MARXISM AND

MATERIAL INCENTIVES

Gorbachev report to June 1987 plenum on deepening democracy in USSR. Bureaucracy and inertia stifle economic growth. Need for scientific-technological restructuring. Will it be at expense of workers, as in the capitalist economies? Pisarevsky article on material incentives and restructuring. Danger of widening income gap. What happens to displaced workers? A problem of too much equality or too little? Input of trade unions in settling wage rates. Right of unions to legislative initiative. Brezhnev speech to 26th Party Congress. Pravda on problem of low skills. Attacks on "egalitarianism" and "leveling." Lenin on equality. Distribution according to work, or according to need? The persistence of bourgeois right in the first stage of communism.

Democracy in all walks of life is expanding and deepening. Public organizations are displaying more initiative. Democratic principles are gaining momentum in production management. Public opinion is coming across loud and clear. The media is working more actively for renewal. An offensive is in progress against bureaucratism. Bossy, pressure management is gradually being overcome. Important changes are taking place in the work of cadres as fresh blood is injected.

The democratization experience convincingly shows that we are on the right road. This offers good prospects for perfecting our political system and society as a whole.¹

Earlier, in his report to the 27th Party Congress on February 25, 1986, Gorbachev had said that:

. . . difficulties began to build up in the economy in the 1970s, with the rates of economic growth declining visibly. As a result, the targets for economic development set in the CPSU Program . . . were not attained. . . .

The main thing was that we had failed to produce a timely political assessment of the changed economic situation, that we failed to apprehend the acute and urgent need for converting the economy to intensive methods of development, and for the active use of the achievements of scientific and technological progress in the national economy. . . .

By inertia, the economy continued to develop largely on an extensive basis, being oriented towards drawing additional labor and material resources into production. As a result, the rate of growth of labor productivity and certain other efficiency indicators dropped substantially.²

Of course, this is not the first time in recent decades that there has been a call by a congress of the CPSU for a struggle against bureaucratism, for the broadening of democracy, for the observance of legal norms against high-handed methods of political procedure and production methods. The 20th Congress in 1956 was notable for precisely that, as well as later congresses. There has, in fact, been a continuous stream of calls for greater democratization of the organs of the Party and government, especially in economic affairs. Today, however, it is envisioned on a much broader and more intensive scale.

Nor is the scientific-technological revolution an altogether new phenomenon in the USSR. It was reported, discussed and acted upon in the 25th and 26th congresses, and even earlier. The whole gigantic effort to industrialize the country since the October Revolution of 1917 has been one giant effort to apply the latest findings of science and technology to industry as efficiently as was possible at the time. This is not to overlook, of course, the very severe, extremely harsh methods utilized during some periods of socialist development. The current problem relating to the scientific-technological revolution differs in that over the last few years, maybe as long as ten years, there has been a slowdown in the growth rate of the economy, according to Secretary Gorbachev.

The fact is that the scientific-technological revolution is a global phenomenon that has taken hold particularly in the most highly developed capitalist countries. One of its fundamental aspects is that, as against previous phases of development, this one has meant a quantum jump in scientific and technological progress. To some extent, it has developed more rapidly in the leading capitalist countries than in the USSR. So that, to prevent a wider disparity in scientific-technological development, it is necessary for the USSR to also take a qualitative leap, as Secretary Gorbachev has said. But how is this to be done?

We know how it is being done in the leading capitalist countries: by a massive and continuing attack on the living standards of the working class, by plant closings, outsourcing, the creation of offshore facilities in the less developed countries, etc. But most of all, this almost seven-year-long wage-cutting offensive against the workers has manifested itself in an enormous shift to low-paid jobs that far outweighs the creation of some high-paid jobs among the more skilled and in the high-tech industries. Hence, high-tech means low wages.³

It is conceded by most bourgeois economists that the scientific and technological leap made in recent years in such capitalist countries as the U.S. has resulted in the phenomenon of low-paying jobs, especially in the service industries, and that this is gradually making its way into high-tech as well. But the whole thing is masked by the continuing relative growth of the capitalist economy. The question is: Is this phenomenon occurring in the socialist countries as well, above all in the USSR? That would seem utterly contrary to and inconsistent with the entire history of socialist development in the USSR. So that the core issue in the Soviet reforms is how to deal with the phenomenon of the scientific-technological revolution. First, of course, the democratization process is exceptionally necessary. This scarcely needs to be said. However, there is the question of the economic content of the democratizing process. Who benefits from it and who may possibly be hurt by it? Which social groupings voice their views first and which don't we hear from?

We know that the imperialist bourgeoisie hails the utilization of the new democratic processes by certain neobourgeois elements, and conveys the impression that they are all there is. However, that is to take a narrow view of the inherent possibilities for socialist democratization and the participation of the broad mass of the workers. Indeed, in his report, Gorbachev called upon the creative energies of the masses and for their broader participation. Still, we have to look at the economic content of the democratization process and see how it affects each stratum of the population and which ones have given voice to their views.

The Soviet restructuring reforms naturally raise the question of how they will affect the wage levels of the workers. To the workers this is one of the principal issues. Of course, the wage problem has to be viewed in connection with the whole plan. Wages have to be considered in the totality of the situation of the USSR, not as an isolated phenomenon. An article on this subject entitled "Economic reform in the USSR: Material incentives are part of restructuring" was distributed in the U.S. in March 1987 by Novosti Press Agency in the form of a press release. It was written by Gennadi Pisarevsky, who was identified as a political analyst.

" `From each according to his ability, to each according to his work,' " says Pisarevsky, "is the main principle for the distribution of material benefits under socialism. The better a person works, the more he should get from society. This is social justice as we see it, but we now see it being violated."

How is it being violated?

"Regrettably, we have lost much of our ability to control the quality and quantity of labor. As a result, the earnings for bad and good work have become largely the same. The wages for skilled and unskilled labor do not differ much, either."

This is surprising, if not astonishing, since the difference between skilled and unskilled workers in the USSR has long been recognized as an inevitable carryover from capitalism. The author presents no wage data to demonstrate his thesis. In fact, no data appear in the article whatever. However, he asserts that "the engineering profession has become much less prestigious." (This strikes us as highly questionable.) "The incomes of all working people have been growing, but those of unskilled labor have been rising even more quickly. Now a worker with the highest qualifications gets just 50 percent more than a low-skilled newcomer. Without solving this problem a tangible acceleration in economic development is unthinkable."

The economic reform, according to him, therefore rotates around the higher paid getting more--at the expense of the lower paid, if we take the national income as a whole into consideration.

According to Pisarevsky, "The improvement of the pay-according-to-work system and the introduction of new wage and salary schedules are a major part of the radical economic reform which is taking place in the USSR. This should be completed . . . in the Twelfth Five-Year Plan period (1986-1990).

"The gist of the reform is a dynamic switchover of the economy as a whole and each enterprise in particular to a self-financing scheme. Every enterprise should pay for itself, so to speak, rather than getting subsidies from the State Budget, as often happens now."

According to our understanding and to the basic reports emanating from the 27th Congress, including the reports of Secretary Gorbachev and others, the gist of the reform is modernization and retooling, the introduction of new, high technology and the phasing out of older technology. That is the basic material foundation of the reform. That will raise the productivity of labor in an intensive way, rather than by extensive methods, as Gorbachev says was done previously. But it signifies the displacement, as we have indicated earlier, of a great number of so-called excess workers. Hence, the imperative necessity of retraining those workers expected to be eliminated by the scientific-technological revolution.

Of course, vast sums of capital have to be invested in the new equipment. But an equal if not greater portion of the national budget must be allocated to the retraining of the workers who inevitably will be eliminated as a result of the retooling, the phasing out of obsolescent plant and equipment and even whole industries. By the end of the planned conversion this will amount to millions of workers. That's where the money has to go. That, it seems, is the ABC of the whole process.

However, according to Pisarevsky, the fundamental changes to be made are not the scientific-technological revolution, the modernization of the plant and equipment and the replacement of obsolescent plants and tools, but instead are in the social sphere: changing the relations between the managers, the skilled and the unskilled, which incidentally results in lowering the pay of the less-skilled worker. Not a word is mentioned about the staggering problem of retraining the lower-paid workers. The change which he envisions, and he says is based on the 1986-90 five-year plan, thus runs dangerously close to the way in which the restructuring process is proceeding in the capitalist countries.

Pisarevsky says the gist of the reforms is a dynamic switchover to a self-financing scheme. Every enterprise should pay for itself instead of getting subsidies from the state. But how would the Soviet space program, for instance, ever have succeeded if it hadn't received subsidies? Such subsidies are the product of the labor of many millions of workers, whose contribution to the state budget pays for not only the space program but for the defense establishment in its entirety, to give just one example.

(It should be interjected here that the U.S. imperialist bourgeoisie, which is always advising the USSR to solve the problem of consumer goods by cutting into heavy industry and its defense budget, has itself been on the wildest spree of military spending ever, to the tune of over $2 trillion in the Reagan years alone. This of course has forced the USSR to divert more of its resources to defense.)

Some Soviet industries could never have been developed, let alone have survived, without subsidies from the state. What is the meaning, then, of "self-financing"?

"But how will this plan be introduced into practice?" Pisarevsky asks. "All enterprises are state-owned in this country, and the state should not prefer some over others. But today ministries often take part of the profits from enterprises which do well in order to subsidize those who don't. This practice is unjust and, naturally enough, will be abolished. But there should be equal pay for equal work." There are many regions of the USSR which are still less developed than others. The task of socialist construction is to raise them up to as high a level as possible, which certainly means subsidies of one form or another. One can never equalize all the regions, but this is precisely one of the great missions of socialist reconstruction.

He then continues: "The wages of workers will go up by 20 percent to 30 percent, and the salaries of high-level executives, specialists and professional people will be raised 30 percent to 35 percent."

"Workers who service processing centers, program-controlled tools, robotics and automatic lines," he says, "will get the biggest increase in wages. They will receive special rates which will be from 40 percent to 45 percent higher than today. The bonus for higher qualification will also be substantial. All in all, 75 million Soviet people will have their wages and salaries raised."

The reform of the pay-according-to-work system, says Pisarevsky, will result in greater autonomy for individual enterprises and greater responsibility for the results of their work. "The management has been given the right to raise the earnings of the best specialists by a quarter of their wages or salaries. True, this right can be abused. . . . To avoid this, the management is obliged to present its decision before the trade union committee and the entire work collective."

This view of the plan marks a sharp shift in favor of the higher-paid workers and all the executives, specialists and higher-ups. Pisarevsky offers no data on the ratio of skilled to unskilled workers or what industries, enterprises and regions will be most affected and no mention if any high-tech equipment will be used or what role it will play in raising productivity. Lower-paid workers, he claims, have been getting much more than they should while the higher-paid ones have been losing ground. Such a picture is completely at odds with what we've known about the USSR for many decades. On the contrary, one of the problems is and has been the disparity between the lower-paid and average workers on the one hand, and the higher-paid workers and general officialdom of the state apparatus on the other. The many privileges they have been entitled to are considered enormous by comparison. The last time there was a significant rise in the wage level of the lower-paid workers was in 1956. There was a rise of about one-third in the lower categories of salaries and pensions, and pensions were drastically revised in favor of employees with low earnings. The method of payment by piece rate was largely abandoned in favor of hourly wages. All this happened immediately following the 20th Congress, during the Khrushchev era. But this substantial raise for the lower-income workers was balanced in time by increased wages to the higher-ups and above all by a systematic increase in the application of material incentives. We really know of no significant increases for the lower-paid workers that were not balanced out by material incentives for the higher-ups.

According to Pisarevsky, the plan's "implementation will become one of the most important events in the life of Soviet society, so these measures were discussed in detail in 150 work collectives. The reform was approved by a majority of the working people."

A majority of the working people approved it. He doesn't say how large a majority, whether it was 51 percent or 91 percent. He doesn't tell us what kind of collectives these are, from what industries or regions, or the character of the discussion. Most of all, he doesn't say whether the trade unions participated in the discussions and what their views are. He concludes, "Now the main principle of socialism--from each according to his ability, to each according to his work--will finally have a chance to be proven in practice."

Now let us see another version of how the reforms are working. It's an article in Pravda which deals with a report by the First Secretary of the Bryansk City Party Committee.

"How is restructuring coming along in the economic sphere?" Secretary A. Kurasov asks. "Though there are difficulties, progress is nevertheless being made. Economic work has been stepped up in the labor collectives. Factors contributing to intensification are being applied more persistently, and the targets for labor productivity have been exceeded. The general level of fulfilling contract obligations has risen as well. . . . The province also handily met its quotas for the sale of meat, milk and eggs to the state during the first six months of the year. Major construction continues to improve. . . . The rate of increase in capital investments for social needs this year was 2.3 times higher than the rate for the economy as a whole."

So far, so good.

"But," continues the Pravda report, "here's the other side of the coin. Wages have gone down in a number of collectives. There have been such cases at the Bezhitsky Steel Plant, the piston ring and telephone equipment plants in Klintsy, the Kokorevka Furniture Factory and several other enterprises. These enterprises failed to stabilize their work and fell into a difficult economic situation. As is well known, wages have become more closely tied to end results nowadays." ⁴

We thus see that all is not as well as Gennadi Pisarevsky claims. Some wages have gone down. The report in Pravda doesn't say by how much or how this is possible in a plan that is aimed at increasing wages for 75 million people, as outlined in Pisarevsky's article. How could this happen? Why should "failing to stabilize the work" result in lower wages for those who worked? Who is responsible for the stability of production? Isn't it the managers? Is this what is meant by wages being tied more closely to end results?

The Pravda report also adds, "Construction collectives that used to live by inflating their production figures and that widely practiced wage padding are also in a difficult situation. What can be done? It's quite clear that a return to the old way of doing things is impossible. That means there is only one path: to raise the quality of work everywhere, to clearly and concretely explain to people the measures that are being implemented to improve the system of payment for labor, and to inculcate the truth that every ruble of wages has to be earned." No mention here of new technology, retooling or phasing out of old equipment or the introduction of retraining programs.

Wage padding is not something initiated by workers from below. This is an abusive practice of managers. It is a survival of the practice in capitalist governmental agencies and businesses of "no show" jobs where officials collect the wages for themselves. For this reason alone, the authority of the enterprise committees and of the trade unions as the central organs to combat this should be reinforced. Wage padding and other practices should not be used as a basis to hand out higher wages and bonuses to the higher-ups, especially the very high, supposedly to increase productivity.

The article urges a switch over from quantity to quality work and accountability for money spent, but just how is not made clear. Suffice it to say that the phenomenon of lower wages in some collectives shows there's something amiss here.

At the same time, Pisarevsky says that management has been given the right to unilaterally raise the earnings of the best specialists by a quarter of their wages or salaries. If this right is abused, if, for instance, "an executive . . . give[s] this bonus to his friend or to those whom he needs for his own purposes," only then is management "obliged to present its decision before the trade union committee and the entire work collective." Of course, this is far superior to what happens in capitalist society, where the owners of a corporation can enforce whatever decision they make upon the workers, especially where there are no effective trade unions. However, it is a departure for the USSR from previous practices. Managers had authority, but never so wide and sweeping. Their authority related to the production process, the management of the plant or the enterprise. The wage rates were primarily the function of the trade unions--of course, as part of the planning process of the whole government. The trade unions are not autonomous organizations, nor are they expected to be; they are part and parcel of the national planning process and an integral part of the government.

Thus the question of wages generally and material incentives in particular for management, specialists and others is a matter of deep concern for the trade unions, and should be discussed at their upcoming congress. Such matters cannot be left to the individual judgment of the managers, only to be approved after the fact by enterprise committees. Such a procedure reduces the significance of the trade unions as a fundamental organ of the workers in the process of production and in the planning process in general.

Under Soviet law, the unions have a constitutional right and obligation with respect to this very critical question. If, as Gorbachev's statement says again and again, one of the objectives of the reforms is to democratize all the institutions of Soviet society, the arrogation of such vast responsibility by the managers of the enterprises goes against this very concept.

As long ago as the 26th Congress of the CPSU, then-secretary of the Party Leonid Brezhnev stated, "Comrades, the Constitution of the USSR has greatly enhanced the role of public organizations in the development of our democracy. The largest of these are the trade unions." ⁵

Several years earlier, speaking to a congress of the trade unions, Brezhnev had said, "The dual task of the trade unions is to show concern for the development of the national economy, for increasing production, and concern for the rights and interests of the working people and their working and living conditions." ⁶

The trade unions take a direct part in the management of production. There were at the time of the 26th Congress more than 70 functions of management which could not be performed without the consent of the trade union committees. Twenty functions were in the competence of the unions. The sweeping powers now granted to management cut all this down and reduce the role of the trade unions in reality. However, one thing should be borne in mind which is to the great advantage of the workers in the USSR. Under the Soviet constitution, according to Brezhnev, "the trade unions have a rich arsenal of forms and means to exercise their rights." ⁷ These go beyond having workers' meetings. They have the right to permanently function in "standing production conferences and collective agreements" and, what is of exceptional importance, the "right of legislative initiative." ⁸ (No union has the right to legislative initiative in a capitalist government!)

In this country we hear only of the neobourgeois elements in the Soviet Union and their criticisms; we never hear what really springs from the interests of the workers, who are concerned with strengthening and deepening socialist reconstruction.

Aside from the general problem of material incentives--their functions, parameters and limitations and their advisability in certain historical circumstances--the question is how they are to be awarded and who is to judge. It seems that the shift is decidedly in the direction of greater management prerogatives, to the detriment of the unions, whose chief responsibility is the well-being of the workers. Bourgeois ideologists in capitalist countries are constantly applauding every move made by the Soviet government which seems to indicate the independence of management and the general loosening of the planned economy. Some reports actually call for the absolute independence of the unions from the government. This is false and destructive in a socialist society and planned economy. No institution can be independent, and least of all the unions that have primary functions in production and in the planning of it. Their functions are many and are not inconsistent with the objectives of socialist construction or the scientific-technological revolution.

The bourgeois press continually distorts decentralization, hoping it will lead to the liquidation of socialist planning and its substitution by the capitalist market. Overblown bureaucratic practices and excessive centralization of course impede the development of the economy, and it may be necessary to distribute some functions to lower organs of government and to different regions of the country. But it's another matter entirely to arrogate to the managers sweeping authority as against the enterprise committees and the trade unions.

The example of the Bryansk case cited in Pravda shows it is the proper function of the unions to correct the situation. That is why they have the constitutional right of legislative initiative to correct not only local but national matters in accordance with the plan. These are safeguards built into the planned economy.

Another article in Pravda in October 1986 summarized the growth of the working class in the Soviet Union and its relation to modern technology:

Over 61 percent of the workers are employed in manufacturing, construction, transport, communications and other industries. Every fourth worker is engaged in the services. Workers account for approximately half of the farming personnel and about a third of the employment in science and related services.

The level of organization of the working class has risen. Almost all blue- and white-collar workers belong to trade unions. . . .

What is it that stimulates the working class as the main social force behind the countrywide acceleration process? The economy of the supreme type of organization and efficiency, which is our objective, requires workers of a new technological outlook, efficient citizens prepared, vocationally and psychologically, for change in the technological base of the production sector.

. . . low blue- and white-collar skills are a brake on new technology. Material and moral losses from personnel incompetence will grow with a switch to more advanced technology.⁹

We still have big numbers of unskilled and semi-skilled workers. Also, the knowledge of many skilled workers is already obsolete. The progress of research and engineering and plant renovation would step up the obsolescence of blue- and white-collar skills.

Without such programs, we will not be able to avoid economic losses (from new technology under-utilization) and social losses (which can arise because of difficulties with the employment of workers of outdated trades). Much is being done in this respect. In the late 70s and early 80s, 7-7.5 million workers were learning new trades a year. . . .

In that period, the 27th CPSU Congress admitted, signs of stagnation appeared. Personnel's activity was on the decrease, and the working class's major social values and honest work and collectivism became depreciated. Outdated management leverage and the emphasis on "improving things without changing anything" favored those who wanted to receive maximum from society with minimum effort. There are still many such persons on the shop-floor level.

The nation sustains economic and moral losses from slack and slipshod practices, breaches of factory regulations, drink abuses and embezzlement.

. . . most workers are for socialism's principle, "from each according to his ability, to each according to his work," and against egalitarian wages and dishonest incomes.

Secretary Gorbachev spoke of "leveling" in his report to a plenary meeting of the CPSU Central Committee on January 27, 1987: "New principles have been worked out, and are being implemented, for raising pay in productive spheres. We have taken the unwavering course of abandoning wage leveling and consistently maintaining the socialist principle of distribution in accordance with the quantity and quality of one's work." We are unaware that any such wage-leveling tendencies have been in progress in the Soviet Union in recent decades. Nor have we been able to find out when, if ever, they were abandoned. Throughout the history of the working class, terms like levelers and egalitarians have been hurled against the working class as an epithet. The charge is that the workers' struggle for communism aims to level the wealth of society and divide it among all on the basis of equality.

At one time long before the Marxist era, when the workers were first emerging as a class, there were numerous communist sects which talked about a kind of egalitarian society. Some of these utopian groups, like the very early Christians, envisioned an ascetic sort of communism based on poverty--rather than on abundance, which of course is the aim of scientific revolutionary Marxism. Sects like this existed in Europe around the time of the Reformation, as depicted in Karl Kautsky's book, Communism in Eastern Europe (not to be confused with modern-day Europe).

Genuine communism, the communism of Marx, Engels and Lenin, assumes a society where the productive forces have grown to such dimensions that it is possible to meet all the needs of society, when the bourgeoisie and its state have disappeared along with all class oppression and distinctions. No such society can exist unless the productive forces have attained the level of assuring abundance for all.

With respect to democratization in the program of the 27th Congress, it's important to remember what Lenin said about democracy.

Democracy means equality. The great significance of the proletariat's struggle for equality and of equality as a slogan will be clear if we correctly interpret it as meaning the abolition of classes.¹⁰

But democracy means only formal equality. And as soon as equality is achieved for all members of society in relation to ownership of the means of production, that is, equality of labor and wages, humanity will inevitably be confronted with the question of advancing farther, from formal equality to actual equality, i.e., to the operation of the rule, "from each according to his ability, to each according to his needs." ¹¹

Attacks against levelers and egalitarians in the Soviet Union in our view represent the unwarranted defense of privileged positions in Soviet society, of exorbitant and highly excessive remuneration paid not just to highly skilled workers (that really isn't such a big problem) but to the so-called specialists, managers, the top notch of the managerial staff and the higher-ups in the governmental apparatus as a whole. While every type of protest against privilege is characterized as coming from levelers and egalitarians, the working class as a whole does not entertain such crude, petty bourgeois notions of equality. However, workers do understand the significance of the growth of social inequality, the widening of pay scales and growing social differentiations in the proletariat as a result. This is what rubs the workers the wrong way.

The workers, of course, know that socialist equality will come primarily as a result of the growth of the productive forces. Hence the significance of the application of the scientific-technological revolution, which is necessary for the gradual abolition of all class distinctions. The workers realize only too well, however, that the best they can get under present circumstances is equal pay for equal work.

Let us now take up the formula "from each according to his ability, to each according to his work," which General Secretary Gorbachev calls "socialism's basic principle." ¹²

According to Marx and also to Lenin, "from each according to his ability, to each according to his work" is a bourgeois norm, a bourgeois standard or criterion for the distribution of products that persists in the lower, or socialist, stage of communism. Lenin says that "the mere conversion of the means of production into the common property of the whole of society (commonly called `socialism') does not remove the defects of distribution and the inequality of `bourgeois right,' which continues to prevail so long as products are divided `according to the amount of labor performed.' " ¹³ (Emphases in original.)

The goal of communism is to go beyond this transitional stage, in which formal, bourgeois "equality" in fact perpetuates inequality, and attain the distribution of wealth according to the formula "from each according to his ability, to each according to his needs." The theoretical elaboration of this formula can be found in Marx's Critique of the Gotha Program (1875) and later in Lenin's summary of it in The State and Revolution.

However, what Marx and Lenin saw as an unavoidable defect in the very first stage of communism is now, 70 years after the Russian Revolution, presented as a "socialist principle" by Gorbachev. This is the basic issue. In his report, Gorbachev said that when the new administration took over, the economy was in a pre-crisis stage. Does it follow from this that the solution to the impending crisis must be first of all an intensification of bourgeois norms of distribution? Shouldn't the primary emphasis be on expenditure for high technology, which is the fundamental lever for raising productivity, and the retraining of the less skilled workers in particular?

There is no doubt whatever, no matter how one reads both the Gotha Program and Lenin's summary of it, that pay according to work performed, equal pay for equal work, is a bourgeois measure. Let us then see precisely how Marx and also Lenin put this.

The question of national distribution in a communist society first arose during the ideological struggle of Marx and Engels against Ferdinand Lassalle's conceptions of socialism. The struggle reached a crisis after the so-called Unity Congress held in May 22-27, 1875, in the German city of Gotha between two trends in the German working class movement, the Lassalleans and the Eisenach faction (most of whose leaders adhered to Marx).

The leaders of the Eisenach faction, who were Marxists, neglected to forward a copy of the draft program to Marx before agreeing to it, so great was their eagerness to achieve unity. When Marx and Engels finally got the draft, they were not just disappointed but angered by the many bourgeois notions of the Lassalleans contained in the program. This forced Marx to write a criticism of the Gotha Program, which contains the clearest exposition of Marx and Engels' conception of the development of a communist society.

Lassalle had a pet dogma about the iron law of wages, which Marx, and later Engels, took apart. The term iron law of wages assumes an inflexibility that is altogether wrong historically, since wages fluctuate between capitalist recessions and so-called prosperity. They are the payment for labor power, which is a commodity differing from all other commodities in that it has the property of producing surplus value.

The first part of the Gotha Program to be addressed by Marx says that "the proceeds of labor belong undiminished with equal right to all members of society." ¹⁴ Marx shows that this Lassallean formula is scientifically incorrect and quite impossible.

" `To all members of society?' " Marx asks. "To those who do not work as well? What remains then of the `undiminished proceeds of labor'? Only to those members of society who work? What remains then of the `equal right' of all members of society? But `all members of society' and `equal right' are obviously mere phrases." Marx says that out of every worker's wages must be deducted the amount necessary to replace the means of production that are used up, as well as additional portions for expansion of production, to set up a reserve for insurance against accidents, natural calamities, etc.

"These deductions," Marx wryly points out, are "from the `undiminished proceeds of labor.' . . . There remains the other part of the total product, intended to serve as the means of consumption. Before this is divided among the individuals, there has to be deducted again, from it: First, the general costs of administration not belonging to production." (Emphasis in original.) Here comes a really remarkable observation by Marx. "This part will, from the outset, be very considerably restricted in comparison with present-day society and it diminishes in proportion as the new society develops."

According to Marx, then, a workers' state or socialist society starts off with a smaller apparatus for the administration of the state than exists under capitalism, and it should diminish in proportion as socialist society develops. This means the administrative apparatus of the state and not the services provided by the state, as Marx notes later. From this it follows that the Soviet state apparatus should have been declining in numbers rather than increasing.

There is the need, says Marx, for schools, health services, funds for those unable to work, etc. This part should grow as the new socialist society develops.

"Only now do we come to . . . that part of the means of consumption which is divided among the individual producers of the cooperative society."

Marx explains that we are dealing here with "a communist society, not as it has developed on its own foundations, but, on the contrary, just as it emerges from capitalist society; which is thus in every respect, economically, morally and intellectually, still stamped with the birth marks of the old society from whose womb it emerges." From this Marx draws the conclusion that "equal right here is still in principle bourgeois right. . . . In spite of this advance, this equal right is still perpetually burdened with a bourgeois limitation. The right of the producers is proportional to the labor they supply; the equality consists in the fact that measurement is made with an equal standard, labor. But one man is superior to another physically or mentally and so supplies more labor in the same time or can labor for a longer time, and labor, to serve as a measure, must be defined by its duration or intensity. Otherwise it ceases to be a standard of measurement. This equal right is an unequal right for unequal labor." (Emphases in original.)

Thus it is very clear that bourgeois right is a standard of measurement in the distribution of the national income. The measurement of equal right is, however, as Marx puts it, an unequal right for unequal labor and is a bourgeois standard.

Then Marx goes on to say, "But these defects are inevitable in the first phase of communist society as it is when it has just emerged after prolonged birth pangs from capitalist society. . . .

"In a higher phase of communist society, after the enslaving subordination of the individual to the division of labor, and therewith also the antithesis between mental and physical labor, has vanished; after labor has become not only a means of life but life's prime want; after the productive forces have also increased with the all-round development of the individual, and all the springs of co-operative wealth flow more abundantly--only then can the narrow horizon of bourgeois right be crossed in its entirety and society inscribe on its banners: From each according to his ability, to each according to his needs!"

What is the difference between the two stages of communism? "Politically, the distinction between the first, or lower, and the higher phase of communism," said Lenin in The State and Revolution in 1917, "will in time, probably, be tremendous." But, says Lenin, "the scientific distinction between socialism and communism is clear. What is usually called socialism was termed by Marx the `first,' or lower, phase of communist society. Insofar as the means of production become common property, the word `communism' is also applicable here, providing we do not forget that this is not complete communism. The great significance of Marx's explanation is that here, too, he consistently applies materialist dialectics, the theory of development, and regards communism as something which develops out of capitalism."

Lenin continues, "Instead of scholastically invented, `concocted' definitions and fruitless disputes over words (What is socialism? What is communism?), Marx gives an analysis of what might be called the stages of the economic maturity of communism." As we can see, Lenin views it entirely in the historical context of the evolution from capitalism into the first and later stages of communism. "In its first phase, or first stage, communism cannot as yet be fully mature economically and entirely free from traditions or vestiges of capitalism." Lenin does not exaggerate or try to prettify this stage, notwithstanding all of its great historical advantages for the working class.

Hence the interesting phenomenon that in the first phase of communism, the criterion of equal pay for equal work is within the "narrow horizon of bourgeois right."

"It follows that under communism there remain for a time not only bourgeois right, but even the bourgeois state, without the bourgeoisie! This may sound like a paradox," says Lenin, "or simply a dialectical conundrum, of which Marxism is often accused by people who have not taken the slightest trouble to study its extraordinarily profound content. . . ."

"And Marx," Lenin continues, "did not arbitrarily insert a scrap of `bourgeois' right into communism, but indicated what is economically and politically inevitable in a society emerging out of the womb of capitalism." ¹⁵

What conclusions, then, do we draw from this in connection with the Soviet economic reforms and plan to restructure wages? First of all, it is necessary to say what Lenin said time and time again. Things must be called by their right names! Bourgeois norms of distribution should not be called socialist norms of distribution. It is necessary to go back to Lenin and Marx and call the form of distribution, the form of payment, a bourgeois right. We are still in the narrow horizon of bourgeois right during the first stage of communism. It is wrong and harmful to embellish bourgeois right, to prettify it, and above all to engender illusions and give it a distorted meaning. Pay according to work performed, equal pay for equal work, is a very great advance in the first phase of communism, notwithstanding its bourgeois limitations. In capitalist society, we are still fighting for it. A large bulk of the working class has not attained this yet. Working women in particular are still fighting to get equal pay for equal work. Even more oppressive is the limitation put on the oppressed nationalities in capitalist countries, where racist and national prejudices and rank discrimination, especially in the United States, prevail. So that equal pay for equal work is still something to be attained in capitalist society, while it has already been attained, at least in a formal sense, in the first stage of communist society in the Soviet Union during the protracted period of socialist construction.

Now that this has been established, what do we do about a bourgeois norm being applied in a socialist society? That may be a contradiction, but all existence is characterized by the movement of contradictions.

What attitude should the state take? Should it take a passive attitude? Should it let this bourgeois norm develop endlessly, spontaneously, unrestricted, so that if altogether unchecked it may swamp the rest of society? Should it let it continue to flourish for such a protracted period, in the 70th year of the October Revolution, and now be enlarged, intensified, deepened? Will that not bring the Soviet Union closer to bourgeois society, at a time when its productive forces have in a number of vital areas outstripped even some of the advanced European capitalist countries?

What does this mean in the contemporary context, in the context of the 27th Congress? According to the Pisarevskys, the burden, i.e., the limitations of bourgeois right, will not be alleviated but will fall more heavily on the backs of the low-paid workers.

If the democratization process proceeds, as everyone hopes it does, it must take cognizance of this regressive phenomenon. It becomes all the more incumbent not only upon the government, but particularly on the forthcoming trade union congress and the members of the labor collectives at the shop and enterprise level, to raise their voices. If this is not done, then as we see it from the vantage point of this side of the ocean, the imperialist bourgeoisie will seek to take advantage of any dissatisfaction and grievances from the workers. It will raise the demagogic slogans of independence for the unions, meaning their bourgeois independence. Is this not what happened in Poland?

All the more then is it necessary, in the course of a developing discussion on the nature of the restructuring, that this be taken into account. Taking a correct attitude in all of this will in itself be one of the very great demonstrations of socialist democracy in action.

References

2. Mikhail Gorbachev, Political Report of the CPSU Central Committee to the 27th Party Congress, February 25, 1986 (Moscow: Novosti Press Agency Publishing House, 1986), pp. 27-28.

3. This theme is elaborated in Sam Marcy, High Tech, Low Pay: A Marxist Analysis of the Changing Character of the Working Class (New York: WW Publishers, 1986).

4. Pravda (Moscow), July 25, 1987.

5. Leonid I. Brezhnev, We Are Optimists, Report of the Central Committee of the Communist Party of the Soviet Union to the 26th Congress of the CPSU (New York: International Publishers, 1981), pp. 66-67.

6. L.I. Brezhnev, Speech at the 16th Congress of the Trade Unions of the USSR, March 21, 1977 (Moscow: Novosti Press Agency Publishing House, 1977), p. 8.

7. Ibid., p. 22.

8. Ibid.

9. Pravda, October 24, 1986.

10. V.I. Lenin, "The State and Revolution," Collected Works (Moscow: Progress Publishers, 1964), Vol. 25, p. 472.

11. Ibid.

12. Gorbachev, report to the 27th Party Congress, p. 56.

13. Lenin, p. 466.

14. Karl Marx, "Critique of the Gotha Program," in Karl Marx and Frederick Engels: Selected Works (Moscow: Progress Publishers, 1970), Vol. 3, pp. 13-19.

15. V.I. Lenin, pp. 470-71.

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