The Soviet Union could not overtake capitalism and advance to socialism because it did not have at its disposal all of the ‘highest productive forces’ within its boundaries. Even basic necessities for survival could only be obtained through trade with the imperialist powers. Its immediate challenge was to catch up with capitalism, to conquer the “commanding heights” of the world economy and so lay the basis for constructing socialism as an international system.

The Soviet Union’s fundamental weakness, in other words, lay in its economic and technical backwardness compared with the advanced capitalist countries. Backwardness was the root of bureaucratisation (see Lesson Six); bureaucratic rule excluded workers’ democracy and formed an absolute barrier to socialist transformation.

The bureaucracy persisted in seeing the international problems of the revolution in essentially military terms and gambled on the ability of the Soviet Union to defeat future imperialist invasions. But, as Trotsky explained, even the military threat of imperialism resulted from its technical superiority, pointing out that “it is not so much military intervention as the intervention of cheaper capitalist commodities that constitutes perhaps the greatest immediate menace to the Soviet Union”. (The Third International After Lenin, 1928). In other words, the Soviet masses would defend their gains and fight the threat of open counter-revolution. But demoralised and disillusioned by bureaucratic rule, they could not be expected to defend their own backwardness against a capitalist enemy apparently offering them a superior way of life.

However, in 1941, it was not the armies of capitalist democracies that invaded the Soviet Union but those of Hitler. With them, instead of “cheaper commodities”, they brought barbed wire and the gruesome paraphernalia of slave labour and extermination camps. Subjected to barbarous racial repression by the Nazis, the Russian workers rallied heroically in defence of the Soviet Union.

The outcome of the world war, despite Stalin’s blunders and his paranoid purge of the Red Army high command, meant that the bureaucracy was able to maintain its rule for far longer than anyone, including Trotsky, had imagined. Aided by the resilience of a planned economy, the Soviet Union had not only defeated Hitler but expanded its influence across Eastern Europe. Even then, the nationalist limitations of Stalinism meant the full potential of what could have been an extended plan across the region was never realised. Nevertheless, based on a planned economy, the Soviet Union continued to develop from a backward economy to a world superpower, a pioneer, for example, of space travel.

Workers’ living standards had improved significantly, as did healthcare and education. While the official Soviet growth figures were overestimates, there is general agreement amongst even capitalist economists that, by the 1960s, certainly in the production of basic industrial commodities, the USSR was entering the same league as the main capitalist powers.

The main ‘Achilles heel’ of the Stalinist economies was quality. Imposed targets, often based on volume, could be met by cutting corners. Without workers and consumers being able to complain and then influence production through workers’ democracy, (nor, as under capitalism, through the play of market forces), substandard goods were churned out. Without workers’ control and management, there was also huge wastage, thanks to the bungling, corruption and bad planning inherent in the undemocratic command system of economic management. This was combined with massive uncontrolled environmental degradation too. Bureaucratic repression stifled all initiative from below.

As the Soviet economies advanced, bureaucratic misrule became increasingly untenable. Without the input from the workplace and the consumers that would exist in a healthy workers’ state, it was impossible for bureaucrats in the Kremlin to run thousands of different industrial enterprises, producing millions of separate commodities.

The contradictions of the Soviet economy were not the same as those affecting a capitalist economy. The most fundamental contradiction was that between the existence of a planned economy and the bureaucratic administration of the plan.

By the end of the 1960s, growth rates were falling. Productivity of labour also continued to lag far behind. From the 1970s the economy started to stagnate and by the 1980s the planned economy had begun to break down entirely. In the end, that illusory promise of a better life under capitalism, that Trotsky had warned off back in 1928, did indeed prove to be the eventual undoing of Stalinism.

In Hungary in 1956, Poland in 1980-1, and even during Stalinism’s final collapse, workers did move into action and start to raise similar demands to those raised by Lenin in ‘State and Revolution’ in opposition to the bureaucracy. However, Stalin’s purges had also wiped the collective memory of the masses and setback their ability to gather themselves together to challenge the Stalinist regime with a conscious programme of workers’ democracy. That was a key factor in preventing the working class taking the road of political revolution – of overthrowing the bureaucracy and rebuilding a healthy workers’ state.

Let’s leave the ‘final word’ to Trotsky, with the warnings that he made about the dangers of capitalist restoration back in the 1930s:

“Two opposite tendencies are growing up out of the depth of the Soviet regime. To the extent that, in contrast to a decaying capitalism, it develops the productive forces, it is preparing the economic basis of socialism. To the extent that, for the benefit of an upper stratum, it carries to more and more extreme expression bourgeois norms of distribution, it is preparing a capitalist restoration”.

“In order better to understand the character of the present Soviet Union, let us make two different hypotheses about its future. Let us assume first that the Soviet bureaucracy is overthrown by a revolutionary party having all the attributes of the old Bolshevism, enriched moreover by the world experience of the recent period. Such a party would begin with the restoration of democracy in the trade unions and the Soviets. It would be able to, and would have to, restore freedom of Soviet parties. Together with the masses, and at their head, it would carry out a ruthless purgation of the state apparatus. It would abolish ranks and decorations, all kinds of privileges, and would limit inequality in the payment of labour to the life necessities of the economy and the state apparatus. It would give the youth free opportunity to think independently, learn, criticize and grow. It would introduce profound changes in the distribution of the national income in correspondence with the interests and will of the worker and peasant masses. But so far as concerns property relations, the new power would not have to resort to revolutionary measures. It would retain and further develop the experiment of planned economy. After the political revolution – that is, the deposing of the bureaucracy – the proletariat would have to introduce in the economy a series of very important reforms, but not another social revolution.

If – to adopt a second hypothesis – a bourgeois party were to overthrow the ruling Soviet caste, it would find no small number of ready servants among the present bureaucrats, administrators, technicians, directors, party secretaries and privileged upper circles in general. A purgation of the state apparatus would, of course, be necessary in this case too. But a bourgeois restoration would probably have to clean out fewer people than a revolutionary party.

The Soviet Union is a contradictory society halfway between capitalism and socialism. … To define the Soviet regime as transitional, or intermediate, means to abandon such finished social categories as capitalism (and therewith “state capitalism”) and also socialism. But besides being completely inadequate in itself, such a definition is capable of producing the mistaken idea that from the present Soviet regime only a transition to socialism is possible. In reality a backslide to capitalism is wholly possible.” (Trotsky, Revolution Betrayed, Chapter 9, 1936.)

“Each day added to its [the bureaucracy’s] domination helps rot the foundations of the socialist elements of economy and increases the chances for capitalist restoration. … either the bureaucracy, becoming ever more the organ of the world bourgeoisie in the workers’ state, will overthrow the new forms of property and plunge the country back to capitalism; or the working class will crush the bureaucracy and open the way to socialism”. (Trotsky, ‘The Transitional Programme’, 1938.) (Full text)