This book is of a type unusual and perhaps unique in Marxist literature. Written in 1921, it takes the form of a series of lectures purportedly given in 1970 which describe the course of development of the Soviet economy in the decade after the book’s publication.
Preobrazhensky was a prominent Bolshevik economist, and over a crucial period a supporter of Trotsky’s fight against the bureaucratic degeneration of the Soviet Union. Like many others he became a victim of Stalin’s purges when he was shot without trial in 1937.
Like his famous ABC of Communism (written jointly with Bukharin) the present work was suppressed by Stalin and is still unobtainable in the Soviet Union.
It was written almost immediately after the adoption of the New Economic Policy, in March 1921. NEP represented the response of Lenin and the leaders of the Communist Party to the enormous problems inherited from the period of Civil War and War Communism: the basic aim of the NEP was to use market forces on a limited and controlled basis as a means of re-establishing some stability in the relations between the town and the countryside. Industry was to supply the rural areas with the necessary goods at such prices as would allow the State to dispense with forcible collection of the products of peasant labour, as was the case under War Communism. Secondly, it was a policy aimed at bringing into play all the under-utilized plant and equipment which had existed during the period of the Civil War. In short, a market economy was allowed to develop alongside the state sector which comprised the bulk of industry, foreign trade and the state farms. Preobrazhensky was somewhat dubious about NEP, but he accepted its necessity, provided that vigorous steps were taken to keep private trade and accumulation under control and constantly to strengthen the state sector at the expense of the private sector. In this way, he thought, the period in which NEP operated would be kept to the absolute minimum.
The importance of the present work is that it is not merely a speculative look into the future, but a statement by the author on how he thought NEP could be controlled and the dangers inherent in it limited. Preobrazhensky therefore wrote the book as a supporter of the policy of planned industrialization which was later to be adopted by the Left Opposition.
Preobrazhensky rightly feared that NEP would strengthen the position of the richer peasants (kulaks), as well as artisans and traders (nepmen) who also gained a considerable advantage from the partial restoration of the market. As the reader will see, Preobrazhensky envisaged in his lectures that NEP would strengthen both these strata to the point where they would make a bid for counter-revolution, assisted by sections of the foreign bourgeoisie.
In this respect his fears were partially justified by the course of subsequent events. As Lenin and Trotsky had hoped, NEP did make possible a restoration of the economy which had slumped to a disastrous level in 1921 when output stood at only one-fifth of its 1913 level. After the turn to NEP, industrial production gradually picked up, regaining its pre-war level in 1927, with agriculture achieving a similar result the previous year. In this sense the partial retreat involved in NEP had been justified and the ground-work laid for a programme of planned industrialization.
The reader will find that Preobrazhensky anticipated that this would be possible and devotes considerable time in the lectures to outlining the sort of policies that he felt would be needed to carry through a planned industrialization. He emphasizes not only the need to build up industry and particularly supplies of electrical power; he says that the working class should be strengthened by linking it more closely to the socialist economy, making it more conscious of its tacks, reducing inequalities in income and extending education.
In this respect this work is an anticipation of his later, more detailed, writings on the problems of planning, when the issues had left the realm of speculation and were the subject of a most bitter inner-party struggle. It was in this later period that Preobrazhensky became known as the leading exponent of what he called ‘primitive socialist accumulation’, that is that the state sector would have to appropriate part of the peasants’ surplus in order to obtain the resources required to build up industry. (Preobrazhensky deals with these questions in his work The New Economics  first published in 1926.)
But it is crucial to understand that Preobrazhensky’s conception of industrialization had nothing at all in common with that finally carried out by Stalin in the Five Year Plans which started in 1928. Stalin, taking his lead in this matter from Bukharin, had long resisted the proposals of the Left Opposition for an industrialization programme, despite the fact that in the period following Lenin’s death (1924) it became increasingly clear that NEP had accomplished all that could be expected of it from the economic standpoint, and that it was leading to grave political dangers of the sort anticipated by Preobrazhensky and others. When Stalin, in blind panic, was forced, under the threat of foreign intervention as well as internal upheaval from the kulaks, to begin a programme of industrialization, he did so in the most brutal, unplanned manner. The Five Year Plans were initiated with no political preparations; the targets set for industry and agriculture alike were pitched at a ludicrously high level; far from aiming to reduce income differentials, such a policy was derided as a bourgeois prejudice. The result was that Russia was plunged into near-civil war, and huge quantities of crops and millions of animals were destroyed in reprisals against the Soviet government, events from which the Soviet economy has never fully recovered even to this day.
In contrast to these brutal, empirical methods, Preobrazhensky here, as well as in his later writings advocated a quite different course. The transfer of resources from countryside to town could only be a relatively gradual one. Further it was best carried out, he thought, through a manipulation of the price system whereby the prices of industrial products would be raised as against the prices paid by the state for agricultural products. Apart from involving the minimum of administrative complications, such a method would also reduce the political dangers which a direct tax upon the peasantry might have incurred.
There can he no doubt that in the inner party struggle on the industrialization question Preobrazhensky, as part of the Left Opposition, made a significant contribution to political economy and the problems of planning which none of his rivals, either in the Bukharin-Stalin camp or from amongst the bourgeois economists, came anywhere near to matching. And it is clear to see why Preobrazhensky should have eventually, like the rest of the Bolshevik Party leadership, fallen foul of Stalin. For he always saw the connections between the Soviet and the world economy. The present work, for example, ends with a sketch of the lines on which he thought the European revolution might develop in the decade after 1921, which brought him necessarily into the sharpest conflict with the Stalinist theory (first advanced in 1924) of ‘socialism in one country’.
But Preobrazhensky’s undoubted talents and his equally great courage in refusing, before he was shot, to admit to a series of imaginary ‘crimes’ like so many defendants at the infamous Moscow Trials were forced to do at the hands of the GPU, should not blind us to his weaknesses and limitations.
Although a close worker with Trotsky in the 1920s it must be remembered that after Stalin’s ‘left turn’ in 1928, Preobrazhensky was amongst that section of the Left Opposition which took this turn at its face value and capitulated to the bureaucracy. Preobrazhensky’s split from Trotsky had a major political impact for it undoubtedly strengthened Stalin’s hand, lending credence to his false assertion that he had now adopted the policies of the Left Opposition, while at the same time slowing down recruitment into Trotsky’s faction. Preobrazhensky’s capitulation cannot of course be attributed to personal cowardice, as his entire career shows. There is no doubt that a section of the Left Opposition were fearful of the consequences of a Party split and saw in Stalin’s Five Year Plans a move in the direction of the policy which they had long advocated.
For Trotsky, however, the essence of Stalinism was not its attitude to the question of the industrialization of backward Russia, important though this question was. The lode star of Stalinism was, on the contrary, the ‘theory’ of ‘socialism in one country’. Here was expressed the core of Stalin’s complete revision of revolutionary Marxism, a ‘theory’ which increasingly entailed the subordination of the world revolution to the needs of the Soviet bureaucracy. Throughout all his many zigzags, from this theory and policy Stalin and Stalinism never broke.
Preobrazhensky’s lack of clarity on this, the most vital of all questions in the fight against the rising Stalinist bureaucracy, is raised here because it is a weakness which to some extent finds its reflection in the pages which follow. There is a tendency on the part of Preobrazhensky to isolate the economic questions from the problems of world revolution. While for Trotsky, the former were always subordinate to the latter, Preobrazhensky’s work lacks this theoretical clarity. Thus the impression is created in the present work that the Soviet economy, following the policies advocated in the lectures, would be able to build up its economy almost to the point of socialism, with the job being completed by the European revolution. It is as though the political questions are seen somewhat as an adjunct to the economic policies operating within the Soviet economy.
Despite these ]imitations, the following lectures can be studied with great interest and profit by the reader today, and their publication in English for the first time after so many years of Stalinist suppression is to be unreservedly welcomed. For they constitute not merely an interesting historical document nor merely a contribution to a debate which was of the greatest importance in the Soviet Union in the 1920s. More than this, they deal with issues that are of the greatest relevance to the still-unresolved problems of Soviet economy. For despite the grossly inflated claims of the bureaucracy and the undoubted achievements of the Soviet economy made possible by the nationalized property relations established in 1917, the aim of building ‘socialism’ in one country remains as utopian as it was when first propounded by Stalin nearly fifty years ago. Because of its isolation from world economy and the international division of labour, the Soviet economy still remains a backward, distorted economy compared with the most advanced capitalist economics. None of these problems can in any way be resolved until the Soviet economy becomes integrated into a world socialist economy which embraces the now-dominant centres of capitalist power in Europe and America.
Preobrazhensky was amongst the first to grapple with these issues and their implications. It is from this standpoint that the present work, along with his other writings, should be studied.
Bumazhnyye den’gi v epokhu proletarskoy diktatury (Paper Money in the Age of Proletarian Dictatorship)
Ot nepa k sotsializmu (From New Economic Policy to Socialism *)
O morali i klassovykh normakh (Morals and Class Norms)
Ekonomika i finansy sovremennoy Frantsii (The Economy and Finances of Contemporary France)
Ob ekonomicheskikh krizisakh pri nepe (Economic Crises Under the New Economic Policy)
Novaya ekonomika (New Economics *)
Azbuka kommunizma (The ABC of Communism *)
* Available in English translations
1. The New Economics, translated by Brian Pearce, Clarendon Press, Oxford 1965.
Last updated on 24.1.2009