Anatoly Karlin: Short on Marxist Economic and Social Theory

Nothing is more hilarious (and telling) for me than to watch right wingers fall on their face when they try to attack the Soviet Union on economic grounds. It’s a tactic that never works in their favour when they approach it honestly. When they’re exposed as being ignorant on the subject, or outright lying, they resort to attacking the country on human rights grounds. The post I am responding to here is a prime example of this. The blogger Anatoly Karlin exposed not just his complete lack of knowledge of the Soviet Union, but his lack of ability to read data.

In a post titled “Ayn Stalin: Soviet Inequalities In 1929-1954“, he claims that he can show the Soviet Union was somehow hypocrites because there was inequality in its society. The main target of the post appears to be Stalin as he’s referenced several times and placed in the title. It attempts to show that inequality was higher under Stalin, and thus Stalin was bad, somehow not a real communist or a hypocrite. Finally he attempts to show that socialism caused more inequality than capitalist states did. In his effort to prove these claims he provides us with a very interesting graph. It displays income inequality in the USSR since 1946.

Ayna Stalin chart

Some problems with this data make themselves known to me immediately. The first thing to note is the fact that this data literally shows the opposite of what Karlin is claiming. During the time period shown here there is a consistent trend in declining inequality. See that squiggly line between 1970 and 1990? That means data was removed, but that data continues the trend that preceded it. From this we see clearly that he doesn’t seem to be looking at the data at all.

Second, his overall point seems to be that there was higher inequality during Stalin’s leadership. This is most certainly true, and it should be obvious why. The USSR was in the process of transformation that included the struggle against inequality. Obviously in previous years it was higher than in later years. This is akin to attacking the previously employed foreman of a building under construction for his work being physically shorter than the new foreman a year later. Of course, it was in the process of being built. This kind of uncritical thinking is characteristic of anti-communists. They are so preoccupied with attacking the Soviet Union that they don’t make simple logical connections. Besides, wouldn’t it be useful to include the data from Stalin’s entire leadership of the country so that we could have an idea of what was actually going on? No, instead Karlin only gives us a small portion of it.

Third, he is making the assertion that there should be no inequality under socialism. This is utterly false and exposes that he knows nothing of Marxist economic theory. In the most superficial sense we can point to the socialist motto of “from each according to his ability, to each according to his work.” Inequality in socialism is a given, it is not the end result of the struggle to end inequality; it’s the struggle against it. In socialism we are making the transition from capitalism to communism. It is a transitional phase, not a mode of production itself. Marx actually made this clear in his work Critique of the Gotha Programme:

“Between capitalist and communist society there lies the period of the revolutionary transformation of the one into the other. Corresponding to this is also a political transition period in which the state can be nothing but the revolutionary dictatorship of the proletariat.”

– Karl Marx, Critique of the Gotha Programme, Part 4

Now I’d like to add in some other points that are not as immediately obvious.

The comparative wage data is frankly worthless when we consider that it is not standardized in single years rubles so that we may have an accurate comparison. This is very important when we consider the pre and post-World War 2 periods. During the war the USSR massively inflated its currency in order to pay for it. They had to, the Nazis were invading the country and the rest of Europe, remember? This was highly skewed towards non-productive production (war materials). This came at the expense of productive production using inflated currency on state accounts. This unfortunate, yet clearly necessary action had negative effects that were felt into the early 1950s. The data presented does not control for these facts, it is very misleading.

It should also be noted that during the war, those who lived in areas the Nazis attacked were greatly impoverished. This tends to happen when a country is invaded, bombed to the ground and has tens of millions of its citizens killed. People who worked much farther away from the front in high priority factories obviously enjoyed much safer conditions and higher wages, in that they could actually get wages. During this time there was an increase in inequality of around 5 to 1 as a result. (To my knowledge there are no hard numbers on this, it’s only estimation.)

This portion of the post is very interesting as it tries to paint the USSR as highly unequal in comparison to other countries, social democratic capitalist ones.

As you can see, the 10% richest Soviet citizens in the first postwar year were more than seven times as rich as the 10% poorest. That is actually substantially higher than in many capitalist social democracies today: Czech Republic (5.2), Finland (5.7), Germany (6.9), Japan (4.5), Sweden (6.2). Russia’s current R/P ratio is about 13 IIRC.

When the Soviet Union is placed back into its historical context, meaning the time in which the data covers, we see that wage inequality was lower than other European countries. Those capitalist countries and their colonies had income inequality levels of about 10 to 30 times, where as the USSR only had 7. When removed from the historical context we get an entirely different picture, a dishonest one. We should also add into this the fact that the inequality between the European countries and their colonies was even higher. What is not placed in this analysis is the fact that they were receiving cheap labour and raw materials from those colonies. A big portion of the inequality was transferred onto the colonized countries. It is dishonest to leave out the economic and social reality of imperialism. Karlin would do well to read up on some Lenin regarding this.

As for the inequality that actually existed in the Soviet Union at the time, we must remember this important fact: Production was rapidly expanding, and as a result the nation needed a drastic increase in skilled labour, engineers, doctors, technicians, and so on. These people needed those rewards which were less than what would be found in capitalist countries.

Finally, it should be noted, that the astronomical increase in income inequality from 1990 – 1991 was the product of pro-capitalist reforms that were enacted by Gorbachev as he was dismantling the Soviet Union. He made several rounds of reforms that had the implicit intention of ruining what socialism was left after the post-Stalin leaders did their damage. Once the state had ended its monopoly on foreign trade, it was more profitable for producers to sell these commodities abroad. This happened as a result of the heavy price controls that still existed domestically. This caused consumer goods to bleed out of the country causing an increase in the cost of living by about an estimated 500%. This was a wholesale attack with the intent of restoring capitalism. The only significant increase in inequality that occurred was the last days of the USSR as capitalism took its grip. Despite the assertion made by Karlin, capitalism caused inequality not socialism.

It is clear from what we have investigated that Karlin absolutely does not know how to read economic data. He has made a fraudulent claim about inequality in the Soviet Union that stems from his ignorance of economics and his ignorance of Marxist social theory.


Ayn Stalin: Soviet Inequalities In 1929-1954, Anatoly Karlin

Karl Marx, Critique of the Gotha Programme, Part 4

Vladimir Ilyich Lenin, Imperialism, the Highest Stage of Capitalism

Bahman Azad, Heroic Struggle, Bitter Defeat

Superior economic data on the Soviet Union