Monday 19 August 2024

Stalin and The Chinese Revolution, 16. The Soviets and The Class Character of The Revolution - Part 3 of 7

On the one hand, in the worker cooperatives, the workers do exercise control, but these are generally too small to be able to survive, in the long-term, in the face of competition with larger capitals. They either fail, or else degenerate, with control passing to a permanent bureaucracy, usually en route to being transformed into a joint stock company, or simply absorbed by one. On the other hand, the joint stock company represents a form of socialised capital that is large enough to succeed, and develops into the multinational corporation, but workers have no control over its/their collective capital. The contradiction, in relation to the worker cooperative, drives workers to a political solution, so as to be able to nurture that development, for example, by the use of credit, as described by Marx.

“Without the factory system arising out of the capitalist mode of production there could have been no co-operative factories. Nor could these have developed without the credit system arising out of the same mode of production. The credit system is not only the principal basis for the gradual transformation of capitalist private enterprises into capitalist stock companies, but equally offers the means for the gradual extension of co-operative enterprises on a more or less national scale.”

(Capital III, Chapter 27)

The contradiction, in relation to the joint stock company/corporation, also drives the workers to a political solution, because it requires that they assert their rightful control over their collective capital. This is, indeed, the property question, described by Marx and Engels, in The Communist Manifesto, as the basis of the class struggle. Yet, as Trotsky describes, this question of workers control over their collective capital, is not one that can be resolved within the limits of bourgeois democracy.

The ruling-class no longer owns the industrial capital that has become socialised capital. It owns fictitious-capital (shares, bonds, property and derivatives) whose short-term interest is, in fact, antagonistic to that of the industrial capital, upon which it ultimately depends, which forms the dominant form of property, and upon which the future of the state depends. Yet, as ruling class, like the landlords in parliament referred to by Marx in his Inaugural Address, it has made sure that company law gives it the right to exercise control, still, over that socialised capital. In doing so, it, even now, acts against the interest of that industrial capital, showing the degree of contradiction, and reality that the ruling-class has become not just conservative, as Marx described in The Poverty of Philosophy, but reactionary.

The interest of socialised capital is the maximisation of profit of enterprise, so as to maximise capital accumulation. But, shareholders seek to maximise dividends, thereby, reducing profit of enterprise, and they seek to maximise capital gains from rising share prices, which drives them to ensure that profits are used to buy back shares, rather than invest in additional capital. So, the ruling class will not simply abandon this control, and will use its state, and other forces to prevent that happening, as they did, in Italy, in the 1920's, Germany and Spain in the 1930's, etc.

As Trotsky puts it,

“workers’ control through factory councils is conceivable only on the basis of sharp class struggle, not collaboration. But this really means dual power in the enterprises, in the trusts, in all the branches of industry, in the whole economy.

What state regime corresponds to workers’ control of production? It is obvious that the power is not yet in the hands of the proletariat, otherwise we would have not workers’ control of production but the control of production by the workers’ state as an introduction to a regime of state production on the foundations of nationalization. What we are talking about is workers’ control under the capitalist regime, under the power of the bourgeoisie. However, a bourgeoisie that feels it is firmly in the saddle will never tolerate dual power in its enterprises. Workers’ control consequently, can be carried out only under the condition of an abrupt change in the relationship of forces unfavourable to the bourgeoisie and its state. Control can be imposed only by force upon the bourgeoisie, by a proletariat on the road to the moment of taking power from them, and then also ownership of the means of production. Thus the regime of workers’ control, a provisional transitional regime by its very essence, can correspond only to the period of the convulsing of the bourgeois state, the proletarian offensive, and the failing back of the bourgeoisie, that is, to the period of the proletarian revolution in the fullest sense of the word.”


This shows the utopian and duplicitous nature of those demands of sections of the statist left for nationalisation by the capitalist state, accompanied by face-saving calls for it to also hand over workers control. As Trotsky describes, such a demand is only possible in conditions of dual power in society, in which the workers seize control of their own workplaces, arms in hand.

“If the bourgeois is already no longer the master, that is, not entirely the master, in his factory, then it follows that he is also no longer completely the master in his state. This means that to the regime of dual power in the factories corresponds the regime of dual power in the state.

This correspondence, however, should not be understood mechanically, that is, not as meaning that dual power in the enterprises and dual power in the state are born on one and the same day. An advanced regime of dual power, as one of the highly probable stages of the proletarian revolution in every country, can develop in different countries in different ways, from differing elements. Thus, for example, in certain circumstances (a deep and persevering economic crisis, a strong state of organization of the workers in the enterprises, a relatively weak revolutionary party, a relatively strong state keeping a vigorous fascism in reserve, etc.) workers’ control of production can come considerably ahead of developed political dual power in a country.”

(ibid)


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