⧠30 State capitalism and the classes

The conduct of the imperialist war was differentiated from that of all previous wars, not only by the dimensions of the conflict and by its devastating effects, but in addition by the fact that in every country actively engaged in the imperialist war the whole of economic life had to be subordinated to war purposes. In former conflicts the bourgeoisie could carry them on merely by providing funds. The world war, however, attained such huge proportions and affected such highly developed countries that money alone did not suffice. It became essential in this war that the steel foundries should devote themselves entirely to the making of heavy guns, whose calibre was continually being enlarged; that coal should be mined for war purposes alone; that metals, textiles, hides, everything, should be employed in war service. Naturally, therefore, the greatest hope of victory was for whichever of the State capitalist trusts could best harness production and transport to the chariot of war.

How was this to be achieved? Manifestly, the only way in which it could be achieved was by the complete centralization of production. It would be necessary to arrange things in such a way that production would go on smoothly; that it would be well organized; that it would be entirely under the control of the fighters, that is to say of the general staff; that all the orders of those wearing epaulets and stars would be punctually carried out.

How could the bourgeoisie do this? The matter was quite simple. To that end it was necessary that' the bourgeoisie should place private production, privately owned trusts and syndicates, at the disposal of the capitalist robber State. This is what they did for the duration of the war. Industry was ' mobilized' and 'militarized', that is to say it was placed under the orders of the State and of the military authorities. 'But how?' some of our readers will ask. ' In that way the bourgeoisie would surely forfeit its income? That would be nationalization! When everything has been handed over to the State, where will the bourgeoisie come in, and how will the capitalists reconcile themselves to such a condition 'of affairs?' It is an actual fact that the bourgeoisie agreed to the arrangement. But there is nothing very remarkable in that, for the privately owned syndicates and trusts were not handed over to the workers' State, but to the imperialist State, the State which belonged to the bourgeoisie. Was there anything to alarm the bourgeoisie in such a prospect? The capitalists simply transferred their possessions from one pocket to another; the possessions remained as large as ever.

We must never forget the class character of the State. The State must not be conceived as constituting a 'third power' standing above the classes; from head to foot it is a class organization. Under the dictatorship of the workers it is a working-class organization. Under the dominion of the bourgeoisie it is just as definitely an economic organization as is a trust or a syndicate.

We see, then, that when the bourgeoisie handed over the privately owned syndicates and trusts to the State, it handed them over to its own State, to the robber capitalist State and not to the proletarian State; consequently it had nothing to lose by the change. Is it not precisely the same thing to a manufacturer, whom we may call Schulz or Smith, whether he receives his profits from the counting-house of a syndicate or from a State-bank? Far from losing by the change, the bourgeoisie actually gained. There was a gain because, through the State centralization of industry, the war machine was enabled to work to better effect, and there was a greater chance of winning the war of rapine.

It is not surprising, therefore, that in nearly all capitalist countries there took place during the war a development of State capitalism in the place of the capitalism of private syndicates or trusts. Germany, for example, gained many successes and was able for a lengthy period to resist attack from enemies of a greatly superior strength, simply because the German bourgeoisie was so successful in the organization of its State capitalism.

The change to State capitalism was effected in various ways. In most cases a State monopoly of production and trade was instituted. This implied that production and trade were placed wholly in the hands of the bourgeois State. Sometimes the transformation was not effected all at once, but by instalments. This took place when the State merely bought some of the shares of the syndicate or trust.

An enterprise in which this had taken place was half private and half a State affair, but the bourgeois State held the leading strings. Furthermore, even when certain enterprises remained in private hands, they were often subjected to governmental control. Some enterprises were by special legislation forced to buy their raw materials from certain others, while the latter had to sell to the former in specified quantities and at fixed prices. The State prescribed working methods, specified what materials were to be used, and rationed these materials. Thus, in place of private capitalism, State capitalism came into being.

Under State capitalism, instead of the separate organizations of the bourgeoisie there now flourishes a united organization, the State organization. Down to the time of the war there existed in any capitalist country the State organization of the bourgeoisie, and there also existed separately from the State large numbers of bourgeois organizations, such as syndicates, trusts, societies of entrepreneurs, landowners' organizations, political parties, journalists' unions, learned societies, artists' clubs, the church, societies for the clergy, Boy Scouts and cadet corps (White Guard organizations of youth), private detective bureaux, etc. Under State capitalism all these separate organizations fuse with the bourgeois State; they become, as it were, State departments, and they work in accordance with a general plan, subject to the 'high command'; in the mines and factories they do whatever is ordered by the general staff; they write in the newspapers under the orders of the general staff; they preach in the churches whatever will be useful to the robbers of the general staff; their pictures, their books, and their poems, are produced under the orders of the general staff; they invent machinery, weapons, poison gas, etc., to meet the needs of the general staff. In this manner the whole of life is militarized in order to secure for the bourgeoisie the continued receipt of its filthy lucre.

State capitalism signifies an enormous accession of strength to the great bourgeoisie. Just as under the working-class dictatorship, in the workers' State, the working class is more powerful in proportion as the soviet authority, the trade unions, the Communist Party, etc., work more harmoniously together, so under the dictatorship of the bourgeoisie the capitalist class is strong in proportion to the success with which all the bourgeois organizations pull together. State capitalism, centralizing all these organizations, converting them all into the instruments of a single, united organization, contributes immensely to the power of capital. Bourgeois dictatorship attains its climax in State capitalism.

State capitalism flourished during the war in all the large capitalist countries. In tsarist Russia, too, it began to make its way (in the form of war industry committees, monopolies, etc.). Subsequently, however, the Russian bourgeoisie, alarmed by the revolution of March, 1917, became afraid lest productive industry should pass into the hands of the proletariat together with the State authority. For this reason, after the March revolution, the bourgeoisie did not merely refrain from attempts to organize production, but positively sabotaged industry.

We see that State capitalism, far from putting an end to exploitation, actually increases the power of the bourgeoisie. Nevertheless the Scheidemannites in Germany, and social solidarians in other lands, have contended that this forced labour is socialism. As soon, they say, as everything is in the hands of the State, socialism will be realized. They fail to see that in such a system the State is not a proletarian State, since it is in the hands of those who are the malicious and deadly enemies of the proletariat.

State capitalism uniting and organizing the bourgeoisie, increasing the power of capitalism, has, of course, greatly weakened the working class. Under State capitalism the workers became the white slaves of the capitalist State. They were deprived of the right to strike; they were mobilized and militarized; everyone who raised his voice against the war was hauled before the courts and sentenced as a traitor. In many countries the workers were deprived of all freedom of movement, being forbidden to transfer from one enterprise to another. ' Free' wage workers were reduced to serfdom; they were doomed to perish on the battlefields, not on behalf of their own cause but on behalf of that of their enemies. They were doomed to work themselves to death, not for their own sake or for that of their comrades or their children, but for the sake of their oppressors.