WI: Humanitarian Soviet Union

RousseauX

Donor
Heard of Singapore? Successful example of a command economy. How about South Korea? Command economy for most of its history and generally considered successful. Or that funny little island they call "Japan"? Yeah, command economy kicking ass again. How about a more obscure example - interwar Poland - again, a shining example of what a command economy can do if it's done right. Of course Poland then got flattened with added rape, massacre and looting from both Germany and the Soviet Union, so that ruined the work of a generation, but getting invaded by Nazis and the Soviets isn't a failure of economic policy.

There's a pretty big difference between statist economies and command economies, because yeah, even the UK/US was pretty statist when it came to industrialization.

I'd really like to hear in what sense was post-war Japan or South Korea a command economy though.
 
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RousseauX

Donor
None of Stalin's mass murders were needed to achieve Soviet economic goals. The deaths were simply the product of a state that was either uncaring about human suffering, or actively causing human suffering in the pursuit of its political goals. The nature of the state was largely (though by no means exclusively, I grant you) caused by the malicious nature of the man on top.

Stalin needed to starve some peasants to generate capital for industrialization because collectivization was a disaster and thus he needed to export essentials instead surpluses.

but yeah, he probably would have starved them anyway.
 

RousseauX

Donor

From your link:

http://en.wikipedia.org/wiki/Ministry_of_International_Trade_and_Industry

MITI has served as an architect of industrial policy, an arbiter on industrial problems and disputes, and a regulator. A major objective of the ministry has been to strengthen the country's industrial base. It has not managed Japanese trade and industry along the lines of a centrally planned economy, but it has provided industries with administrative guidance and other direction, both formal and informal, on modernization, technology, investments in new plants and equipment, and domestic and foreign competition.

A command economy does not refer just to state interference or direction in the economy, it refers to a system in which the state establishes a system of monopolies controlled by firms owned by itself which encompasses most if not all of the production of goods and services within a country. Markets are either banned or at least heavily curtailed in such an economy.

Neither post-war Japan nor SK fits this definition.
 
Two massive differences between the Soviet planned economy and the Asian planned economies are that the Asian companies are exporters and generally public companies. That means that the Asian companies needed to successfully build products that Americans and Europeans wanted and that their corporate owners had an incentive to do so. The Soviets were selling to communist countries, had a monopoly, and no incentive to make good products or even be productive. You simply cannot compare central planning from Asian countries to that of the Soviet Union.
 
From your link:

http://en.wikipedia.org/wiki/Ministry_of_International_Trade_and_Industry



A command economy does not refer just to state interference or direction in the economy, it refers to a system in which the state establishes a system of monopolies controlled by firms owned by itself which encompasses most if not all of the production of goods and services within a country. Markets are either banned or at least heavily curtailed in such an economy.

Neither post-war Japan nor SK fits this definition.

In this definition South Korea fits even more to the term of command economy; here, the government nationalized and controlled all major banks since 1960s and through them, controlled the chaebols and its activities. In 1971 the government literally ordered Hyundai to invest in shipbuilding industry, and bam! Hyundai Heavy Industries is born.

Not to mention all these government-funded and owned companies still dominating some certain sectors, like transportation and power producing.

Things changed only after the 1997 crisis. Banks were privatized and businesses were sold out; Posco is prime example. Two dominating telecom companies in Korea, SK Telecom (50%) and KT (30%) were once government-owned but now privatized.
 
With the POD anytime between 1910 and 1930, how would a different Soviet Union be in 2000?
In the alternate timeline, the Soviet Union would not enter in a cold war and instead of wasting resources with military things, it would use the resources to improve the welfare of the population. It would also avoid internal conflicts by tolerating religion and avoiding dictatorial policies.

The timeline needs another adjustment, because with weak military power, Hitler would be able to invade and bring down the Soviet Union. Later, the USA would free the Soviet Union and implant a modern capitalist system.


A suggestion: if Stalin had never been the leader of the Soviet Union? And if Hitler had never been the leader of Germany?

For the USSR to not arm itself to the teeth they need to have no enemies. No Nazi invasion or hostile powers close by. So socialist europe would help. Socialist America would be even better.

So seriously bad depression. Communists rise everywhere and take everywhere. All join USSR or are at least friendly towards the soviets. No enemies means not so much spending on weapons etc.

This is of course fairly ridiculous and requires incredible luck etc.
It's just hard to see how you demilitarise the USSR with hostile states with ideologies which were affronted by it's existence (and could act sgainst the USSR) still around.
 

RousseauX

Donor
In this definition South Korea fits even more to the term of command economy; here, the government nationalized and controlled all major banks since 1960s and through them, controlled the chaebols and its activities.

Banking is merely one sector of the economy, abet a very important one for capital allocation, nationalized banks does not represent a command economy per say. Capital allocation in China today for instance, is dominated by state owned banks and yet China does not have a command economy today.

Let's just say if the Chaebols were actually owned by the state (and I draw a very important line on ownership) like they would be in the USSR then maybe it would be considered a command economy. But even then it would depend on precisely what % of GDP is produced by the state.

Come to think of it I don't think even NEP era USSR would qualify as a command economy.
 
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and as we know, economic planners are NOT in your house collecting information on your favorite brand of scarves or how many Pop Tarts you inhale overnight.
That is what the People's Commissariat for Internal Affairs (NKVD) was for, or at least in East Germany where the Stasi cataloged the complaints of citizens as to better provide for consumer-based commodities such as cars, radios, and the like.

In all seriousness though, the planned economy was fully capable of industrializing the USSR at a quicker pace than if Russia had remained Tsarist, and did try to meet the demands of citizens for more and better consumer goods.

IMHO, Gorbachev was aiming for a less centralized command economy, one which allowed for the (limited) existence of markets. There's a book (can't remember the name of it) that collects essays from Gorbachev-era Soviet citizens, and one thing that struck me was a piece arguing for a humane, localized socialist economy devoid of Stalin-style 'barracks socialism.'

Assuming that the Soviet Union survived, it would probably end up like modern China economically - central economic planning existing alongside markets, possibly including special economic zones.

So yes, very much so I would have to say, a humanitarian Soviet Union and a humane socialism was wholly possible given the right conditions.

Heard of Singapore? Successful example of a command economy. How about South Korea? Command economy for most of its history and generally considered successful. Or that funny little island they call "Japan"?
Those weren't and aren't command economies, not by a long shot.

Stalin needed to starve some peasants to generate capital for industrialization because collectivization was a disaster and thus he needed to export essentials instead surpluses.
Well, no actually. Collectivization was far from having been a total disaster, and in fact the main issue was that collective farming underperformed economically - it is said that the individual private plots given out to peasants in the collective farms produced far more food than that produced from farms held in common.

The Soviet regime fully expected poor and middle peasants to flock to the government's side and eagerly carry out collectivization of agriculture - some did, but most did not. As such, the ones that did help worked with party cadres from the cities and political police forces to do so - meeting great resistance from a large segment of the village populace contrary to what Stalin and Co. expected.

BTW, how does starving peasants generate capital for industry?

And yes, surpluses taken from the peasants by the state as stipulated by law (enshrined in the 1936 Soviet constitution) did occur on a regular basis for much of Stalin's rule excepting the famine in Ukraine in the early thirties.

Again, why deliberately kill off the peasantry by seizing their 'essentials' (grain needed to feed their families I assume)? How does that help Stalin create and ultimately maintain a socialist planned economy?
 
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RousseauX

Donor
BTW, how does starving peasants generate capital for industry?

And yes, surpluses taken from the peasants by the state as stipulated by law (enshrined in the 1936 Soviet constitution) did occur on a regular basis for much of Stalin's rule excepting the famine in Ukraine in the early thirties.

Again, why deliberately kill off the peasantry by seizing their 'essentials' (grain needed to feed their families I assume)? How does that help Stalin create and ultimately maintain a socialist planned economy?
You export grain and use it to buy machinery, machinery is required for industrialization. This isn't something Stalin came up with either, Zinoviev, Kamnev, Trotsky etc all wanted to do some variation of this. Bukharin was probably the person who came closest to having a sane agricultural policy in a Socialist country.

Had Soviet agricultural policies done better, as it did during the NEP, you would have being able to export surpluses to accomplish this.

That being said, Stalin might have starved the peasantry to murder them in any case because he didn't think Ukrainians are loyal enough, and hence the need to reduce their number.

Well, no actually. Collectivization was far from having been a total disaster, and in fact the main issue was that collective farming underperformed economically - it is said that the individual private plots given out to peasants in the collective farms produced far more food than that produced from farms held in common.
It is, both in China and the USSR, because people literally starve to death in the millions due to collectivization.

"under performing economically", in real history, translated into "you guys aren't gonna eat for a while have fun with that", so yeah it qualifies as a total diseaster by my books. But I guess it did make controlling the countryside easier for the Communist party so there's that.
 
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Banking is merely one sector of the economy, abet a very important one for capital allocation, nationalized banks does not represent a command economy per say. Capital allocation in China today for instance, is dominated by state owned banks and yet China does not have a command economy today.

It must be noted that no other modern source of capital than bank existed in Korea. Stock market barely existed, (15 listed companies in 1963) and there was no foreign source since no one would invest in this third-world country unless they are provided with a government guarantee of payment. The government also distributed foreign aids, directed foreign loans, and controlled 'foreign currency' aka US Dollar.

Let's just say if the Chaebols were actually owned by the state (and I draw a very important line on ownership) like they would be in the USSR then maybe it would be considered a command economy. But even then it would depend on precisely what % of GDP is produced by the state.

Come to think of it I don't think even NEP era USSR would qualify as a command economy.

The government owned the banking system. And through the banking system, the government indirectly-owned the Chaebols.

Direct state control over an entire industrial sector was not a big thing in Korea anyway. Since 1961 state-controlled Nonghyup, an agricultural cooperative union (only in name; The Agricultural Cooperative Law of 1961 made clear that its board members and chairman were to be appointed by President) dominated the agricultural sector, state-owned Korea Tungsten Company and Korea Coal Corporation dominated the mining sector, Chungju Fertilizer the chemical sector, Posco the steel making sector, KEPCO the electric power sector, and on, and on, and on.
 
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You export grain and use it to buy machinery, machinery is required for industrialization.
Yes, but why starve the peasants in the process?

Taking away the grain needed to feed their families, one seized, would kill off the peasantry and prevent further collection of grain by the state.

The grain was meant not only for export but was also used to feed the urban working-class population. Deliberately starving peasants would eventually cut off the flow of grain, hurting Stalin's plan for further industrialization.

That being said, Stalin might have starved the peasantry to murder them in any case because he didn't think Ukrainians are loyal enough, and hence the need to reduce their number.
IMHO, and according to some historians, the famine was no doubt man made but wasn't deliberate on Stalin's part - again, why kill ethnic Ukrainians because they weren't allegedly loyal enough to Soviet power? (Harvest of Despair: Life and Death in Ukraine under Nazi Rule by Karel C. Berkhoff comes to mind, chiefly the first section of the first chapter covering Soviet Ukraine in the thirties.)

If the peasants farming in the breadbasket of Russia are simply killed off, then that stunts agriculture dramatically in that region of the USSR and prevents the flow of grain to the cities and damages the ability of the regime to send grain off as exports.

Basic economics dictates that keeping the peasants alive and merely taking their surplus grain (thereby preventing starvation) rather than the grain needed to feed their families allows for continual exports and the feeding of the cities during the rapid industrialization drive.
 
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BTW, how does starving peasants generate capital for industry?

Selling the grain for export. There were relief ships carrying food for famine victims crossing paths with export ships carrying grain to sell.

Assuming there wasn't some intent to use hunger to break the peasantry to the regime's will, there's also the possibility of overdoing the food export.
 
Yes, but why starve the peasants in the process?

Taking away the grain needed to feed their families, one seized, would kill off the peasantry and prevent further collection of grain by the state.

The grain was meant not only for export but was also used to feed the urban working-class population. Deliberately starving peasants would eventually cut off the flow of grain, hurting Stalin's plan for further industrialization.

Because by the point the Stalin can rely on his shiny new industrial base to as a means to raise capital, reducing the need to export grain.

IMHO, and according to some historians, the famine was no doubt man made but wasn't deliberate on Stalin's part - again, why kill ethnic Ukrainians because they weren't allegedly loyal enough to Soviet power?
Why kill all those administrators in the Great Purges because they were allegedly not loyal enough to Soviet power?

In truth it was a little of column A and a little of column B. There was not exactly one famine in the Soviet Union (not just Ukraine, but elsewhere as well) but a series of them, some of which occurred in parallel with each other. Given that there were attempts at resistance from the peasantry against collectivization, some of those famines were likely indeed deliberate as a means of punishment. It's just difficult to tell which famines were deliberate and which were not. As Grey's Law observes: "Any sufficiently advanced incompetence is indistinguishable from malice."
 
Otherwise, you would have to totally butterfly away socialism, which stunted economic growth in Russia (and before everyone tries to chop my head off, there is a reason why market economies have much higher standards of livings...look how the average South Korean lives compared to the average Russian, even though South Korea in 1953 was essentially almost totally pre-industrial.

That's a touch inaccurate. Living standards, per capita income, and basic health of the population of Russia is only now starting to approach what it was in 1989 just before the fall of the USSR.

There's also the fact that, from a purely materialistic standpoint, the Soviet Union was hobbled twice over in the same time period the US suffered from at best a major market downturn. The first time was due to the massive destruction caused by the First World War and the Russian Civil War. The second was due to the Nazi invasion which had a similar effect on Russia as invading, conquering, and attempting to ethnically cleanse everything east of the Mississippi would on the United States. The fact that the USSR succeeded in completely rebuilding the core of their economy quite literally from scratch twice in as many generations is nothing short of miraculous considering the circumstances and even more astounding that this same country was able to actually keep the Cold War going for as long and with the intensity it had OTL against the ONLY major power on earth that as of 1945 had an intact industrial manufacturing economy.

As for the OP if the Soviet Union had gone with an approach based more on workplace democracy (which did exist in 1917 throughout much of Russia through spontaneous worker appropriations of factories and farms) then you'd avoid most of the problems that come with a command economy. Having bottom up worker control of workplaces means different sites of production are going to be far more in tune with people's needs and responding to that while still having the necessary capacity to engage in large-scale projects like overhauling Russia's economy.
 
Because by the point the Stalin can rely on his shiny new industrial base to as a means to raise capital, reducing the need to export grain.
ObsessedNuker, you seem to be misunderstanding just what capital is.

Essentially, it can be said, capital is more or less money invested by a capitalist into production; Marx lays it out pretty well in his analysis of capitalism in Capital: Volume I, wherein he distinguishes between three different kinds of capital: Constant, variable, and fictitious capital.

Wikipedia (for want of specific page numbers in Marx's Capital, that and its something that I can easily link to which gives the gist of Marx's three basic assertions) gives a pretty good account of the three main types of capital, which I'm simply paraphrasing from:

http://en.wikipedia.org/wiki/Constant_capital

http://en.wikipedia.org/wiki/Fictitious_capital

Constant capital is essentially money spent on fixed assets (the land, buildings, and machinery needed for the modern factory), raw materials needed for the process of production itself, and various other expenses incurred in the push to, say, build or buy a factory structure likewise placed on bought land, install the machinery with the assumed end goal of actually producing with the hopes of creating surplus value (profit)

Variable capital is more or less money spent on workers' labor power, which the capitalist needs in order to get the factory producing goods to sell (hopefully) at a profit in the market.

Finally, fictitious capital appears in the form of bonds, stock, and so forth.

Marx's analysis is pretty much up to snuff in terms of describing capitalism as he saw it in the middle half of the 19th century, basing his analysis off of classical economists such as Ricardo, Mill, and Adam Smith.

What, now, does that say about the Soviet planned economy?

Firstly, replace capitalists with state appointed bureaucrats - chiefly, in our case, the People's Commissariat for Food Supplies and another separate commissariat for Agriculture respectively, which jointly were responsible for the production of food by the collective farms needed to feed the growing urban proletariat/working-class in the wake of Stalin's drive to rapidly industrialize the USSR as to defend against potential (capitalist, later fascist) threats from abroad.

Not just those two commissariats but the NKVD as well (the Russian abbreviation for the People's Commissariat for Internal Affairs) I do believe played a role in reporting on peasants in relation to farming techniques, amount of grain produced locally for consumption on a family basis and any surplus grain meant for the state, etc.

Assuming that Stalin's goal was to simply kill off much of the peasant population (chiefly Ukraine's vast peasantry) by seizing grain used to feed peasant families, then agricultural production would undoubtedly suffer as less and less peasants means less and less grain - which is needed for exports and to feed the urban workers.

What good is this shiny new industrial base when grain required to feed increasing throngs of factory workers dries up once all of the grain needed for peasant families as food eventually dries up? Peasants that are starving won't be able to produce surplus grain, all of the grain taken away by the state needed for peasant family consumption being finite and gone once it is exported or sent to the cities.

Not to mention the fact that, with the elimination of markets and thus capitalists, both the collective farms and the factories functioned together to a certain extent; the state invested money into land, buildings, and inevitably machinery (all of which make up the so-called means of production) in place of individual capitalists, using variable capital to pay for workers' wages -the state, like the capitalists before it, utilized labor power of said workers whom it paid with a wage which is garnered from the assumed creation of profit or surplus value.

That shiny new industrial base Stalin constructed in turn provided farming implements such as tractors and various tools produced by factory machinery out of, say, various types of metal or raw materials.

In turn, the collective farms provided much needed grain to feed the urban workers and therefore sustain factory production day in and day out. Any extra grain not used as food for peasant families taken as a surplus from the peasantry as stipulated by law would consequently go to the cities and foreign countries as exports.

If the peasants consequently starve assuming that every last bit of grain needed to feed their families was seized forcibly by the state, agricultural production would slowly contract before grinding to a halt as less and less peasants (most of whom in your scenario would be starving) produce grain needed for the urban working-class and as exports.

If the grain needed as food for peasant families gradually dries up in the absence of surplus grain (that could only be produced by a well fed peasantry btw), less food is sent to the cities to feed the growing working-class - less and less food means at the very least more and more hungry workers.

With hungrier workers, production of, say, farming implements for the peasants suffers.

Thus, all of that constant as well as variable capital is either under underutilized potential wise or outright wasted as the factories fail to produce enough tractors, tools, and various other societal goods which henceforth would prevent the acquisition of much needed surplus value or profit by the state - without surplus value/profit, Stalin's 'shiny new industrial base' wouldn't be worth a dang thing as new and more factories would not be built, financed, etc. which means a stagnant industrial base that is incapable of expanding (this 'shiny new industrial base' doesn't just materialize, it needs money converted into capital by the Soviet state in place of capitalists to come into being first)

So no, starving the peasants wouldn't simply 'raise capital' and reduce the need for exports - rather and IMHO, creation of capital would decrease overtime as workers gradually begin to feel the effects of hunger from a lack of grain, which means both an inefficient workforce and quite possibly a complete halt in production as a whole.

No surplus value from under preforming factories or ones that shut down means an inability to build new factories needed to produce farm implements for the peasantry on the collective farms - this ultimately negative process as far as Stalin is concerned in this hypothetical scenario then winds up in a vicious cycle.

The entire economy-a planned, socialist economy at that-suffers greatly as a direct result.

My two cents.

Rant over.
 
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ObsessedNuker, you seem to be misunderstanding just what capital is.

I know what capital is. I also know that the second and third 5-year plans of Soviet industrialization relied more on capital provided via the sale of goods manufactured by the industrial base established in the first 5-year plan then it did on the sale of agricultural products like the first 5-year plan did.

In straight forward terms, once the first 5-year plan was completed, the Soviets did not have to rely as much on agricultural exports to raise capital. This also meant they didn't need to take as much grain from the peasantry.

Assuming that Stalin's goal was to simply kill off much of the peasant population (chiefly Ukraine's vast peasantry) by seizing grain used to feed peasant families,
The goal of the deliberate famines were to kill off the peasant populations which refused to cooperate with collectivization. There were many cases of peasant resistance against collectivization which the Soviet government generally responded to with force and harsher quotas that went and cut into said peasants subsistence.

then agricultural production would undoubtedly suffer as less and less peasants means less and less grain
And, not coincidentally, that is precisely what happened. Soviet agricultural production pretty well flat-lined (again) as a result of the famines, but there were still numerous-enough loyal-enough peasants once both the deliberately and accidentally engineer-famines were over to maintain a baseline of productivity to continue feeding the populace as a whole.
 

RousseauX

Donor
It must be noted that no other modern source of capital than bank existed in Korea. Stock market barely existed, (15 listed companies in 1963) and there was no foreign source since no one would invest in this third-world country unless they are provided with a government guarantee of payment. The government also distributed foreign aids, directed foreign loans, and controlled 'foreign currency' aka US Dollar.



The government owned the banking system. And through the banking system, the government indirectly-owned the Chaebols.

Direct state control over an entire industrial sector was not a big thing in Korea anyway. Since 1961 state-controlled Nonghyup, an agricultural cooperative union (only in name; The Agricultural Cooperative Law of 1961 made clear that its board members and chairman were to be appointed by President) dominated the agricultural sector, state-owned Korea Tungsten Company and Korea Coal Corporation dominated the mining sector, Chungju Fertilizer the chemical sector, Posco the steel making sector, KEPCO the electric power sector, and on, and on, and on.

While this is an interesting discussion, it's getting to be mainly a semantic one.

Both South Korea and the USSR had statist economies, I think mainly differ on what amount of state control would constitute a command economy. Let's just say that I'm basically willing to assert the USSR post-NEP had much greater state control/ownership, and markets were much more curtailed than South Korea. If South korean level of statist intervention was optimal then the Soviets went way past the optimal point.
 
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