Comrade Prabhat Patnaik is an outstanding Economist of our country, He teaches economics in Jawaharlal University, New Delhi and is our left economist and is a very renowned? He will initiate the debate. He will initiate the discussion and then comrades can participate in discussion. Those of us who have not given their names for discussion should feel free to do so. So I invite Com. Prabhat to come and initiate the discussion.

Comrade Prabhat Patnaik: “Thank you Mr. Chairman. Comrades, it is an honour for me to have been asked to initiate this discussion in this gathering of representatives of communist movement all over the world. Unfortunately I must begin with an apology. I was supposed to speak yesterday but there was some mix up because the programme was not able to change as a result I have to go there.. So after this I have to go there again. So after I have spoken, I have to leave this hall with an apology in advance.

The basic point which I wish to make is the typical contrast which is drawn on lots of literature on Socialist Economy between a command economy on one hand and a market economy on the other hand. The suggestion which is made in Socialist economy is either it can be a command economy on one hand or a market economy in a false? dichotomy. In other words that is the basic point which I want to ? agree. In order to support that argument let me begin by asking for establishing the specificity? of a Socialist Economy a question.? What is it that makes the producer in the society work and in a exploited society hand over a part of their production a surplus to the exploiting class. The answer in a feudal society is to take forward ? because in a feudal society the pressure to work and the pressure to hand over a part of the producer’s surplus is exercised through coercion. So extra economic coercion is ultimately backed by force? A custom backed by force. In a capitalist society the coercion to make people work and to extract the surplus value from them is exercised not from the extra economic coercion but in fact through the economic coercion in an altering? situation where everybody has been?

As Marx said, in a market in the field of circulation everybody there seems to be ….democracy?. Just as commodity sellers are there to sell their goods and just as there is an apparent democracy…but underlining that apparent democracy…. is infact coercion, which is not extra economic but economic coercion. The economic coercion is exercised thorough a reserve army of leaders. In other words anyone who is found lacking in work, anyone who is insubordinate, anyone who is a trouble maker is infell? As a result the existence of a reserve army of labour is essential not merely for the stability of the capitalism but it is actually essential for the existence of capitalism. It is a fact that capitalism as a system does make people work to extract surplus value out of it. It we want to look at a Socialist Society then a socialist society must view (because it is Socialist) neither as an instrument of coercion….Neither the coercion of unemployment nor the coercion of force. Then when we think of a Socialist Society with unemployment represents a contradiction in terms. I think we as socialists mark the third that it is the only society to represent in modem human history, which is, did not characterize itself by unemployment. Let me explain what I mean by that. In any given empirical situation one would always come across some people who are between jobs. Those who have lost one job and have not got another job. So as an empirical phenomenon a fact that certain members of the work force happen not to be at any given moment of timework, imagine? or with a job? Is something, which is unavoidable, inevitable?

When I say Socialist Society must not be characterised by unemployment then what I mean is that those persons who have a job or not; is not the responsibility of the society nor of an individual. The fact that if I do not have a job, it is the job of the society to provide me with a job. A recognition of that fact could take a possible form. I am not asserting, I am suggesting could take the possible form in Socialist society where whether a person has a job in the society or not everything belonging to the work force must be given a wage. If so then it becomes the job or it becomes the work of the Socialist economy to provide everybody with a job. Now let us be very clear, capitalism has for all reasons in its welfare scheme claim in some way under the Socialist threat under the challenge of Socialism by providing unemployment to those who are without jobs. Socialist Society must be better than merely providing employment. Socialist Society must recognise that it is the society’s responsibility to provide work to the individuals and as a result ?unemployment in that sense if it does not exist. If people are between jobs then it is the function the society to ensure that even if they are between jobs they are in fact provided with wages. Likewise it is the function of the society to ensure that there are not too many people not having a job and are been paid a wage and consequently a self-responsible? society in a Socialist economy can be so arranged that to reach in a period where substantial no of people not having jobs can be substantially accommodated. But in a situation where there is a substantial unemployment there is a substantial….of economy. In otherwise a Socialist government would infact take care to ensure that there are not too many people between jobs in a given moment of time, by pursuing counter technical, functional measures and so on.

Historically then the question arises and this is the question which many people raise about Socialism in reaching……………………….? It is that if everybody is assured of a wage then why should they work? Where does the work motivation come? In a society where there is no unemployment. Unless you go back to the extra economic coercion which Socialism has to abandon because of its total way of making people work. A good number of people work in a society in which there is a assured living for everybody. This question has been only raised about socialism. This question has also been raised about capitalism. In fact the ideological counterpart of the defeat of the Keynian demand supply management and the emergence of supply side economics is the proposition, which actually says that the poor people do not work. If more the poor gets less he work and if more the rich gets the more he works. In other words give incentives to the rich but actually freeze? the poor because if the poor works harder? if we don’t give them much. So if rich are supposed to work harder so give them much. But it is sure ideological offensive, which actually say that there will be no motivation in the Society in which everybody is assured of a decent living standard. This ideological offensive has to be met. Now ideally and fundamentally about what socialism means is a society where people work not only because of their need but because they wish to champion their individual self. They think of certain duties they have to the? collective. So socialism must inculcate the collective spirit. Additionally it must be certain pressure to be exercised by the collective domains to which they belong. In other words it is not the Socialism which collectively perish the spirit of slackness in work but there has to be a clear pressure from the members of the collective to which a individual belong ……….. But I think this theory of collective spirit and pressure from the collective can alone provide us with an alternative society and with an alternative work?. When I see that we have a set of connectives to which individual work belongs, am I thinking in term of the reserfication? of the market and my answer is No! The concept of the market is very gravely misunderstood. One must think in term of the market. A market as a social Institution which in facts occurs? Its instruments… Marx has said the market in fact will be in Darwinian struggle between one capitalist skill as the basis of centralisation of the capital. Market is a pure? Instrument. The market functions as an-----?------ instrument is precisely because it is always superimposed on a pit of unemployment. Market as a social institution without a reserve army of labour is in fact unthinkable. Therefore a market in that sense cannot exist in a Socialist Society. Market an objective source which is acting to produce a Darwinian struggle between different production units in which some go under generating unemployment and this process is continuously taking place is not what a Socialist Society is about. The market as a means of coordination is something, which is perfectly compatible with market norms as a Social Instrument of the resource we have in a capitalist economy. If you have too many shirts and too few to pick up then you get a signal from the market that you have too many shirts and too few to pick up then you have a shift of production facility from one direction to the other. But while that role of the market is a carrier of the information, then a role, which the market can play in capitalist society as a Social Institution, the market has no role in a Socialist Society, the way it functions in a capitalist Society. The well-known Polish Economist? has written a article on computer and the market. The market can be a analog of a computer where data can be stored. And that is not a faith that a market been a Social institution that perishes, act punitively, acts impersonally? punitively. So the market as a Social Institution is incompatible with the capital in Socialism with a human system, I am talking about. But of course there is Quote? for Socialism for a market with information. Two issues in particular I know would like to draw your attention to. A well known British Marxist Economist Noris Straw? has one argued that if have? then Socialism is not just (Social ownership of the means of production)……. imagine a Society in which you have Social ownership and collective management. Here the Social ownership like what was the case of Czechoslovakia in olden days. But if collectives relate to one another entirely through the market, in that case such an economy will reproduce many approaches? of the capitalism in particular inflation as well as unemployment. Unemployment is discussed because many may go(?) under employment with no necessary …… state of the kind which is publicly criticized. On the other hand you can have an inflation, inflation in individual units even if collectively managed in a Social? Individual units fight against one another buy against one another and buy against one another to push up their prices. If mine is one unit owned by a collective. Yours is a unit owned by a collective. I may charge you a higher price. You may charge me a higher price in order to get a higher profit. And in the process we can actually pick up prices and give rise to inflation. Therefore this act of mine in this unit whether owned by the capitalist or owned by so-called the Society and collectively managed atomised units will infact tend to give rise to unemployment and inflation. Therefore Socialism why it needs Social ownership of means of production not to have on upper hand but to have an acceptance of the responsibility that unemployment as a punitive measure should not be resorted to.

Use of mechanism show that pitting against one another should push up the prices. Therefore the whole inflationary tendency in unit in a market economy is kept in check and that a Social State can use the right to instrument as a fiscal instrument to ensure that this does not happen? I would just like to make a last? set of comment that anything? we say about a Socialist economy today, I think we should be clear and project it to the World that a Socialist economy is a human economy and in fact more than what can a world think of a Socialist economy that does not entail a command economy, because the hallmark of a command economy was that it produce ……….? Because work motivation is provided to a certain extend by on? instrument. Therefore it tended to introduce an alienation, which is incompatible with Socialism. Those were the travails of early building of Socialism but that is not the model of Socialism that we necessary wish to project. But we have to project the fact and we can very clearly project that Socialism is a workable humane system. There point, I want to make. First is that we are talking about Socialism as an ideal between…. now and Socialism there is of course a long period of transition. In this transition there will be proactive struggles against imperialism. There will be all kinds of different forms of property coexisting. There would be individual property. There would be social property. There would even be some elements of capitalist property. So that one has to be very clear that one is talking about different ways of transition and therefore different societies have to work out their own ways of making this transition. You cannot have one uniform pattern in the transitional system.

The second thing which we also have to make clear, is that at the moment we are not concerned with the contours of a futuristic Socialistic Society but we have to go from here to death? Which means a prolonged anti-imperialist struggle because imperialism is dominating us. Any transition, which we have to make, is the transition during which we have to ensure that we do not either compromise with imperialism nor do we ourselves in some sense become imperialist or the partner of imperialist. Because Marx had said that any society that dominates another cannot be correct? and committed. The last point, which I wish to make, is that ultimately Socialism is not a matter of an economic arrangement. We have to make it very clear that of course an economic arrangement for a Socialist Society or a humane Economic is possible but ultimately Socialism is much more than merely an economic arrangement. As it really maintains a new person, a new man, a new transformation of a human being through a change in productively arrangement. And that is what is something we must never lose.

Thank you very much.

Chairman: Thank you Comrade Prabhat. Now I am having two names with me. If some Comrades of some other parties wish to take the floor they may do so and send names. I would like to invite Ratt….? From the communist party of Vietnam.

Speaker from Vietnam: Dear Chairman and comrades and friends, I would like to talk about the Socialist Economy in Vietnam. My subject is developing, functioning, augmenting market economy in Vietnam, I am trying to look at Vietnam situation in 1970s. Old and veteran people still remember the economic crisis of 1930 to 1935. After the victorious War, Vietnam faced the consequences of War there were missive civil reconstruction undertaken. Social transition in Vietnam as a whole. The country was reeling production was far below stagnation.

During five years from 1976-81 growth was average. The economy growth rate was nearly 0.6% industries try, 1% agriculture and ½ % for national income. And then Vietnam went for Socialist economy………………..

Chairman : Now I invite the representative of communist party of China.

Speaker from China: ...............

Chairman: Now I invite the most prestigious representative comrade ---- of communist party France to share his view and give the European prospective.

Speaker: “Comrades please excuse me for my terrible English. First of all I would like to thank my India Comrades for this seminar. I went to speak about the views in capitalist country. The universal share to control the three markets. Labour, Market, Currency and Financial Market and Bull Market. .....................

Chairman: Now I request Comrade................

Speaker: Comrades, I would try to summarise my opinion on specific points. Friends, the capitalist economy can be less productive than the Marxist economy. The productivity of the unnecessary goods are harmful. I want to give two examples. The financial sector. This sector has nothing to do with production but disturbs it. The second example is unemployment. Unemployment is not using the productive forces of the society. The productive forces of the society are less idle through unemployment. Second thing is that Socialism is not a system that can overcome counter revolutionary forces without the formal intervention of a revolutionary party. Third the attention of the working class should be focussed on the political problems of the country. The forces of production is not an area that working class can fight. The mistake of the Soviet Union was not because of planning but of the mechanism that allows the participation of the people. The participation of the people in the political or the economic life of the society is not? It can be arranged. In other words the most important task of the a communist part in a Social era is to encourage the participation of working class. And this can be done only through mobilizing the society towards advancements. A concrete example of that is the industrialisation of the Soviet Union. In that period the outcome of the mobilisation of the Soviet people i.e. in five years. I think that and my party the Communist. Party of Turkey thinks that the growth of the solution of the Soviet Socialism was not an economic viable. The solution was given by the ideological and political leadership. Economic problems faced by Soviet Union were caused by the same fact. Finally I want to you to ask to member something. The capitalist are always using……….? Chinese think that one of the biggest problem of the world is using? A technically in the organisation No! They are planning in every field. And in every sphere they are planning. So additionally the technological development is create a much more advanced planning organisation, which can overcome all sorts of problems that, the world experience. Thank you!

Chairman: A comrade from Kerala wants to contribute.

Prabhu: I am from Kerala, the southern State of India. We have cooperatives. We feel that information technology plays a role in economy. Capitalist economy already influences the management, means of production and productivity. In other words all spheres. In this context, We would like to highlight software production…………….. Here we are not building a product but copying a productivity is backing in Information Technology Area. Still the present I.T. companies are able to survive under the back of value of market under stringent patent laws and property rights laws that I.T. companies encourage in capitalist economy. However ? that has been a movement that there are software products available on the computer Internet where a consumer can copy the product and use it for? We seek at the model if every consumer ? reach the value of the product. In that sense we see that the entire phenomenon ca be used as in a Socialist Economic Model; surviving and gradually involving an influences all spheres and all sectors of economy even in the present capitalist system----------------------- The hope that this I.T. technology and computer Technology will be taken into account in deciding in Socialist Economy Model.

D.Raja: Thanks comrade Prabhu, a very interesting contribution. Now I invite the representative from the United States of America.

Speaker from U.S.A.: I am a member of the economic platform of the Communist Party of America. I am speaking--------------Soviet Union-----------? The problem that we face in economy is that. There is no way in establishing price mechanism of transactions between enterprises. ---------------------------

Next Speaker: I am from Shri Lanka. The Communist Marxist Leninist Party of Shri Lanka. My question is for the Chinese Party ----------?-------- One of things which bothers is context to China is that their Social Security in some areas like Shengan has broken down. For instance is one area there are more private hospitals then government hospitals. And both charged from all patients. The government hospitals were much cheaper and insurance was provided by the private hospitals. But for farmers there was no insurance------------- I wish to find out that if this information is correct. If yes, then they should take some step to correct the Social Security situation. --------------------

Reply from representative of China: ....

New Speaker: My question to all Marxist intellectuals. Because the subject is Socialist Economy. Particularly from those who are fighting for Socialism. Please do not put this under the carpet. After the collapse of Soviet Union and interaction of market economy in China and Vietnam. Many questions are coming up. My proposal is that it should be properly studied and they have put in a political way to the people of -------? The background is there. According to Marx, the revolution had to be in advance countries. That it took place in relatively backward countries. The background problems are there. In China, in Vietnam and even in Russia the capitalism was not too much developed. Now we have to keep in mind whether we analyse Russia or China or Vietnam. So that problem is there. That we face today also. It was not a mistake to bring a revolution. The mistake may be otherwise. That in such a situation what we need, what we could not do and what could be done. That could be appreciated in that way. Now the task is there. The citadel of capitalism in America, Europe, the Japan all are there, The revolution------------------? So this is a theoretical and it has to be confronted by the entire Marxist all over the World. It has not to be replied only by the Chinese Comrades or Vietnamese comrades but has to be replied by all the Marxist. They have to Study. They have to go to China also and Vietnam also to study. They have not to bring and ask only Chinese comrades here. This is a question is question bothering all Marxists all over the world. What a new situation it would be. It has not to be replied only in some part? How to comfort? What is the alternative? New this alternative is not only to oppose W.T.O. or oppose? Our alternative is about Socialist transformation of the whole world. SO this is the long-term strategy. New our life is not more than hundred years. So we think that everything is after the collapse of Soviet Union. No! For the last seventy years we were winning. Now there is some reluctance? So there is a question of change of Society not the Government. So there appears a back persistence. We may build in one hundred years or one thousand years. No problem. But what is my point here is that Marx pointed a view, a theory; a correct theory. Now it has to be reinterpreted to today’s condition. To say look this is the alternative. What is that period for transformation. They have to learn and learn from their mistakes. They have to put in front of the working people of the world. So that they have to advance and can convince our people. No! No! No! There is that reverse or this? No! A situation has to be build and we have to come together has to be build and we have to come together. Now my question to D. Raja as the chairperson and also all Marxist. Now this has not to be replied immediately but can be replied in months and years. The reply must come.

Reply from Chinese Representative: ................

D. Raja: Comrade I think now we should wind up the discussion. Since nobody is there for comments or for any suggestions? Now this Socialist Economy is one subject, which is haunting Communist minds everywhere. The Socialist Economy repuses to be Static. Whatever happened in Soviet Union or East Europe is? We would not accept that Socialism is outdated or Marxism has no validity and no relevance in this time. We do not forgot--------? But at the same time we admit that the particular model of Socialism which was build in Soviet Union or Eastern Europe has collapsed. It was a set back to Socialism to that extent that we should also accept that Socialism has failed or it has to fail. How it works in countries like Cuba, Vietnam, China, North Korea. Our comrades are trying to know from the communist set up. They are under tremendous pressure and in tremendous difficulties. We say in Cuba there is a very humane society, a very literate society. There is no unemployment. There is no racial discrimination. There is no other sectarian feeling among people. Cuba had to face the economic irbargo. Cuba had to face the America onslaught. Cuba had to withstand all the pressures and all the aim twisting given by various ? It s very interesting that for Americans that were still not China it is a question which is raised that in China whether they can handle this big population. Whether they could produce food to feed each one. This was done under the able leadership of Chinese Communist. Now they undertake the reforms in Agrarian Sector first. Since 1945, they have guarantee the supply also have reforms in Industrial Sector. When I visited China few times. I tried to study there are free economic zones and in the foreign capital mostly it is Chinese only and till now the public sector is the government sector in Chinese economy. Whatever foreign capital foreign, investment they get mainly comes from the overseas Chinese. That you should keep in time. Yet there are some confusions. They are some apprehensions in the minds of survival comrades. Because there is always a good hope propaganda. Here there is a Good Hope Party. Here we have a party B.J.P. This is a right wing party. Whenever it comes to economic reforms--------? Congress Party is also? Up. So there is a continuous need to develop a Socialist Economy all over the World. Different countries. Different experiences. It is the question of other countries also other than China, Cuba, Vietnam, North Korea. You know that what happened in Soviet Union. So it is for the convince of all to think over all these questions. And this needs to be done also by Indian left. After the shock of collapse of Soviet Union. Now we replying to all this. We have to convince the people. We have to work on the problems at the same times. The ideological position. Now that we are comforting the different levels of capitalism. We should and there is no alternative to Socialism. If at all there is an alternative there is a better Socialism. Victim of the threat to Socialism. We may not go back to the victim. We cannot go back. So social is the alternative and a better Socialism is the alternative to Socialism. We can also do this in the framework of World Social Forum with respect to capitalism. I must also congratulate the communist party of Greece to take the initiate to being us all here. There organised this international meeting. And opened up the subject of globalisation, Wars and Peoples Movement and the Role of Communists, U.S. war, and occupation. So at the time of War we were together. At W.S.F. also there are very trends. Even we have to reflect about the Mumbai Resistance here. When we decided to participate in W.S.F., here in India, we were very conscious about our participation. We should also try to study other alternatives and should try to present our alternatives and we should try to implement the agenda of W.S.F. while trying to present our alternatives. Today we had a good session on Socialist Economy. We would try to put all this in a bookshop, and try to bring out all that is discussed. I will thank all the parties and all the participants to come and share on behalf of their parties. I give revolutionary greeting to all of you on behalf of CPI and CPM here. Tomorrow there is a mass meeting. I again request you to join as at 4PM, Gate No.2. So with your permission I would like to conclude. Thank you!

For Hindi click here

Courtesy: Service Centre for Development Cooperation Kepa http://www.kepa.fi

Copyleft. Any part of the content on this site can be used, reproduced, or distributed freely by anyone, anywhere and by any means. Acknowledgement is appreciated.

Designed and maintained by CAPITAL Creations, New Delhi. Phone 91-11-26194291