For a Lasting Peace, For a People’s Democracy!
No. 27 (54), Friday, November 18, 1949

Concerning the Basis of Planning in the People’s Democracies

Hilary Minc

Member, Political Bureau
Central Committee, United Workers’ Party of Poland

A correct solution to the questions of planning in the People’s Democracies can only be made on the basis of a Marxist-Leninist definition of the class essence of the state in these countries. The rise of the People’s Democracies and consequent course of their development toward Socialism have made it necessary to solve a number of theoretical questions concerning the class nature of the State in these countries.

As is known, a detailed solution to these questions was outlined by Comrade Dimitrov in his report to Fifth Congress of the Bulgarian Communist Party, and by Comrade Bierut in his report to First Congress of the United Polish Workers’ Party.

On the basis of the Marxist-Leninist doctrine on the role of the State and of the dictatorship of the proletariat during the transition from capitalism to Communism, and basing themselves on the counsel and explanations of Comrade Stalin on the main theoretical questions, Comrades Dimitrov and Bierut pointed out that the system of the People’s Democracy was successfully carrying out the functions of the dictatorship of the proletariat, and that therefore the State in the People’s Democracies was in essence, a variation, a form of dictatorship of the proletariat.

This peculiarity of people’s democracy as one of the form of the dictatorship of the proletariat does not change the main thesis that people’s democracy and Soviet form of the dictatorship of proletariat are, in their class essence, one and the same type; that both these systems are forms of the dictatorship of the working class which, under the leadership of the Marxist-Leninist Party, rallying the working people of town and countryside around itself, is guiding the transition from capitalism to Communism.

The peculiarity of people’s democracy as a form of the dictatorship of the proletariat is determined by the victory of Socialism in the USSR, by the decisive role of the Soviet Union in the World War Two, and by the extremely favourable conditions created in these countries for building Socialism, thanks to their liberation by the Soviet Army, and to all-round assistance given to them by the Soviet Union with its great might.

A fierce struggle for building Socialism, for dislodging and then abolishing the capitalist elements, is being fought in the People’s Democracies. Capitalist elements are still strong in many branches of the economy, and there still remains a basis for their development in the petty commodity economy which prevails in the countryside. However, this does not alter the fact that the People’s Democratic States are States of a socialist type, since they have set themselves the goal of building a classless, socialist society.

In 1918, Lenin wrote in “‘Left-Wing’ childishness and Petty Bourgeois Mentality”: “No one, I think, in studying the question of the economics of Russia, has denied their transitional character. Nor, I think, has any Communist denied that the term Socialist Soviet Republic implies the determination of the Soviet Government to achieve the transition to Socialism, and not that the new economic order is a socialist order”. (Lenin, Selected Works, Volume VII, p. 361.)

Addressing the Third All-Russian Congress of Soviets, Lenin said: “We never had any illusions on that score, and we know how difficult is the road that leads from Capitalism to Socialism; but it is our duty to say that our Soviet Republic is a socialist republic because we have taken this road, and our words will not be empty words”. (Lenin, Selected Works, Volume VII, p. 275.)

This definition by Lenin can and should be fully applied to the people’s democratic States. They are States in which Socialism has not yet triumphed completely, where the new economic order is not, as yet, always and everywhere socialist; but they are, nevertheless, States which have set themselves the aim of going over to Socialism, and the successful experience of socialist construction in these countries has shown that their determination to build Socialism is not an empty word.

While recognising that the people’s democratic states are fulfilling the functions of the dictatorship of the proletariat, it can and must be recognised at the same time that these States are, in their class essence, similar in type to the Soviet State, that they are variegated, specific forms of a State of a socialist type.

During recent years, the Communist and Workers’ Parties in the People’s Democracies had to carry on a great struggle to destroy completely various Right and nationalist deviations, the supporters of which advocated the rotten “theory” of the State in the People’s Democracies as some kind of compromise between the dictatorship of the proletariat and the capitalist State.

The views that the planning of national economy in the People’s Democracies is a third path, a “new” path of regulating the national economy, a middle way between the capitalist path of crises and contradictions and Soviet socialist planning, have revealed themselves and sometimes still reveal themselves, even now, as an integral part of this “theory”. It is obvious that these views are, in essence, a repudiation of real planning, that they lead to the freeing of capitalist elements and to complete capitulation before them.

Planning the national economy in the People’s Democracies is one of the main functions of the Socialist State, a vital instrument of the proletarian dictatorship in realising, according to the classical formulation of Comrade Stalin, one of the three main aspects of the dictatorship of the proletariat, which is, “the utilization of the power of the proletariat for the organisation of Socialism, for the abolition of classes, for the transition to a society without classes...”. (J. Stalin, “Problems of Leninism”, p. 130.)

Therefore, planning in the People’s Democracies, which are States of a socialist type, is not and cannot be something mid-way between capitalist anarchy and Soviet planning. It is socialist planning which, in its class essence, is of the same type as Soviet planning.

Clearly, in the People’s Democracies, where Socialism has not yet triumphed completely, where the capitalist elements are still strong, planning differs greatly from that in the Soviet Union at the present stage of development of the Soviet State where Socialism has completely triumphed and where, on the basis of the already-realised abolition of antagonistic classes, a speedy advance is being made along the road to Communism. But if we take Soviet Planning in its historical development, we will see that, apart from the same class essence, there are very many common practical features and analogies between present planning in the People’s Democracies and Soviet planning during the New Economic Policy.

This is understandable. As far back as 1928, Comrade Stalin said: Can the capitalist countries, even the most developed of them, do without the New Economic Policy during the transition from capitalism to Socialism? I do not think so. To one degree or another the New Economic Policy with its market relations and the utilisation of these market relations are absolutely essential for every capitalist country in the period of the dictatorship of the proletariat.

In the People’s Democracies in different periods and to varying degrees, market relations have been retained and utilised; possessing the leading economic positions, the State can ensure the steady development of the socialist sector in the national economy, the realisation of economic planning and the advance toward Socialism. The retention and utilisation of market relations with the State holding the leading economic positions, have become a reality in the People’s Democracies, which, as distinct from the USSR, bypassed the stage of War Communism which was inevitable largely because of the bitter civil war and military intervention. Due to the powerful assistance of the Soviet Union, the People’s Democracies avoided a fierce civil war and armed imperialist intervention. Instead, benefiting from the experience of the Soviet Union, they were able in the main to find the correct solution to the problems of their economic development. At first, in certain sectors and on certain conditions, they allowed some capitalist elements to remain in the economy; then, having consolidated their possession of the leading positions, they went over to the offensive, gradually restricting and dislodging the capitalist elements and, in some decisive places, even abolishing the capitalist sector.

As in the USSR during the New Economic Policy, socialist planning in the People’s Democracies is being conducted under conditions of a complicated interweaving of various types of social-economic structure (Socialism, private-economy capitalism and partly State capitalism, petty commodity economy and in some countries even a patriarchal economy).

It is clear that, under such conditions, the main task of planning is to secure such all-round development of the country’s productive forces as is most favourable for the abolition of the capitalist elements, for the transition of petty commodity production onto the socialist path, and for the complete victory of Socialism.

The pivot of such planned development of the productive forces is the industry which has become the property of the State. This industry constitutes the leading position of the State and together with other sectors in the hands of the State (transport, banking, monopoly of foreign trade, and the leading State and cooperative positions in wholesale and retail trade) makes possible, on the basis of planned direction, to direct the development of the national economy as a whole.

The question of the nature of State industry in the People’s Democracies, which originally caused a number of doubts in the Communist and Workers’ Parties in the People’s Democracies, has now become quite clear. It is clear that, being the property of a State of a socialist type and, in the hands of the proletarian dictatorship, being the main lever for the socialist reorganisation of the country and for planned economic development, this industry is a socialist industry. Lack of clarity about this, particularly the definition made in the Polish Workers’ Party that State industry was “socialist only in its main features”, arose from the lack of clarity at the time on the question of the People’s Democratic State as a State of a socialist type, carrying out the functions of the dictatorship of the proletariat and being a specific form of it.

To ensure that State industry in the People’s Democracies victoriously plays the role of main lever of the dictatorship of the proletariat in the socialist reorganisation of the country and in securing planned direction of the entire national economy, it is essential to give a correct definition of the path of development of socialist industry, particularly the connection between the development of industry producing the means of production and consumer goods industries.

In the majority of the People’s Democracies the legacy of the capitalist system was a backward, undeveloped industry where light industry predominated. It is obvious that if industry had remained at this level it would not have been able to play a leading role in the socialist reorganisation of the country. Therefore, it becomes necessary to secure a rapid, all-round development of industry, giving first preference to industry producing the means of production. However, putting emphasis on the development of heavy industry does not mean that light industry should not be developed. On the contrary, the development of light industry is essential both from the point of view of satisfying the growing demands of the working people whose well-being steadily improves under planned economy, and from the point of view of using a part of the accumulations in light industry, where the turnover of funds is more rapid, for building heavy industry. Maximum coordination of the rates of development of heavy industry and light industry and the determination of these rates is, from the point of view of the entire national economy, one of the main questions of planning in the People’s Democracies. Relying on the rich experience of planning in the Soviet Union, and greatly helped by the Soviet Union in the matter of industrialisation, the People’s Democracies are, in the main, solving this question correctly.

A vital element of the leading positions in the hands of the State, which makes possible the planned direction of the national economy, is the monopoly of foreign trade now secured in the People’s Democracies. Foreign trade and, in general, the international economic relations of the People’s Democracies have two distinct aspects. Foreign trade and economic relations with the Soviet Union and the other People’s Democracies are relations of a new type through which the planned economy of the given country comes into contact with the planned socialist economy of the Soviet Union and the planned economies of the other People’s Democracies. These relations are aimed at giving mutual assistance to secure the speediest development of productive forces and the complete victory of Socialism. Without economic contacts with, and assistance from the Soviet Union, the People’s Democracies would not be able to retain their economic and political sovereignty. They would become the object of the arbitrariness of the imperialist plunderers, the object of their dictate, a backward appendage to their economy, and would not be successful in building a socialist society. The all round development of foreign trade and the general economic relations between the People’s Democracies and the Soviet Union accelerates the growth of the productive forces and the victory of Socialism, strengthens planning in the People’s Democracies, and makes it possible to extend the coordination in planning between several countries. The Council of Mutual Economic Aid is the organisational form which accelerates the accumulation of experience and provides also for the formation and crystallisation of these essentially new economic relations.

As for the foreign trade and economic relations with capitalist countries, the task of planning in the People’s Democracies is to secure such an organisation of these relations as will increase to the maximum the economic power of the given country, making it more independent of the capitalist economy, creating conditions for the speediest advance towards Socialism and strengthening the country as a link in the international camp of the struggle for peace and Socialism. Consequently, in planning foreign trade between the People’s Democracies and capitalist countries it is not the aim of the former to secure the broadest development of these relations, irrespective of their content and the results, but to establish relations which will facilitate the strengthening of the given country in its position as a socialist state.

The planning of foreign trade, the correct establishment of the ratio between trade with the Soviet Union and the People’s Democracies on the one hand, and with the capitalist countries on the other, a correct course in the trade with capitalist countries – all this is one of the most difficult and complicated questions of planning in the People’s Democracies.

The majority of the People’s Democracies are either agrarian or agrarian-industrial countries in which petty commodity production in agriculture is predominant. It is natural that in these conditions the question of the impact of planning on agriculture takes on particular significance. We speak about the impact of planning, for in conditions where agriculture is dispersed in millions of peasants households, it is difficult to speak about the direct planning of their production. In relation to individual farming, planning can only be a question of the regulating role of the State.

As for the planned-regulating role of the State in relation to individual peasant households, two periods are clearly seen in the economic development of the People’s Democracies.

In the initial period, the leading positions of the State were insufficient or too weak to make possible the broad planned regulation of individual agriculture. State industry was little developed and poorly organised, banking was not accommodated to the new tasks of the country’s socialist reorganisation, to a large extent the cooperatives still served the interests of the kulaks in the countryside, and the supply mechanism was still mainly in the hands of private capital.

In spite of the decisive changes in the countryside as a result of the agrarian reform, the planned regulating role of the State during this period was weak, and the individual peasant household was largely dependent on the private trader and the kulak, being effected not so much by the State as by spontaneously developing market relations. More than once during this period, market caprices stuck heavy blows to the economic policy of the State, upsetting plans or hindering their realisation.

Accordingly, as State industry became consolidated and banking adjusted to the new tasks, as the cooperatives now beginning to serve the interests of the mass of the people were radically reorganised, as private capital was partially squeezed out in bitter class struggle from the sphere of distribution in the countryside by the State and cooperative trade, and accordingly as both the means of production and distribution became concentrated in the hands of the State – the transition to the second period made progress. This transition took place in conditions of a fierce class struggle, when those political forces which strove for the restoration of capitalism were being broken. During this new period, in the place of spontaneously developing market relations, the planned-regulating role of the State was increasingly becoming a decisive factor in the development of agriculture.

This period is characterised by the squeezing out of private capital from the sphere of marketing the main agricultural products (grain, meat, industrial crops), and by the successful realisation of the policy of fixed State prices for agricultural products which, together with the tax and credit policy, makes it possible to influence favourably the process of agricultural production. This period is also characterised by dislodging the private trader from distribution in the countryside, by the mass development of consumer and marketing co-operatives, by the mass development of State contracting, the development of the network of State machine-tractor depots, and also of State and co-operative machine-hiring centres, and finally, by the development of socialist elements in agriculture in the form of State farms. This period is also characterised by the appearance of agricultural producer cooperatives. All this makes it possible for the dictatorship of the proletariat, for the State of People’s Democracies to intensify its planned regulating influence by assisting the poor and medium section of the countryside in every way, by systematically restricting and dislodging the kulaks, and developing agriculture in the direction of Socialism. The main task in this period is to create the preconditions for the mass of the working peasantry to take the path of collectivisation and of abolishing the kulaks, as a class. A new phase will open in agricultural planning which will signify an enormous extension and deepening of the function and significance of planning, that is, the transition from the planned regulating role of the State to the direct planning of agriculture organised along collective lines.

Planning in the People’s Democracies is socialist planning, which in its class essence is of the same type as Soviet planning. It takes place in conditions which differ in many aspects from conditions of socialist construction in the USSR. The main difference is the radical change in the international situation, the radical change in the relation of forces between the camp of imperialism and the camp of Socialism in favour of Socialism, the replacement of the capitalist encirclement in which Soviet socialist construction was carried out by the powerful fraternal bulwark which the People’s Democracies find in the Soviet Union. Moreover, the People’s Democracies are following the path already mapped out by the Soviet Union, and have the opportunity of utilising the great Stalin’s theory of socialist planning as a method of socialist construction, of overcoming the difficulties in this construction and of mobilising the broad masses who are creating a new life.

All this accelerates the advance of the People’s Democracies toward Socialism. All this makes their plans more and more real, vital and successful.

The idea of planning the national economy which has been triumphantly realised in the Soviet Union and is now being realized in the People’s Democracies, exercises a powerful influence on the working people in the capitalist countries. Therefore, it is not surprising that various bourgeois leaders, particularly in the post-war period, hastily began to concoct “plans” for economic development on a capitalist basis. As could be expected, bitter reality has relegated these plans to the archives where they are forgotten. What, for instance, has become of the grandiloquent Monnet “plan” in France which envisaged the development of France economy, the growth of industry and large-scale capital construction? How does this plan stand in comparison with the economic ruin in France, with the complete stagnation in the country’s economic development and its degeneration into a semi-colony of United States imperialism on the basis of the collapse of the sorry Marshall Plan?

What has become of the “Plan to develop Yugoslavia” of which Tito and his clique boasted so loudly? It is clear that there can be no question of any plan to develop the economy in Yugoslavia which, as a result of the counter-revolutionary coup d’etat, has become a fascist-type State led by a gang of murderers, spies and provocateurs, subordinated to foreign imperialists, and where capitalism is being restored. The only plan which is being carried out there – and this with great consistency – is the plan for the colonial enslavement and deception of the Yugoslav peoples.

To plan successfully it is necessary to plan along socialist lines. But to plan along socialist lines there must first be a State of the socialist type; it is necessary to rely on the growing strength of this State, on the growing power and organization of the national economy, on the growing activity and consciousness of the working people led by an advanced Marxist-Leninist Party.

These conditions exist in the People’s Democracies. Therefore, there can be no doubt that, relying on the great Soviet Union, the People’s Democracies will triumphantly realise their plans of economic development, will steadily raise the level of the productive forces and of the well-being and culture of their people, will complete the laying of the foundations of Socialism, thus contributing to the cause of the triumph of the world camp fighting for peace and Socialism.

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