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List of Chapters
19: "Divide and Rule"

An important aspect of the material incentives system introduced under the "economic reform" is its utilisation to play off one worker, and one group of workers, against another. In fact, contemporary Soviet economists admit that the decisive factor in the "efficiency" of the system is not the size of the bonuses paid, but the differentiation in their size between individual workers, which enables the management to play off one worker against another:

"The efficiency of any system of incentives largely depends on differentiation between the workers encouraged. Therefore, the decisive factor is not the absolute size of incentive funds but the relative size per worker".

(B. Gubin: "Raising the Efficiency of Socialist Economic Management"; Moscow; 1973; p. 79).

 But this differentiation applies not only to bonus payments, but to wage-rates, which, at the discretion of management, are varied not only between different regions of the country, but between different departments of the same enterprise and -- in blatant contradiction of the principle of equal pay for equal work -- between male and female workers: "The recent economic reform... enables industrial managers to differentiate labour remuneration rates according to the specific conditions of each individual shop, section or other production unit".

(P. Tabalov: "Switching Over to the New System", in: "Pravda" (Truth), October 27th., 1965, in: "The Soviet Economic Reform: Main Features and Aims"; Moscow; 1967; p. 119).

"Differentiating the rate of pay for labour by regions and types of labour (male, female and so on), it will be possible to influence in a planned manner the structure of utilising labour resources".
(A.G. Aganbegyan: "Territorial Planning and the Economic Reform", in: "Soviet Economic Reform:Progress and Problems"; Moscow; 1972; p. 99).
20: Anti-Semitism

A particularly unpleasant feature of "divide and rule" discussed in the previous section is the official encouragement of racist prejudices -- manifested in particular, in Soviet conditions, by a revival of that scourge of tsarist Russia, anti-Semitism.

In the days when Soviet society was socialist in character, the official position on anti-Semitism was one of outright denunciation and illegality:

"anti-Semitism, as an extreme form of racial chauvinism, is the most dangerous vestige of cannibalism.

Anti-Semitism is of advantage to the exploiters as a lightening conductor that deflects the blows aimed by the working people at capitalism. Anti-Semitism is dangerous for the working people as being a false path that leads them off the right road and lands them in the jungle. Hence Communists, as consistent internationalists, cannot but be irreconcilable, sworn enemies of anti-Semitism.

In the USSR anti-Semitism is punishable with the utmost severity of the law as a phenomenon deeply hostile to the Soviet system".

(J.V. Stalin: "Anti-Semitism", in: "Works", Volume 13; Moscow; 1955; p. 30).

 In line with Stalin's statement above that anti-Semitism is of advantage to exploiters, with the revival of an exploiting class in the Soviet Union has come a revival of anti-Semitism -- both official and unofficial: "Official and unofficial anti-Semitism.. is widespread in the Soviet Union...

This anti-Semitism, which is created by the Party bosses,... finds fertile ground among people who are looking for a scapegoat on which to vent their frustrations with the regime.

The State and the Party use anti-Semitism as a safety-valve. The regime still encourages and old saying from Czarist times, 'Save Russia, boot the Yids'. Even in the camp where there were water shortages, anti-semitic prisoners would come out with an old song about the stinking Jews drinking it all.

Every year anti-Semitism in the Soviet Union gets worse. The children of Jews are no longer admitted to higher institutions of learning -- or if they are, it's through bribery and corruption."

(M. Shtern: "Jew in Gulag: Shtern's story", in: "The Observer", April 24th., 1977; p. 10).

"The camp authorities inculcate nationalistic conflicts and agitate other inmates against the Jews. KGB Captains Maruzan and Ivkin stress in their conversation with non-Jewish inmates that all nationalities of the USSR must take a stand against Jews, particularly in labour camps. The administration provokes anti-Jewish incidents, utilizes informers and spies, and uses false witnesses in order to be able to impose additional punishment upon the Jews. Inmates who have had contact with Jews are summoned for discussions during which anti-Semitic sentiments are expressed and they are told that protest against arbitrariness in camp rules are profitable to the Zionists".

("A Perm Camp", in: Amnesty International: "Prisoners of Conscience in the USSR: Their Treatment and Conditions", London; 1975; p. 80).

"Audiences in Russia are currently being shown a specially made film which is deliberately and wildly anti-Semitic. The film is called 'Things Secret and Things Obvious' and it is a vicious attack on Jews. It is a compilation of newsreel film and reconstructed scenes, and it attacks Jews from the 1917 revolution to the present day. Accompanying the pictures is a particularly nasty commentary saying such contentious and unpleasant things as: "Jewish capitalists assisted Hitler a great deal in coming to power". It also make great play of the fact that it was a Jewess, Fanny Kaplan, who once tried to kill Lenin...

The film... has been produced by the Moscow Central Studio of Documentary films".

("The Guardian", March 29th., 1977; p. 11).
21: Corporatism

According to Marxism-Leninism, corporatism exists in capitalist society when independent trade unions representing the economic interests of the working class have been replaced by "corporations" of which both capitalist managements and employed workers are members.

In Nazi Germany the Labour Front was a classic "corporation". It included

"... the members of all the previous trade unions, the previous salaried workers' associations and the previous employers' associations".

( R.A. Brady: "The Spirit and Structure of German Fascism"; London; 1937; p. 125).

 In the words of the Leader of the Labour Front, Robert Ley: "The management of the Labour Front is in the hands of the National Socialist German Labour Party".

(R. Ley: Address to the Foreign Press, March 7th., 1935, in: R.A. Brady: ibid.; p. 124).

 The result of Nazi corporatism was: "Employers have practically complete control over workmen in regard to wages, hours and working conditions...Collective bargaining is completely abolished".

(R.A. Brady: ibid.; p. 41).

 Since the Soviet management personnel now form a new capitalist class and are members of the same "trade unions" as the workers they employ (and may dismiss), these Soviet "trade unions" are, in fact, "corporations" similar in every respect to the Nazi Labour Front -- except that they are led by a political party which calls itself the Communist party instead of the National Socialist Labour Party.

Like the Labour Front, too, the Soviet "trade unions" do not participate in collective bargaining on such important questions as wage levels, since -- as has been demonstrated in Section 12: "The Price of Labour Power" -- these are determined by the state.

As in the later days of the fascist regime in Spain, Soviet workers are responding to Soviet "corporatism" by setting up independent trade unions to defend and improve their conditions of work:

"Soviet workers have been forcibly confined to mental hospitals for nothing more or less than exercising some of the most fundamental rights of working people anywhere. The astounding accounts of fourteen workers, hospitalised since January 1977 for displaying such 'symptoms' as appealing against unfair dismissal, complaining about poor working conditions and helping to form a free trade union, reached Amnesty International in March...

With the news of the imprisoned workers came an appeal to Amnesty form the Association of Free Trade Unions of Workers in the Soviet Union, already more than 200 strong, to forward their application to the International Labour Organisation (ILO) in Geneva to be given ILO recognition".

("USSR Jails Trade Unionists", in: "British Amnesty", No. 25; April 1978; p. 1).

 This represents a political development of great significance. In the years following the Breznhev "economic reform" the majority of "dissidents" -- at least of those who have managed to communicate to the world outside the Soviet Union - have been intellectuals who have, in most cases, criticised the contemporary Soviet regime from the right. Now, as Amnesty International points out: "The addition on the Soviet human rights map of a substantial area of protest from ... workers, then, is one of signal importance".

(ibid.; p. 1).

 On the workers' struggle for freedom of trade unionism, official Soviet publications are -- at least as yet -- silent. But a fair idea of the difficulties and struggles which face Soviet workers may be gained from those which face French workers employed by a Soviet "subsidiary" in Besancon: "Employees of Slava -- one of the many faces of the multi-tentacled Russian Mashpriboringtorg conglomerate -- are forcing he company to accept ... a 40-hour week, a £250 a month minimum wage, five weeks' holiday and an extra month bonus pay...

A strike last year reduced the working hours. And for the past week workers have been picketing the factory to force the ten Soviet bosses to come to the negotiating table. True to board room form the bosses are refusing to comment, but the strikers sense victory because the managing director has just made a secret trip to Moscow, presumably to discuss the effects of the dispute on the dividend".

("Striking Out", in: "The Guardian", April 27th., 1978; p. 15).
 
22: The Social Services

According to Marxism-Leninism, a certain level of social services (for example, in the fields of education and health) is necessary for the effective operation of a modern capitalist society. Unhealthy workers, without a minimum of education, are incapable of maximising the creation of profit.

Expenditure by the Soviet state on education, the health service, sickness benefits, children's allowances, pensions, recreational and holiday facilities, housing construction, vocational training etc., are drawn from what is termed social consumption funds. These funds account for some 17-20% of the income of the average working class family. (Y.L. Manevich: "Wages Systems", in: "The Soviet Planned Economy"; Moscow; 1974; p. 259).

Some 60% of Soviet state expenditure in connection with social services takes the form of monetary benefits, some 40% that of services. (Y.L. Manevich: ibid.; p. 263).

The aim of a capitalist class, however, is to keep the level of social services at the minimum level consistent with maximum profitability and social stability of the social system and to make a higher level of services available only on a payment (and profit making) basis.

The Soviet capitalist class pursues both these aims.

The growth rate of payments from social consumption funds has fallen consistently since the "economic reform", as follows:

1966-70: 53%

1871-75: 40%

1976-80 ("planned"): 26-30%

("Soviet Economy Forges Ahead"; Moscow; 1973; p. 70).

(A.N. Kosygin: "Guidelines for the Development of the National Ecoomy of the USSR for 1976-80", 25th. Congress CPSU; Moscow; 1976; p. 25).

The development of educational and health services that operate on a payment and profit-making basis has been a feature of the Soviet social system since the "economic reform":

"A certain percentage of services (health, education) is offered for prices that contain a profit: certain health and educational institutes that operate on a cost-accounting basis".

(V. Azar & I. Pletnikova: "On the Question of the Classification and Full Assessment of Services in Personal Consumption", in: "Nauchnye doklady vysshei shkoly: Ekonomicheskie nauki" (Scientific Reports of Higher Schools: Economic Science). No. 11, 1973, in: "Problems of Economics", Volume 17, No. 2; June 1974; p. 55).

 and it is planned that these paid services shall expand at a faster rate than the unpaid: "The current five-year plan calls for the relatively more rapid growth of paid services...

The volume of paid services will grow by 47% during the five year plan.. The volume of unpaid services will increase by 32% during the five year period".

(V. Komarov: "The Service Sector and its Structure", in: "Voprosy ekonomiki" (Problems of Economics), No. 2, 1973, in: "Problems of Economics", Volume 16, No. 3; p. 8,9).

 This latter development is presented by contemporary Soviet propagandists as "in the interests of the population" on the grounds that the standard of the paid services is higher than that of those which are unpaid: "The preferential development of branches of paid services in the present stage conforms to the interests of the population... The population receives the possibility of supplying its needs more completely".

(V.Komarov: ibid.; p. 9).

 In fact, this development is in the interests, not of the Soviet working people but of the Soviet capitalist class. In the first place, it enables the latter to reduce the proportion of national income which would otherwise have to be spent on unpaid social services; in the second place, it opens to Soviet capital a "highly profitable" sphere of operations: "As a rule, all basic branches of paid services.... are highly profitable".

(V. Komarov: ibid.; p. 9).

 Some of the more humanitarian of the contemporary Soviet economists have, however, been frank enough to demand that this replacement of unpaid by paid services should not be carried "too far" because of its undesirable social effects: "The reduction of the sphere of free services and the satisfaction of the expanding range of the needs of the people in paid form are possible only up to a certain limit, beyond which the undesirable differentiation of the enjoyment of services by individual groups of the population with a different level of per capita income in the family may take place".

(V. Rutgaiser: "A Comprehensive Plan for the Development of the Service Sector", in: "Planovoe khoziaistvo" (Planned Economy), No. 2, 1973, in: "Problems of Economics", Volume 16, No. 5; September 1975; p. 49).

 Other economists, however, are drawing attention to Marx's statement that the value of labour power includes the cost of its education: "In order to modify the human organism so that it may acquire skill and handiness in a given branch of industry,... a special education or training is requisite, and this, on its part, costs an equivalent in commodities of a greater or lesser amount... The expenses of this education (excessively small in the case of ordinary labour power) enter to that extent into the total value spent in its production".

(K. Marx: "Capital", Volume 1; London; 1974; p. 168-9).

 While denying, in other connections, that labour power is a commodity -- and so has a value -- in the contemporary Soviet Union, these economists do not scruple to use Marx's analysis above to support the demand that no education should be free, but should be paid for, at least in part, by students of parents: "Educational expenditure takes the form of a portion of the outlays required for the reproduction of the labour force...

The first and most widespread assumption is that all expenditure for education should necessarily come out of the surplus product. But this is not true...

In the expenditures for education, it is necessary to discriminate between those made by the government and those made by parents or the pupil himself".

(V. Zhamin: "Economics and Education", in: "Voprosy ekonomiki" (Problems of Economics), No. 2, 1967, in: "Problems of Economics", Volume 10, No. 5; September 1967; p. 48, 49-50).

 An exception to this general movement from subsidised state social services towards "economic" profit-making services is to be found in the sphere of housing. This was partly because --as in orthodox capitalist countries -- it became increasingly difficult for profit-making building enterprises to construct dwellings at economic rents (or mortgage repayments) which working people could afford to pay. But it was also partly because, by 1960, in the larger towns, where there was a sizable petty bourgeoisie, a shortage of building land had arisen as a result of extensive private building of single - and two-storied houses.

Accordingly, on June 1st., 1962 a joint resolution of the Central Committee of the CPSU and the Government instructed republic administrations to prohibit the building of private houses in towns with a population of more than 100,000.

At the same time citizens in need of a home were encouraged to invest in housing co-operatives which, with the aid of state credits, would build multi-storey blocks of flats in such large towns. Those who could afford a down-payment of 40% (1,000 to 3,000 rubles, depending on the type of accommodation) would in this way have the possibility of moving into a new flat within a few years of joining the co-operative, without having to wait their turn on the state housing list.

These measures brought about a relative increase in the proportion of dwellings being built by the state and by housing co-operatives, and a relative decrease in the proportion being built privately:

Proportion of Housing Space Built
                                                                    1961-65     1966-70
BY THE STATE                                                              58.5%         61.5%

BY HOUSING COOPERATIVES                                      2.7%           6.5%

PRIVATELY                                                                    19.2%       14.0%

BY COLLECTIVE FARMS &
COLLECTIVE FARMERS                                                 19.6%     18.0%

("Narodnoe khoziaistvo SSSR v 1970 godu" (The National Economy of the USSR in the Year 1970); Mosocw; 1971; in: H.W. Morton & R.L. Tokes: "Soviet Politics and Society in the 1970's"; New York; 1974; p. 181).

For urban housing this trend was considerably more marked:

Proportion of Housing Space Built

1960             1965                 1970 By the state                                                          75.6%                 76.1%                 79.9%

By housing co-operatives                                                          10.7%                 10.8%

Privately                                                                 24.4%                 13.2%                  9.3%

(Ibid.; p. 182).

State housing is, to date, a true social service in the contemporary Soviet Union, being subsidised by the state as to two-thirds of its construction and operating costs, with rents fixed at a nominal 3-4% of the income of the occupying families.

("Soviet Economy Forges Ahead"; Moscow; 1973; p. 207).

(P.S. Mstislavsky: "The Standard of Living", in: "The Soviet Planned Economy"; Moscow; 1974; p. 269).

Nevertheless, in line with other social services, the proportion of total capital investment devoted to housing has declined significantly in recent years:

1956-60: 23.2%

1961-65: 18.3%

1966-70: 17.0%

("Narodnoe khoziaistvo SSSR v 1970 godu" (The National Economy of the USSR in the Year 1970)); Moscow; 1971; in: H.W. Morton: op. cit., p. 168).

and the standard of state housing is admittedly low:

"Newlyweds can initially get along very well without certain types of utilities... Not until they have children do they need separate apartments with all the conveniences".

(E.G. Antosenkov: "The Availability of Housing and Personnel Turnover", in: "Izvestia sibirskogo otdelenya Akademy Nauk SSSR: Serila obshchestvennykh nauk" (Journal of the Siberian Section of the Academy of Sciences of the USSR; Social Science Series). No. 11, 1972, in: "Problems of Economics", Volume 16, No. 3; July 1973; p. 59)

 Not all social services, however, are provided by the state. Some are provided by enterprises specifically for their own personel.

Since the "economic reform", every enterprise is required to set up out of its profits, in addition to a production development fund and an economic incentives fund, a fund for social and cultural undertakings and housing:

"There are now three types of material incentive funds at the Soviet enterprises:.... b) a fund for social and cultural measures and housing from which an enterprise can make the necessary expenses for providing services for its personnel, in addition to those provided by the state".

(V.M. Batyrev: "Commodity-Money Relations under Socialism", in: "The Soviet Planned Economy"; Moscow; 1974; p. 172).

 Out of this fund the enterprise is obliged to provide on its premises a health centre and a canteen for its personnel. (Statute on the Socialist State Production Entrprise, in: M.E. Sharpe (Ed.): "Planning, Profit and Incentives in the USSR", Volume 2; New York; 1966; p. 294).

Like the other two funds, the size of the fund for social and cultural undertakings and housing is dependent on the rate of profit made by the enterprise:

"Housing, communal and cultural facilities provided by an enterprise depend on the profitability of production, since expenditure on these items is made from the fund for social and cultural measures and housing, which is financed from deductions from enterprise profits".

(S. Kamenitser: "The Experience of Industrial Management in the Soviet Union"; Moscow; 1975; p. 134).

 It thus functions as a secondary economic incentives fund, stimulating the personnel to maximise the rate of profit.

At the same time, the fund is designed to assist the enterprise in competing for manpower and retaining it, by providing amenities such as housing to its employees that might not otherwise be available. This applies also when the fund is used to assist employees to purchase houses privately:

"The enterprise helps these workers under the following terms: the funds for socio-cultural resources and housing construction advance 40-50% of the down payment to the worker, and this sum is cancelled after the worker has worked a certain length of time at a given enterprise".

(E.G. Antosenkov: ibid,; p. 68-9).

 The social welfare schemes of Soviet industrial enterprises are thus little different from those operating in orthodox capitalist countries, about which contemporary Soviet sociologists comment scathingly: "Welfare and cultural schemes the management of industrial corporations.. introduce for their employees are prompted by egoistic class interests...

The corporations' expenditure on welfare schemes.. is seen to 'produce the greatest material and ideological returns to the corporation'".

(W.G. Scott: "Human Relations' in Management", Homewood (USA); 1962; p. 368).

(N. Bogomolova: "Human Relations' Doctrine: Ideological Weapon of the Monopolies"; Moscow; 1973; p. 107).

 In the Soviet Union, however, the funds for social and cultural undertakings have grown much more slowly than the other two funds: "Between 1966 and 1970... the production development fund rose 6 times, the fund for socio-cultural measures and housing construction 2 times, and the material incentive fund 4 times".

(N.Y. Drogichinsky: "The Economic Reform in Action", in: "Soviet Economic Reform: Progress and Problems"; Moscow; 1972; p. 207).

 and considerably more slowly than the growth of profits: "At the same time that the profits of enterprises and organisations increased 3.5 fold during the last decade, their allocations for social and economic services increased only 2.8 fold.... These figures alone are evidence of the great reserves that exist for the development of the sphere of social and economic services".

(B. Khomeliansky: "The Sphere of Social and Economic Services and the Reproduction of Aggregate Labour Power", in: "Nauchnye doklady vysshei shkoly: Ekonomicheskie nauki" (Scientific Reports of Higher Schools: Economic Science), No. 4, 1972, in: "Problems of Economics", Volume 16, No. 2; June 1973; p. 62-3).
23: Environmental Pollution

Contemporary Soviet economists and politicians hold that harmony between man and his environment is possible only under a planned socialist or communist social system:

"True harmony between man and nature is only possible under socialism and communism".

(K. Ananichev: "Environment: International Aspects"; Moscow; 1976; p. 30).

 But, since the "economic reform", each enterprise is required to maximise its profits and minimise production costs -- an aim which frequently conflicts with the social need to minimise environmental pollution resulting from production, as contemporary Soviet economists admit: "The implementation of pollution control programmes leads to worsening of the cost-accounting performance of enterprises".

(N. Fedorenko & K. Gofman: "Problems of Optimisation of the Planning and Control of the Environment", in: "Voprosy ekonomiki" (Problems of Economics), No. 10, 1972, in: "Problems of Economics". Volume 15, No. 12; April 1973; p. 46).

 As a result, since the "economic reform" environmental pollution in the Soviet Union has reached dangerous levels, as in orthodox capitalist countries: "The Zhdanvsky and Lovozersky ore-dressing combines of the USSR Ministry of Non-ferrous Metallurgy have not yet taken the necessary measures to bring a complete halt to contamination of the rivers and lakes of the Kola Peninisula... A number of enterprises belonging to the Ministry of the Chemical Industry... are polluting the air. Many cement plants are operating with a low degree of purification of exhaust gases. The construction of purification facilities at the Selenginsky and other pulp and paper enterprises is unsatisfactory. Individual enterprises of the ministries of oil refining and of the petrochemical industry, of power engineering and electrification, of the building materials industry, are also polluting the air and water. In a number of major cities the contamination of the air by automotive transport has increased...

The law calling for the re-cultivation of disturbed lands is not always observed in the prospecting and extracting of minerals and in urban, industrial and transport construction".

("Safeguard and Multiply Natural Wealth", in: "Planovoe khoziaistvo" (Planned Economy), No. 6, 1973, in: "Problems of Economics", Volume 16, No. 11; March 1974; p. 32-33).

"In the Soviet Union and other socialist countries... there are violations of technology... and as a result unpurified gases are discharged into the atmosphere, unpurified waters are discharged into rivers and water basins, there is soil erosion, etc.".

(G. Khromushin: "Problems of Ecology", in: "Voprosy ekonomiki" (Problems of Economics), No. 8, 1973, in: "Problems of Economics", Volume 16, No. 11; March 1974; p. 53-54).

"For all the variety of causes behind the deterioration of the environment in the United States and the Soviet Union, both these countries are now faced with the practical need to check this process...

The harm caused to bodies of water by effluents from pulp-and-paper, chemical fibre, and other factories is well-known. Every day they discard thousands of tons of polluted water into rivers, lakes and seas. The damage caused by these effluents is incalculable".

(K. Ananichev: ibid.; p. 118, 123)

 Soviet politicians certainly support, in words, moves to reduce environment pollution: "As we take steps to speed up scientific and technical progress, we must see to it that it should combine with the rational treatment of natural resources and should not cause dangerous air and water pollution or exhaust the soil".

(L. Brezhnev: Report to the 24th. Congress CPSU, in: K. Ananichev: ibid.; p. 24).

 The practice is, however, somewhat different.

For example, Soviet environmentalists generally agree that one of the two chief causes of atmospheric pollution is motor transport:

"The development of motor transport has come up against a number of 'dead-ends'. One of them is the air pollution with the noxious gases of internal combustion....

The chief sources of air pollution today are the power industry and motor transport".

(K. Ananichev: ibid.; p. 97, 120).

 and that the difficulty in producing a non-noxious motor vehicle is economic, and not technical: "Of course, it is possible in principle to develop a motor vehicle which does not emit poisonous or harmful exhaust fumes. This, however, would be.... very costly".

(K. Ananichev: ibid.; p. 97).

 They propose, therefore, that the number of private cars in use should be drastically reduced: "In all probability, the number of motor vehicles will be reduced by withdrawing from use a tremendous number of private cars".

(K. Ananichev: ibid.; p. 97-8).

 But the car industry is such an important sector of the Soviet capitalist economy that exactly the opposite policy has, in fact, been pursued: "In accordance with the directives of the 24th. CPSU Congress for the five-year plan for 1971-1975, there is to be a fourfold increase in car production. This tremendous increase in the number of motor vehicles... poses the threat of large-scale air pollution".

(K. Ananichev: ibid.; p. 121).

 Some contemporary Soviet economists propose a "business-like" approach to the problem of environmental pollution: the state should make an "....assessment of the loss resulting from the... higher morbidity among the population".

(N. Fedorenko & K. Gofman: ibid.; p. 45).

 resulting from it, and, on this basis, impose on enterprises responsible proportionate "... payments for environmental pollution".
(N. Fedorenko & K. Gofman: ibid.; p. 46).
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