The Socialist System: The Political Economy of Communism

The Socialist System: The Political Economy of Communism

The Socialist System: The Political Economy of Communism

The Socialist System: The Political Economy of Communism


This book provides a comprehensive account of the structure, conduct, and performance of the centrally planned economies of Eastern Europe, the USSR, Communist China and the Marxist LDCs, looking at 26 nations in all. The author focuses on reform, perhaps the most important issue facing countries such as the USSR, Poland, Hungary, and China. Bureaucracy, soft budget constraints, markets, and the nature of the socialist state are the centralissues that arise in the course of reforming a socialist economy. The first half of the book deals with 'classical socialism' and provides a theoretical summary of the main features of a now closed period of history. The second half deals with the processes of reform and concludesthat the reform of classical socialist systems is doomed to failure as they are unable to renew themselves internally.


Writing and publishing this book is a risky business. When I began writing it, the Berlin Wall was still standing, several leaders of the Czechoslovak opposition were still in prison, and governmental power in the countries of Eastern Europe was still in the exclusive hands of the Communist party. Now, as I write this introduction in the spring of 1991, new parliaments brought about by the first free elections have been operating in those countries for several months, and governments qualified to carry out the governmental tasks of the postsocialist transition have formed. Who would dare forecast what the situation will be when this book appears, or when a reader picks it up some years later? But even though the socialist world is creaking at every joint, the purpose of this book remains to arrive at statements of a generalized nature about this system.

Let me quote from the introduction to Simon Schama's excellent book on the French revolution (1989): “Chou Enlai, the Chinese prime minister, when asked what he thought of the significance of the French revolution, is said to have replied, 'It's still too early to say.' After two hundred years it may still be too early (or too late) to say.” That ironically ambiguous comment of Schama's is what I would like to latch onto: it is too early, or possibly too late, after the passage of two hundred years, for a social researcher to comment on a great event.

Be that as it may, the author of this book does not intend to wait. I accept all the risks and drawbacks of proximity to the events: the beginning of the period in 1917 is only seven to eight decades ago, and every day in the present brings a new development. I may fail to appreciate the proportions, overrate some features of the system, and underrate others for want of a historical perspective of several centuries. I may be subject to prejudice even though my aim is objectiveness. Nevertheless, I feel an inner compulsion, which I cannot and do not want to resist, to express what I have to say. Before attempting to state objectively the useful purpose I hope this book can serve, I would like to recount frankly my personal motives for writing it, which inseparably entails evaluation of my own previous work.

All I have written about the socialist system hitherto has appeared in the dismembered form of monographs and articles in academic journals. However important the subject of any particular study may have been in itself—on the distorted strategy of growth, the chronic shortage, or

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