Wednesday, September 17, 2014

Lenin: State and Revolution: Chapter 5 - Withering Away the State (Part Two) Review

Lenin: State and Revolution: Chapter 5 - Withering Away the State (Part Two)
Thomas Riggins

Chapter 5 of State and Revolution  has a brief introduction and four sections. Part Two of this review covers section three. 

3. First Phase of Communist Society

To avoid confusion it must be pointed out that Marx speaks of two phases of "Communism"-- a lower and a higher. By convention the first or lower phase has become known as "Socialism" and the higher or advanced stage as "Communism"
proper. Except for direct quotations, I shall use the term "Socialism" to denote what Marx calls the first phase of Communism and "Communism" to refer to what Marx calls the second phase of Communism.

In this section Lenin presents  Marx's remarks on the misguided views of Ferdinand Lassalle, one of the early leaders of the German working class, some of whose opinions he thought pernicious. Specifically, he wanted to disprove Lassalle's view that workers living under Socialism would get "the full product of their labour."

The idea here was workers would not be exploited because under Socialism: “to each according to his work’’ meant if  I created $100 of social wealth that’s what society would give back as part of my disposable income. Not so, according to Marx. The Socialist state has to deduct from wages money to put aside as a “reserve fund” to make improvements in production and maintain infrastructure. It also needs to deduct money for a social consumption fund to pay for schools, hospitals, pensions, aid to people who are sick or can’t work, salaries for public employees,  etc. If each fund got $10 then for every $100 of social wealth I created I would get back $80 for my disposable income.

The state, just as the former capitalist, would be taking $20 of the surplus value I created. This accounts for the “social” in Socialism. The difference is the capitalists would not be taking the wealth I created and using it for themselves and living high on the hog while I just made do; the State would be using it to do things for me that I really need but could not provide for myself— medical services, rent subsidies, price controls so that food was cheap and available, the secret police to keep the capitalists from making a comeback, etc. 

In Marx’s words: “What we are dealing with here is not a Communist society which has developed on its own foundations, but on the contrary, one which is just emerging from capitalist society, and which therefore in all respects — economic, moral and intellectual — still bears the birthmarks from the old society from whose womb it sprung.” This is the lower phase, right after the revolution, of “Communism”, AKA “Socialism.” Socialism covers this whole first phase out of which the second phase true Communism will hopefully emerge. Unfortunately none of the revolutions of the 20th century succeeded in even establishing the first phase, let alone the second phase of this project— although some countries are still trying to figure out how to get the first phase going.

Now, Lassalle thought that there must be a “just distribution” of the social wealth under Socialism— “the equal right of each to an equal product of labour.” There would be no inequality under Socialism (and nothing for Piketty and others to complain about). Marx is interested in this idea of “equal right.”  He agrees that we have in Socialism “equal rights” but we must understand that “rights” presuppose inequality.  I can demand the right to vote only if I don’t have it. What is the point of demanding what I have?

To demand a “right” is to demand equal standards be applied to all people and people are not really all equal to one another.  In the real world some are smarter, some are richer, some are better educated, some are stronger, etc. In the words of Blake:

Every night and every morn
Some to misery are born,
Every morn and every night
Some are born to sweet delight.

Some are born to sweet delight,
Some are born to endless night. (Auguries of Innocence)

Socialism wants to change these morns and nights, but only Communism will bring sweet delight. Marx says we are still haunted by the bourgeois order when we demand rights because rights are under the regime of “bourgeois right.”  As a good dialectician Marx says that equal rights violates the concept of equality and is actually a form of injustice. Lassalle is wrong and under Socialism justice demands “unequal rights.” Huh?

Suppose under Socialism we get equal pay for equal work. Laura and Judy both get paid the same. Laura is single and saves up some of her pay so she has money to go on trips or to buy extra goodies. Judy is a single mother of two and can’t save up money for trips and extra goodies as three people have to live on her pay. Equal pay results in an unequal outcome. This is the regime of from each according to his/her ability to each according to his/her work. 

While there is no capitalist exploitation of human beings (private property in the means of production having been abolished) Lenin nevertheless points out that Socialism “still cannot produce justice and equality.”  This is because under Socialism distribution is governed by  “work performed.”  Real “justice” and “equality” must await the second or higher form of the transition— Communism where distribution will be governed by need.

 “No justice, no peace” is therefore really a temporary slogan limited to the capitalist era since, while under Socialism there is still “no justice” ( in an absolute sense) there is nevertheless peace because “bourgeois right” is completely enforced and people understand that they are working together to achieve a future Communist society in which the bourgeois notions of justice and equality will have no meaning.

In the words of Marx: “These defects are unavoidable in the first phase of Communist society [Socialism], when after long travail, it first emerges from capitalist society. Justice can never rise superior to the economic conditions of society and the cultural development conditioned by them.” Critics of the 20th century failures and successes of the Socialist revolutions and their successor states still pursuing their goals in the 21st should be mindful of this insight given by Marx.

Lenin points out that Marx was aware (not being a Utopian) that with the initial overthrow of capitalism and the beginning of Socialism the only standard of fairness and the sense of what is “right” is what was learned under the old system— “a fair day’s wage for a fair day’s work”, “equal pay for equal work,” “a living wage,” etc. “Bourgeois right” is the only standard they will initially have and “a form of state will be necessary, which while maintaining public ownership of the means of production, would preserve the equality of labour and equality in the distribution of products.” 

The Socialist state, even as it sets in motion its own withering away, functions at this level to protect bourgeois right and enforces actual inequality. Even under Socialism we understand a better world is possible and that world is explained in the last section of Chapter 5: “Higher Phase of Communist Society.”

This will be discussed in part 3 of our review of Chapter 5 of State and Revolution.

Tuesday, September 09, 2014

Piketty for Progressives -- Part 3

Thomas Riggins

5. From Marx to Kuznets, or Apocalypse to Fairy Tale

As we have seen, Piketty rejects Marx's views about the future of capitalistic inequality, which  he called "Apocalyptic", and in this section he will also reject the views of Simon Kuznets (1901-1985) which he finds too optimistic.  Kuznets engaged in empirical studies and arrived at the view that as capitalism became more advanced income inequality would decrease-- on the principle (mis-attributed to President Kennedy) that "a rising tide lifts all boats."

Although Piketty does not accept Kuznets’ conclusions, he credits him with being the first to empirically utilize two sources of information which must be used in conjunction to be able to meaningfully study income inequality and its evolution__ i.e., growth of national income for a country and the distribution of that income to individuals. It was using such information that Kuznets arrived at his views regarding the decrease of inequality. The question is--  did the data reflect universal trends within advanced capitalism or just an historical fluke? If the latter then Kuznets’ theory was a "fairy tale"-- as Piketty suggests by this section title.

6. The Kuznets Curve: Good News in the Midst of the Cold War

In this section Piketty says that Kuznets admitted his statistical discovery of a decrease in inequality in the US (the period covered was 1913 to 1948) was “largely accidental.” In his 1953 book Shares of Upper Income Groups in Income and Savings he even admonished his readers not to jump to conclusions based on his data. But that is just what he did himself two years later in a famous lecture where he proposed a bell curve to explain the relation between capitalism and
inequality. As capitalism begins to develop inequality increases between the capitalists and the general population and peaks just as capitalism becomes mature and widespread, thereafter it begins to decline as the benefits of the capitalist system begin to be shared by all.

Even in this lecture Kuznets says his statistics reflect unique historical circumstances, but also suggests that, despite the historical specificity that shaped his curve, the inherent nature of the capitalist system itself would also work to produce the curve. This was simply cold war propaganda posing as science.
Piketty points out that in the lecture Kuznets told his audience (it was a speech to the American Economics Association) that he was giving an optimistic twist to his theory to, in his own words,” keep the Third World “within the orbit of the free world.”

Nevertheless, despite this lecture and other papers, Piketty says that Kuznets showed the true “scientific spirit” in his big 1953 book (the supposed first use of meaningful statistical analysis) even if the Kuznets curve is a fairy tale. It was the two world wars and the Great Depression that brought about a decrease in inequality not the inherent tendency of capitalism.

7. Putting the Distributional Question Back at the Heart of Economic Analysis

Piketty thinks the question about how wealth is distributed is important. He says there has been a big increase in economic inequality since the 1970s— in all the developed countries, but especially in the U.S. In the Third World it is possible that economic development may decrease inequality— especially the development of China. All of this, he says, is a cause “of deep anxiety.” He does not make clear why this should be so— whether it is the growth of inequality, the development of China, or both.

Also, markets that are supposed to exhibit “balanced growth” according to Kuznets and others ( real estate, oil and financial) are showing remarkable “disequilibrium.” Piketty asks who will be running the show in 2050 or 2100 (i.e., controlling the world as it were). He lists several possibilities, one of which is the Bank of China. I can see the origin of “anxiety.” The Bank of China is ultimately under the control of the Chinese Communist Party (it is state owned).

In any case, the distribution of wealth becomes, for Piketty, the most important area of study if we are to understand the growth of inequality. To determine this we must collect data on the economic history of many countries and forecast future developments by a scientific understanding of past and present trends.

8. The Sources Used in Piketty’s Book

Piketty says his work is basically an extension of the work begun by Kuznets in his study of the period 1913-1948 in the U.S.  Kuznets’ statistical methods were extended to France, the contemporary U.S., and to other countries. But “the primary source of data” for the book comes from the World’s Top Incomes Database (WTID). [Google: The World’s Top Incomes Database]

Piketty says there are TWO components of income— from labor and from capital.
He says labor income consists of wages, salaries, bonuses, non-wage labor, and income “statutorily classified” as such [tips?]. Capital income consists of rent, interest, dividends, profits, royalties, capital gains, and “other income” from land, real estate, financial instruments, industrial equipment, etc. [!]. It is obvious that this is an un-Marxist way of treating income but Piketty can define his categories anyway he chooses since he is not a Marxist economist. We shall see later how useful, or not, his definitions are.

Piketty says his book “stands out” from those before it because he has “made an effort to collect as complete and consistent a set of historical sources as possible”
for the study of the distribution of income and wealth “over the long run.”

We will resume the fourth installment  of this commentary on Piketty’s introduction with the 9th section :“The Major Result’s of Piketty’s Study.”

Thursday, September 04, 2014

Lenin: State and Revolution, Chapter 5 (Part One) Review

Lenin: State and Revolution: Chapter 5 - Withering Away the State (Part One)
Thomas Riggins

Chapter 5 of State and Revolution  has a brief introduction and four sections. Lenin opens by telling us that Marx’s major discussion of the withering way of the state is to be found in his Critique of the Gotha Program. The Gotha Program was the founding document of the SPD in 1875. Although Marx wrote it in 1875, it was not published until 1891, eight years after his death.

1. Formulation of the Question by Marx

Lenin makes some very interesting comments in this section-- relevant to our understanding of socialism and the transition from capitalism in the twenty-first century. First, as opposed to those who maintained that Marx and Engels had different views on the nature of the state, i.e., that the Letter to Bebel and the Critique of the Gotha Program are incompatible, Lenin says that they were actually in complete agreement on the state. The two works dealt with different aspects of the state and it is only by misinterpreting these works that any so-called incompatibility arises. Engel's letter dealt with the issue of what the state is under capitalism and the incorrect notions held of its role after the socialist revolution. Marx was interested in discussing  the transition from socialism to communism. Marx was dealing with the evolution of communism. "The whole theory of Marx," Lenin says, is an application of the theory of evolution ... to modern capitalism." This raises a couple of interesting points. 

For instance, Herbert Spencer (1820-1903) has been criticized for trying to apply the theory of evolution to modern capitalism and developing what came to be called "Social Darwinism" (although this term was not used to describe Spencer's views until the twentieth century).  Darwin's theory is based on "natural selection" as applied to biological organisms and Social Darwinism has been attacked for making a category mistake, applying language appropriate to one group of things (e.g., biological organisms) inappropriately to a different group of things (e.g., non-biological social institutions.)

This critique basically did in Spencerism and so, it would seem, Lenin's characterization of Marxism as the theory of evolution applied to modern capitalism should also be rejected. But Lenin did not, as Spenser did, use Darwinian terminology (natural selection, survival of the fittest - coined by Spenser) when he discussed evolution. He did not see Marxism as a subdivision of Darwinism. He used the term "evolution" in a more general sense to describe systematic changes in any type of organization such that any time 2 could be understood as a result of causative factors at work at time1 for any system biological or social. Darwinism and Marxism would both be species of the genus "evolution." The terminology of one could not be mechanically applied to the other, hence Lenin did not, while Spencer did, commit a category mistake.

So, what was the question formulated by Marx? Lenin said it was, "On the basis  of what data can the future evolution of future communism be considered?" Lenin's answer is most important as it contains (although not obviously) the seeds of understanding why the twentieth-century socialist experience has been partially set back and may be temporarily in stasis.  "On the basis of the fact," Lenin wrote, "that it has its origin in capitalism, that it is the result of an action of a social force to which capitalism has given birth."

Marx and Engels had no use for thinking up Utopias based on speculations about a future society. Unfortunately Lenin uses a biological analogy-- Marx is working like a biologist studying a new organism and explaining it in terms his knowledge of other organisms out of which it developed. This is an analogy, however, and not a category mistake.

Lenin also mentions that the concept of a "people's state" was being bandied about by the SPD leadership at this time. This notion was used to justify ideas about keeping the state around under socialism. Marx thought the notion of a "people's state" was ridiculous once one understood what the role of the state was historically and that it had no function to play after the establishment of socialism. Perhaps Khrushchev's views on the USSR as a "state of the whole people" put forth at the 22nd CPSU Congress can be better understood in light of these passages from Lenin. Subsequent events seem to suggest that the concept of "a state of the whole people" was indeed ridiculous considering the actual conditions in the Soviet Union at the time.

2. Transition from Capitalism to Communism

Given Capitalism, Marxists want to end up with Communism— its negation. Marx says there will have to be a long period of transition separating these two systems. What is the role of “democracy” during the transition? Lenin says we can have “more or less complete democracy in the democratic republic.”  But under capitalism the bourgeois democratic republic puts limits on the extent of democratic rights i.e., “democracy is always bound by the narrow framework of capitalist exploitation.” Only the rich fully enjoy democratic freedom while the majority of the population  have the illusion of freedom; it is Lenin says, almost the same as it was in Ancient Greece “freedom for the slave owners.”

Marx held that the workers (“wage-slaves”) are so crushed down by debt and poverty under capitalism that “democracy is nothing to them” and “politics is nothing to them.” Lenin gives examples from his day to back up Marx’s comments. Here are some examples from our own time. Well, there has been some advance in our consciousness since Marx wrote those words (1875). Many working people have become aware of the possibilities of using the limited democratic possibilities of the capitalist state to somewhat improve their conditions of servitude. But many are still in the condition that Marx described. In the US for instance, in midterm elections such as we have in 2014, traditionally only about 40% of the voters bother to cast ballots. 

The working people and their allies have the power in this year’s election to rout the ultra right and put in place less reactionary politicians under whom it is possible to make some gains for the majority in terms of economic and social rights. We will see how well socialists, progressives, and union activists  have succeeded in making the oppressed aware of their stake in elections by the percentage of voters who go to the polls and the extent of the possible rout. I should think we have to have a greater turn out than 40% or we are doing something wrong. [UPDATE 2016: The turn out was 36.8% the lowest in 70 years -- evidence that the center-left tactics are not working: will we learn from this or just muddle along?]

Lenin, following Marx and Engels, understands that wars, human exploitation, and poverty can never be ended until capitalism itself is ended. We have to fight for real democratic change, i.e., worker’s democracy, in order for this to happen. Thus Lenin maintains that the way forward is NOT to start here where we are and fight for “greater and greater democracy”— this is the delusion of “liberal professors and petty-bourgeois opportunists” — the way forward is to fight to establish workers democracy [AKA the dictatorship of the proletariat; this particular choice of words can be debated: "worker's democracy" is a fine substitute as long as the concept is kept -- abolition of the bourgeoisie] which enacts laws that end the exploitation of working people and that deny to the capitalists democratic rights that they now presently enjoy which enable them to exploit other people. 

Lenin stresses the fact that the first REAL democracy, democracy for the poor and oppressed, democracy for the people, is also the restriction of democracy for the rich, the exploiters, the capitalists. Freedom for the 99% can be gained only by restraining the 1%. This is the only way, Lenin says, freedom can  be attained by the masses of people, by using force to destroy the power of the exploiter. This is just the way of the world. Lenin calls it “the modification of democracy during the transition period from capitalism to Communism.”  For those who are less concerned with words than the concepts behind them, the term “dictatorship of the proletariat” can be replaced by “modification of democracy,” or “worker’s democracy” without any change of meaning as long you are clear about  what Lenin thinks is the role of the state in the transition period. Once Communism is reached democracy will fade away along with the state structure itself since democracy is a concept relating to the form of a particular sort of state.

What Lenin means can be understood by examining the logic of a common progressive slogan in use today— i.e., “No Justice, No Peace.” People have an almost innate feeling for justice and fairness (although socially conditioned) and understand quite well when they are not being treated fairly. They will eventually fight back if the unfair treatment becomes too much for them. Since all class societies are based on the the ill treatment of the vast majority by a tiny minority a state is created which keeps the majority in check. Since there is no justice there are many incidences of no peace—  strikes, revolts, riots, uprisings, civil disobedience, rebellions, boycotts, civil wars, colonial wars, wars for economic dominance, demonstrations, marches, revolutions, etc. all of these are more or less calibrated to reflect the level of injustice being imposed by the ruling minority. 

A successful state must keep the majority in check and (with a few exceptions in small societies) “the greatest ferocity and savagery of suppression are required, seas of blood are required, through which mankind is marching in slavery, serfdom, and wage-labour.” With the establishment of socialism a transitional period ensues with a new kind of state, one representing the majority which puts down the exploiting majority and eliminates it as a class, enabling the creation of conditions of justice for all, and thus peace. The end of the transitional period ushers in Communism “which renders the state absolutely  unnecessary  for there is no one to be suppressed”— in the sense of a class trying to exploit others. There will of course be ornery individuals no matter what kind of society you have but they will be dealt with by the people themselves living in communal arrangements.

In the next part of this review we will deal with what Marx thought these two stages of post capitalist society would be like— without being Utopian Lenin says. We will resume with section 3 of chapter 5: “First Phase of Communist Society.”