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The Berlin Wall-Fall and the failure of (non?) market approaches?

by Spectors

19 November 1999 16:22 UTC


Note to PSN:  I originally planned to send this only to WSN (the World Systems Network list), but given all the noise about the tenth anniversary of the fall of the Berlin Wall, I thought it might help stimulate discussion on the PSN list as well.  As always, apologies in advance to those of you on both lists who are going to get this twice)
 
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I don't want to get into the debate with all the utopian proposals on WSN lately that somehow believe that good intentions and spirituality will cause the most powerful, most efficient mass murderers in history to step down from power. But Randy Groves did put forward the following point which (again) needs addressing.
 
Mr. Groves wrote:
 
"I am also struck by the fact that some on this list seemed to have missed a
great deal of recent history. The fall of the Berlin Wall and the discrediting
of non-market approaches to the economy seem not to have registered with some
people. Yes, we need to work on restricting the market, but the idea that there
are non-totalitarian and effective non-market economic arrangements just doesn't
seen plausible."
 
One of the great strengths of those who work in World Systems analysis is that they when attempt to take history into account, they tend to look at more than just a ten year slice nor make generalizations about all of political economy from that ten year slice, which furthermoe might not even have been analyzed in depth.
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Two points:
 
POINT ONE: What "fell" in Eastern Europe was not Marxism.
Any serious analysis of the collapse of the  Soviet Bloc would systematically analyze what types of political-economic relations existed in those places.  In the first place, there were very few mass revolutions in any of those places. In most of those places, dissident members of the Communist Party or pro-U.S. capitalist forces (sometimes the same people) made alliances with various military forces to sieze power. In very few places there were mass uprisings.
 
And to the extent that there were some uprisings (this isn't the same as "celebrations after the fact", such as the dismantling of the Berlin Wall), do we have evidence that those crowds were marching down the street chanting: "Give us MORE INEQUALITY!  Close down our child care centers! Abolish our industries! Do away with our social welfare centers and PLEASE GET RID OF THIS DAMN SOCIALISTIC FREE EDUATION AND HEALTH CARE!  PLEASE let the big corporations be allowed to expand without this government?" interference! We DEMAND MORE INEQUALITY!"   (Or were they angry at the INEQUALITY/domination of their lives by the party elite?)
 
 
I had a teacher years ago who said that she thought that the US and the USSR would learn from each other and become closer together as the USSR adopted less repressive government ideas from the US, and the US adopted more economic equality from the USSR.  Alas! They have become more like each other. But in the worst way. The U.S. has become more politically repressive while inequality increased, and the former USSR has adopted the worst aspects of the so-called "free market" system.
 
What was consolidated in the Soviet Bloc since the mid-1950's (and for many reasons, the seeds were developing there even before) was a kind of "state capitalism" in that the Communist Party leaders did live off the profits (surplus value) of the working class, and manipulated the economy, first and foremost, to protect their economic interests. Not only was that not communism, it wasn't even socialism. If government ownership equalled "socialism", then, as Marx basically said, every fascist dictator getting rich off the working class could call themselves "socialist" just by expropriating property from others. The question is "which class runs the government?", and not "whether or not there is a lot of government control."
 
Through the 1970's and 1980's in those places, the developing small capitalist groupings, and some factions of the bigger (state) capitalist interests,  sometimes in alliance with pro-U.S. or pro-Vatican groupings, realized that they could increase their wealth even more if they sold off public wealth and bought it up themselves. (That's not too different from what has been happening in Britain and the U.S. under "privitization" of everything from schools to prisons to garbage collection, etc. etc.)
 
Meanwhile, the working classes were becoming increasingly aware of their alienation. With socialism or communism, presumably the working class would be motivated to work hard in the belief that their efforts would enhance the well-being of the whole society and therefore improve their lives as well. With capitalism, the unselfish motives are not mainly at work; rather the motivation is more cynical -- "I'll accept the greedy principles of society and hope that I can be one of the winners."
 
(However, as a side point,  the capitalists do develop fascist/racist/fundamentalist religious/nationalist ideologies to try to tap into our sense of unselfishness to make us willing to sacrifice for the capitalists.)
 
By the late 1970's, as segments of the smaller capitalist, professional, and even bigger state capitalist groups were moving towards more explicit capitalism, the working class in those places were not being motivated by the short run motivatation of corporate capitalism because the state capitalist rulers were relying more on the ideology of "socialist service" than on the ideology of "you can get a piece of the pie of you are greedy too."
 
BUT, with Brezhnev driving a Mercedes, and party leaders owning estates on the Black Sea, with their children going to fancy schools, etc. etc., it was getting harder to sustain the myth that the sacrifices of the working class were for the good of the whole society.  Unmotivated by Marxist  unselfishness and unmotivated by the (illusory) promise of capitalist individualist wealth, the working classes became increasing aware of their alienation. Combined with the massive military spending by the U.S. in the 1980's which caused the Soviet Union to spend more than it should have to match it, toss in the Soviet-Afghanistan war disaster, and the pro-Soviet regimes became increasingly unable to provide for the working class. (The U.S. government was able to spend massively for the military because of the extra wealth it makes from imperialism, and because the working class in the U.S. was paying for this with declines in its standard of living, AND because the U.S. government went very deeply into debt very rapidly, something which the next generation of working class people will have to pay for as their government and personal debt load has greatly increased.)
 
In any case, all these factors led to increased alienation of the working class of Eastern Europe with the rhetoric of the  Communist Party leadership and some were willing to follow, for the time being, whoever might promise them some prosperity or security.
 
That's why, to sum up: What "fell" in Eastern Europe was not Marxism.
 
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POINT TWO:  The "free market" isn't so great. It isn't even "free."  (It can't be.)
The so-called market system has been responsible for the worst disasters in world history.  It is quite simplistic to compare life in a Chicago suburb in 1985 with life in Poland in 1985, and declare that capitalist market systems give people a better life.  If you want to talk about the successes of the "market system" you have to include Bengladesh and Botswana alongside of Beverly Hills,  Haiti along with Haverford, Pennsylvania. Even India from 1950 to 1970 doesn't compare well to China during that same period, even taking into account the famine in China.  Even in Eastern Europe, the average standard of living for the average family has dropped VERY SIGNIFICANTLY in the past ten years as the last residuals of socialism were eliminated and the corporations, the various mafia-type gangs, and the international bankers have been able to move in. This is not just a hunch. The evidence is overwhelming.
 
It may be "metaphysical idealism" to think that it is possible to create a world based on self-conscious attempts to regulate production and consumption to meet the needs of humanity (I'd call that "communism" in Marx' sense of the word), but surely, it is quite a bit more "metaphysical idealism" to think that just letting the profit motive run wild will automatically produce a world that will meet the needs of humanity.
 
And the big capitalists know this. The so-called middle classes, some of the working classes, and various professionals, intellectuals, etc. are taught this nonsense about the wonders of the self-regulating capitalist market, but the biggest capitalists understand the failures of capitalism, which is why they constantly impose massive government regulation on all sectors of the economy. Just look at the recent U.S. federal budget, where some of these people who prattle about "free market" put in huge subsidies for various businesses. And of course, imperialism is the biggest form of government welfare for corporations of all.  So, to sum up point two:
The "free market" isn't so great. And it isn't even "free."  (It can't be.)
 
 
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Understanding why and how the socialist experiments in Eastern Europe and China were reversed is one of the most important and complex issues that social scientists today can explore. But 1950's Cold War theories, 1920's economic theories, 1776 political philosophy-ideological statements, combined with 1980's Reagan-Thatcher propaganda and a 1990's CNN penchant for cliches, all wrapped up in a simplistic:
 
"I am also struck by the fact that some on this list seemed to have missed a
great deal of recent history. The fall of the Berlin Wall and the discrediting
of non-market approaches to the economy seem not to have registered with some
people. Yes, we need to work on restricting the market, but the idea that there
are non-totalitarian and effective non-market economic arrangements just doesn't
seen plausible."
 
will not provide an adequate answer.
 
 
It will require a lot more work, a lot more data, and a lot deeper analysis to fully understand these very complex, important historical processes.
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Alan Spector
     

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