanshita gendai "shakaishugi"
[Bankrupted Modern "Socialism"]
Tokyo: Wing, 1998.


Translator's Introduction / v

Hayashi Hiroyoshi's Preface / xi

Suzuki Kennichi's Preface / xvi

The Bourgeois Boundaries of the Russian Revolution

1. Forerunner of Socialist Revolution (Sixty Years after the Russian Revolution)
Hayashi Hiroyoshi / 3

2. Revolution in Russia and China (The Significance of State Capitalism)
Suzuki Kennichi / 27

3. Trotsky's Theory of Permanent Revolution (A Marxist Expression of Romanticism)
Hayashi Hiroyoshi / 49

The System of State Capitalism

4. The Starting Point of the Theory of
State Capitalism
Hayashi Hiroyoshi / 75

5. The Fundamental Concept of State Capitalism
(Relations of Production and Internal Contradictions)
Suzuki Kennichi / 86

6. The Stalinist System
(Internal "Evolution" Towards "Liberalization")
Hayashi Hiroyoshi / 106

Abstract Theories of State Capitalism

7. Tony Cliff's "Bureaucratic State Capitalism"
(State Capitalism Without the Concept of Capital)
Suzuki Kennichi / 179

8. Tsushima' Theory of "State Capitalism"
(The Limits of Wishful Theories of "Socialism")
Hayashi Hiroyoshi / 200

Stalinist and Trotskyist Apologists for State Capitalism

9. JCP "Theories" of Socialism
(From the Denial of Historical Materialism to Agnosticism)
Suzuki Kennichi / 245

10. Sentimentality is Not Historical Science
(A Reply to the Trotskyist Koyama)
Hayashi Hiroyoshi / 266

11. Kuroda Kanichi's Theory of the Soviet Union
(Obscurantist Development of Trotsky's Theory)
Suzuki Kennichi / 277

12. State Capitalism or "Transitional" Society?
(Ebara's Criticism of Marxist Workers League)
Hayashi Hiroyoshi / 288

Translator's Introduction

Just as it was assumed for the greater part of the twentieth century that the Soviet Union was socialist, in the past ten years there has been an equally pervasive view that "socialism has failed". This "socialism failed" argument, of course, is inseparably linked to the earlier "common-sense" view that the Soviet Union was a socialist country. In other words, the conclusion that "socialism failed" is based on the irreproachable logic that, (a) the USSR was socialism, (b) the USSR collapsed, therefore (c) socialism has collapsed. As an example of deductive reasoning, the whole argument hinges on the truth of the initial premise that the Soviet Union was socialism, if this is false, the argument collapses, not socialism. For the past three decades, the authors of this book, Hayashi Hiroyoshi and Suzuki Kennichi (*1), have criticized this premise, and on the basis of a concrete, historical analysis of the system of production in the Soviet Union, China and elsewhere, have drawn the conclusion that these supposedly "socialist" countries were in fact state capitalism.

(*1) Please note that all Japanese names are presented in this book in the Japanese style, with the family name first and the given name second.

The significance of the theory presented in this book, however, is not simply limited to pointing out that "really existing socialism" is not really socialism at all. There is already no shortage of theories that reach more or less the same conclusion that these countries are (were) not socialist-although many end up defining them as a sort of halfway house between capitalism and socialism as "transitional societies" or "degenerated workers' states". The task of a theory of the Soviet Union or China, then, is not simply to point out what these systems are not (socialism), but also to correctly understand their historical significance and necessity, describe how they actually function(ed), and locate the fundamental contradictions which determined their development and led, or are leading, to their collapse. Most theories, however, fail to do this and instead of concretely explaining how these systems of production actually function(ed), they merely say how they should have functioned or speculate on how real socialism might have been reached. In this way, most theories lose sight of the object they set out to explain.

The approach of Hayashi and Suzuki differs from such abstract, unhistorical or moralistic theories of the Soviet Union, including those that also define the USSR as "state capitalism". The authors maintain that a socio-economic system, like any other object of cognition, must be studied objectively (without mixing in one's subjective wishes!) in all its aspects and connections, and grasped in its development, change and movement, rather than treating it as a sedentary, isolated or fixed thing. In the case of a "socio-economic object" of cognition (Soviet society), its development and movement, needless to say, is the historical process itself. As Hayashi says in chapter four: "what is required is a historical critique, not a moralistic one, and this is the very essence of Marxism." The authors maintain that in order to gain a correct understanding of the USSR (state capitalism) one must begin by studying the historical starting point of Soviet society (i.e. the Russian Revolution and the socio-economic conditions in Russia at the time). This is also the starting point of this book.

In "Part One", the authors discuss the Russian Revolution and the Russian Marxists' theories of revolution before 1917. Hayashi and Suzuki uncover the fundamental fact that the Russian Revolution was never a socialist revolution to begin with, despite being led by the workers and peasants. In other words, they argue that a distinction needs to be drawn between the "bourgeois" socio-economic content of the Russian Revolution and the fact that the revolution was politically led by the working class and peasantry (i.e. its political content).

Marxists in Russia (Mensheviks and Bolsheviks), for example, agreed on the "bourgeois" content of the coming revolution on the basis of the recognition that socialism required the high development of capitalism, and that this objective condition was not present in Russia at the time.(*2) The difference between the Mensheviks and Bolsheviks lies in the conclusions they drew from this recognition. Simply put, the former reasoned that if the economic content of a revolution is bourgeois, it must be led by the liberal bourgeoisie (with the workers tailing after them), whereas the latter thought the liberal bourgeoisie would likely compromise with feudal power, and thus it would be the historical task of the workers and peasants to sweep away feudal relations and open the path to capitalist development. The Bolsheviks' view that the proletariat (and peasantry) could lead a "bourgeois" revolution and that this would be in their interests may appear paradoxical, but as Lenin pointed out in Two Tactics:

In countries like Russia, the working class suffers not so much from capitalism as from the lack of capitalist development. The working class is therefore undoubtedly interested in the widest, freest and speediest development of capitalism. The removal of all the remnants of the old order which are hampering the wide, free and speedy development of capitalism is of absolute advantage to the working class…it is to the advantage of the bourgeoisie to rely on certain remnants of the past as against the proletariat, for instance, on a monarchy, a standing army, etc. (*3)

In other words, the fact that workers and peasants led the Russian Revolution, and indeed had to, does not, as Trotsky imagined, alter its "bourgeois" economic content. This understanding of the "bourgeois boundaries" (Lenin) of the Russian Revolution forms the basis for the authors' understanding of the historical necessity of state capitalism.

(*2) There was also Trotsky's theory of "permanent revolution" that was a mixture of both positions, with a sprinkling of Narodnism. That is, Trotsky agreed with Lenin and the Bolsheviks that the workers (and peasants) would grab power according to the "dialectics" of the political struggle, but in reverse-Menshevik fashion, he mechanically drew the conclusion that this would raise the "socialistic tasks" (i.e. he deduced the economic content directly from the political content of the revolution). His conclusion that the socialist tasks were on the "order of the day" was similar to the Narodnik view that Russia could leap from feudalism to socialism. Trotsky, like the Marxists, did however recognize that the objective conditions for socialism did not exist within Russia, but he pinned his hopes on "world revolution" to lift Russia up to socialism. For more on Trotsky's theory see chapter 3.

(*3) Lenin, Two Tactics (New York: International Publishers, 1989) p. 39.

In other words, the fact that workers and peasants led the Russian Revolution, and indeed had to, does not, as Trotsky imagined, alter its "bourgeois" economic content. This understanding of the "bourgeois boundaries" (Lenin) of the Russian Revolution forms the basis for the authors' understanding of the historical necessity of state capitalism.

State capitalism, according to Hayashi and Suzuki, emerged as an effective form for an economically backward country, such as Russia, to ensure the "wide, free and speedy development of capitalism", i.e. the rapid accumulation ("primitive accumulation) of national capital and industrialization, in the age of capitalist imperialism. This system was clearly geared to rapid industrialization, and the "profitability" of individual state enterprises was subordinated to this overall task (what Stalin referred to as a "higher form of profitability"). The nationalization of the means of production, agricultural collectivization and the "planned economy" were all employed as a means to achieve this objective (but this also formed the objective basis for the misconception that the USSR was in some way socialism or a workers' state).

In "Part Two", the authors examine how this state capitalist system actually functioned, and discover that once this historical task of capitalist accumulation had been achieved, the problem arose of the "efficiency" of this capital. Hayashi and Suzuki view the conflict between the "repression" and subordination of capital under state capitalism, and its inherent nature as capital as the fundamental contradiction of this system of production. Hayashi, for example, describes this contradiction in the following way:

To the extent that state capitalism is one form of capitalism, it cannot eliminate the essential characteristics of capitalism-e.g. commodity exchange, anarchic production, markets, competition, and various types of crisis or imbalance particular to capitalism (even Stalin was forced to recognize the "objectivity" of the law of value). On the other hand, under state capitalism, capital assumes an extreme monopoly form; in other words, this means that capital's particular nature is denied (or at least severely limited and suppressed).

The suppression or denial of "capital's particular nature" lent the Soviet Union the appearance of socialism, but the intrinsic "personality" of capital began to assert itself in the postwar period, and this was officially recognized by the economic reforms and "liberalization" of the sixties. However, this fundamental contradiction between the form of capital as state capital and its inherent nature was not easily resolved. That is, Soviet state capitalism was unable to smoothly shift to a form of "liberal capitalism". This state capitalist contradiction is vividly apparent in the "zigzagging" of the Chinese bureaucrats today between liberal reforms and the reassertion of state control and power in their "market-socialist system".

The authors' clear understanding of this fundamental contradiction of state capitalism, as well as the historical significance of the Russian Revolution, distinguishes their theory of state capitalism from other theories that employ the same terminology. In part three, they discuss the "state capitalism" theories of Tony Cliff and Tsushima Tadayuki. One interesting point that emerges from this discussion is that both Cliff and Tsushima were unable to go beyond the "horizon of Trotskyism" which was their starting point. While recognizing the important historical role these two men played in taking the first steps, back in the fifties, beyond Trotsky's "degenerated workers' state" dogma, Hayashi and Suzuki point out that they remained "loyal" to Trotsky in some important respects.

First of all, Cliff, Tsushima and others did not consistently grasp the historical necessity of state capitalism outlined above, and instead spoke of a "retreat" or "regression" to state capitalism (i.e. the workers' state "degenerated") after a "socialist" revolution. State capitalism is thus seen as a form of society that might have been avoided altogether (if revolution had broken out in Germany or Trotsky defeated Stalin). This speculative approach and arbitrary view of history is exceedingly Trotskyist. Furthermore, although Cliff, Tsushima and others often provide a lengthy factual list of the outrages of the Stalinist system to demonstrate its non-socialist essence, these details do not add up to a comprehensive understanding of how the system actually functioned. When they do speak of state capitalist crisis or contradictions, their conclusions are based either on abstract models of state capitalism or underconsumption theories, or these contradictions are located outside of the state capitalist system altogether and explained from the "pressure" of the world market or "world capitalism". The Trotskyist limitations of such theories are immediately apparent, for example, in Chris Harman's summary of Cliff's theory in his introduction to State Capitalism in Russia:

Cliff's argument is quite different. It is to insist that the revolutionary workers' state born in 1917 degenerated under the pressures of the capitalist world around it in the course of the 1920's, with a depleted working class increasingly losing control to a new bureaucracy. Quantitative changes became qualitative in the bitter winter of 1928-9. Those who controlled the state destroyed the last vestiges of workers' control in the cities, drove the peasants in the countryside into collectives and subordinated all classes in Russian society to a quite different dynamic to that embodied in the revolutionary program of 1917. The drive to overthrow capitalism internationally [i.e. world revolution-RW] was replaced by the drive, in Stalin's words, to "catch up and overtake" the Western Powers. (*4)

(*4) Chris Harman in Tony Cliff, State Capitalism in Russia (London: Bookmarks, 1988) p. 17.

The similarities to Trotsky's thought (in italics) are striking, and Hayashi and Suzuki discuss the limitations of this Trotskyist outlook throughout the book.

Finally, "Part Four" looks at theories that essentially glorified or defended the state capitalist systems. This includes both open apologists such as the Japanese Communist Party (JCP), as well as what might be called "covert" apologists for state capitalism from the New Left and Trotskyist movements. Both Stalinists and Trotskyist were largely in agreement that the nationalized means of production and the "planned  economy" meant that the USSR was socialism (or a workers' state), and not capitalism. In this sense, even the "anti-Stalinists" objectively aided the Stalinists (state capitalist bureaucrats) by spreading illusions about the society they ruled. For this reason, it is closer to the truth to call them "semi-Stalinists" rather than "anti-Stalinists. In addition to examining the "USSR theory" of Trotskyists, Suzuki also looks at the "development" of the JCP's view of the Soviet Union, including their notorious "formative-period" of socialism which accounted for the shortcomings in the Soviet Union by arguing that socialism was still in a stage of infancy or adolescence. The Stalinists and Trotskyists discussed in this section are not well-known outside of Japan, but essentially identical theories can be seen throughout the world, and in this sense these essays are relevant to the non-Japanese reader.

* * * * * * * * * * *

This is a basic outline of the content of this book. The essays collected here were written over a period of roughly thirty years stretching from the early seventies to the present. Most of these articles were written for the theoretical journal of the Socialist Workers Party [Japan].* In this sense, the view of state capitalism presented here is not simply the fruit of the individual intellectual labor of Hayashi and Suzuki, but rather is the result of over three decades of group study by revolutionary socialists, and represents the Marxist standpoint of the SWP. One should bear in mind when reading Hayashi and Suzuki's essays that they were written at various periods in time for different practical purposes, and not originally intended for publication in this form, which accounts for the overlap in content between the essays, and the repetition of quotations. Chapters 3, 4, 6, and 7 were originally translated by Shin Takeo for the SWP homepage, and I have consulted his work for my translation. I take full responsibility, as translator, for whatever mistranslations or other errors may still remain in this text.

Tokyo, August 12, 2000

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