|
|
                 |
How planned was Stalin’s ‘planned’ economy?
Before
undertaking an evaluation of Stalin’s ‘planned’ economy an analysis of the
dire economic situation in 1928 is required. Although a predominately
agricultural nation, Russia was unable to feed its people, relying on archaic
farming methods, whilst industry remained very small scale. Russia was the lone
Communist state, despised by the capitalist West. Afraid of the threat of
western invasion Stalin was acutely aware of the need to prove Communism could
lead to a successful state economy. He knew that a thriving and strong state
could not be bullied by the West and would improve the chances of spreading
communism. Stalin famously said in 1931: ...We
are fifty to a hundred years behind the advanced countries. We must make good
this lag in ten years. Either we do it or they crush us. 1 He warned that if Russia did not change from an underdeveloped, agrarian country into an advanced, industrial power extremely quickly it would be overtaken by the capitalists who feared the spread of communism and wished to destroy it. Stalin's fears were well grounded because it was well known the West wanted to smash communism. Stalin, and his people, were united in thinking Socialist society could only succeed if industry was quickly modernised and expanded. In the next decade Stalin used his totalitarian powers to shape the economy in his own image, using the Five Year Plans, in what was called the ‘Second revolution’. Based in Moscow, Gosplan, the central planning office, set production targets for each industry, such as coal, gas, steel, and ship building, which had to be met after five years. From these targets every factory devised its own targets for every worker. It is often said the Five Year Plans demanded the impossible, through 'hopelessly optimistic'1 targets. For example, Stalin demanded industrial production to increase by 180%1. He used the slogan 'there are no fortresses that cannot be conquered by the Bolsheviks'1 to stir up patriotic fever amongst the workers declaring war on the inefficiencies of Russia's past. Existing factories had to dramatically expand and people had to work longer hours. Labour camps were established in remote areas of Russia where prisoners worked, in terrible conditions, on dams, factories and canals. Huge new factories and cities like Magnitogorsk were constructed in remote areas east of the Ural mountains and Siberia. Here no wages were paid and millions died. The state was able to use the profits to reinvest in industry. Much of the planning concentrated on heavy industry as this produced the materials necessary to wage war. Stalin placed great importance on iron and steel because he saw them as the basis of industrial growth in the west. The basic aims of the 5-year plans were to convert the USSR from a backward agricultural country to a leading industrial power, to effect the complete collectivisation of agriculture, and significantly, to transform the very nature of society. Lewis thought Stalin’s motives behind industrialisation ‘were mainly ideological'2. The ‘iron grip’ centralisation allowed Stalin over industry was always his priority over an efficient implementation of the plan. Indeed Russia was able to modernise to become an industrial giant. By 1940 it had overtaken Britain and France, had caught up with Germany and was beginning to catch up with the USA. It proved largely immune to the 1929 Economic Crisis, having little trade with the West. This demonstrated the economy's strength. In 1930 78% of all machine tools were imported but in 1937 this figure was reduced to less than 10%2 ,a huge improvement. When the USSR was invaded by the Nazis in 1941 it was self-sufficient, possessing a large-scale iron and steel industry, automobile plants, a chemical industry, electrical power stations and engineering works. It mined all its own coal, drilled and refined all its own oil. The mechanisation of transport was far advanced and the USSR had the most mechanised farming system in Europe. Without these tremendous industrial advances it would probably not have survived the War with Nazi Germany. However, there were many serious shortcomings which show how improvised the ‘planned’ economy actually was. Lewis described the ‘planned’ economy as a ‘paradox’. He saw a ‘breakneck plunge into rapid industrialisation’2, rather then the implementation of a set schedule. Evidence of this is that decreasing the speed of progress was ‘treated as sabotage’ 2. The industrial improvement was set against a background of inefficiency often as great as that in agriculture. Kotkin saw ‘colossal waste and inefficiency’3. The plans never encapsulated 'quality and innovation'4. They were merely quantitative totals and this exacerbated the problem, requiring more and more bureaucrats. Those who chose to ‘sit in Moscow and give orders’1. could never ensure they were carried out to an efficient, high standard. In Stalin's poorly planned economy appearances counted for everything. Lynch wrote that organisation was so bad that the ‘term plan is misleading'5. Many of the peasant workers had not even seen a machine before. There are many specific examples of Stalin personally showing a lack of understanding, playing a negative role and disrupting any measured planning which existed. The original 1928 project for the Magnitogorsk works envisioned an annual capacity of 656,000 tons. But by 1930 the capacity had been raised to 2.5 million tons, quadruple the requirements of a year earlier. The Bolshevik leaders also called for the plant to be the latest word in technology’3. The planners wanted huge size but at the same time they also wished for highly technological industrial plants. Kotkin said ‘the desire to have such a plant, however, was not easily converted into the capacity to erect one’3. The results of Stalin’s 'wilful'6 method of planning, can be illustrated in the case of the development of synthetic rubber. The first batch of the material produced by a new experimental method became available in January 1931. Against all the engineers' advice it was decided to go ahead and build one or maybe even two factories. Stalin however wanted TEN factories before the end of the first five year plan. Stalin contributed more to the chaos than to its resolution. This intervention was clearly inefficient, unhelpful and counter-productive, showing the blatant lack of planning in the economy. It led to numerous unsolved technical problems and limited construction resources were spread over ten sites. Bullock claims that the result was that starts were made on only three factories during 1932-33; the rest were not built either in the first or second five year plan1. Kotkin said the centre wielded ‘power of the most crude, clumsy and often counter productive kind’3. Stalin's obsession with scale was matched by his unrelenting, often impossible insistence on speed. Without even attempting to present a reasoned case, Stalin made a surprising appearance at the Council of Commissars and shockingly insisted that the already ambitious figures, which Gosplan proposed for the five-year Plan, should be increased by up to (and in some cases exceeding) 100%’3.Unsurprisingly this threw the balance of the plan into chaos. Even though impractical Stalin also demanded the plan should be completed in four years. Once again the impact of this intervention was negative leading to constant disruption of production schedules, maximisation of waste and the encouragement of an unplanned scramble for the limited resources of material and labour, hardly what was envisaged. Surely, these resources could have been better managed. McCauley questioned the planned economy, saying that they were formulated- ‘irrespective of economic rationality'4.and that ‘human will overruled mathematical calculations'4. As in the case of the collective farms, Stalin was obsessed with what Fitzpatrick called 'gigantomania'7 the worship of size for its own sake. He demanded flagship industrial complexes be built, like the kolkhozoy, on a scale which surpassed Russia's resources to construct or operate. They were much less efficient due to their size. The result was that they either took far longer to complete than was economical, and then were constantly subject to breakdowns or were left unfinished. Similar emphasis on the spectacular from the Stakhanovites showed how little Stalin understood the steady, systematic rhythm of work needed to make a modern industrial plant produce successfully and efficiently. The ‘planned’ economy reflected this lack of understanding. Stalin claimed his changes led to economic success, but the figures he used to show this have been described as 'a shower of glittering and often incompatible statistics'4. Bullock said of Stalin's figures 'soviet statistics have long been a subject of continuing controversy'1. Such dubious statistics are incompatible with a planned economy. Many Historians have concluded that the statistics or the instruments of control available in Moscow were in reality far behind the extent suggested by the ‘totalitarian’ model. An example of how Moscow’s plans were out of touch with reality was the competition for labour between different sectors and enterprises which drove money wages well above the limits laid down at the centre. Further evidence of this was that in 1929, the industrial labour force was estimated in Moscow to rise by some 50% by 1932. In fact, it doubled. When the impossible dates were not met, Stalin showed his brutality. He falsely denounced those involved as guilty of crimes such as sabotage, wrecking and conspiracy. He targeted the former bourgeois and foreign specialists who were convenient scapegoats, but on whom Soviet industry was heavily dependant for technical and managerial expertise. Once again he played a negative role in the process. In this case Stalin was forced to recognise that the cost of losing their services could be fatal to the success of the Plan, but he never abandoned his suspicions or his belief that the way to achieve the maximum out of anyone in a position of responsibility was to keep them in a permanent state of insecurity. Russia would have progressed more if Stalin had used his powers in a less brutal fashion. The economy lacked a settled system of organisation characteristic of a planned economy. Kotkin wrote that ‘there was a seemingly endless search for adequate administrative structures through reorganisations of the ponderous, massive bureaucracy’ in reaction to the permanent chaos which would never have occurred in a truly planned economy. Action agreed, seeing ‘hectic growth and ceaseless flux, marred by gross waste and inefficiency’ 8 in the bureaucracy, with ‘corruption and abuse’8 rife.
There appears little doubt that the ‘planned’ economy was in fact to
a much greater extent an ‘improvised’ economy. The consensus among modern
Historians is that the ‘planned’ economy was structurally flawed and if a
less ‘delirious’3 approach had been followed Russia would
certainly have performed more efficiently. Stalin favoured centralisation
because it allowed a concentration of power, in his hands, allowing him to
demonstrate his inability to implicate a balanced plan. Instead a
‘constantly changing’8 plan was experienced which was far
less efficient. Bullock wrote that Russia’s huge size as well as the dearth of
‘competent administrators, economists, engineers and managers in industry’1
inevitably made the system of centralised planning ‘inefficient
and cumbersome’1.The reality of the ‘planned’ economy
was that it‘lacked skilled men, sufficient equipment and enough time’2.
I think that the ‘planned’ economy was contradictory and was unplanned in
many ways. Bibliography
References
|
|
|