Groucho Marxism

Former Labour MP Zarah Sultana caused a stir last week by suggesting that we should nationalize the entire economy. Put simply, nationalization is the process of transforming privately owned assets into public assets by bringing them under the public ownership of a national government or state. On the face of it this seems an entirely sensible thing to do and is in line with the usual socialist aim of abolishing private property. So it is somewhat surprising that Sultana’s suggestion has come in for a lot of criticism from people who claim to be on the left. The main objection seems to be that full nationalization, although a good idea in principle, has never been demonstrated to work in practice, and where it has been tried has only led to authoritarianism and destitution.

Tempting as it is to dismiss such arguments, we have to be honest and admit that there is more than a kernel of truth to them. The 20th century is full of examples of socialist governments fully nationalizing their economies with often disastrous consequences: the Soviet Union, China, Vietnam, Cambodia, Cuba, North Korea, and so on. To be sure, things weren’t all bad in these countries. The Soviet Union went from a backwards agrarian society in 1917 to effectively winning the space race less than 50 years later, lifting millions out of poverty in the meantime. China followed a similar trajectory. Cuba was doing fine until the fall of the Soviet Union in the early 1990s. And there was even a time when it looked as though North Korea might turn out to be more successful than its southern neighbour.

There are many on the left who venerate these achievements and play down the obvious downsides of these regimes; but I am not one of them. I think it is important that we on the left are honest about the true nature of these states if want to have any credibility. Anyone who lived in any of these countries during periods of full nationalization will tell you that life was hard and characterized by chronic shortages of basic goods. Apologists for these regimes will point to the fact that they often faced outside sabotage from capitalist countries, which of course is true. In my view, though, it was primarily the nature of the regimes in these countries which made peoples’ lives so hard. We see this playing out in socialist countries today – particularly North Korea, which is a failed state, and Cuba, which is well on its way to becoming one.

So it’s true that full nationalization of an economy has never worked in practice. But that doesn’t necessarily mean it couldn’t work. The question is: what was it about the regimes mentioned above that meant that nationalization went so horribly wrong? The obvious answer is a lack of democracy. Here, I am going to break ranks and criticize both Marx and Lenin (gasp!). I think the issues stemmed to a large extent from Marx’s concept of the ‘dictatorship of the proletariat’, which describes a transitional phase between capitalism and socialism where the working class holds state power. Lenin interpreted ‘dictatorship’ as meaning ‘unlimited power, based on force and not restricted by law’, a concept that inevitably leads to authoritarian rule by a single party.

Others, like the Austrian Marxist Karl Kautsky, argued that true ‘dictatorship of the proletariat’ should not be a rejection of democracy, but rather an expansion of democratic principles to include the working class. The problem is that for most people, the terms dictatorship and democracy represent polar opposites. Therefore I think we would be better off ridding ourselves of the ‘dictatorship of the proletariat’ concept altogether. In this respect I am more aligned with the 19th century Russian revolutionary anarchist Mikhail Bakunin, who advocated for the immediate abolition of all states, arguing that power inevitably corrupts and any new state would simply create a new ruling class. The events of the 20th century appear to have proven Bakunin correct.

It is important to note that Marx and Bakunin were in agreement in advocating for a move to a stateless, classless society. Their difference of opinion lay in how they thought this should or could be achieved. Whereas Marx argued for the proletariat to organize as a political party to take over state power, Bakunin argued for the immediate establishment of decentralized, democratic federations of workers’ cooperatives, rejecting hierarchical and centralized power structures altogether. Of course I agree with Marx that it is necessary for the working class to organize to conquer the bourgeois state. But I also agree with Bakunin that once the bourgeois state has been conquered, a new state should not simply be established in its place.

Returning to the original question, I think the controversy around Zarah Sultana’s suggestion that we should nationalize the economy stems from their being two different interpretations of the word ‘nationalize’. The first interpretation means creating a centralized workers’ state of the type advocated for by Marx and Lenin; whereas the second interpretation means establishing decentralized, democratic federations of workers’ cooperatives, as advocated for by Bakunin. People are rightly wary of the first interpretation, based on historical experience. But I think that the second interpretation represents exactly what most modern-day socialists envisage when they talk about ending capitalism and moving to a socialist society.