Lenin's characterisation of a state-capitalist economy, in Russia, rested on the fact that the workers' state had the power to plan economic development, and to act to regulate the market, and the control, in its hands, of large industrial capitals, also enabled it to intervene in the economy, in the same way that the monopolies and the state did in Europe and the US. In fact, even there, the backward nature of Russia, limited that, for the reasons described above. And Lenin notes that there is a difference between nationalising and confiscating property and socialising it.
“Yesterday, the main task of the moment was, as determinedly as possible, to nationalise, confiscate, beat down and crush the bourgeoisie, and put down sabotage. Today, only a blind man could fail to see that we have nationalised, confiscated, beaten down and put down more than we have had time to count. The difference between socialisation and simple confiscation is that confiscation can be carried out by “determination” alone, without the ability to calculate and distribute properly, whereas socialisation cannot be brought about without this ability.”
(ibid)
That also required a significant development of the economy, which remained capitalist, and predominantly small, private capitalist, or even pre-capitalist. It involved a long period of transition, even if the international revolution, came to its assistance, which was the basis of The New Economic Policy, which Lenin envisioned would have continued into the 1950's. Lenin notes that Marx and Engels had spoken of a long period of transition between Capitalism and Socialism, even in respect of already developed economies like Britain. Marx and Engels had analysed socialised capital, in the form of the cooperatives and joint stock companies as transitional forms of property, between the two, but this did not change the fact that, during this period of transition, the economy is a capitalist economy, just as Marx explained that, even with the workers cooperatives, the socialised capital, was still capital.
Workers continued to sell their labour-power, as a commodity, in exchange for wages; the large state enterprises continued to produce commodities for sale, in the market, including the global market, and in Russia, huge numbers of peasants and small commodity producers continued to produce for the market. Indeed, with NEP, the Bolsheviks increased all of these capitalist elements in the economy.
The control of the state, and of the large-scale capital, was intended to enable these forms of capital – socialised capital – to expand, and for the small capitalists and independent commodity producers to be absorbed. The large-scale, socialised capital – including the foreign corporations that Lenin sought to attract to Russia – as it already did, in the West, plans its production, and via the state, these plans are integrated, leading to an increasing planning of the economy, and replacement of the market. What becomes decisive is the extent to which these large-scale socialised capitals do prove themselves, and expand at the expense of the small capitals and the peasant, and petty-bourgeois producers. This determines the relative social weight of these different classes, and, hence, ultimately the class nature of the state.
The socialised capital (cooperatives, joint stock companies,/corporations, state enterprises) is, objectively, the collective property of the workers employed in the enterprise, as Marx sets out, in Capital III, Chapter 27. In bourgeois states, it is only in worker cooperatives that they also exercise control over that capital, but, in a workers' state, the state itself guarantees them that control. As Trotsky describes, in a period of dual power, a revolutionary proletariat might also implement workers' control, over that capital, using its strength, and would demand that any Workers Government, legitimise it.
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