N.I. Bukharin and E. Preobrazhensky: The ABC of Communism
To each method of production there corresponds a special method of distribution. After the abolition of capitalist ownership in the means of production, the Soviet Republic inevitably came into conflict with the capitalist method of distribution, with trade that is to say, and was compelled to undertake its abolition by degrees. First of all, the great warehouses were confiscated. This was likewise necessary on account of the severe food crisis and on account of the general need for goods. The articles which were being hoarded by speculators in anticipation of a rise in prices were distributed among the working masses, and during the first weeks after the November revolution this served to mitigate the crisis.
The nationalisation of the mercantile warehouses was no more than a first step. The nationalisation of large-scale trade soon followed. The measure was necessary in the fight with speculation, and in order to take stock of all the goods in the republic; also and above all in order that these goods might be distributed among the working class. The Soviet Power introduced a system of class rationing, not only for food-stuffs, but also for manufactured articles in general and for all articles of domestic use.
But perhaps the best way would have been for the Soviet Power to have proceeded as follows: to confiscate all the stores of goods which were in the hands of private traders, and to distribute these goods in accordance with the system of class rationing, without destroying the apparatus of trade, which the Soviet State should rather have preserved, have utilised for its own purposes.
To some extent, indeed, we worked along these lines. But the goods were unfortunately confiscated too late, when the greater part of them had already been converted into money, which had been hidden by the owners. The whole apparatus of large-scale distribution was seized by the Soviet Power, and began to work on its behalf with the aid of the employees’ trade unions. Only the heads of the businesses were discarded, for these had now become purely parasitic elements. Formerly it had been necessary to buy goods, to hunt them out, to make bargains. But now that the proletarian State had itself become the chief producer of goods in its nationalised workshops, it would have been absurd for the State to sell these goods to itself, and thus to maintain traders at its own expense. Furthermore, middlemen are superfluous as between the peasants and the State, and as between the State and the consumers — as soon as a State monopoly in grain has been established. Middlemen can offer no inducements which will encourage the peasants to hand the grain over to the State. The peasants have no occasion to seek buyers for the grain, for there are no buyers.
In so far, therefore, as the proletarian Power has taken over the production of a number of important articles, and in so far as it effects a notable proportion of production by the work of its own instruments, it needs its own apparatus of distribution. There is no place here for private trade.
But what is to happen in the case of petty private trade which serves for the distribution of the produce of small-scale independent home industry? The Soviet Power has not yet taken possession of this branch of production. It has not yet succeeded in becoming the monopolist buyer of the produce of home industry. What is to happen in the case of the petty traders who are distributing such produce among the population (of course, at fancy prices) — articles which the agents of the Soviet Power are unable to provide at fixed prices?
Indubitably this question is far more complicated than the problem of large-scale trade, for the fate of large-scale trade was settled by the mere fact of the general expropriation of capital. It would be absurd for the Soviet Power to prohibit petty trade when it is not itself in a position to replace the functions of this trade by the activity of its own organs of distribution. In certain cases, and above all in the regions from which the White Guards had recently been cleared out, local soviets and revolutionary committees prohibited private trade without providing their own apparatus for the supply of necessaries; or, even if such an apparatus existed, without ensuring that it should function regularly for the adequate supply of the population. As a result, private trade was driven under ground, and prices rose enormously.
Petty trade will cling tenaciously to life. Its extinction will be possible only in proportion as there passes through the hands of the State a larger and ever larger quantity of the products needed for the supply of the population. If to-day the Narkomprod [the People’s Food Commissariat] exists side by side with the Suharevka [a Moscow market], this implies that the war between capitalism and socialism still continues in the domain of distribution. The struggle now rages round the positions occupied by petty trade. It will not cease until the State authority becomes the chief buyer of the products of petty industry; or until, as will ultimately happen, the State has itself become the manufacturer of all these products. Of course we are not here considering the cases in which petty traders sell products which are already supplied by the distributive organs of the State; we are not concerned with cases which are simply forms of the struggle against pilfering and against other defects of the soviet mechanism of distribution. In any case, petty trade will continue until, first, large-scale production has been adequately organised in the towns, and, secondly, there is proper provision for the supply of all such necessaries as are not yet produced by State monopoly.
Although the complete abolition of middlemen in the field of distribution is the aim of socialism, and although this aim will ultimately be realised, it is obvious that we cannot expect in the immediate future to achieve the entire destruction of the apparatus of retail trade.
Appropriate socialistic distributive organs must be created to deal with the great masses of products requisite for the supply of the population, in so far as these products now pass through or will shortly pass through the hands of the State. These distributive organs must have the following characteristics. They must be centralised. Centralisation will ensure the most equitable and accurate distribution. It will reduce the cost of maintenance of the apparatus, for under socialism this apparatus will require far less expenditure of labour power and of material means than were requisite for the apparatus of private trade. The socialist distributive apparatus must work swiftly. This is of the utmost importance. It is essential, not merely that the apparatus should demand the minimum expenditure of strength and means on the part of the State, but in addition that it should not involve the waste of a minute of any consumer’s time. Otherwise, great loss would be involved for society as a whole through the unproductive expenditure of energy. Under a system of private trade and in the normal conditions of the capitalist economy, the consumer, provided he has money, can procure whatever he wants whenever he wants it. In these matters, the socialist apparatus of distribution must be at least as good as that of private trade. But in view of the high degree of centralisation, there is considerable risk that the socialist apparatus will degenerate into a cumbrous and dilatory machine in which a great many articles will rot before they reach the consumer. How is an efficient distributive apparatus to be constructed?
Two possibilities were open to the Soviet Power. It could create an entirely new distributive apparatus; or it could make use of all the organs of distribution created by capitalism, pressing these into the socialist service.
The Soviet Power adopted the latter course. While creating its own organs wherever necessary, especially in the opening period of the destruction of capitalist conditions, it concentrated its attention upon the cooperatives, aiming chiefly at the utilisation of the cooperative apparatus for the distribution of goods.
In capitalist society, the main function of the cooperatives is to free the consumer from the tyranny of the middleman, from the grip of the speculative trader; to secure trading profits for the union of consumers; and to provide consumers with goods of satisfactory quality. The cooperatives achieve these results with a considerable measure of success, but they do this only for their own members, only, that is to say, for a certain part of society.
The early cooperators fancied that capitalism would be peacefully renovated through the instrumentality of cooperation. What has really happened, however, amounts to this. With all its successes, cooperation has been able merely to overthrow retail trade with more or less success; but it has done nothing to break the power of wholesale trade, to which it is itself subordinate. We refer, of course, to distributive cooperation. As far as productive cooperation is concerned, this plays an insignificant part in the whole system of capitalist production, and exercises practically no influence upon the course and the development of capitalist industry. Speaking generally we may say that the titanic organisation of capital does not regard cooperation as a serious competitor. Capitalism felt fully capable of strangling cooperation like a kitten whenever it should think fit, and it was therefore content to leave the dreamers of the cooperative movement free to indulge their visions of the overthrow of capitalism, and to allow the cooperative book-keepers to plume themselves on the profits they had snatched from the petty traders. Cooperation adapted itself to capitalism, and came to play a definite part in the capitalist system of distribution. It was even advantageous to capitalism, for it reduced the cost of the capitalist apparatus of distribution, and thus set free a certain amount of trading capital for use in productive industry. On the other hand, cooperation, by reducing the number of petty middlemen and by bringing the consumer into closer contact with the large-scale capitalist producer, accelerated the exchange of commodities, guaranteed the prompt and conscientious payment of obligations, and in the last resort made the position of the industrial reserve army even worse than before — for the members of the industrial reserve have often been inclined to take refuge in the life of petty trade. Moreover, numerous investigations have shown that as far as cooperation among the peasants was concerned, its advantages were mostly confined to the vigorous and well-to-do peasants, whereas the poor peasants profited by it very little.
Considering the class to which their members respectively belong, the distributive cooperatives may be divided into workers’ cooperatives, peasants’ cooperatives, and the cooperatives of comparatively well-to-do town-dwellers — petty bourgeois and civil servants. The workers’ cooperatives always form the extreme left wing among cooperative institutions in general; but as regards the class organisations of the proletariat they constitute the extreme right wing. In the peasant cooperatives, the well-to-do peasants have the decisive voice. In the third type of cooperative, the predominant place is occupied by the petty bourgeois intellectuals, of the same calibre as those whose mentality has dominated the whole cooperative movement — persons who believe that cooperation has a great mission for the destruction of capitalism by means of cooperative vouchers and loaves of cooperative bread.
The true nature of the cooperative movement was disclosed by the proletarian revolution in Russia. Except for some of the workers’ cooperatives, this movement — especially as regards the intellectuals and the rich peasants among the cooperative leaders — assumed a definitely hostile attitude towards the socialist revolution. Indeed, the Siberian cooperatives, in the form of the organisation known as Purchase and Sale, and other distributive cooperatives, sided openly with the counter-revolution and advocated the crushing of the Soviet Republic with the assistance of world imperialism.
On October 1, 1917, there were 612 cooperative societies in Russia. Apparently, however, this figure is too low, for on January 1, 1918, according to estimates from various sources, there were 1000 such societies. In the Centrosoyus [the central cooperative league] there were 38,601 societies with a total membership of 13,694,196. Since, however, one and the same cooperative may belong to two or three different leagues, it is probable that the number of cooperatives and cooperators in Russia is smaller than this statement would suggest. As far as productive cooperation is concerned, in 1918 there existed in Russia 469 cooperative societies and leagues, small undertakings for the most part.
In the capitalist regime, cooperation fulfils a definite role in the general system. In the soviet regime, the cooperative apparatus is destined either to die out gradually in conjunction with all the other apparatus of capitalist distribution, or else to enter the system of socialist distribution and to assume the role of a State distributive apparatus. The old leaders of the cooperatives — the mensheviks, the social revolutionaries, and the various “socialists” of the Kolchak type — would like to ensure for the cooperatives independence of the proletarian State, which means to ensure for them the freedom to die out. The Soviet Power, on the other hand, having an eye to the real interests of the great masses of the workers, and caring in particular for the interests of the cooperators themselves, pursues another path. Disregarding the opinions of the intellectuals who were leading the cooperatives, and refusing to discard the whole cooperative apparatus because of the counter-revolutionary activities of these leaders, the Soviet Power has continually endeavoured to fuse the cooperative distributive apparatus with the whole system of its own distributive organs. It has endeavoured to widen rather than to narrow the scale of cooperative activities. The practical aims of the Soviet Power and of the Communist Party, in this connexion, have been the following.
The normal cooperative of the bourgeois type is a voluntary union of citizens having a definite interest in the society. As a rule the society serves none but its own members; and if it supplies products to the general population, it does so only in so far as this can be effected without harm to the members. We, on the other hand, consider it necessary that the entire population shall be organised in cooperatives, that every member of the community shall belong to a cooperative. Only then will distribution through the cooperatives signify distribution to the whole population.
In a distributive society of cooperators, the work is usually carried on under the administration of all the members of the society. In actual fact, as a rule, quite a small group of the members is responsible for the conduct of affairs, but this depends upon the members themselves. The constitution of the society puts the absolute control in the hands of the general assembly of the members. If all the citizens of the republic are enrolled in the cooperatives, they have full power to control these organisations from below upwards, thus controlling the entire apparatus of distribution in the proletarian State. Should the masses display sufficient independence, they could resolutely and successfully eradicate maladministration and bureaucracy from the work of distribution, and could thus ensure the requisite punctuality and accuracy throughout the State-cooperative organisation. When the consumers themselves participate in the work of distribution, the distributive organs will no longer hang in the air above the masses, but will become implements in the hands of the masses themselves. This will undoubtedly promote the development of a communistic consciousness, and will favour the growth of a comradely discipline among the workers. At the same time it will help the masses to understand the integral nature of the productive and distributive apparatus in socialist society. Further it is necessary, after enrolling the whole population in the cooperatives, that the leading part in these organisations shall be assigned to the proletarian stratum of the population. In the towns this will be secured through the more active participation of the urban workers in cooperative functions; through securing the election of a communist and proletarian majority upon the administrative bodies; and above all by seeing to it that the cooperatives which are transformed into urban consumers’ communes shall be the workers’ cooperatives and not the cooperatives founded by the petty bourgeois and the civil servants. To the same end it is essential that there should be an intimate association between the cooperatives and the trade unions, that is to say between the respective organs of distribution and production. There is an immense future for such an association. In course of time the function of the State will be reduced to that of a central accountant’s office, and then the living union of productive organisations with distributive organisations will be of overwhelming importance. Finally, it is essential that the communists should participate as a compact group in the construction of this system of cooperative distribution, and that they should secure the dominant role in the work.
In the rural districts it is important that the rich peasants should be excluded from the management of the cooperatives; that the comparatively well-to-do inhabitants of the countryside should not receive any privileges in the matter of distribution; and that the entire apparatus of the rural cooperatives should be controlled by the poor peasants and the class-conscious among the middle peasants.
Since the November revolution there have come into existence various additional distributive organs created by the revolution. In the centre of these is the Narkomprod [the People’s Food Commissariat] with all its subdepartments in the provinces and the counties. These organisations for the supply of food had and have their own distributive instruments in the form of a network of food depots and stores. At one time, in the rural districts, the committees of the poor peasants were distributing agents, thus forming a counterpoise to the cooperative distribution. Whereas the cooperatives distributed most of the products they received among the well-to-do peasants, the committees of the poor peasants distributed among the poor peasants the greater part and the best part of the goods they received from the State. An important role in distribution was played by the house committees in the large towns and by the house communes. The trade unions and the factory committees were likewise occupied in the work of distribution.
The task of the Soviet Power is to ensure that these multiple organs of distribution shall be replaced by a single distributive organ, or shall become parts of one integral distributive mechanism. In this connexion, for example, the house committees and the house communes play a useful part, for they enable consumers to secure the goods they need without standing about in queues for hours or days.