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Ygael Gluckstein

Stalin’s Satellites in Europe

Part One
The economy of the Russian satellites

Chapter VI
Socio-economic relations in the satellites
(Part 1)

State Ownership and Public Ownership

Article 6 of the Soviet Constitution states: “The land, its deposits, waters, forests, mills, factories, mines, railways, water and air transport, means of communication, large state-organized farm enterprises (state farms, machine-tractor stations, etc.) and also the basic housing facilities in cities and industrial localities are state property, that is, the wealth of the whole people.”

The Constitutions of the People’s Democracies all contain similar clauses with one difference, that the land is not, or rather, not yet included in the state-owned properties.

Part of the article quoted is self-evident – that the land, factories, railways, etc. are state-owned. Part of the clause, however, is not self-evident although it is proclaimed as if it were – “state property, that is, the wealth of the whole people”. The words “that is” signify that state ownership can be nothing other than people’s ownership. But this does not stand the test of logic or of history. From the standpoint of logic, the middle term is missing. The factories, railways, etc., are state owned; the people (or the workers and peasants and intellectuals) own the state; therefore the people own the factories, railways, etc.

From the standpoint of history, the article stands the test no better. There are numerous examples in the history of the East of economic systems with deep class differentiations, based not on private property but on state property. Such systems existed in Pharaonic Egypt, Moslem Egypt, Iraq, Persia and India. That the state owned the land was, it seems, mainly due to the fact that agriculture depended entirely on the irrigation system, which in turn was dependent on the activity of the state. The example of Arab feudalism under the Mamelukes (1250-1517) is sufficiently instructive to warrant the apparent digression.

Chapter Index

Arab feudalism – an example of class society based on state property

In this society the subjugation of the peasants to the strong feudal state was much harsher than in medieval Europe, but the individual member of the ruling class had no individual property rights whatsoever. The Sultan was the only landowner and he used to divide the right to collect the rent in the various regions among the different nobles (called Multazims). While in Europe every feudal lord was the owner of a certain domain, which was handed down from father to son, in the Arab East the feudal lord had no permanent domain of his own, but was a member of a class which collectively controlled the land and had the right to appropriate rent. In Syria and Palestine the area from which these feudal lords collected rent was changed from year to year. In Egypt they received the right to collect the rent in a certain area for their whole lives, and their heirs had a prior right in the appointment of the deceased’s successor. While in Europe the feudal lord was relatively an independent power as against the king, who was no more than the “first among his equals”, in the Arab East only the feudal collective was a factor of any consequence; as individuals the Arab nobles were weak, because they were dependent on the state for their positions. The weakness of the feudal lord as against the state was clearly indicated by the way in which the fiefs were allocated: the Sultan distributed them by lot among the emirs and knights, each getting a portion of land differing hi size and quality according to his rank. The Arab nobles were thus divided into different groups with different incomes, the distinction between them being very great (for instance, the “emirs of the hundred” got 80,000 to 200,000 dinar jayshi a yea; “emir-al-tabl” 23,000 to 30,000, “emirs of the ten” 9,000 and below, “emirs of the five” 3,000 and so on). The form of appropriation was much more like that of a state official than that of. the European feudal lord. As a result of this dependence of the nobles on the state, an unusual phenomenon recurred in the Arab East. From time to time whole feudal strata were “purged” and annihilated, others arising in their place. The Arab lords were replaced by the Sultan’s freed slaves – the Mamelukes – who were not of Arab origin and did not speak Arabic but Turkish. In the thirteenth and fourteenth centuries they mostly originated from the Mongolian state, the Golden Horde, whose centre was on the banks of the Lower Volga; in the fifteenth and sixteenth centuries they were mainly Caucasian. With the Tsar’s increasing resistance to conscription in the Caucasus for the Sultan, the Balkan element (Albanians, Bosnians, etc.) predominated.

The ownership of the land by the state not only prevented the rise of feudalism based on private property, but also of any social group with any individualist tendencies whatsoever. The town was a military camp; the majority of the artisans were not independent. Even when the guilds (Hirfeh) did arise, they did not attain any importance at all in the towns and did not become an independent force of any importance. The government subordinated them to itself by appointing many of the heads of the guilds, making them its officials and turning the guilds into government organisations.

The fact that the chief means of production – the land – belonged not to individuals, but to the state, and that the Arab nobles did not own property and therefore did not have the right to inherit, did not improve the position of the peasant masses. Nor did the plebeian origin of the Mamelukes make any difference. The concentration of the ruling class of the Arab East in the towns afforded them great military power over the peasants, and furthermore, increased their appetite for wealth and power. In this too, they differed from the European feudal lords in the Middle Ages. The produce which the European serfs gave to their feudal lords as rent was in general not sent out to be sold; the serfs therefore did not need to give their feudal lord more than he and his household needed for their daily use. Marx says of the European feudal lord: “The walls of his stomach set the limits to his exploitation of the peasants.” The Arab feudal lords had different tastes, as they traded extensively in their agricultural produce, and their point of view might best be summed up in the words used by Khalif Suliman to his emissary about the peasants: “Milk till the udder be dry, and let blood to the last drop.”

The mode of production, the form of exploitation, the relation of the toilers to the means of production in the Arab East, was the same as in medieval Europe. The source of income of the ruling class was also the same; the only difference was in the mode of appropriation, in the legal expression of the right to exploit. [1]

Another example of class exploitation based not on private but on “public” ownership is the Church of the Middle Ages. The Church acquired about a third of all the land of Europe as a whole, and in some countries even the majority of the land (e.g. Hungary, Bohemia). Formally, this was public property, the property of the Christian community, and it bore the official name of “patrimonium pauperum” – the inheritance of the poor. This, however, did not make the conditions of the serfs on Church land fundamentally different from those of the serfs on the private feudal estates. For even though the clergy did not have the right of inheritance (not being allowed to raise families) and were often of plebeian origin, they were not Less harsh exploiters than the feudal nobility. Thus “public” property by itself does not exclude the exploitation of man by man. [2]

The first part of this book attempts to show that the chief means of production and exchange in the Russian satellites are in the hands of the state (in part the Russian state), and that they will be more and more so concentrated. The second part attempts to show that these countries have undemocratic, totalitarian police regimes, which means that they are not “owned” by the people – workers, peasants and intellectuals – but by the self-appointing and self-perpetuating bureaucracy itself. From these two propositions, if they can be proved, the only conclusion possible would be that the Bureaucracy is the owner of the wealth of these countries, that as well as being the ruling class politically, it is the ruling class economically.

Chapter Index

The abolition of all elements of democracy in the factory

The relations between the state-bureaucracy and the people in the economy as a whole permeate each sector of it down to the individual enterprise. The macrocosm and the microcosms are governed by the same rules.

In Russia from 1917 to 1928 the running of the industries was, formally at least, in the hands of what was called the Troika (that is, trio) – the workers’ factory committee, the Party cell and the manager. With the disappearance of all democracy in the Party and trade unions, the Troika gradually lost its functions till it became a mere label. Nevertheless it did not cease to stand officially at the head of the plant, nominally running it, and even to show signs of life by acting as something of a brake on the high-handedness of the plant manager, until 1929. Thus Dr. A. Baykov, in The Development of the Soviet Economic System (London 1946), states:

De facto, during that period (before the Five Year Plan – Y.G.) the director was largely dependent on the works’ trade union organ, the “Zavkom” (the factory trade union committee) and on the Party cell, the organ of the Cornmunmt Party at the enterprise. Representatives of these organizations considered it their duty to supervise the director’s activities, and usually interfered with his decisions. (p.115).

But even the remnants of workers’ democracy in the plants disappeared with the Five Year Plans, which were called ... “The Victory of Socialism”. A resolution of the Central Committee of the Party decided that the workers’ committee of the factory “may not intervene directly in the running of the plant or endeavour in any way to replace plant management. They shall by all means help to secure one-man control, increased production, plant development, and, thereby, improvement of the material conditions of the working class.” (Pravda, 7th September 1929).

The manager is in full and sole charge of the plant. All his economic orders are unconditionally binding on all the workers. He alone shall select, promote and remove personnel “taking into consideration” “the opinion of the Party and the trade union organizations”, but he is not bound by them. (Quoted by A. Feller and J. Marschak, editors, Management in Russian Industry and Agriculture, New York 1944, p.36).

The Troika was officially buried in 1937. At the Plenum of the. Central Committee, Stalin’s second-in-command at that time, Zhdanov, declared: “... the Troika is something quite impermissible ... The Troika is a sort of administrative board, but our economic administration is constructed along totally different lines.” (Pravda, 11th March 1937, Ibid., p.44).

The new management of industry was very clearly defined by an official manual thus: “Each plant has a leader endowed with full power of decision, hence fully responsible for everything: the plant manager” (Economic Institute of the Academy of Sciences, Economics of Socialist Industry, Moscow 1940, p.579, ibid., pp.12-13). Further, “one-man control implies strict demarcation between the administration, on the one hand, and Party and trade-union organisations on the other. This strict demarcation must be applied on all levels of industrial management. Current operations in fulfilment of Plan are the task of the administration. The chief of a workshop, the manager of the plant, the head of the Glavk, have full powers, each within his field, and the Party and trade-union organisations may not interfere with their orders” (Economics of Socialist Industry, p.563, Ibid., p.19).

In the “People’s Democracies” the workers’ committees never acquired the authority they had in Russia, and the Troika never existed at all. The tendency against any element of workers’ democracy in the factory was more pronounced and its progress much quicker than in the “vanguard” country. In all the countries of Eastern Europe the overthrow of Hitler inspired many workers to strive to participate in the management of industry, and in many places they achieved their aim of having the plant management democratically elected by the employees. Thus, for instance, The Economist of February 9th, 1946, writes of Czechoslovakia: “The Employees’ Committees tried, in the first fine careless rapture of revolutionary enthusiasm to dictate how the factories should be managed ...”

This could not be tolerated by the Communist Party leaders in the government and trade unions. The following process took place:

“... the Workers Councils were ... in control of management for some months, indeed almost until the end of 1945.” “The situation was transformed by the Government’s Nationalisation Decree of 24th October, (1945), which provided for the appointment of National Managers of the public enterprises.” “So at one step the management of the industries was taken out of the hands of the Works Councils, nor did they retain any semblance of control over the Manager. This was a radical change and brought with it the undisguised hostility of a number of Works Councils.“ (Czechoslovakia. Six Studies in Reconstruction, The Fabian Society, London 1947, p.49).

To reduce still further any remaining efficacy of the Works Committees, every element of democracy in them was abolished. At the general meeting of the Central Trade Union Council of Czechoslovakia at the beginning of April, 1947, the General Secretary complained that in the first round of the elections 32 per cent of the official candidates (no other candidates were allowed) were voted down in the Czech lands and 26 per cent in Slovakia. The Social Democratic Party now came forward openly with a proposal that more than one list be allowed in the Works Council elections, and that each party be free to put forward its own list of candidates. Antonin Zapotocky, the Communist Chairman of the Trade Unions (today the Prime Minister of Czechoslovakia) decided on another tactic as a result of the elections. He proposed to prolong the term of office of the Works Councils from one to two years.

Having established one list of candidates for Works Council elections, the Communist Party not only increased the use of terror in the elections, but also employed various devices for falsifying their results. The Social Democratic daily Pravo Lidu of 9th January, 1948, carried across the front page the Party protest against the Communist Party’s methods in the factories: “It is impossible to be silent. Fanatics are breaking up the unity of labour unions. New wave of political oppression in factories.“ Of the recent Works Council elections the paper said: “As developments in the elections are reported to us especially in the large industrial concerns, it is evident that all the questionable practices were used, which were calculated to upset the democratic form of election and to force on the voters a selection (of candidates – Y.G.) that is not free. The meetings are usually called after working hours when the majority of workers are leaving or have left.

Furthermore, the methods of voting are controlled, which is practically equivalent to direct intimidation. (Quoted by New York Times, 10th January 1948).

After the February coup the mouths of the Socialists were closed.

The secret ballot too was abolished at that time, and elections to Works Committees were carried out by acclamation, candidates in many cases being trade union officials. Small wonder that at the May 1949 session of the Central Council of the Czechoslovak Trade Unions, Josef Kolský, Deputy General Secretary, could say that in recent Works Council elections 97.3 per cent of the official lists of candidates were accepted (the official Czechoslovak News Letter, 19th May 1949).

After these steps were taken, nothing more stood in the way complete one-man management in the plant. In place of the workers’ management that had arisen in the first months after the liberation of Czechosovakia from the German occupation, came the Production Board (set up by the Decree of October 24th, 1945), only a third of whose members were elected by the workers. After the “Democractic Victory of February”, the Minister of Industry, A. Kliment, announced a new plan: “We are abandoning the system of collective management and we are going to abolish the Production Boards, instead of which we are going to introduce the system of personal responsibility of the works director, the technicians, the foremen and the workers.” This harks right back to unadulterated capitalism.

In Hungary the “iron” Minister Erno Gerö declared in his report to the Central Committee of the Party (June 1950): “A factory ... can only have one manager who in his own person responsible for everything that happens in the factory.” In all the other satellites too one-man management is the rule.

Democracy having duly been stamped out, the governments could without further ado follow this up by imposing on the workers all the known methods of exploitation, old and new. First of these was the introduction on an unprecedented scale of piece work in place of time work.

Chapter Index

Piece Work

Marx once said that piece work is “the most suitable to capitalist methods of production”. The leaders of the “People’s Democracies”, however, teach otherwise. Thus Scanteia, the Rumanian Communist Party daily, of January 13th, 1949; says: “Piece-work is a revolutionary (!) system that eliminates inertia and makes the labourer hustle. Under the capitalist system loafing and laziness are fostered. But now everyone has a chance to work harder and earn more.” (Quoted by R.H. Markham in Christian Science Monitor, 31st January 1949) “Socialism”, then, is superior to capitalism in that it uses the piece-work system!

The volume of work done at piece-work rates is continually increasing all the time.

In Czechoslovakia in February, 1946, 30.2 per cent of the total number of working hours came under the piece-work system, in January, 1947, 41.7 per cent, in June, 1947, 48 per cent, and the Two-Year Plan (1947-8) provided for the extension of piece-work so as to include 70 per cent of all working hours in industry. The aim is not 100 per cent only because in certain processes it is not possible to implement it. That the emphasis on piece-work was not welcomed by the workers is clear from the following attack made on in January 1949 by the Minister of Justice, Alexej Cepicka, on workers who show “false solidarity” and a striving for “equalisation of incomes” by opposing the piece-work system. “Equalisation in waged hampers higher productivity. The piece-work system must be extended so as to give every worker an incentive. It is now used in only 58 per cent of our factories. To extend it to all is our task.“ This was not all, for the workers were going slow to keep the norm low: “Our workers have got to quit stalling and fight against equalitarianism in pay.” (Christian Science Monitor, 31st January 1949)

The piece-workers par excellence, the Stakhanovites, are not loved by the workers. In his report to the 9th Congress of the Party (May 1949), the General Secretary, Rudolf Slansky, revealed that out of 900,000 members of the Party’s factory organisation only 65,000 were listed as Stakhanovites. Their unpopularity becomes manifest from a perusal of Rude Pravo, the Communist Party daily, which finds it necessary constantly to repeat that Stakhanovites should be placed in more responsible positions and that they should be protected against attacks made on them by “politically immature” workers. “There are officials and directors who, being snugly ensconced in their jobs or afraid for their popularity among politically undeveloped elements, fail to defend Stakhanovites as they ought to.” In letters from Stakhanovites published in the press, a frequent complaint is the hostile attitude of the workers towards them. When a reporter of Lidové Noviny went to interview Marie Zemancová, a young Stakhanovite in the Prague radio factory “Tesla” who had been included in the Czech delegation to the Paris “Peace Congress” as a reward for her work, it turned out that she was completely unknown in her factory. “This proves”, comments the paper, “that we have been unable to popularise our Stakhanovites and pioneer workers.” (Quoted by News from Czechoslovakia, No.6, April 1949, published by the Czechoslovak Social Democratic Party in Exile, London). In view of these facts, it is no wonder that at the 9th Congress of the Communist Party open war was declared on people “who run down the work of Stakhanovites and who even try to put spoke in their wheel”.

In Poland the piece-work system reached a stage at which the basic wage almost entirely disappeared. As Clarion describes it: “It should be emphasized incidentally, that with regard to salaries the whole system rests upon the maintenance of basic salaries at an abnormally low level and upon a huge inequality in the bonuses both of money and in kind. The periodical Etudes et Conjoncture in this regard pointed out, in a tidy of the economic situation in Poland, published in November 1946 that “on the average for the whole of industry in May 1946 the total benefits granted (to the workers) in Poland represented from 6.8 to 14.6 times the basic salary, which thus became a mere supplementary item instead of being the main element of the total remuneration.” (op. cit., pp.106-7).

The hatred felt by the Polish workers for these extreme forms of piece-work was displayed openly in the spring of 1946 and in September 1947 when tens of thousands of workers went on strike in Lodz, the biggest industrial city in Poland, in spite of the police terror, the mass arrests, the beatings, etc.

In Hungary, when the workers did not show sufficient enthusiasm for the piece-work system, they were accused by Rákosi of being “lazy” (New York Herald Tribune, Nov. 30th, 1948, reporting a speech delivered on November 27th) the factory directors were “capitulating” to the lazy workers; the production quotas were too low. “We cannot eat up the future of the nation”, he declared. That Rákosi’s speech was not effective enough can be seen from the continual harping on the theme of piece-work and its norms by the Hungarian leaders. Thus in the above-mentioned report to the Central Committee of June 1950 Minister Ernö Gerö said: “The enemy succeeded in opening a new front against the ‘People’s Democracy’; that of wage and norm swindling.” “That wage and norm swindling has spread among the masses can be attributed to a great degree to the underground work of right-wing social-democratic elements and to their allies, the clerical reactionaries ...” It appears that Party members are also in league with “right-wing social-democratic elements” who “swindle” the norms: “That such an unsavoury situation in the field of norms could arise is partly because in many cases the economic leaders of the factories, party functionaries and trade union members are among those who slacken the norms.” “... in more than one case they go as far as to protect and support the wage swindlers.” This vituperation was followed by a considerable increase in the basic norm.

It is interesting to note that Stalinism is not the only system having extreme recourse to piece-work, Nazi Germany had too. Franz Neumann in his book Behemoth (London 1942) writes: “The class wage of the Socialist trade unions has been replaced by the ‘performance wage’ (Leistungslohn) defined in Section 29 of the (Nazi – Y.G.) Charter of Labour. ‘It has been the iron principle of the National Socialist leadership’, said Hitler at the Party Congress of Honour, ‘not to permit any rise in the hourly wage rates but to raise income solely by an increase in performance.’ The rule of the wage policy is a marked preference for piece-work and bonuses, even for juvenile workers. Such a policy is completely demoralizing, for it appeals to the most egoistic instincts and sharply increases industrial accidents.” (pp.352-3).

Neumann explains why the Nazis went to such extremes in using the piece-work system (no more, however, than are resorted to in the Stakhanovite system): “The preponderance of the performance wage brings the problem of wage differentials into the forefront of social policy. It is essential that this problem be understood not as an economic question but as the crucial political problem of mass control (my emphasis – Y.G.) ... Wage differentiation is the very essence of National Socialist wage policy ... the wage policy is consciously aimed at mass manipulation.” (p.353).

The piece-work system “is completely demoralising”, “it appeals to the most egoistic instincts”, it is a most important means of “mass control”, of “mass manipulation”, of atomization of the working class, of the creation of elite above elite even within the oppressed class. That is why the Nazis were so keen on its extension, and there is no other explanation of the enthusiasm of the Stalinist rulers for it. [3]

Chapter Index

The increasing limitation of the workers’ legal freedom

In Russia, until the First Five-Year Plan every worker could freely change his place of work and could migrate unhindered from one part of the country to another.

On the right to change the place of work at that time, the Labour Code (1922) stated:

The transfer of a hired person from one enterprise to another or his shipment from one locality to another, even when the enterprise or institution moves, can take place only with the consent of the worker or employee concerned. (Article 37, Labour Code.) [4]

On freedom of movement, the Small Soviet Encyclopaedia (1930 edition) wrote:

... the custom of internal passports, instituted by the autocracy as an instrument of police oppression of the toiling masses, was suppressed by the October Revolution.

But already in 1931 no worker was allowed to leave Leningrad without special permission, and in 1932 this system was adopted in all parts of Russia. An internal passport system much more oppressive than the Tsar’s was introduced. Now no one could change his place of residence without permission.

As early as September 1930 all industrial enterprises were prohibited from employing people who left their former place of work without permission. In 1932 Labour Books were introduced which every worker must give to the Director when he is taken on, and in which the director can write whatever remarks he likes when the worker leaves the job. No worker can be taken on at another job without showing his Labour Book. Victor Serge, who lived in Russia for many years as a prominent Communist and then was arrested, and who was finally allowed to leave Russia, writes:

The passport is visaed at the place of work. With each change of employ, the reason for the change is entered into the passport. I have known of workers discharged for not having come on the day of rest to contribute a “voluntary” (and, naturally, gratuitous) day of work, in whose passports is written: “discharged for sabotage of the production plan”. (Russia Twenty rears After, New York 1937, p.68).

On 4th December 1932 the Government issued another decree designed to subjugate the workers. The factory’s supplies of food and other necessities were put under the sole control of the Director “in order to strengthen the powers of Directors of enterprises”. (Pravda, 5th December 1932).

Under a law of 26th June 1940 a worker is prohibited from leaving his job, unless he is physically unfit to work, is accepted into an educational institution or is given special permission by higher authorities. Any absence without a satisfactory excuse; even for a day, makes the culprit liable to six months’ corrective labour – which means a cut of 25 per cent in his earnings during that time. It is symptomatic that a few months after the promulgation of this law a few women wrote a letter to Izvestia suggesting that domestic servants also be subject to this law. Izvestia, in its comment on this question (December 30th, 1940), although disagreeing with this suggestion, showed no astonishment as to its content in this period of the “transition from Socialism to Communism”.

Not only are workers prohibited from calling strikes, but strikers are liable, according to law, to be sentenced to death for such an offence. (Item 14 of Article 58 of the Criminal Code. As capital punishment has now been abolished, twenty years penal servitude is given instead). [5]

The Russian model is now being copied in the “People’s Democracies”. This time it will not take so many years to reach perfection. Until 1928, strikes in Russia were legal and were conducted without police intervention, even though the bureaucratic rulers opposed them more and more as their power grew. [6]

The “People’s Democracies”, however, from the beginning avoided the mistake of allowing strikes. Not one of the new Constitutions includes the right to strike. The explanation is simple, and was put in a nutshell by the spokesman of the Yugoslav Government when he was replying to a proposal to include “freedom to strike” in the Constitution: “Now when our constitution fully guarantees the rights of the working class, such a proposal is outright reactionary and anti-national” (20th January 1946). In opposing strikes the Communist Party leaders showed themselves very willing to use the help of the bourgeois politicians, and these, on their side, did not hesitate to use the authority of the Communist Party leaders in opposing strikes. For instance, the Czechoslovak Minister of Justice, Dr. Drtina (“purged” in the coup of February 1948) said on 17th March 1947, about recent unofficial strikes: “They were ... in effect strikes against the Government and Premier Gottwald ... What is more serious is the fact that these strikes against the legal order occurred after the Revolution. Therefore, they are of a terroristic and anarchic character” (East Europe, 26th March 1947). Of course, from the suppression of the “anarchic” strikes, the real benefactors were not Dr. Drtina and his friends, but Gottwald and his. In Rumania Decree No.183 bans strikes, defining them as “an economic offence”. Participation in strikes is punishable by imprisonment of 1 to 12 years and by fines of Lei 10,000 to 100,000. A member of the Communist Party of any of the Western countries, making use of the double thinking so common to him, will find it quite consistent to support the banning of strikes in Russia and the People’s Democracies (except, of course, Yugoslavia after 28 June 1948 – the day of the excommunication of Tito by the Cominform) and at the same time oppose any limitation of the right to strike in any enterprise owned by a democratically elected public body in his own country.

The first steps have also been taken to abolish the right of workers to change their place of work. On April 16th, 1948, a law was passed in Yugoslavia prohibiting any state employee from leaving his place of work without permission from a special government commission. On August 19th Sofia Radio reported that the Labour Directorate had decided that the workers “have no longer the right to leave their working places without permission” of the factory administration. Permission to employ or to dismiss will be granted only in accordance with the needs of production. Workers who leave their employment without permission of the Labour Directorate must be sent back to their original jobs, in accordance with Cabinet Decree No.7. If they do not return voluntarily, they can be called up by the branch labour office (that is, assigned to compulsory labour groups). In Hungary the government published a decree on January 9th, 1950, laying down severe penalties for workers who leave their place of employment without permission. In all the “People’s Democracies” the labour book was copied from Russia. In Yugoslavia an “improvement” was introduced: every citizen has a karakteristika, a record of his political reliability which has to be shown every time he takes a new job. As it is sealed, lie does not know its contents, and is not even able to appeal against what is written in it.

Chapter Index

Slave labour

An institution which is of paramount importance in Russia, which is beginning to appear in the satellites and is bound to increase in importance as time goes on, is slave labour.

Some figures regarding the number of slave labourers in Russia are given by D.J. Dallin in a book that he wrote with B.I. Nicolaevsky, Forced Labor in Soviet Russia (London 1948). “Kiseliev-Gromov, himself a former GPU official in the northern labor camps, states that in 1928 only 30,000 men were detained in the camps ... The total number of prisoners in the entire network of camps in 1930 he gives as 662,257 ...” (p.52). Dallin comes to the conclusion on the basis of available evidence that the number of people in labour camps in 1931 was nearly 2 million, in 1933-35 about 5 million. He says that in 1942 there were from eight to fifteen million (pp.53-62). The former Yugoslav Communist leader, Anton Ciliga, who was for many years in a Russian concentration camp, estimates that the number of prisoners was about io million (The Russian Enigma, London 1940, p.249).

A conclusive proof of the existence of slave labour on a big scale in Russia can be gained from the following quotations from Pravda. On June 4, 1947, the Presidium of the Supreme Soviet of the USSR passed a decree on Protection of Citizens’ Private Property the first article of which reads: “Theft – that is, covert or open appropriation of the private property of citizens – is punishable by confinement in a reformatory labour camp for a period of five to six years. Theft committed by a gang of thieves or for a second time is punishable by confinement at a reformatory labour camp for a period of six to ten years” (Pravda, 5th June 1947).

On the same day another decree was passed on Embezzlement of State and Public Property which includes the following articles:

(1) Theft, appropriation, defalcation or other embezzlement of state property is punishable by confinement in a reformatory labour camp for 7 to 10 years, with or without confiscation of property.

(2) Embezzlement of state property for a second time, as well as when committed by an organized group or on a large scale, is punishable by confinement in a reformatory labour camp for 10 to 25 years, with confiscation of property.

(3) Theft, appropriation, defalcation or other embezzlement of collective farm, cooperative or other public property is punishable by confinement in a reformatory labour camp for 5 to 8 years, with or without confiscation of property.

(4) Embezzlement of collective farm, cooperative or other public property for a second time, as well as that committed by an organised group or gang or on a large scale, is punishable by confinement in a reformatory labour camp for 8 to 20 years, with confiscation of property. (Ibid.)

A month after these decrees were passed the U.S.S.R. Public Prosecutor’s Office gave ten examples showing how the decrees were carried out in practice (Pravda, July 9th, 1947):

(1) In the city of Saratov, V. F. Yudin, who had been previously convicted for theft ... stole fish from a smoke factory. On June 24th, 1947, ... Yudin was sentenced to fifteen years imprisonment in corrective-labour camps

(2) On June 11th, 1947, an electrician on the power lines of the Moscow-Ryazan railroad, D.A. Kiselev, stole fur goods from a railroad car ... On June 24th, 1947, the war tribunal of the Moscow-Ryazan railroad sentenced D.A. Kiselev to ten years’ imprisonment in the corrective-labour camps.

(3) In the town of Pavlov-Posad in the Moscow region, L.N. Markelov ... stole clothing from the Pavlov-Posad textile factory. On June 20th, 1947 ... Markelov was sentenced to eight years’ imprisonment in corrective-labour camps.

(4) In the Rodnikov district of the Ivanov region, Y.V. Smirnov and V.V. Smirnov ... stole 375 pounds of oats from a collective farm. On June 26th, 1947 ... both were sentenced to eight years’ imprisonment in corrective-labour camps.

(5) In the Kirov district of Moscow, E.K. Smirnov, a chauffeur, was arrested for stealing 22 pounds of bread from a bakery. The people’s court ... sentenced E.K. Srnirnov to seven years’ imprisonment in corrective-labour camps.

(6) In Saratov, E.I. Gordeyev ... stole various products from a warehouse. On June 21st, 1947, ... Gordeyev was sentenced to seven years’ imprisonment in corrective-labour camps.

(7) In Kuibyshev, E.T. Poluboyarov stole a wallet from a train traveller ... On 4th July he was sentenced to 5 years’ imprisonment in corrective-labour camps.

(8) On June 7th, 1947, in Kazan at the collective farm market, V.E. Bukin snatched money from the hand of Citizeness Pustinsky ... On June 20th, 1947 ... Bukin was sentenced to eight years’ imprisonment in corrective-labour camps.

(9) On June 6th, 1947, in the village of Subovka in the Kutuzovsk district of the Kuibyshev region, A.A. Chubarkin and V.G. Morozov stole from a cellar 88 pounds of potatoes belonging to Citizeness Presnyakov. On June 17th, 1947 ... both were sentenced to five years’ imprisonment in corrective-labour camps.

(10) On June 5th, 1947, in Moscow ... K.V. Greenwald, who had been previously convicted for theft, took advantage of the absence of his neighbour, entered the room of Citizeness Kovalev and stole various household articles ... Greenwald was sentenced ... to ten years’ imprisonment in corrective-labour camps.

That people steal bread and other elementary necessities of life under the cruel threat of a minimum of five years’ slave labour if caught, shows what dire poverty they are suffering.

That slave labour in USSR is very widespread is clear not only from the large amount of evidence given by former inmates of these camps (collected in the above-mentioned book of D.J. Dallin and B.I. Nicolaevsky) and from the facts published in the Russian Press of heavy punishments for the most elementary crimes – if the theft of bread can be so called. There is further evidence which is conclusive even if indirect. Soviet law grants the franchise to everyone above the age of 18 with the exception of the inmates of forced labour camps. In the 1946 elections 101.7 million people had the franchise. The population of USSR was 193 million in the same year. The census of 1939 says that 58.4 per cent of the population were 18 and over. In 1946 the percentage of people above 18 was higher, as, firstly, the age distribution of the population in the new areas added to USSR (Lithuania, Latvia, Estonia, etc.) was such that the percentage of children was lower than in the population of USSR in its 1939 boundaries, and, secondly, the war caused a relatively greater decline in the birth rate and increase in the death rate of children as compared with the death rate of the adult population. If we assume that the proportion of people aged 18 and over was the same in 1946 as in 1939, there were altogether 112.7 million people in this category. Seeing that only 101.7 million had the franchise, it is clear that at least 11 million were inmates of slave labour camps.

Up to now news from official sources of slave labour camps in the satellite countries has been very scarce. The Czechoslovak news agency reported on October 5th, 1948, that forced labour camps were to be set up under a Bill approved at the same day’s meeting of the Cabinet.

In the debate on the new Penal Code, passed by Parliament on June 27th, 1950, the deputy Dr. Patchova said: “The Law expressly states that convicts must be given useful employment which will, after their release, make it possible for them to join the ranks of the workers. On the other hand, a prisoner sentenced as an enemy of the People’s Democracy, who, by his work and behaviour while serving his sentence, does not show improvement justifying the hope that he will lead the life of a decent working man, can be sent to a forced labour camp after he has served his sentence.” This speech alone proves the existence of the forced labour camps in Czechoslovakia. The best known camps are at Joachimov and Kladno.

In Rumania a law of 14th January 1949 fixes very severe sentences – as much as the death penalty – for negligence in fulfilling service obligations in industry. Many of those who are arrested under this law will, of course, not suffer the supreme penalty, but will supply recruits for the slave labour camps. That other “crimes” besides economic negligence are paid for by forced labour, is illustrated by the fact that several thousand Jews, including some Zionist leaders, have been sent to forced labour camps in Rumania. (London Jewish Chronicle, 4th August 1950).

Of forced labour in Yugoslavia The Times of 13 June 1950 wrote: “To root out Cominformist opposition within the Communist Party and to enforce the collection from the peasants of produce quotas the Government has made numerous arrests, which, although no doubt dwarfed by comparable figures in Russia, make the prison population far greater than anything found in the west. In Britain, with a population about three times as great as in Yugoslavia, the prison population is now about 20,000. Most observers estimate the number of persons now in prison in Yugoslavia at anything from 100,000 to 200,000.” “Most of the prisoners are employed as a useful reserve of labour on public works ...”

Indirect official confirmation appears from time to time of the existence of forced labour camps in Hungary, as well as of the pettiness of the “crimes” that open the gates to them. Thus on 21st August 1950 Radio Budapest announced that in the wagon factory of Gyöv, a worker, I. Olajos, had been sentenced to six years’ compulsory labour for a wage swindle.

In Bulgaria the most notorious forced labour camps are at Kuznian near Pernik, and at Belene.

In Poland the camp at Milecin is the most well-known.

The fact that so little is known of slave labour in the “People’s Democracies” is primarily because the governments are doing their very best to hide the ugly truth which is such an outrage to the concept of “Socialism” and “Democracy” which the Communist Parties claim to have established. Another two factors must also be taken into account. To quote Juvenal, “No one reached the climax of vice at one step.” It took Russia many years to establish camps with millions of inmates. If it is assumed that the proportion of prisoners in the population in all the “People’s Democracies” is about the same as in Yugoslavia, there must be ½-1 million prisoners altogether. The USSR with a population double that of the “People’s Democracies” had less than a million slaves in 1930, and two million in 1931. Secondly, it is very probable that although slave labour will be more widespread in Eastern Europe than at present, it will not reach the Russian dimensions. It is, as Adam Smith clearly showed, very unproductive, being suitable mainly for manual labour which does not require modern industrial equipment, such as lumber work, road and rail construction, large-scale industrial construction, irrigation works, or canals. The more abundant the machinery and the supply of cultured and skilled workers, the less profitable the use of slave labour. Hence in all probability Czechoslovakia will have less slave labour than Bulgaria or Rumania, and the “People’s Democracies” as a whole less than Russia.

It is very difficult, if not impossible, to distinguish between voluntary and forced labour in a totalitarian regime. If it is not obvious in itself, the following declaration of Tito (to the Joint Congress of the Union of Communist Youth and the People’s Youth, December, 1948) will make it plain: “There are, of course, also such students who are not very keen on voluntary work, or who refuse to take part in voluntary work activities ... Such was the case of a small number of students whom we had to expel from Belgrade University and other universities ...”

Chapter Index

The distribution of the social product

Many Communists admit that the bureaucracy in Russia and the satellites have complete control of the state machine and thus of the running of the economy. But they claim that they act entirely in the interests of the people.

To assume that a group of people who are in absolute control of the means of production will not take as much as they can out of the national product for themselves, is tantamount to explaining manes economic conduct by his intentions – a strange method of argument for those who claim to hold the materialist conception of history. The more so when from the same lips we hear that in America and elsewhere, under capitalism based on private property, mere crumbs from the table of the bourgeoisie are a sufficient inducement to bribe and corrupt the “aristocracy of labour” – the trade union bureaucracy, and so forth – and alienate them from the working class. Stalin and his associates have all the food on the table within their reach, and their reach alone, but apparently they are incorruptible, and will remain forever loyal to the working people. This double vision sees the molehill as a mountain, and the mountain as a molehill!

All the experience of history in this connection points to the inescapable conclusion that if a group of people are in absolute control and ownership of the means of production they will inevitably take for themselves all the benefits they possibly can out of production.

The division of the national income among different income groups is kept strictly secret in the “People’s Democracies”, although if the British Government did not publish such statistics the Communist Party would certainly, and justifiably, criticize it for keeping the truth from the people. Nevertheless from fragments of news in the press it is possible to get some idea of the great differentiation of incomes.

The official Free Bulgaria of 15th March 1947 states that in Bulgaria the ratio between minimum and maximum salaries in Government employment is 1:5. “New Yugoslavia, which had adopted a ratio of 1:3.2, is gradually introducing a greater differentiation. France has a ratio of 1:6, the United States – 1:10, USSR – 1:11.” The USSR leads all the rest, and is praised for it by the Bulgarian Communists!

Departmental chiefs in Bulgaria got 17,000 leva a year, counsellor-reporters 19,500, counsellor-specialists 21,000 and general secretaries 25,000. This was increased in many cases by a “supplementary salary” of 13,200-22,800 a year, which raised their salaries to 30,000-47,000 leva a year. As against this the average worker’s wage was 357.7 leva a month or 47,292.4 leva a year (Free Bulgaria, October 1st, 1947) and many unskilled workers earned 150-200 leva a month, or 1,800-2,400 leva a year (Free Bulgaria, April 1st, 1948), i.e., twenty times less than the parvenu rulers. There is, of course, no record of the value of the benefits the high bureaucrats get not in money but in kind, such as houses, cars and servants.

In Rumania the minimum salary of a civil servant is Lei 3;328 a month, the maximum Lei 42,600 (Rumanian News, 6th February, 1949). Many workers earn as little as Lei 2,000-2,500 a month.

Some information about income differentiation in Poland can be gained indirectly from the table giving the rate of income tax payable by people falling within the different income groups. This gives an insight into the difference between maximum and minimum incomes, but does not reveal the number of people falling within each group. Incomes of persons or enterprises up to 72,000 zlotys are tax-free (there are many who earn even less than 36,000 zlotys). The rate of tax goes on:

To paraphrase Orwell: all men are equal, but some men are more equal than others! [7]

In Czechoslovakia, as has already been mentioned, it was not uncommon (in 1948) to find factory managers earning 40 thousand crowns a month, while two-thirds of the workers in 1948 got less than 2,900 crowns a month gross (i.e. before payment of taxes, dues, etc.). In addition, those earning 40,000 crowns were given the fl-cc use of a villa, a car with a chauffeur and other perquisites.

Benes’s bourgeois liberal paper, Svobodné Slovo, stated, not unjustifiably, that the bureaucracy were “living in the style of millionaires ... enjoy every comfort and luxury, thanks to the villas and limousines which they have been allocated by the authorities and to their high incomes”. These people, the paper continued, are “propertyless – in form only ...” (6th September 1947). The standard of living of the masses, on the other hand, is very low, as even the official statisticians have to admit. As early as June, 1946, the monthly average wage of an industrial worker was 2,540 while the food ration alone of a family of three cost 2,721 crowns. And many earned less than the average of 2,540 crowns! Since June, 1946, the condition of the masses has deteriorated. The correspondent of Associated Press in Prague, did not exaggerate when he said on 15 July 1948: “Czechoslovakia today can fairly claim to be the hungriest country in Europe – hungrier than even Austria.” The Viennese Socialist paper Arbeiter Zeitung wrote on 23rd June 1948: “Travellers who often come from Prague to Vienna report that in the last few weeks, for the first time, they have not taken goods from Prague to Vienna, but on their return from Vienna to Prague.” The paper adds particulars of prices on the black market in Prague. It is possible to cite innumerable facts to the same effect.

There can be no doubt about who suffered from the shortages, which were the result partly, but only partly, of the drought of the winter of 1947-8. The drought fails to explain either the acute shortage of textiles, shoes (in the country of Bata!) and other consumer goods, or the duration of the shortages.

It is clear from official data that the portion of the social product going to the workers is decreasing. In January 1946 the total product of Czechoslovakian industry was sold for 9.09 milliard crowns; wages and salaries in industry itself came to 2.83 milliard crowns, i.e. 31.6 per cent of the turnover. A year later, in January 1947, the total sales amounted to 15.66 milliard crowns; wages and salaries came to 4.03 milliard or 25.7 per cent of the turnover. This decline in the portion of wages and salaries was accompanied by an increase in the turnover per hour of work from 50 crowns to 78 crowns, a rise of 56 per cent (Statistical Bulletin of Czechoslovakia, published by the State Statistical Office, Prague, July 1947). If the statistics had included only wages and not salaries as well, the decline would have been even bigger.

The journal Ucetnictví a Kontrola, issued by the trade union publishing house, Práce, submitted the state budget to a detailed analysis in order to get an approximate estimate of the cost of the bureaucracy. This reveals that the travelling expenses of the administration proper – that is, the ministries, not including the administration of the nationalised industries – amounted to not less than 780 million crowns, the maintenance of automobiles to 180 million. How large these amounts are is clear from the fact that the expenditure on travelling of these bureaucrats would cover the difference between the meagre wages of about 300,000 families and a minimum living standard. In summing up, the article states: “The public administration swallows 48 per cent of the national income. How will it be possible to raise the standard of living of the whole people, how will the wide layers of the toilers be satisfied, how will it be possible to pay proper salaries to government clerks?”(From an article, Let us think about the Figures quoted by V. Salus in the theoretical paper of the Czech Social Democracy, Cíl, August 15th, 1947, under the interesting heading, Economic Democracy and the New Nobility). [8]

The division of the national income in Yugoslavia is not less unequal than in the other “People’s Democracies”. Vernon Bartlett, when in Belgrade, described the situation in the following terms:

Here, as in Moscow during the war, I am shocked that leaders who boast so much of the dictatorship of the proletariat should enjoy privileges that are relatively far greater than those enjoyed by any privileged class in Britain or in most of the other countries condemned by Moscow as Fascist and imperialist (News Chronicle, 26th April 1949).

The situation was described sixteen months later by the correspondent of the Neue Zürcher Zeitung in the following terms:

The social revolution in the eastern countries, which pretended to have the abolition of exploitation and inequality as its aim, leads in actuality to the erection of a hierarchically ranked social order with a whole number of privileged layers. This can be observed daily in Yugoslavia in the same way as in the Cominform countries and one will always be astonished at the way in which the bearers of the system take the privileges they enjoy for granted. The proletarians who stand in the queues near the bus stops look with greedy eyes at the lit-up American cars of the state leaders, resplendent in chrome and coloured varnish, which pass swiftly by them. The higher-ups of the State and Party travel in the latest model cabriolets, the great ones of second rank travel in limousines. Skoda and Opeldienst cars are at the disposal of high officers and officials.

In the entrance to the People’s Front Street in Marshal Tito Boulevard stands a big warehouse. Men in khaki or white uniforms with gold epaulettes go in and out. The warehouse is reserved for officers and their families. There they can buy clothes, shoes, furniture, carpets and other goods of better quality and cheaper price than the common mortal can buy. The officers get their food rations there too – far larger rations than those of workers and clerks. So large are these rations, that in the spring, at the time of the great food scarcity, peasants came to town in order to buy from the officers their surplus fat and flour at black market prices.

It is obvious that the police and high officials also have their own store. The warehouse of the political police is even better supplied than that of the officers. Naturally these categories of the population also have their special rations. It is the same here as in the other Eastern countries: one who has a higher post and a higher salary also gets larger food rations and is less directed to the expensive free market than the poorly-salaried small man. Reductions in prices for the higher-paid instead of for those with smaller means ... (Neue Zürcher Zeitung, 30th August 1950) [9]

One aspect of the problem of the mode of distribution of the social product is this: to what extent is the differentiation between different income groups concomitant with national differences? How much of the cream of the milk produced in the satellites is in the form of higher personal incomes for Soviet officials? These facts are unfortunately covered by a veil of secrecy. Some facts, however, have emerged. A letter of the Central Committee of the Communist Party of Yugoslavia to the Central Committee of the Communist Party of the Soviet Union (dated 13th April 1948) stated: “The wages of the Soviet experts (working as advisers in Yugoslavia – Y.G.) were four times as high as the wages of the commanders of our armies and three times as high as the wages of our Federal Ministers. The commander of one of our armies, a lieutenant-general or a colonel-general, then had 9,000 to 11,000 dinars a month, and a Soviet military expert, lieutenant-colonel, colonel and general had from 30,000 to 40,000 dinars. At the same time our Federal Ministers had a salary of 12,000 dinars a month.” The reply of the Central Committee of the Communist Party of the Soviet Union (dated 4th May, 1948) did not deny the correctness of these figures, but claimed as an extenuating circumstance the fact that the Yugoslav generals also got “apartments, servants, food, etc.”

The paper Glas, the organ of the People’s Front of Serbia, in its issue of 16th December 1949, gave another example of the same thing. Near Sofia an automobile factory employing Russian, Czech and Bulgarian specialists was being built. The salary of the Russian specialists was 2,000 levas an hour, of the Czechs 2,000-3,000 levas a day, and of the Bulgarian 250-300 levas a day. These differences were certainly not due mainly to differences in skill.

It might yet be claimed that even these differences in income are smaller than those prevailing in the countries of capitalism based on private property. There is not sufficient statistical information about income distribution in the “People’s Democracies” accurately to check this contention, but some general remarks may be made. To compare the ratio between the income of an American capitalist and his workers on the one hand, with the ratio between the incomes of a manager in the “People’s Democracies” and his workers is to compare two qualitatively different things. Let us assume that the American capitalist gets a million dollars’ profit, of which he ploughs back into the enterprise 700 thousand dollars. For his personal consumption lie thus takes 300,000 dollars. The boss in the enterprise in the “People’s Democracies”, on the other hand, would claim that as he does not own the factory the profits ploughed back into the enterprise must not come out of what he gets, but out of the profit made by the whole of society. If the American capitalist argued that the 700,000 he ploughed back was in the interests of society, the communists would reply that he gets the main benefit from it. But it appears that the same argument must not be applied to bureaucratic state capitalism.

Since a group of people in control of the means of production will take for itself the biggest possible share of the national cake, and as under the rule of the Communist Parties the workers are faced with the most concentrated capital, while they lack the right to defend themselves through democratic organisations independent of their rulers or by strike action, the inequality in incomes will inevitably reach its most extreme forms.

Next part
The socio-economic relations in the satellites
(Part 2)

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Footnotes

1. Sources used on feudalism in the Arab East:

A.N. Poliak – Feudalism in Egypt, Syria, Palestine and Lebanon, London 1939.
A.N. Poliak – Les Révoltes Populaires en Egypte a l’Epoque des Mamelukes et leurs causes économiques. Appeared in Revue des Etudes Islamiques, Paris 1934.
A.N. Poliak – Various articles that appeared in the Hebrew periodical Hameshek Hashitufi, Tel Aviv.
A. Kremer – Geschichte der herrschenden Ideen des Islam, Leipzig 1868.
A. Kremer – Culturgeschichte des Orients unter den Chalifen, Wien 1875-7.
C.H. Becker – Beiträge zur Geschichte Aegyptens unter dem Islam, Strassbourg 1902-3.

2. There have even been cases of state-ownership of the means of production with equality between the different “owners” of the state, equality in the right collectively to exploit those whom the state owned. Spartan society was a case of “communism” in slave ownership. Kautsky characterized this regime in the following terms:

The Spartans made up the minority, perhaps a tenth of the population. Their state was based on real War Communism, the barrack communism of the ruling class. Plato drew his ideal of the state from it. The ideal differed from real Sparta only in that it was not the military chiefs, but the “philosophers”, that is, the intellectuals, who directed the war communism. (Die Materialistische Geschichtsauffassung, Zweiten Band, Berlin 1927, pp.132-3).

3. As an indication of the purpose for which piece-work was so widely introduced, it is interesting to note that it was introduced even before the nationalisation of industry. It would be good, the Communist Party leaders thought, to discipline the workers in advance, in “the interests of the nation”. In Rumania and Bulgaria, at the beginning of 1945, before the nationalisation decrees, production competitions were introduced, and “labour heroes” were honoured with medals and money rants conferred by the heads of the governments. The 1st of May 1946 was celebrated in Hungary as a production competition in the private industries. In these measures the Communist Party leaders got the whole-hearted support of the bourgeoisie. Then, after harassing them in this way, they used the same workers as their support in their onslaught on the bourgeoisie, which resulted in its expropriation. This shows the united attitude of the bourgeoisie and the Communist Party bureaucracy towards the exploitation of the masses (piece-work) and the united attitude of the bureaucracy and the working class towards private property (see Part II of the book).

4. This article was abolished on 1 June, 1932. (Collection of Laws, Labour Code, Moscow 1937, p.20.)

5. The following article is the only item in the Collection of Laws which touches on or covers any cases that can be interpreted by the courts as strikes: “Counter revolutionary sabotage, i.e., knowingly omitting to discharge a given duty or discharging it with deliberate carelessness, with the specific object of weakening the authority of the government or the operation of the government machine, entails – deprivations of liberty for a period of not less than one year, and confiscation of property in whole or in part, provided that where there are aggravating circumstances of a particularly serious nature the penalty shall be increased to the supreme measure of social defence: death by shooting, with confiscation of property.” (My emphasis – Y.G. Criminal Code, Article 58 (14), June 6, 1927, Collection of Laws, No.49, Article 330, Moscow 1937, p.31).

6. In 1922-3 there were 500 strikes with 150,000participants in 1925, 196 strikes with 37,600 participants; in 1926, 337 strikes with 43,200 participants; in 1927, 396 strikes with 25,400 participants. More than 90 per cent of the participants in these strikes were workers employed by the State. Not only were strikes allowed, but at that time the Bolshevik leaders insisted on the active support of Party members for strikes whenever the majority of the workers of an enterprise took this step. (See, for instance, the speeches of Lozovsky and Tomsky to the at the 11th Congress of the Russian Communist Party, 1922).

7. In Russia the scale of income-tax starts with taxes on less than 1,800 roubles a year and ends with taxes on more than 300,000 roubles (Izvestia, 6th April 1940).

8. For a time the Communist Party leaders tried to cushion the conflict between the workers and the “new nobility” by directing the hostility of the masses exclusively against the bourgeoisie. For example in October 1947 in connection with the relief to the peasants who were suffering from the drought, the Communist Party raised the slogan “Let the millionaires pay”, and proposed as a solution the imposition of a property levy. Of course the bureaucracy, being “propertyless – in form” would not have to pay anything. The Communist Party tried to overlook the fact that the portion of the national income of Czechoslovakia in the hands of the bourgeoisie was so small, only a quarter of industry being left in their hand; that the only possibility of seriously improving the conditions of the masses was by 1. cutting into the income of the bureaucracy; 2. raising the general national income; 3. preventing Russia from taking her cut from the national income.

The Communist Party claimed that there were 35,000 millionaires in Czechoslovakia. This is a large number, but it is much less impressive when it is realised that they were not pound sterling or dollar millionaires, but crown millionaires. A million crowns in July, 1947, was equal to five thousand pounds sterling. Even according to the Communist Party estimate the wealth of these 35,000 “millionaires” was only 50 milliard (According to the bourgeois paper Svobodné Slovo there were only 12,000 millionaires with a property of 22 milliard crowns). 50 milliard crowns is only about a quarter of the annual national income of Czechoslovakia.

The conditions of the masses could not therefore be substantially improved at the expense of the bourgeoisie, but only by improvements in the nationalised sectors of the economy and at the expense of the bureaucracy. This is proved by the distribution of the national income:

The figures speak for themselves. The possibility of increasing item 4 at the expense of item 1 is very limited indeed.

9. Since then a big change has taken place. On 14th October 1950 Marshal Tito signed a decree abolishing special privileges in the supply and distribution of rations and consumer goods, doing away with the special shops of the upper bureaucracy, and transferring all villas and rest homes hitherto reserved for the privileged to the tourist industry. Whether this is a temporary measure resulting from the terrible drought and famine of the 1950-51 winter, it is too early to say.

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Last updated on 16.6.2004