Perestroika's architect reveals details of Gorbachev's blueprint

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Gorbachev waiting in the wings. Is the restoration of capitalism waiting Eastern Europe is becoming a in the world capitalist assembly line SOCIALIST ACTION SEPTEMBER 1990 17 Inside Perestroika, by Abel Aganbegyan, Harper and Row, New York. 245 pages, $9.95.

Abel Aganbegyan has been described as the "architect of perestroika" and "Gorbachev's guru." So his book has value as a view from high in the Kremlin of the turmoil that perestroika is creating.

Aganbegyan was trained as a mathematician and spent years with the graphs and statistics of macro-economics. He felt at home in the world of international economists and made many trips abroad. As a government representative, he conferred with economists and leaders of the Western world.

After visiting Milton Friedman, President Ronald Reagan's economic adviser, he wrote favorably of the "great thinker" and proposed publishing his books in the Soviet Union. Prime Minister Margaret Thatcher also impressed this representative of a degenerated workers' state.

He wrote, after a visit to Downing St. in 1987, "If I were asked my opinion of the policies of the Conservative government, often labelled Thatcherism, I would certainly have to give them quite high marks." (p. 57)

Aganbegyan includes a caveat that he does not believe capitalism is superior to socialism. But he then proceeds to outline a "socialist market" economy that is, in fact, little different from the system envisaged by pro-capitalist theoretician Adam Smith in the 18th century.

First, centralized planning is to play a minor role under perestroika. Aganbegyan writes, "The center of gravity will no longer lie in the directives given to the branches of the economy ... but in a system of advantages and privileges." (p. 93)

Aganbegyan proposes to achieve this "system of economic advantages and privileges" by a series of steps, ranging from selling shares in state enterprises to meshing the Soviet economy into the system of Western imperialism.

Prices must first be allowed to find their own level in a free market and reflect the true cost of production, Aganbegyan says. He acknowledges that lifting state subsidies will lead to a doubling or tripling of many prices.

Here Aganbegyan's blueprint collides with Soviet reality. Gorbachev is not ready to risk hyper-inflation by dropping all price controls. When Gorbachev prepared to raise prices of bread, meat, and milk in May he was condemned. "Worse than shock therapy!" cried one deputy. "It is shock without the therapy."

The therapy is missing, Aganbegyan argues, because Gorbachev is combining an administered price system with a free-market economy. For three years, this "mixed-economy" perestroika has failed to improve anything. Aganbegyan says: Go to the free market all the way; throw out central planning except for public works and the military.

"Profits guarantee production"

Self-managed and self-financed enterprises will decide production and prices. Their overriding concern will be to make a profit. Profits alone, says Aganbegyan, will guarantee production of every social need. (The sick and homeless in the profit-motivated United States would challenge that assertion!)

New financing for Soviet industry would come partly from workers' savings, which are high because they have little to buy. Workers would buy shares in the plants where they work. This would give workers a stake in their factory and presumably lead to greater effort on the job.

(American industrialists have also tried Employee Stock Option Plans [ESOP], but there has been no voluntary speedup in those plants.)

Aganbegyan may have some doubts about raising productivity through share ownership. He presents us with another scheme to motivate workers. He calls it "collective leaseholding." In agriculture, this has meant leasing part of a state farm to a group of workers, who raise a crop and share the profits.

In a factory, the system would work the same way. A group of employees in a statethere with him?

run factory could join together and contract with management to independently produce some part of the output. Several such groups could be formed in a large factory.

Aganbegyan writes:

"For instance, in a shoe factory a collective produces clogs and is paid the price fixed for clogs. On completion, the leasehold collective is paid the contractual amount and divides it among its members according to its own democratic principles.

One of the major tendencies of modern-day capitalism has been the transfer by major multinational corporations of textile, electronic, and vehicle-component assembly to the semi-colonial world. In these countries labor costs are less, unions are weaker, and health and safety regulations are often nonexistent.

These types of plants (for example, the foreign-owned assembly plants in Mexico known as maquiladoras) construct consumer goods for export to some countries out of component parts shipped in from others.

This process tends to extend the assembly-line process to a world scale, with whole sectors of the economies of some countries functioning as part of a giant conveyor belt, dependent for their existence on the other parts of the "belt" continuing to operate.

This acts to increase the control of imperialism over the economies of the Third World, as the flow of production can be transferred from plants where wages become too high (through strikes, etc.) to lower-cost areas, leaving the independently non-viable plants to be forced to close down.

This situation is beginning to be the case in Eastern Europe, as perestroika reforms have opened the economies of the workers' states to increasing penetration by imperialist corporations. A glimpse of this can be seen in an article in the August issue of "Such an idea could be developed further to include payment for the machinery and equipment needed by the collective in the lease. If the collective then consumes less by increasing its efficiency, its income will increase still further.... This will transform the worker in a socialist enterprise from a wageearner into a co-master or co-manager of the leased means of production and will provide a new motivating mechanism and new possibilities for involvement." (p. 76)

is becoming cog Airport Press ("Austrian Airlines Filling Eastern Bloc Needs"), published in New York.

In this article, Joseph Luise, North American cargo sales and service manager of Austrian Airlines, a major flyer to Eastern Europe, explains how a number of U.S. companies are taking advantage of the new opportunities for extending the assembly-line system. These companies include Kodak, Casio, Levi's. Sassoon, IBM, and AMP.

The process whereby numbers of East European workers are being drawn into the capitalist world assembly line is described in the article:

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1923-1927 TOM I solidarity in a plant! In a large factory, little groups of speedup artists will share the gains from increased production. What will happen to the rest of the work force who are not invited into these privileged groups? Presumably they will be toiling at the less desirable jobs at low fixed wages.

Citizens would also be free to form cooperatives to supply any product or service that can command a market. Their regulation, Aganbegyan says, is to be based on the principle that "anything not actually forbidden is permitted."

This laissez-faire attitude to commerce would extend to foreign trade and investment. Enterprises could deal directly with foreign concerns, by-passing state ministries and breaking the traditional state monopoly of foreign trade.

Foreign trade zones Investment in the Soviet Union by Western capitalists can put foreign investors in charge. They can now own more than 50 percent of the stock and make all the decisions. To make foreign trade and investment easier the rouble is being made convertible. Aganbegyan proposes to bring Soviet industry even closer to foreign investors. "We are looking into the possibilities of creating zones where conditions for joint enterprises will be particularly favorable. Such zones exist in China and have on the whole been successful," Aganbegyan tells us. He mentions the low cost of Russian labor that should attract Western investors.

For Aganbegyan, perestroika requires a new world view. He says he no longer holds the "old outlook that divided the world into different political systems that had to be in confrontation." International problems must now be addressed "not from a class position but from a general human position," he declares. (p.175)

By "general human position," Aganbegyan means the position of the dominant ideology in the world today-capitalism. Throwing the word "socialism" into his thesis here and there does not disguise the fact that he has laid out a blueprint for a retreat back to capitalism.

The road back to capitalism will be a rocky one. Protests over rising prices will be followed by even louder ones as unemployment mounts. Gorbachev is committed to the capitalist road, but he fears the destabilization that will result. Aganbegyan assures him the transition can be made safely.

But Gorbachev has challenged Aganbegyan by appointing him to the "Commission for the Evaluation of Alternative Variants for the Transition to a Regulated Market Economy." This tongue twister could be translated as, "Take us to capitalism, but don't disturb the people." This is likely to be an impossible task.

"The flow of goods goes like this: The parts, whether clothing or electronics, come in from the Far East, are transshipped through U.S. airports and on to the Eastern bloc countries where they are assembled, and shipped back as whole goods for Americans to buy." The article adds: "Formerly, garments were assembled in South America. But manufacturers have found that they can get the same quality of work in Eastern Europe."

This is the future imperialism is preparing for the workers of Eastern Europe. The capitalism waiting for them is not that of West Germany or the United States, but that of Taiwan and Mexico.

The only way forward in these countries is for the working class to organize to defend the socialized property forms that exist, gain collective democratic control over them, and join the worldwide struggle to end exploitation everywhere.

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