The Betrayal Began with Khrushchev and Modern Revisionism
p Abstract
p The betrayal of socialism in the USSR and its East European dependencies did not begin with the Gorbachev gang or even with the rise of the Mafia. It was wholly a product of modern revisionism and its beginning occurred within weeks of the death of Joseph V. Stalin in March 1953. Without the three decades of preparation between 1953 and 1983 by the modern revisionist leaders of the CPSU it could not and would not have happened.
p Mao Zedong warned the international communist movement of what was happening in the Soviet Union in the late 1950’s and early 1960’s. Exactly what he predicted came to pass as modern revisionism strengthened its hold in the USSR and it those parties it controlled abroad (including the CPUSA under the Khrushchev stooge Gus Hall and gang.) This was brand new territory for the CPC and the international working class movement and the Cultural Revolution in China could accomplish its objectives. But it did buy us time. The Deng solution beginning in 1975 has proven that in backward countries the best way is to keep the new capitalist elements of the social equation above board and open so they can be legally regulated. By keeping the always present second economy open, legal and above board, the level of technological development Marx and Engels required for the transition from the capitalist stage to the communist stage can be achieved, as the Chinese Communist Party has proved. Denying the existence of classes and capitalism in the USSR and Eastern Europe worked against us, not for us, and the opposite has been proven true in China.
408p This is not really relevant in the USA and Canada as we have achieved, in our capitalist stage, the necessary technological foundations that the founders of our science required. Here we will be able to move directly to communism through a very brief transitional period (a short period of socialism which will be more of an introductory phase to the Communist stage and the Era of Freedom.) This is science and not speculation nor is it wishful thinking and if you wish to be the scientists involved you need to understand chapters 1 through 13 and that means perfected understanding. Read and study this Handbook carefully.
p The actual final destruction of what was achieved under Lenin and Stalin (1917 — 1953) by the Mafia in Russia and its candidate Mikhail Gorbachev is instructive and constitutes the final part of this discussion on the Collapse of Soviet Socialism c. 1989-1991. In short modern revisionism was the gun and the trigger was pulled by the organized crime elements of Soviet society.
p The Story Unfolds
p The Collapse of the Revisionist Regimes in the Soviet Union and Eastern Europe left in its wake an extraordinary imbalance in the global positioning of class forces. From the standpoint of Bolshevism, getting rid of the labor-fakir institutionalization of revisionism in those countries was a tremendous positive. There is no credibility whatsoever to the idea that the presence of sabotaged forms of industry and agriculture under the revisionist control of what had become reactionary de facto anti-communist New Class dictatorships in the USSR, Eastern Europe and Mongolia, made them worth defending, and now commiserating over. It is not only the organizational form of the economy which determines whether it is “socialist” but the intentions of those in command, and the classes upon which they depend. To the degree that Stalinist first economy socialist organizational forms remained by 1985 they were being swamped by de facto second economy capitalism with all the programmatic and ideological and organizational corruption this implied. What was left was just the name Communist. Just the name “communist” usurped by Stalin’s Russian-East European successors, due to historical happenstance, does not mean they really were communist. Mao discovered this to his chagrin in the 1950’s and the not well read or educated Euro-American Left should have learned that lesson long ago as well. The Russians learned it the hard way under the Great Traitor Mikhail Gorbachev from 1985 — 1991 as you will learn below in section A.
409p On the other hand, the simple fact that the revisionists were fakirs had often required them to play a positive role in the global class struggle; many times after 1953 (and Stalin’s death.) As for example in the defense of the Cuban Revolution. It is this simple fact that makes the less educated Left in the West think (or feel) they have lost something worth having.
p We Bolsheviks are far better off with the Putin-Medvedev New Class leaders in power with their open capitalist system at work than we were with that whimpering traitor Gorbachev and his gang of labor-fakirs parading around calling themselves communists. The current New Class government is standing up to US imperialism because they have realized we were right all along and there is no living with imperialism forever. In fact we should expect to see the newly reformed and reorganized Communist Party of the Soviet Union to enter the historical scene once again. No one knows exactly how this is going to happen but mark my words a Second Bolshevik Revolution is on the historical agenda. Perhaps the honest and open New Class leaders, Putin and Medvedev, will enter into a formal alliance with the “new and improved” CPSU. That would be the easiest thing for us and we should certainly consider this as the next step forward in that part of the world. Then the CPSU can deal with the second economy according to the Chinese style of the last thirty years and lead the reconstituted USSR (and it will be reconstituted in proper Leninist form no matter what the US imperialists or European imperialists say about that).
410What has Chinese Communism proven is the best way to handle the danger of capitalist restoration in countries trying to build socialism with an inadequate capitalist technological preparation? We will deal with that now in the following thirty odd pages.
Collapse of Modern Revisionism in the USSR and Eastern Europe
p The collapse of the Soviet Union and its East European People’s Democracies is also the final and definitive collapse of modern revisionism in the international working class movement. It has been followed by the reintroduction of capitalism in a new and even more hellish form in all these countries. Exactly, this was predicted by Chinese Party Chairman Mao Zedong in a series of papers issued during the early 1960’s and widely disseminated to the international communist movement via a variety of publications. Those of us in the USA followed Peking Review (now Beijing Review) with avid attention in those years.
Now, some twenty plus years, a full generation, since the collapse of Soviet/East European Socialism (and Mongolia), has passed, we can look back with some confidence that the analysis which follows is correct. With this historical perspective we can reconstruct why the collapse happened in those countries. —And, why it did not happen in the People’s Republic of China, Cuba, Vietnam, Laos, and Korea. In this section of your Handbook we will divide the discussion of the Collapse of Revisionism into three parts:
p Coup de Grace
p Let’s get started.
p The Soviet New Class
p Guanlong Capitalism 1953 — 1975:
p The Classless Intelligentsia in Transformation: Phase I
p This is a critical part of the history of the Stalinist Socialist Stage. Understanding what begins to occur with the death of Joseph Stalin and how the New Class evolved, explains the collapse of the Soviet Union. I have approached this matter in three parts reflecting (A) the mild predation form of the post-Stalin (post-1953) New Class in the USS the East European People’s Democracies and Mongolia, and (B) the monster form which devoured all the accomplishments of Soviet Socialism after about 1975. (C) The final coup de grace delivered to Soviet Socialism by Mikhail Gorbachev using the CPSU to do the job that all the Whites, foreign capitalist interventionists, Hitlerites and gringo imperialists had failed to do. We will begin with the years of the first predatory New Class phase ( 1953 — 1975).
411p First of all, why this particular labeling: Guanlong and Tyrannosaur? The answer: because the monster we all have come to know as the 7 ton Tyrannosaurus rex of Cretaceous times actually began as a fairly small ( 150 pound) cougar-sized carnivorous predator in the Triassic period some 100 million years earlier. We call this original little fellow Guanlong after the fossil locality in China’s Gobi Desert where it was found. I
p think this is a useful analogy, for in this sociocultural case, the relatively powerless New Class Stalin created, and named “the classless intelligentsia”, (that had been essential to the construction of Socialism in the backward conditions of the USSR, and which he kept in check during his lifetime), began to grow into something monstrous. In other words with Stalin’s death the New Class went from being a potentially dangerous small scale predator to something much more fierce. We can distinguish two growing forms of the monstrous New Class: (1) the early small-to-medium sized predator Guanlong form and (2) the truly monster form of its post-Stalin final manifestation.
p In summary, the Czarist Russian (technocrat) New Class itself had been the product of long and intricate evolution from the earliest days of class society (as was the case globally in all centers of the origin of civilization as we have reviewed in chapters 1 through 10) and which began some 6000 years earlier. (1) Under Stalin’s leadership the Soviet (technocrat) New Class emerged in its “classless intelligentsia” phase of early Soviet history. Then (2) it morphed into what at first was a relatively mild predation form. At the end, (3) it transformed into a monster. This final New Class Tyrannosaur form was a lethal all-consuming carnivore of all that was good and righteous in the USSR.
Today, New Class ruled Russia is coming to grips with the inherent contradictions which, as history proves, all class societies must eventually confront and resolve. The way forward for the shattered remnants of the old Soviet Union is being worked out. Mr. Putin, echoing the comment of others, calls the collapse of the old Soviet Union the greatest tragedy of the 20th century and he may well be right. As a KGB career officer he knows what you will know, once reading these sections on the New Class and the collapse of the Soviet Union. In my opinion, our side will require their (the people and Party of the former Soviet Union) internalizing of this scientific account of what happened. As such, the study and understanding of the facts of history is preparatory, to a second Bolshevik Revolution for them, and this time one that prevents this capitalist restoration event from occurring once again in those former Soviet Republics and East European nations. It is also preparatory for you in pursuing your historical task of bringing Communism to the USA and Canada.
412p Learning from the Past, Application in the Present, Hope for the Future
p One critical lesson you will see emerge from this analysis is, that the path of bringing the hidden capitalist class of the Guanlong-Tyrannosaur form out of hiding and into the open as the Chinese Communist Party has done since Deng (1975), allows our Party and its State and Government in the PRC to clearly identify the capitalist elements in the nation and regulate them. Something which was impossible in the old Soviet
p Union, that is to say, because the transforming New Class was largely hidden from view, denied to exist, it could not be confronted and defeated under the system then extant in the USSR. A brief cursory glance at the multiple English language Chinese periodical internet publications shows us that a constant muckraking of Chinese capitalist and socialist sectors is ongoing alongside a constant rectification movement in the form of teaching and studying Marxism-Leninism and Mao’s and Deng’s thinking (Collected Works of both are online and available in English.)
Now on to the details of how the New Class underwent its transformation from the rather mild form it had taken when it was very largely avocational and one had his or her day job in the bureaucracy, educational facility, factory or collective farm.
p Origins
p We have seen how the original New Class of technocrats in the Soviet Republic (and after 1924 the Soviet Union) had two principle components and why. In that review you have seen simultaneously how the New Class emerged in part from the old New Class of Technocrats under the Czarist Capitalist-Feudalist Regime. But, these bourgeois specialists left over from the pre-Revolutionary period, even being supplemented by those finishing college and technical schools in the first five years of Soviet power, were joined immediately by Communist Party generated technocrats (or often wannabe technocrats) who wanted the technocratic positions for their own employment. This was especially true for the three hundred thousand officers and Non-Coms who had served in the 5 ÃÂÃÂÃÂÃÂÃÂÃÂÃÂý million man Red Army. The latter (Party originating) candidates for technocratic employment won out over the former during the period of the Five Year Plans (beginning in August 1928). In the coming decade they were supplemented by millions more from the new Soviet Universities and Technical Institutes who had proper proletarian or poor and middle farmer backgrounds. By 1938 there were about ten million of them. The old petty bourgeoisie specialists had been swamped out of the picture.
413There was always a capitalist economy even in these years but it was relatively small. Some of it was legal but much was not. The multitude of small forms of exchange and functions of a small-scale economic nature had also to be fulfilled. These functions could best be handled in the second economy (shadow economy, black-market economy) way, and in fact in practical terms could be handled in no other way. For reasons of expediency and efficiency, as long as this secondary capitalist economy was not threatening rule by the Party, Stalin and his (e.g., Molotov’s) Government(s) allowed it to continue.
p The Doctor’s Plot
p Toward the latter part of Stalin’s reign as General Secretary he received a letter from a citizen (you will recall anyone could, and millions did, write to the Boss whenever they were pissed off. A very large staff read them all and certain types of letters were routinely taken to the Boss for his personal examination and reply) claiming that corrupt medical doctors were doing a series of illegal things. These included charging unlawful fees in order for citizens to obtain medical care, medicines, hospital admittance, and other things of this nature. Stalin investigating via Beria found this complainant’s allegations to be true, common practice, and furthermore began to see that the second economy — the capitalist sector previously small and non-threatening — was growing by leaps and bounds. There were a variety of reasons for this but for purposes of this Handbook suffice to say the Boss decided to fully investigate the growth of this second economy (a de facto secret capitalist economy) and to conduct a thorough purge of the entire phenomenon. This would have involved a massive press campaign against this sub-rosa corruption as had characterized the thousands of trials of local agricultural tyrants in the 1930’s and a complete public expose of the entire second (capitalist) economy phenomenon. Stalin died before he could get this anti-capitalist campaign underway.
414Trotskyist and other imperialist historians have made a mountain out of this fact ever since calling it “the Doctor’s Plot” implying another irrational and paranoid adventure was in the making by Stalin, just before his death, such as the irrational and paranoid plots they claimed the Boss had made against them in the 1930s. We have already reviewed the truth about the purges of the 1930’s (chapters 15 and 16) and won’t rehash old ground here.
p Guanlong Capitalism Grows by Leaps and Bounds
p An excellent summary of this secret capitalist “second economy” is provided by the historians Roger Keeran and Thomas Kenny in their book Socialism Betrayed, Behind the Collapse of the Soviet Union, 2004, International Publishers, New York, 230 pp. I recommend you read it especially beginning with Chapter 3. Let me simplify some of the terminology.
p To begin with there are numerous ways this second economy is referred to in scholarly works (black market economy, private economy, illegal economy, shadow economy, and a half dozen others) but for our analysis it is best to refer to the second economy for what it was scientifically, which is to say a capitalist economy. In the USSR it always had two components: a legal component and an illegal component. However, since the entire legal economy is where virtually everyone worked — that is, the first economy — what inevitably had to happen was that everyone with any kind of private
p enterprise was taking things from their job for usage in the capitalist second economy whether the activity was legal or illegal. Illegality was therefore inherent in the way in which the capitalist economy in the Soviet Union worked. This illegality was always there and grew and grew, mostly unchecked, in the 37 years from 1953 to 1990.
Khrushchev and his crew enabled the capitalist economy to undergo this rapid expansion in a variety of ways but the point is that with the death of Stalin, and the removal of Beria as Boss of the Cheka, the entire campaign to isolate and liquidate the capitalist second economy was itself isolated and liquidated. The showdown came June 18 — 21, 1957 when the Politburo (named at this time the Presidium, voted 7 to 3 and one abstention [neutral]) voted to kick Khrushchev out and his policies. The fat boy managed to get a full Central Committee meeting called immediately thereafter with just enough Moscow Party bosses and allies present (Khrushchev had been Party Boss for Moscow before being elevated to Chair of the Politburo) to reverse that decision! Instead they kicked out the key anti-Khrushchev Politburo (Presidium) members, including the leaders of that seven man group, Molotov, Kaganovich, and Voroshilov, labeling them the “anti-Party group”. Khrushchev held on another seven years until even the compromised bureaucrat (second economy advocate) members of the Central Committee had had enough of his bullshit and threw him out. (His failure to counteract US imperialism over the Bay of Tonkin incident being the straw that broke the fat camel’s back.)
415p The Party Disarmed
p This was not the last time the Soviet Party had a chance to correct the capitalist course the nation was on but it is symptomatic of a fundamental change in power at the top of the Communist Party. In a little over thirty years after Khrushchev’s consolidation of power capitalism would be fully restored. Note that the major reason this secret restoration policy was successful was because the Party denied that there were classes in the Soviet Union and that capitalism in any form even existed in the USSR. If you don’t recognize a growing dinosaur about to devour your system you can’t fight it. The Party had permanently disarmed itself. The true anti-Party New Class leadership had succeeded in reversing Stalin’s entire domestic policy in only four years. (On the other hand as D. F. Fleming pointed out in 1962 (in The Cold War and its Origins, Doubleday, New York), it had only taken the most fascist reactionary section of the US ruling class two weeks under Truman to reverse FDR’s entire foreign policy.)
416Let us look at some important statistics.
p Guanlong Capitalism Unleashed
p The backbone of Russian capitalism and the primary demographic of the Soviet Republic and early Union had been the farming classes. In 1926 theses classes constituted 83 percent of the Soviet population. By 1975 the total farming population had been reduced to 20 percent of the population. Furthermore almost all of that 20% were devoted first to their collective farms for regular paychecks and only secondly to their private plots (3/4 of an acre). Simultaneously, the industrial working class and those workers involved in the construction and transportation industries had grown from a total of 5 million persons in 1926 to 62 million by 1975. Of the latter some were involved in private market legal selling, service providing and exchange but this was clearly the type of income we have come to call “supplemental” to their regular paychecks. Truly illegal private capitalist activity existed by 1953 but had been closely watched, regulated (policed) and even utilized (MOCR style) — (all this aside from the fact we have stipulated; namely, that legal capitalist activity always implied some degree of illegal (theft) activity as persons involved took from the public teat for private benefit at least some of their tools and/or resources. In a manner similar to the way secretaries in North America take from their day job employment, office supplies, for their home businesses.)
417p Soviet law allowed certain forms of hiring of labor (household domestic staff for example) and certain kinds of private entrepreneurial activity. In this latter case the boundary between legal and illegal was arbitrary by nature and not difficult to get around. Persons employed in agriculture (collective farmers) were allowed to cultivate up to ÃÂÃÂÃÂÃÂÃÂÃÂÃÂþ of an acre for private gain. Certain other non-farming elements were accorded the same privilege. By 1974, only 17 years after the Khrushchev Central Committee victory 1/3 of collective farmer work-time was spent on these plots (ten percent of national GDP work-time.) One can see that in the case of agriculture this system invited corruption inherently in the form of obtaining (stealing) seeds, fertilizer, equipment, cattle feed, water and of course transportation. You can’t really blame the farmers because where else could they turn to get what they needed since all of this was publically owned as part of the first economy. They did not have the option of going to WalMart or Home Depot to get these things.
418p Contrary to capitalist propaganda personal property was never endangered by the socialist order. Included in the category of personal property was housing — or at least if you had a house before the revolution (and were not a class enemy) or built one with your own hands after the revolution it was your legal personal property. Thus, housing became another source of growth potential for the second (capitalist) economy. By 1975 ÃÂÃÂÃÂÃÂÃÂÃÂÃÂü of the Soviet city population lived in such private housing. Inevitably this led to corruption in the form of renting rooms (charging rent was illegal) as was common place in Cuba when I visited eight years ago; hiring illegal construction activity by underground firms (such as the illegal Mexican labor component in the California housing industry, without which that industry as currently constructed could not function). Keep in mind that the Home
419p Depot option being non-existent meant that ‘building materials’ had to be stolen from public resources.
p In mining, and in the oilfield, individual entrepreneurs could mine and drill provided they sold to the Government (similar to the way in which all gold mined by prospectors in States like Idaho had to be sold to the US Government until recent years.)
p Note that bribery of regulatory officials and policemen was an inherent function of all of this second economy activity as one could easily declare any specific act a crime otherwise.
p Doctors, teachers, craftsmen, tutors, dentists, veterinarians and virtually any professional could legally sell his or her services, within certain constraints — easily avoided or evaded.
p Any person could sell their personal private property and who was to say how a used item had been originally obtained?
Even so all of this legal capitalist activity did not grow in and of itself into its Tyrannosaur form under Socialism. In fact, it declined from about 22% of the total economy in 1950 to about 10% in 1979. (At least, that is until Gorbachev began wholesale introduction of capitalist economics in 1985.) The overall size of the second economy grew because the first economy by which we measure the percentages just quoted was growing massively, so the second economy while percentile smaller was much larger in gross terms. Yet even this would have made the second economy no more than a significant portion of economic activity. No. We must look elsewhere to see how the New Class of the First Economy expanded their economic and political power beyond their utilization of petty bourgeois entrepreneurial activity. We don’t have to look very far. What did grow was the illegal criminal component of the second (capitalist) economy!
420p Mafia! The Rise of Organized Crime
p With the death of Stalin and removal of Beria in 1953 “illegal money-making presented a much greater problem than legal activity. Illegal activity eventually assumed an astounding array of forms, eventually penetrating all aspects of Soviet life, and was limited only by the boundaries of human ingenuity. The most common form of criminal economic activity took the form of stealing from the state, that is, from the work places and public organizations.” (Keeran & Kerry, 2004:55-56)
p In addition to the petty theft we have already mentioned wholesale theft began to occur. True wholesale activity in which large scale systematic thefts on docks and from
air and land transport cargo warehouses, ships, planes and trucks became common place. These required retail outlets. Criminal swag organizations exactly as in the USA and Western Europe emerged. These activities required law enforcement (police, judges, and so forth) functions to be suborned and disciplined to mafia type operations.
p Four Curses of the Modern World
p Communist historians not to mention historians in general remained blissfully unaware of all of this — both in capitalist countries and most especially in socialist ones. At bottom this is why when we list the four deadly curses of the modern world we must include naivetÃÂÃÂÃÂÃÂÃÂÃÂÃÂé as the number two curse. For those of you with an interest in these sorts of things I have included in the modern world’s four curses, and in the 1980’s in this order of importance: (1) modern revisionism, (2) naive ultra-leftism, (3) Trotskyism and (4) anarchism. Think of the eight curses of Ancient Egypt as the analog.
{Today (2012) modern revisionism has shot its bolt and its treason in the USSR and Eastern Europe has completely discredited it so that it only threatens parties out of power or in coalition (and then from the sidelines as a kind of joke.) As a consequence I have moved it back to third position and this leaves moving up (1) naïve ultra-leftism (2) Trotskyism (3) modern revisionism and (4) us usual the syphilitic lesions of anarchism on the working class body politic here and there.}
p Institutionalizing Criminal Illegality
p Managers in the Soviet Union had a long history of bad acts and we reviewed many of these early ones in Chapter 15. Then at least the bad acts (e.g., managers not reporting but hoarding supplies) had been part of paving a road of good intentions. No longer. Now these bad acts were pure criminal endeavors aimed at lining ones pocket to the max, including: black market selling of large quantities of goods reported as spoilage, or lost; lay-away plans for the well-to-do buyers of the best merchandise (goods, food) and to hell with the public (these buyers paid special tips to those so engaged); putting goods on “waiting lists” invited the practice of selling list positions to highest bidders who paid to go to the top of said list. Speculation was invited when higher income persons could buy more than what they required for personal consumption for purposes of selling at a later date at a much higher price. Organizing of the repairs and services for houses, cars, sewing and tailoring, moving furniture and transporting household contents, became major sources of illegal profit making.
421p It was not long until large scale tract-housing construction operations were organized by the Russian mafia so that personal home construction, always legal for an individual worker, now was transformed into the completely illegal capitalist spec-housing construction business, almost identical to the way it was and is conducted in the USA! Large scale bribery of police and judges was essential here. Nor was this large-scale production restricted to housing.
p By 1975, tens of thousands of illegal factories had been built nationwide on the QT. Every conceivable type of commodity began to be produced in these illegal factories after 1953, including clothes, shoes, household appliances, and a variety of small items such as sunglasses, handbags and gloves, knick-knacks. Such large scale underground illegal production could not happen in a cottage industry way and had to take place through the back door of legal above ground factories. These factories meant workers were hired and exploited for their labor-power exactly as in the USA. Capital was accumulated through a variety of typical capitalist investment house practices, and as in New York City every cop on the beat and every judge on the bench were suborned.
422p A bourgeois class structure emerged in the Soviet Union, with New York 5 Family style super millionaire Russian criminal family clans at the top. Big bourgeois Soprano style boss families as middle level management and your basic hood and one man (or one-woman as in house-hooking) house-based criminal enterprise at the bottom.
p The Communist Party of the Soviet Union played the role of the Catholic Church and its hierarchy in New York’s Italian boroughs. Going on as if everything were fine except for a few persons who had lost their way.
p Needless to say a simple Stalinist police operation would have prevented all of this and or reversed it once underway. But, that is precisely why the anti-Stalinist Khrushchev government was so absolutely essential to the rise of the secondary economy in general and organized crime in particular. All of the Khrushchev bullshit about Stalin’s crimes and violations of socialist legality was nothing more than an invented cover for this counter-revolutionary process of restoring capitalism. They started out with the elaboration of Trotsky’s lies and then took on a life all of their own as in the fat man’s, last hour, “secret speech” to the Party Congress in 1956. All of the rewarding of mentally challenged authors, and a variety of Russian misanthropic iconoclastic malcontents, by the Western cap press, was nothing more than encouragement of this on-going criminal activity. (In 1985 Gorbachev turned the Soviet press over to this worst-of-all-persons crowd). All that was required was to reach a “critical mass” and have the right mafia man in the right place to give socialism in its proper form the coup de grace. It came in the form of the assassinations of Andropov and Chernenko and the subsequent rise of Gorbachev. However, we are getting way ahead of ourselves.
423We will continue this story in Part II Tyrannosaur Capitalism 1976 — 1990: the Classless Intelligentsia in Transformation: Phase II (below and in Chapter 27)
p The Soviet New Class
p Tyrannosaur Capitalism 1976 — 1990
p The New Class in Transformation: Phase II
p We have reviewed some details about Guanlong Capitalism, but we have also seen in its mildly predacious form it did not seem to be a clear and present danger. We should have seen that it was. Andropov believed it was, and as KGB chief he had led a fight against it, not only in the Party but in many government institutions in Russia and especially in the Trans-caucuses. Unfortunately, try as he did in the short time he had, he could not make the other Party leaders as sure of the inherent danger it posed to the very socialist nature of Soviet society. In other words, it was not yet inevitable that the great Soviet experiment would succumb to capitalism. Yet, because the Party failed to recognize the growing class structure based around the second economy the great tragedy of the 20th century did unfold. It came in the form of the monster of Tyrannosaur Capitalism.
424p I cannot over emphasize the importance of your grasping the equally great historical irony that our side had withstood incredibly bad odds from Day One. In this Handbook you have seen how we defeated the Whites and their foreign capitalist interventionist allies; how we defeated all of the plots of the foreign capitalist regimes against us in the 1920’s and 1930’s. You have seen how the USSR led the fight worldwide for the destruction of Hitlerism by transforming Rapallo from a German-Soviet alliance into an English-speaking-World-Soviet alliance, and then withstood the assault of gringo hegemonized world capital when the US picked up the gauntlet dropped by world fascism. The USSR not only withstood that imperialist assault it took the lead in every scientific and engineering area. All of this accomplishment of the first economy however was to be subverted by the newly emerging bourgeoisie within our own, (socialism’s own), homeland, via the second economy.
425As I say, in 1976 it would not yet have been too late to reverse the trajectory toward capitalist restoration except for three things. In the event (the 14 years, 1976-1990) these three factors weighed decisively against the ability of reformers (Andropov, et. al.) in the Soviet leadership to be able to get the USSR back onto the correct road.
First of all the capitalist second economy was largely denied by the very Party, (its Government and State) that would be required to excise it. Try as he did Yuri Andropov could not convince the Party that the second economy was a clear and present danger to the very Soviet experiment they were leading. Perhaps the reformers didn’t try hard enough. Perhaps the enemy had grown simply too all-pervasive in class structure and was just better organized. But the lesson is that the Party must get capitalist economics out of the shadows and into the open world if it is to be contained.
The PRC has led the way in this regard. Perhaps, therefore, what happened in the USSR was necessary in order to teach all of us this critical lesson. It did give China the time it needed to prevent the capitalist sector of their economy from duplicating its success in the PRC. Even a cursory glance at the many English language pages from Chinese publications on the internet will show any observer that China has a complete and total grip on the capitalist sector. Furthermore that the positive aspects of emerging capitalism have been harnessed to the needs of the proletarian Party and the classes it represents.
Second, back to Russia and the Republics, the small exchange and service supply functions which had justified leaving the second economy in place all along continued to be important and it would require some approach to the organization or at least control of small exchange we had not yet seen, if the second economy as constituted was to be replaced. This was still the pre-computer era and the option of computerized total planning and centralization in government large-scale planning was just being born in the most advanced capitalist countries. (For example, in the work of H. Ross Perot, and EDS, in Dallas.)
Thirdly, throughout the USSR, the mafia component of the second (capitalist) economy was prepared to push their plan through, and in fact did so. To counter our state apparatus they used their gangster tactics to eliminate opponents; that is to say those who indicated they might be prepared to take steps to liquidate the second economy.
p The Mafia Doctor’s Plot: the Assassination of Yuri Andropov
p Taking the last point first, the most dramatic example of mafia power came in the form of the case of General Secretary Andropov. The assassination of Andropov is the case in point.
p Yuri Andropov was by this time an Old Bolshevik, and following Brezhnev’s death in 1982 he was elevated to the General Secretaryship of the CPSU. There can no longer be any doubt but that his sudden illness (within three months of assuming his new position) was organized by the mafia. The medical plot worked and played out over the
p coming year like a spy movie thriller. The bottom line was that the plot reduced Andropov’s fifteen month tenure to one of constant illness before he finally succumbed. Thus history, in the event, records the “Andropov Year” (1982-1983) as the last chance the Soviet Party had to rectify the otherwise inevitable course of capitalist restoration the Soviet Union was unwittingly following. After that it was all over for Socialism as it had come to be known in the USSR, at least for the time being.
p Why was Yuri Andropov (1914 — 1983) so dangerous to the Mafia and the entire second economy class? (1) First because he was a highly prestigious Old Bolshevik. Although he had joined the Party nearly a generation after the October Revolution he had been mentored by some of Lenin’s top men beginning with Otto Kuusinen. (2) Second because Andropov embodied all the personal traits admired by the Party: austere living, dedication to work (a Stalin-like workaholic personality), constant self-education, and he had (3) an impressive history of having dealt successfully with the most difficult assignments the Party had to offer, including the 1956 mess in Hungary. (4) Fourth, because he had a proven record of policing effectively against the Second Economy as KGB chief over the previous fifteen years (1967-1982), and (5) most importantly as a danger to the mafia, and because he had proposed the complete and final uprooting and liquidation of the entire second economy. As General Secretary he would have the power to do just that. Accordingly, as far as the Mafia was concerned, he had to die!
426p Note (1) that the Cheka (called KGB by this time), of which Andropov was boss for the preceding fifteen years, was the structural equivalent in the Communist Party of the Jesuit Order in the Catholic Church. Also, note (2) Andropov’s close association with the theoretical purists of the Party from the date of his joining the Bolshevik Party in 1936. From these earliest days he had the good fortune to be directly mentored by the Old Bolshevik Otto Kuusinen, and his association with this group continued over the following fateful years, especially with Anastas Mikoyan and Mikhail Suslov. (3) He had an absolute personal hatred of the criminal element in the Soviet Republics and an outstanding record in breaking it up, in and out of the Party, in his years as KGB boss. Finally, (4) he was one of the few highly placed Politburo leaders who admitted, and in fact emphasized, the existence of the Mafia and the scope of its activities (meaning the entire second economy.)
427p “ as head of the KGB, Andropov took responsibility for the crackdown on dissident intellectuals, like Alexander Solzhenitsyn. Andropov’s willingness to defend these actions openly and to withstand the criticism of Western commentators and such Soviet intellectuals as Yevgeny Yevushenko, strongly suggested that Andropov would have avoided Gorbachev’s blunder of turning the media over to anti-socialist elements. (Emphasis added, Ed.) As head of the KGB, Andropov also showed courage and conviction by investigating corruption in high places. On his KGB watch, the entire Presidium (Politburo, ed.) and government of Azerbaijan were dismissed for corruption,
p bribery and embezzlement. Moreover, in 1981, Andropov’s deputy exposed and arrested some of the ‘black market-ridden la dolce vita crowd” that included Brezhnev’s daughter and son-in-law. Even investigating crime in the General Secretary’s family did not daunt Andropov.”’ (Socialism Betrayed, Behind the Collapse of the Soviet Union, Roger Keeran and Thomas Kenny, International Publishers, New York, 230 pp. this citation pg. 40).
p Leading to the decision to elevate Andropov to the position of General Secretary had been the fact that the Politburo (Presidium) and the entire Party had been impressed with his theoretical preparation for tackling the problems of constructing Socialism in the USSR, which included liquidating the second economy. Belatedly many in the Party from the leadership on down were beginning to see the entire second economy phenomenon as a serious threat to Soviet socialism (or at least some of them had.) Those Politburo and Central Committee members who did not yet see the second economy as a clear and present danger still thought Andropov’s analysis of the problems of the first economy was correct, and that he could set things straight there. Andropov led the way in his call to reform the first and second economies in the following theoretical way:
428p (1) There were the internal discussions among the High Priests of Soviet Socialism, to which Andropov had added:
p (2) Three papers also delivered as speeches in
p (i) November 22, 1982 (“The Better We Work the Better We Will Live”);
p (ii) December 21, 1982 (again on the same topic); and
p (iii) On June 15, 1983 (“Analysis of the Existing Situation and Landmarks for the Future”). —And,
p (3) A longer treatise on the matter also in 1983 (“Karl Marx’s Teaching and some of the Problems of Building Socialism in the USSR”), the latter marking the Centennial of Marx’s death in 1883.)
The Mafia read these papers and listened to these speeches and if they had had any doubts, they now knew that their future depended on killing the man who proposed to do away with them (the organized crime element) and the very conditions they required (the second economy) to continue operating as the bosses of this real economy, now becoming bigger than the first economy as we shall see in a few statistics below. I recommend that serious students of this Handbook read the thorough summary discussion of Andropov’s analysis in pages 41 — 46 in Keeran and Kenny (2004).
p The Assassination of Konstantin Chernenko
p The Mafia had its candidate to be the new boss of the USSR. But first there was Konstantin Chernenko, a poorly educated and rather stupid person, to be gotten out of the way. Having acquired some considerable expertise in murdering a top Party leader without leaving obvious footprints the Russian Mafia saw to it that a man they could not stop becoming General Secretary, Konstantin Chernenko, also passed rather quickly (thirteen months, 1984-85). Getting rid of Chernenko was done so smoothly that it seems to me identical to the way the conspirators in the USA got rid of Bobby Kennedy after the sloppy mess in Dallas assassinating JFK.
Then the evil genius himself was in position to do the final job of liquidating socialism (Mikhail Gorbachev 1985-1990). After all a system that had withstood all of international capitalism’s plots so far (1917 — 1985) required that a coup de grace that could only be administered by the CPSU itself. At long last the Mafia had a Government as an equal partner as Hyman Roth (Meyer Lansky) would have said (Godfather 2)
p Last Man Standing: Gorbachev 1987-1991
p The final turn toward capitalist restoration began in January of 1987 and within four years it was completed. You should know by now if you have read this book as a cadre should be reading it, that this takeover of a Government, by a Mafia, is not a new thing in the 20th century. Capitalism had been saved in many countries precisely by the illegal section of the capitalist class taking command of the bourgeois cause at precisely the right moment to prevent the proletarian cause from succeeding.
Exactly this had happened in Spain as you should recall from Chapter 15. Exactly this had happened in China, as you should remember from Chapter 14. These are just two examples but they are examples which directly affected the proletarian global cause and were noteworthy herein for that reason. Exactly the same thing was now happening in the USSR. In each of these cases the specifics were different but in all these cases the underlying class realities were identical. In all cases the cause of the bourgeoisie was at a crossroads. Existing strategies of bourgeois leaders had left capitalism’s future in doubt. Only a dramatic takeover by competent (mafia) capitalists could save the day.
p The New Class in Jurassic Park: 1985-1991
p Now let us look at the statistics relevant to the emergence of the New Class in its new Tyrannosaur form under, Brezhnev, Chernenko and Gorbachev. Note that with the
p death of the chief reformer (Andropov) not everything went immediately straight to hell. I would take five years.
The institutionalization of study of the second economy was a continuing fact and one of its many forms was the Economic Research Institute of the USSR State Planning Commission. In her 1990 monograph “The Shadow Economy in the USSR”, a leading expert on the second economy Tatiana Koriagina, compared the total amounts of legal earned income to the total amount of money being expended (spent and/or saved.)
p
The Growth of the Monthly Salary of Workers Compared with the Growth of the Total Size of Money Spent on Goods and Services and Saved in the Savings Banks (S/S) in Billions of Rubles Monthly
p 1960 1970 1975 1980 1985 1988
p Salary 80.6 122 145.8 168.9 190.1 219.8
p % 1960 152 180 210 236 273
p Total S/S 103.2 223.2 329.9 464.6 590 718.4
p Overall Koriagina said that statistics for the entire economy showed that the second economy was growing at a much more rapid rate than the first economy, and faster than these selected area statistics indicated. The second economy had grown by a factor of 18 while the first economy had grown by only a factor of 4 or 5. The 1988 total of money spent and saved was nearly seven times greater than the total amount of money earned, in the first economy. How could that be?
p Obviously what Brezhnev had said “none of us live on wages alone” was true. That excessive amount spent and saved had come from the only place it could come from and that is the second economy: legal and increasingly illegal. Class power, and thus political power, was shifting dramatically. The question of legality was now an academic one. Clearly the present was full of danger for capitalist restoration. By 1985 only the most determined Party police and propaganda assault could have saved the USSR. Instead the Soviet Union got the great traitor Mikhail Gorbachev who enabled the New Class form of capitalism we witnessed emerge in 1990 and himself was followed by another traitor (Boris Yeltsin) who outlawed the Communist Party itself!
p “Taken together, a variety of monographs provided a kaleidoscopic view of the second economy during the Brezhnev years. Private food vendors sold goods valued at 35.5 billion rubles a year (21). Soviet barbers in state owned barbershops customarily collected “very high” tips “in effect transporting the transaction into the SE [second economy] (22). The home production of grape and fruit wine and beer, the illegal resale of state beverages, and the sale of stolen ethanol, accounted for as much as 2.2 percent of the Gross Domestic Product in 1979. (23) By the late 1970’s, the black market sale of gasoline by drivers of state-owned cars and trucks allegedly accounted for between 33 and 65 percent of all gasoline sales in urban areas (24). Privately rented housing brought illegal landlords an estimated 1.5 billion rubles in 1977 (25). Tips, bribes and payments for private services (such as religious ceremonies) associated with funerals involved more than four times the amount of money spent on official funerals. (26) Prostitution and illegal drug sales constituted another part of the second economy. (27)” (Keeran and Kenny, 2004:57)
429Part of the changing nature of the class structure was the concomitantly changing nature of technology and the social organizational system extant. Even the perhaps 30% (1989) percentage of the population with income derived primarily from the second economy still had first economy jobs. The rest of the population (70%) whose primary income was from the first economy still participated at one level or another in the second economy, if in no other way with what Western capitalist economists call “disposable income.” (Of course, many persons within that 70% also operated small second economy businesses from home.)
p Back to the Founding Fathers
In this sense the operation of the second economy brought ongoing stability to the Soviet Regime. As late as 1989 some 96% of the national population (the Party was constantly polling) were all in favor of the Soviet system. The most common comment being, to paraphrase, “what we have is the best system in the world despite all its problems and we could solve these if we went back to the founding fathers” (in this case meaning Lenin and Stalin.) Sound familiar?
p Seduction Enabled and Promoted
p The second economy had always provided those consumer items the first economy could not provide (given the Party’s emphasis on heavy industry, steel, aluminum, electricity, etc., and then on light industry devoted to increasing overall production — e.g., trucks and tractors.) Furthermore the increasingly prosperous Soviet
citizenry had more and more disposable income to get the second economy things it wanted. Why? Because the first economy guaranteed them a cradle-to-grave annual income, covered all medical and educational as well as communication and transportation expenses. What they had monthly was largely expendable (disposable) income! —And, as Gorbachev turned the press and media over to the most reactionary elements in the country the citizenry was being enticed with knowledge about consumer items many had never even heard of before. They had the money to get these things and anything one wanted could be obtained in the second economy after 1985, if not before.
p The Party Succumbs to Corruption
The statistics prove that the Party was inundated with every conceivable form of bribery, extortion, subornation, and as a result its high moral character was not only reduced but it was largely destroyed. “Believer’s” in the doctrine of Communism as developed by Karl Marx, Frederick Engels, V. I. Lenin, and Joseph Stalin were reduced to kids and Old Bolsheviks, much as Christianity had been reduced to children and old women in the cap countries. This affected the CPSU from the bottom to the very top as the corruption of General Secretary Brezhnev’s own family proved. Once the Party was thoroughly corrupted by the Tyrannosaur second economy it was only a hop skip and a jump until it could be used to pull the trigger in assassinating the Soviet Republic. That is exactly what happened in 1989-1990.
430p Coup de Grace
Finance is the gun in class politics. Politics is knowing when and how to pull the trigger. In the case of the assassination of Socialism in the USSR the financial (class) basis was the complete transformation of the Second Economy from an adjunct of the first into its driving component. The end of socialism (the first economy) was guaranteed when the now corrupt Party (CPSU) and its corrupted mode of production in the Soviet Union, as the gun, was placed in the hands of the “pistolero” Mikhail Gorbachev who fired the shots that did away with the last enemy Soviet capitalist mafia bosses confronted — i.e., the Soviet state and government itself. In so doing, Gorbachev did what Hitler had failed to do. In the meantime, for better or for worse, the lessons of the second economy and the traitors it spawned in and out of the Party, and how it and they succeeded in transforming socialism backwards into capitalism of an even more hellish form than had existed before Bolshevism would have to be learned elsewhere.
431p The International Learns from the Soviet Tragedy
p These lessons were not lost on the Chinese Party. In fact the Soviet collapse only confirmed the correctness of the policy of controlling capitalism which the CPC had adopted after the failure of Madame Mao and her group to get production moving in China once again. The CPC had embarked upon a totally new road with regard to how to deal with the second economy in its own country ten years before Gorbachev took power in March of 1985. What had happened in the USSR because of the failure to face up to the fact of a de facto capitalist growing sector of Soviet society was proof in the minds of the Chinese Party leaders that the road they had pioneered was the correct road. Rather, ironic in a way, that Lenin’s idea of protecting Socialism (i.e. the Soviet Republic and later Union) via a Chinese buffer had proven correct in the end — except that China had now become the homeland of the World Socialist Stage.
432p The Vietnamese, being as well led as they were, soon followed China’s lead. The Cuban’s in a much more dangerous geographical position vis a vis US imperialism had to take a slower road and only in 2011 did they make the big jump to the Chinese model and avoided the terrible mistakes in the Soviet Union by proceeding very carefully. Korea was stuck in an increasingly dangerous stagnation as its own internal structure delayed its transition to the Chinese model even longer than the Cubans but as of this writing they seem to be about to make that move.
To the Soviet Party, and to the International Communist Movement, Gorbachev’s March 1985 assumption of power as General Secretary gave the initial outward appearance of “everything is going to be alright after all.” How wrong that assumption turned out.
p The Trojan horse: Mikhail Gorbachev 1985-1986
p The Mafia had not assassinated Yuri Andropov and Konstantin Chernenko because they were playing a dangerous game of Russian roulette. Big time capitalists of the New York Five Family variety, which is exactly what we had at the top of the second economy by 1980 in the USSR, don’t take chances and act recklessly when their entire family structure and the class behind them, their lives and their way of making a living, are on the line. Furthermore, the Russian Mafia bosses were far better educated and thus made much more intelligent decisions than their Italian counterparts in New York had ever done. —And the Russian Mafia bosses had Ph.D. consigliore not trigger men as advisors and numbers one and two. No, the Russian bosses did what they did because they had a Trojan horse waiting in the wings. —And his name was Mikhail Gorbachev. The removal in rapid succession of these two General Secretaries (Andropov and Chernenko), after Nikita Khrushchev and Leonid Brezhnev had however unwittingly
433p cleared the way, by putting the First Economy into a tailspin of stagnation, and this was no accident. The Mafia high command (equivalent to the US national crime commission) was confident in their Trojan horse because they had had their man under their wing virtually all of his life. The only time Gorbachev was not physically under their direct influence was when he was in college in Moscow. They knew their man and he knew what he was to do.
p Mikhail Gorbachev was born in the year 1931, in a farming village named Privolnoye about 124 miles from the city of Stavropol, in the Stavropol Region of the Russian Soviet Socialist Republic. This part of the trans-caucuses was where so many Bolshevik leaders had begun their careers. The city of Stavropol was an early example of Soviet industrial success and wheat farming supplemented by sunflower cultivation was the agricultural mainstay. The Stavropol area had undergone collectivization along with the rest of the Soviet Union beginning in 1928, so that was the only social organizational form of agriculture Gorbachev had ever known. Gorbachev lived through the German occupation too young to participate in the war as a soldier (ten to fourteen years old) but not too young to observe all the suffering of his people and he witnessed directly or indirectly the deaths of at least seven of his relatives as the Germans raped the countryside and the city of Stavropol.
434p In 1950, five years after wars end, he graduated from High School, and a collective farm stint as a tractor station employee. He had earned the preparatory degree and as a consequence of his outstanding work running a combine in the fields he received the award of the Red Banner of Labor. With these recommendations in hand he was accepted into the Lomonosov State University in Moscow. At LSU he received his degree in Law but was never a practicing lawyer, and instead went into professional Party political work upon graduation. Working his way to the top he would become the first All-Union top Party boss (now called General Secretary) since Lenin (who had different titles but not General Secretary) with a college degree.
p Gorbachev’s Party career was centered for the 23 years after college graduation in Moscow, in Stavropol, where he obtained a second college degree (in agronomy) and specialized in leading the Party effort at mechanizing agriculture and developing the industrial infrastructure, building vacationing resorts, as well as overseeing many of the rest of the Government tasks of his Soviet Region. In 1970, at the age of 39, he was elevated to First Secretary of the Stavropol region which encompassed about 2.4 million people at that time. Simultaneously he was elected to the Supreme Soviet (the federal Congress). In 1971 Gorbachev was co-opted onto the Central Committee of the CPSU, a big step up for a 40 year old person. Seven years later (1978) he was appointed chief of the Agricultural Department of the Central Committee and had become a protÃÂÃÂÃÂÃÂÃÂÃÂÃÂégÃÂÃÂÃÂÃÂÃÂÃÂÃÂé of Yuri Andropov who was also originally from the Stavropol region. This latter relationship gave him the authenticity of having been directly mentored by the Old Bolshevik
435p generation even though he was of the “classless intelligentsia” New Class. In 1979 he was elevated to the Party’s highest authority, the Politburo. Within ten years he would oversee the dismantling of the Soviet Union and the outlawing of the CPSU. It all began along these lines in 1985 after as I say, the deaths in quick succession of Yuri Andropov and then Konstantin Chernenko.
p Nothing in Gorbachev’s public Party and Government career could have made his colleagues suspect disaffection from Marxism-Leninism or a tendency toward social democratic thinking. Nothing other than the fact he had traveled widely in Europe and was influenced by Czech and Italian Communist Party thinking. This experience was not uncommon trait among this new class generation of Bolshevik leaders. What he did have, which unappreciated until it was too late, was a lot of exposure to the second economy and its privileged de facto capitalist classes. This Stavropol part of the RSFSR second economy was bigger than the second economy was in any other part of the USSR with the exception of the Georgian Soviet Socialist Republic which the Stavropol Region bordered. Outwardly, Gorbachev gave every expected sign of being as orthodox as Andropov, and far more bureaucratically capable than hacks like Brezhnev and Chernenko.
436Upon taking the helm Gorbachev started out by referring to Andropov’s initial November 22, 1982 speech on the economic problems in the USSR, and apparently taking it as the keystone for his own administration. He gave the impression of wanting to begin again where his mentor had left off. Nothing could have been further from the truth as the disastrous next five years played out.
p External Causation (Conditioning Causality in Practice)
p Within the arena of international affairs at precisely the moment the Carter-Reagan offensive against the Socialist system was at its high point Gorbachev began making a series of concessions which only weakened the Soviet position. Under these two capitalist regimes the die-hard US ruling class strategy of rolling back Soviet socialism at any cost required a Stalin-like class struggle attitude — tit for tat — massive reinvestment in heavy industry and defense industry. Gorbachev did exactly the opposite. Let us look at what the capitalists did to subvert the Soviet Union.
p (1) As we will see in the chapters on US imperialism (23 through 28) the North American colossus had complete and total control over Saudi Arabia after World War II and this meant over most of the Arab World’s oil which also meant most of OPEC’s oil. Working with that tool in hand US imperialism drove down the world price of oil (being sure that the Saudi oil spigot was turned on at full production meaning low prices.) Overnight this cut Soviet foreign currency reserves by 50%. In hard dollar terms this meant that the 20+
p billion dollars in annual foreign currency accumulated in the USSR was reduced by 10 billion.
p (2) Simultaneously the US imperialists picked up the gauntlet against Poland (with the CIA AFL-CIO Solidarity front organization) and Afghanistan (creating the Al-Qaida Jihadist movement it directed against the most progressive government Afghanistan had ever had or would ever have for generations to come) which required another ten billion US dollars or so equivalent in rubles to be sent to both of these countries. Suddenly the USSR was back in pre-collectivization (pre-1928) levels of financial capability. (See Chapter 15)
p (3) Also, simultaneously, the US ruling trillionaire oligarchy continued its policy of making relative peace with the PRC as the price of breaking up socialist solidarity with the USSR on its eastern front. The Chinese had no objection to being left alone. Undoubtedly they saw the gringo approach as a temporary rapprochement in pursuit of the Rockefeller et al overarching objective which was their decision to first bring down the Socialist country most competitive with them for global domination (as it had been since the end of World War II effectively preventing gringo imperialism from achieving its principal international objective of total global hegemony.) So, while China was no military or financial threat to the revisionist leaders of the USSR it was of no assistance either. The imperialists had succeeded in dividing the socialist camp in half with the majority of its population (the Chinese) unengaged.
437p (4) During all of this the international communist movement not to mention the even broader international working class movement went into stagnation, confusion, misdirection, as years of revisionist control resulted in a Party membership uneducated, unknowledgeable, with dishonest leadership, self-interested pandering bureaucrats for leaders. (The CPUSA being an archetype example of all of this. The contending parties such as Progressive Labor and the RCP confused and uneducated also went immediately off onto the naïve ultra-left path which initially took Madame Mao as their leader. Everywhere else the communist movement splintered into multiple parties so that Italy with what had been the largest West European party split into three parties. Again and again world-wide the same was true.)
438p (5) Economic direct sabotage of the USSR’s industrial plant by the US imperialists went on with the long, intricate and stupid naivetÃÂÃÂÃÂÃÂÃÂÃÂÃÂé of the Soviet’s Gorbachev leadership.
p (i) US imperialists purposely sold defective computer chips to the Soviets to sabotage everything those chips were to be inserted into.
p (ii) Faulty industrial equipment was purposely created and shipped to the USSR as part of the gringo collaboration in “opening up” the Soviet Union via “trade.”
(iii) Sabotaged blueprints for gas turbines were created by the imperialists (using the CIA) and sold to the Russians.
p Primary (Internal Causation): Gorbachev Proves not to be
p What He Appeared To Be
p Gorbachev initiated a series of economic policies which quickly showed an antithetical approach to what had been outlined by the great theoretician Andropov. What he called restructuring (perestroika) took the factor of centralization as the key problem facing the Government and his programs began dismantling what was in fact the most successful part of the Soviet system. Using anti-corruption measures as a cover (and some of the initial assaults on Party and Government bosses were correct and had been initiated by the Cheka under Andropov) to dismantle key bureaucratic institutions such as the Ministry of Instruments (where Gorbachev fired 1000 technical workers), fired 50,000 industrial managers, fired one third (50+) of the first and regional and district secretaries, fired 14 of the 25 Central Committee department heads along with their staffs and often obliterated their functions. 40% of the USSR’s ambassadors were fired. Over half of the Politburo’s full and candidate members were dismissed. Gorbachev had both disarmed his opponents and dismantled the Party and Government structure in his first three months.
439Simultaneously, Gorbachev began to turn the media over to the worst enemies socialism could imagine within its own borders. Contrary to his history of ideological orthodoxy he now turned 180 degrees in the opposite direction. Everything was wrong here not the least being the almost overnight introduction of capitalist concepts of “the good life” which most Soviet citizens were only vaguely aware of. This precisely at the time that the US imperialists had stepped up the massive radio broadcasting into the USSR encouraging all sorts of sedition, spreading all sorts of envy creating jealousy about living standards. Then Gorbachev enabled the entire US radio propaganda campaign by stopping the jamming! Hitler in Moscow could not have been worse.
p Theory and Method I: Causality and Process
p It is time to review our theory and method. —And, in doing so we should always begin with dialectical materialist epistemology (the theory of knowledge of dialectical materialism) and the first principle therein is that primary causation must always be sought internally not externally. That is to say, for example, while an environmental change may trigger a specific event, the way in which the phenomenon involved
p subsequently evolves, (that is the locus of the primary causation) is determined first by whatever a phenomenon’s internal structure may be. Of course, the internal structure (and changes within it) may have triggered the event change in question; it is the internal structure of the phenomenon in question which determines how the processual interaction is going to play out. In other words, environmental causes (in this case the international social environment is as much of the environment as the Earthly natural environment) can only be secondarily or conditionally causal. In real world terms the reaction of hunting and gathering advanced palaeolithic Bands to the environmental change at the end of the Pleistocene was often migration during part or all of the year from the areas drying out (e.g., the Great Basin USA). The reaction to a heat wave of a modern capitalist society in the same area (e.g., Las Vegas, Nevada) is to turn on the air conditioning and continue as usual. It is critical for you cadre to first of all get this epistemological scaffolding in place so that your construction of the social process is itself correct. Unlike bourgeois historians and social scientists that have never started correctly you must always start correctly.
440p The next step is to get our general theory into the reconstruction. Our general theory is that of historical materialism. We know that humanity unlike previous biological forms adapts to its environment culturally. Culture being the buffer between biology and the environment. Here is where we depart from all the other (all incorrect) views of society and its culture and their history. Archaeology in particular and anthropology in general has proven that humanity has socially and biologically evolved through a series of cultural Stages. At the moment the globe is evolving from capitalism and transitional socialist Stages to the Stage of Communism. This is scientific fact written into stone as certain as Darwin’s proof that biological forms evolve as a consequence of natural (one form of which is sexual, another climatic) selection acting on variation within species. Variation itself established by errors (i.e., what we call mutations) in the replication of DNA which carry all hereditary data in all living things on Earth.
441p As I say in the case of human social and cultural (sociocultural) evolution the phenomenon being studied is culture. Culture is the totality of learned behavior which in its general manifestation is always structurally composed of (1) the mode of production and (2) its superstructure. In specific anthropological terms that means changes in the (1a) relationship between the forces and (1b) relations of production (i.e., technology and social organization) are always accompanied by an effected change in (2) the superstructure (i.e., ideology) and/or vice versa. That is what culture is. It is the evolution of culture and not the evolution of genetic biology which defines humans and their development. Biology in humans is the hardware and culture is the software. Over the course of many millions of years the latter changed the former so that our species has evolved through three distinct biological (species) stages — we reviewed these in the first few chapters of this Handbook. But through all of these biological forms from Homo
442Australopithecus through Homo erectus and finally to our current Homo sapiens culture has evolved just as certainly through its own distinct stages and according to its own internal laws of causality and process. This is basic Marxism but one can never get too basic in science to remind us to review the elementary building blocks of our science. This is especially true when we are trying to reconstruct sociocultural evolution in process as we are when we examine the events of the last two decades in the evolution of the transitional stages of Socialism.
p Application
p As I say the foregoing is elementary Marxism, and it is all the more important at this point, because to understand the collapse what happened in the USSR and its East European dependencies (People’s Democracies) established in Joseph Stalin’s cookie-cutter way (Chapter 13), we don’t want to be all over the page. We must begin not by looking to external (environmental factors such as US led capitalist aggression against the USSR, that can only be conditionally causal epistemologically), as important as they were, but instead we must look first to internal factors. We must analyze the collapse process first at the general level of the evolution of the three components of culture (technology and social organization and ideology) —And then we must have a specific theory of collapse. That must be a theory based on class analysis. Why class analysis? Because we know from our general theory that in the Servitude Epoch it is class struggle which is the primary internal source of causation (the prime mover; the primary cause; the internal essence of the mode of production; the originator of the superstructure (ideology) extant.) It was the growth of the second economy and the capitalist classes behind it which doomed the USSR.
443p In other words, in this case it was the Soviet Union’s primary internal structure of class division — the third stage New Class itself — which was the prime mover — that is, the locus of primary causality. The first source of failure to prevent socialist collapse was in failing to admit that the Soviet Republic (and from 1924 forward the Soviet Union) always had an internal class structure. The final source of failure to prevent socialist collapse was in always failing in this regard and its counterpoint which was the false assertion (when it was made) that classes and class struggle in the USSR had ceased to exist — whereas in reality class division evolved and deepened throughout the history of the Soviet Union.
p We can divide the history of that class struggle into two parts. —And, in fact, we have reviewed the emerging Soviet Union in historical terms sufficient for the task at hand in chapters 13 through16. Chapter 17 prepared us for this discussion by taking us through the Post-World War II years of USA/USSR jockeying for global supremacy
(capitalist/Stalinist socialist jockeying) and in chapters 23 through 28 below you can follows the details of the evolution of class struggle within the USA itself. For now I shall summarize the outlines of the evolution of the class struggle within the Soviet Union.
p The First 36 Years of Soviet Power (1917 — 1953)
p The Mode of Production (Technology and Social Organization)
p To begin with, in the history of the mode of production in the Soviet system you will recall that the Bolshevik Revolution was a proletarian revolution in intent (and led by the proletarian Party) but in practice as Lenin pointed out all along, our revolution was a bourgeois revolution of the farming masses at the beginning. He means that the farmers being petty bourgeois (small capitalist farmers) in the main and all bourgeois, if we include the large capitalist farmers (middle and big), then the agrarian bourgeoisie were the bulk of Bolshevik support at the beginning and this made it a bourgeois revolution. It is for this reason the Bolsheviks were successful as Lenin points out (that is the Bolsheviks marched in Lenin’s words with the mass of the Russian population). The Revolution liquidated the Feudal Parasite nobility and city magnate land-owners, and in the aftermath of Bolshevik seizure when state power was in our hands we saw the liquidation of the Rich capitalist farmers. This left by 1922 only small and very small capitalist farmers.
444p To continue with the agricultural setting, we had a situation in 1922 in which 90% or more of the Soviet population existed in capitalist agriculture; some of the middle farmers became rich farmers once more, and as we saw they were given their old name of Kulaks (Fists). These kulaks were liquidated as a class beginning in 1928 in that as a class they were rounded-up and sent to Soviet Central Asia or Siberia to begin again as common farmers and not allowed to return for five years. If and when they and/or their offspring did come back they were specifically excluded from participating in the collective farms and this meant after 1928 excluded from farming. Upon return they would have to find another way of earning a living which under Bolshevik economics meant the Government would have to find some non-farming place for them to work or get a higher education. Otherwise they might as well stay where they had taken new roots.
445p Simultaneously, within the urban population there were the true proletarians, now employed by the Government, and we reviewed the growth of NEP and its subsequent transformation into all Government enterprises under the Five Year Plans in Chapter 15. However, simultaneous to this growing urban proletarianization via Government
p employment in all key industries of the first economy, there was also a growing urban second economy.
p The latter began as largely a black market economy under War Communism. Then huge sections of the second economy became legal under NEP. At the same time as (a) a legal second economy capitalism was allowed and in fact encouraged to thrive there was a (b) necessary second economy in the shadows. However, the line between the two was rather arbitrary in that they both handled all forms of small exchange that backward Soviet Russia and associated Soviet Republics could not possibly handle as part of the First economy. For that reason this (b) second economy shadow portion was allowed to exist by the Party and its Government and State (police).
p In the 1920’s there was warfare between the old bourgeois specialist managers and the new Old Bolshevik wannabe managers that was finally resolved in favor of the latter by the edition of millions of new college and technical school graduates absorbed into the managerial “classless intelligentsia” New Class. This swamped out the old bourgeois specialists and created a vested interest New Class in the Soviet System that initially made the system very stable. Simultaneously, however, there was this growing shadow second economy class with a distinct traditional petty bourgeois mentality (exactly as characterizes the petty bourgeoisie in capitalist countries).
The growth of this petty bourgeois shadow second economy class was kept in check by (1) the Stalinist police and by (2) the reality that there was very little disposable income available to the working stiffs and their managers in the first economy. Without money to spend on things in the shadow economy, that economy was very restricted in size and scope, by objective financial reality, in a way analogous to the way a “governor” restricts rotation in machinery. Scarcity acted as a sociocultural economic “governor” under Stalinist socialism.
p The Superstructure and the Ideological Class War
p But throughout all of this Soviet history there were distinct social classes because there were distinct differences whole classes of people had in their relationship to the means of production and the subsequent articles of production in distribution. The class war is always fought out in the ideological arena as fiercely if not more so than in the industrial arena. In the Soviet Union the first feature of the ideological class war was that the Party constantly exhorted the nation toward classless society. Sometimes the overzealous Party intellectuals insisted that the Soviet Union’s legal structure had actually eliminated classes, and to the degree this latter absurdity was actually believed, this was self-delusion of the worst type and certainly not Marxist nor Leninist. This is the
446p origin of the denial of classes and class struggle which would eventually be the death knell tolling of the bell for the Soviet system.
p The reason for this fatal attraction to the line that “the ideal” was “the objective reality” goes back to the beginning of Bolshevik power. Regardless of its utility at the beginning it became the drug of wishful thinking. A drug that surely as morphine can go from a wonderful pain reliever in an emergency to a lethal addiction. An ideological drug that dulled our Party’s senses to what an objective observer from another planet might have considered an obvious path to self-destruction.
p Why? What do I mean by that? How mechanically did it actually come to pass?
p In the beginning (after October 24-26 1917) there was little the Bolshevik Party could do beyond keeping campaign promises about land to the farmers and abolishing ranks in the Army, except cosmetic things. For example names were changed of just about everything. Ministries became Commissariats. Officer ranks were democratized in title — meaning rank names such as the traditional lieutenant, captain, major, lieutenant colonel, colonel, brigadier, major general, general etc. became platoon commander, company commander, battalion commander, regimental commander, divisional commander, army commander and so forth. This was a democratization of titles from individual ranks which carried in Czarist times many social privileges to descriptive job titles. Capitalist press slogans were proletarianized. But cosmetic changes were about all a working class government could do if the objective reality of a highly industrialized capitalist substrate with the corresponding mass proletarian population did not exist. Art form over substantive reality was the core of the ideological war and conducted by Bolshevik propaganda.
447p You may recall that from Day One of Soviet Power Petrograd State Radio was broadcasting 24 hours a day the new laws and declarations of the Soviet Government. Yet, even the radio producers looked at the entire edifice they were constructing over the radio as a “model to be copied by a successful worker’s state in the future.” In other words, they did not expect they would be able to hold onto state power. They thought of themselves as latter day (Paris) communards leaving behind a much more advanced model of what a worker’s government would be like than the one left behind by the Paris Commune after its liquidation.
p Everywhere the ideal was propagandized throughout 1918 as the civil war raged. That propaganda was very visible in the form of art and graffiti which the Party managed to put everywhere by mobilizing the art communities of the country and wannabe artists from the youth of the Republic. Red flags decorated everything from government buildings to railroad trains as often did portraits of the Revolution’s leaders.
p But, as far as serious social change was concerned there was not that much that could be done beyond propagandizing the ideal. Consequently as Marx speaks of in Chapter One of Volume One of Capital, in Servitude systems such as capitalism “the material relations among people appear as social relations between things.” In the transitional period under Bolshevism what happened occurred in the most common delusional way. In other words, the desired material relations among people were pictured in the apparent social relations between artistic things. Propaganda substituted for reality. Not in all minds of course but in too many of them.
p Throughout the nation the ideal was propagandized, as it should have been and had to be for the Party to hold power based on its moral high ground. But the objective reality behind the ideal was much different.
p Note: We want to recognize that the nation changed rather quickly from a geographically small Republic about the size of the original Russ (landed estates of a feudal oligarchy of Lords and Ladies within a few hundred miles of a center which became Moscow) to the entire breadth and scope of the Czarist Empire. The Bolsheviks destroyed and dismantled the latter and we now reassembled it in our own image. All of that within about seven years (1917 through 1924).
p War Communism created a few model communities in the territory under Soviet power but they did not amount to much more that Owenite social communities such as had emerged during the 1800’s in the USA. They were not much different than 20th century hippie communes. The mass of the population, albeit the subject of a constant literacy campaign that was quite effective, still plowed the land with wooden implements behind oxen, horses and people and lived in a not much more advanced way than a Neolithic community of 10,000 years earlier. Yes the landlords were gone but beyond that not much had changed except for the constant propaganda urging the masses toward the socialist ideal. Only after the collectivization and five year plans got under way in August 1928 did anything resembling a future socialist society begin to form on the land.
448p In the cities while workers now owned the factories small exchange continued in exactly the same fashion as before (except that petty bourgeois activity was now largely illegal and thus part of a second, officially unrecognized but very real economy). The Government now owned all the stores where people could legally buy things, if they had the money or the ration coupons, but these stores were terribly inadequate in that they never had enough of anything, both under NEP and under the Five Year Plans (if for different reasons).
p The schools made the most determined departure from capitalist culture as did the arts (which now included motion pictures — Lenin described movies as the greatest art form in human history.) This was true because it was here the Party could actually do
p some very material things in terms of instruction, textbooks, audio-visual aids, literary works, posters and movie making.
p The point you 21st century cadre want to take from this exposition is that the ideal was so sought after by the Party that its honest members tended to delude themselves into thinking that the ideal was the reality. Much the same as honest church going Christians may delude themselves into thinking that the ideal they ascribe to Biblical teachings is in fact the way in which people in their community relate to one another. Cynical members of the community however notice that no matter what the petty bourgeoisie says on Sundays their day to day business Monday through Saturday features the exploitation of man by man, the lowest forms of chiseling out a penny or a kopeck, and is the mirror opposite of Sunday school fairy-tales. The Eagle Scouts, Hardy Boys and Nancy Drew, meet the Bloods and Crips.
449p Certainly Karl Marx and Frederick Engels took this as their starting point and it is for this reason they concluded that as long as mankind lived in a system of Servitude relations (slavery, feudalism and capitalism) that freedom was impossible except for the very few at the top of the heap. That is why they referred to all previous forms of society as comprising The Era of Necessity. The great promise of the last stage of the Servitude Epoch (capitalism) was that it unleashed truly great productive powers. So great that people could imagine a day when their technology would have advanced to the point where all things could be provided to all citizens according to their needs regardless of their ability to make a contribution. But mankind could not advance to the next stage (modern communism) without this technological foundation of capitalism having been passed on. Once it existed then and only then would it be possible to restore the ancient order of primitive communism in social life (true egalitarianism) — this time on the advanced technological mode of production created in the Servitude Epoch and especially in the final stage of that epoch — i.e., capitalism. Then it would be possible for humanity to enter The Era of Freedom.
450p This keystone scientific discovery is the first great discovery Marx and Engels made — it is the entire basis of what we call historical materialism — and it is the recognition of this truth which separates us from all other social thinkers (all of whom take one or another incorrect departure when they fail to begin from this fundamental and elementary scientific truth.) No real Marxists have ever disagreed with this fundamental discovery, although many have tried to make up for the lack of technological preparation in some social organizational way. For example all of us Bolsheviks tried to make up for the lack of technological preparation in Russia and its associated Soviet Republics and in Red China with proletarian dictatorship via our Party and its State (police and army) while we proceeded to build the industrial foundations we should have inherited, if we had moved lock step from advanced mature capitalism into socialism, via the use of state power (police and army) to enforce our will. We did not inherit what we needed
451p anywhere and to this day we have not yet inherited what we need from capitalism. Everywhere we have seized state power the industrial and mechanized agricultural infrastructure has been far from adequate — in fact desperately primitive. This is why we have always said that one cannot build communism without having first on hand (or at least well on its way to completion) the industrial and mechanized agricultural advanced mode of production built in the capitalist stage (or in practice built by us under the Party’s dictatorship over society in a transitional “socialist” stage.) This is elementary Marxism that cannot be avoided or evaded and which must be taken as the starting point in any serious discussion of building communism.
The Soviet Union did not have this in its first 36 years. Rather for us under Soviet power it was a constant struggle to get the minimal technological preparation on hand to allow our armed forces to conduct successful wars of defense and offense, (e.g., concluding the First World War; the civil war in the Czarist Empire; wars of jockeying for position between 1922 and 1941 such as that in Spain and China; the Second World War; the continuing war with the capitalist world under US hegemony after 1945). When Joseph Stalin died the Socialist World Camp was completing its first transitional Stage. That is, the stage of Stalinist Socialism which as we have seen is a transitional stage. Specifically a transitional stage between the Servitude Epoch and modern communism equivalent to the Stage of Simple Chiefdoms in the transition from primitive communism to the Servitude Epoch.
452p The Second 36 Years of Soviet Power (1953 — 1989)
p The Mode of Production (Technology and Social Organization)
p The death of Joseph Stalin marks the approximate beginning of the end of the first transitional period between the Servitude Epoch and modern communism (at least one more distinct sociocultural stage would yet be required.) It also signaled the end of Leninist-Stalinist Old Bolshevism. The actors were old and dying. And along with the end of this stage (or at least of the initial phase of this first transitional stage) also came an end to the second economy in its initial shadow phase.
p Coming out of the shadows, the second economy now began to grow and in the succeeding three plus decades it grew and grew and with it so did a New Class with a distinct petty bourgeois mentality. This New Class growth of a petty bourgeoisie engaged in the same kind of petty bourgeois activity it engages in in capitalist countries, also occurred alongside the evolution of the Stalinist “Classless Intelligentsia” New Class. The latter having been purposefully created by the Party to fulfill the necessary management functions inherent in having to do what we had expected (in theory) to inherit from capitalism. This “classless intelligentsia” New Class continued to evolve in
p the second 36 years of Soviet power from its primordial form of minimal privilege in the first economy, to join with and intermarry with the true petty bourgeois second economy class (and their adjunct utility in handling the multitude of small exchange needs of the first economy workers and their managers could not handle or had not handled) into something quite different. That is a third stage New Class.
p This newly emerging Third Stage New Class was comprised of the First Economy classless intelligentsia and the simultaneously growing shadow new class of petty bourgeoisie. In the process the newly emerging far richer petty bourgeois components (and now often middle and big bourgeois) second economy principle earners began to emerge as the dominant partners because they had most of the money.
There is a rapidly growing academic literature on this entire phenomenon and Keeran and Kenny have done an excellent job in citing that literature which is why I have recommended their book (Socialism Betrayed, Behind the Collapse of the Soviet Union) to you as your next essential reading on the New Class after Stalin. This will help you cadre learn how the second economy and the class behind it managed to change both the mode of production and the ideology arising away from a socialist and into a capitalist direction.
p Notes for the Less than Naïve Working Class Leaders in North America
p I have not mentioned in this section the role of organized crime in the capitalist countries in staging similar coups in the latter part of the 20th century, and in a book of this nature I shall not except to say that the less naïve among you should already have taken note of the FBI-Mafia combine that formed under Jane Edgar Hoover and Meyer Lansky. I have discussed this in Volume One of this series and I refer you to that book The Buccaneer. The assassinations of JFK, RFK, MLK in the early to middle 1960’s should appear to even the most naïve among you as suspicious and to those of us who have spent a lifetime in the secret world are dammingly obvious. Many observers believe that the latter were a de facto coup d etat. Only the complete and total failure of gringo imperialism’s attempt to subdue Vietnam led to an unraveling of the whole thing.
453p You should also reflect upon the fact that Richard M. Nixon’s assent to power was organized crime’s idea and the only real way to carry on the Vietnam War given the failure of their boy LBJ to do it his way. The removal of Nixon over Watergate was not because of two cub reporters from the Washington Post, as admirable as their muckraking turned out, but because the ruling oligarchy had lost control of their man. When they decided to chuck the war after the Tet Offensive they ran into opposition from the very criminal Lansky gang that had pushed it and still hoped to regain everything they had lost in Cuba and elsewhere, and now much more than that. Meyers’s men were men who did
p not see the setback in Vietnam as anything more dangerous than the military fool Westmoreland believed it to be (who still believes he won the Tet battles and would have won the war had he been allowed to do so.) An epoch struggle for control of the US government got underway and involved now far more than Cuban rub joints. By now it involved the entire military-industrial war profiteering complex which had become the very center of US capitalist profit making. What came out of Watergate was a strategic realignment within the US ruling class with the Mafia in a distinctly second place and a wiser if somewhat chagrined Rockefeller-Mellon-Morgan-DuPont leadership determined to keep them “always second to us, if we allow them to continue to exist at all.”
454I mention the USA because this is a book for North American cadre. But similar things happened subsequently throughout the capitalist world of West Europe and Asia (Japan, Korea, Indonesia, and the Philippines.) When the time came to stage what in earlier decades would have been a Mafia type operation over 9/11 the gringo oligarchy no longer needed the Mafia. The Bush gang had proved they could handle it, and in the event they did an acceptable job of pulling it off. (Albeit many questions have been and are being asked but if they could get away with the Dallas assassination more or less than they could get away with just about anything.-And, they have, over 9/11, at least so far.)
p My Experience with the Russian Mafia
p Furthermore, the gringo oligarchs had handled the USSR via support to the Russian Mafia, who they gave complete access to the USA, beginning with the acceptance of the Russian’s running-at-large members into the States and resettling them in appropriate parts of New York, New Jersey and associated postage-stamp states of New England and especially in the West Hollywood-Encino locale in Los Angeles. When they got too far out of line in southern California a few federal court cases, such as the Smushkevich-Jovavich medical fraud case below and then the gasoline tax cases got the Russian mafia in the USA back into line (refocusing them in the 1990’s on petty fraud and large scale subprime mortgage fraud).
p In April of 1990 I met Michael Smushkevich in MDC LA (Metropolitan Detention Center, Los Angeles) where I was being held on a phony Federal securities case (SEC and Postal Inspectors) against me and Jason Smith Petroleum Corporation, filed for political reasons. On May 14, I scored a rare and substantial personal victory in court over my enemies and was on the way out the door when I agreed to help Smushkevich in his medical fraud case. For the next year and a half I designed and carried out the private investigation arm of the defense of both Smushkevich and his partner Bogie Jovavich from my home in Huntington Harbour.
p You will notice that this was occurring during the very end of the Soviet period so I had a good chance to observe the Russian Mafia (which was almost exclusively Russian Jewish mafia) during this period in Los Angeles and across the USA and in the process to tangentially view their operations in the disintegrating Soviet camp and across Europe. This is far beyond the scope of a Handbook for young communist cadre but it has given me a rather unique, among communists, insight into the issues herein (especially in this Chapter.)
p The Russian Mafia sabotages Chernobyl, 1986
p On April 26, 1986, the Russian mafia hacked into the computer system at Chernobyl and overrode (shut down) the “fail-safe” protocols. They then sent the electronic computer orders to do a series of things to the reactor core which led to its meltdown and the subsequent first true world nuclear disaster (if we exclude Three Mile Island.)
p What was the purpose? Well it wasn’t just to get their hands on incredibly valuable land in the vicinity, which they did. No, the real purpose was to strike a fatal blow at the confidence of the Soviet people in their government. Because, people of all walks of life and of both the first and second economy had always concluded, at the end of the day, that “what we have is better than anywhere else in the world”. Sound familiar? —And, as aware as they were of all of the failings of modern revisionism which had made Soviet socialism simply a farcical caricature of true socialism (in anyone’s book) it was at least a government which had won World War II, defeated all of the Soviet Union’s enemies and established the most progressive welfare state in the world (and in world history.) The failure at Chernobyl was designed to inflict, as I say, a final fatal blow to that confidence. It worked.
455Finally, the Chernobyl disaster cost the USSR 18 billion rubles at a time its economy was already reeling because of Gorbachev’s financial sabotage of the first economy. It was a knock-out punch following the hard left to Soviet confidence.
p It didn’t work out so well for the mafia in Los Angeles
p Note: That the Smushkevich-Jovavich case would have concluded successfully for them in its first phase had Michael Smushkevich not lost his nerve and plead guilty. Worse, he and the Feds hammered Jovavich into doing the same thing. Within days both of them tried to withdraw the plea. I knew the Judge (Hatter) in this case and knew he never would agree to that and he did not.
p These gentlemen had experience in ripping-off the Soviet and East European governments which were much more difficult to handle than the US Feds. They had a series of the most modern medical clinics in the entire USA and they used them to run scans of roughly $10,000 on every patient who entered, with insurance, for any ailment (such as a common cold.) They fed an incredible number of people in southern California into these clinics and actually did perform the services. The feed done by telemarketing.
p My defense was designed on the principle that this is exactly what was done routinely for wealthy people in the USA but when it came to common every day folk the government was not interested. This would have been a winning combination in court. What jury (properly selected) would say that what was good for the rich was not good for the middle class? Defense counsel would tell the jury if you want your health care needs determined by the Post Office why don’t you just go straight down there the next time you are sick? (The postal inspectors were the cops in this US Attorney for LA’s case).
p The case came to the Feds attention when large numbers of persons on the lifetime public teat (e.g., military families from Los Angeles to San Diego) who have insurance provided by a Government insurance company swamped that company with claims. By the time the US Attorney’s office for LA pulled off a TV designed spectacular arrest sealing off Smushkevich’s home with troops, SWAT, helicopters and TV cameras, and the US Attorney got on TV claiming a $1,000,000,000 (one billion dollar) medical fraud case which he said was the biggest in history (you know how they stage these so-called news conferences, like a James Bond Hollywood premier for their own political purposes) the two defendants had collected about $70,000,000 (seventy million dollars) of a billing substantially larger.
456p Cutting to the chase, in the end Smushkevich turned rat on his partners in the US and Russia (and Lithuania and others in Europe — it was from a Lithuanian bank I got my money in the years I worked for him by wire transfer.) He got out. His partner had too much self-respect and would still be inside except for his daughter (the actress Mila Jovavich) who made a lot of money with Bruce Willis (the movie Fifth Element) and spent a million of it at the 9th circuit to get her father a new trial. The Feds had lost interest by that time and accepted the inevitable so Bogie got to enter a plea to a lesser charge (rather than put himself and the Feds to the trouble of a second trial) and got “time served” (about 7 years) as his sentence. Today he lives happily at a location I will not divulge.
457So the world turns. With one final comment. These Russian Mafioso’s are very well educated and much smarter than any other mafia in the world with who I have had experience. They make the Italians look like a sorry joke when it comes to organized crime. The world has not seen the last of them yet and will not for a long time to come.
p The Russian Mafia Shakes Down Thatcher and Reagan for 20 Billion Cash
p But it was Reagan’s successful backing of the Russian Mafia ploy via his pressuring of Soviet finances and financing Gorbachev’s (Russian Mafia) demand for a 20 billion dollar cash payment (made to Margaret Thatcher by the Trojan Horse himself on his December 1984 visit to London) which was not just the final victory for the Russian mafia but the real proof that Reagan and his road (more appropriately the Rockefeller management team’s road) which cinched the new gangland bosses reign (that is the US military-industrial henchman both official and mercenary reign) which did in the US mafia as far as ever taking a leadership position in the North American system ever again (at least within the foreseeable future of one or two generations.)
p Within hours of Gorbachev’s exit from London in December 1984 Thatcher was on a top secret flight to Washington. In Washington she flew immediately to Camp David and was closeted with Ronald Reagan the entire time. She returned to London immediately and the trip was not disclosed to the press for some rather long time. Even today in every biography in the US cap press of Gorbachev I have seen this Thatcher flight is ignored (and in fact in the US cap press in general — for what should be obvious reasons). However, in her autobiography (The Downing Street Years, Mrs. Thatcher admits to the trip and says she wanted to talk to Reagan right away about what Gorbachev had to say about SDI.) Why would “Star Wars” suddenly be of such importance to the Prime Minister of the United Kingdom to jump on a jet fly immediately to Washington? It doesn’t make sense.
458p What was all this about?
p At the time I learned of the visit almost immediately but did not attach the significance to it I should have. It was obvious that she had come to tell Reagan something that could not be communicated in any other way and that it had to be something that came out of her visit with Gorbachev who was angling to be the next General Secretary.
p We could not have known over here that the Russian Mafia was planning an actual takeover of the Soviet Union and that Gorbachev was their stalking “Trojan” horse. (In her book Mrs. Thatcher says she knew she was the stalking horse for Gorbachev’s upcoming visit with Ronald Reagan.) As the years passed it became common knowledge in secret intelligence circles in the Socialist countries, and then even in the always intelligence challenged gringo NSC, that Gorbachev had told Thatcher he needed 20 billion in cash (a slush fund) at his disposal if his campaign to overturn Soviet socialism were to be guaranteed success.
p Thatcher didn’t have the money but she knew where to get it. Thus, the flight to see Ronald Reagan.
p Republicans had a lot of experience with secret slush funds by this time. The discovery of the most famous of these in 1952 had nearly resulted in the removal of Richard M. Nixon on the Republican ticket with Dwight D. Eisenhower. Ike gave Nixon a chance to save himself by throwing the decision to the Republican National Committee and Nixon pulled his own rabbit out of a hat with his famous “Checkers” speech. My own parents were Republican politicians and were so taken in that they sent a telegram to the RNC asking that Nixon be kept on the ticket. (Dad later changed his mind when Nixon snubbed him at the Boise airport but that is another story.) Nixon was brought down because of his secret slush fund during the Watergate affair.
Now let us return to the USSR and the victory of the Russian Mafia led takeover of the old Soviet Union.
p The Superstructure: The Ideological Arena
p Gorbachev’s Sebastopol background had placed him for over two decades in the midst of the strongest second economy sector in the entire nation. Consequently, his career had been amongst the intellectuals least attracted to Marxism and having the strongest petty bourgeois and fully bourgeois orientation in the entire USSR. This was reflected within the first three months of his administration by the appointment of openly anti-Marxist advisors in the ideological arena such as Alexander Tsipko and openly pro-capitalist intellectuals in the economic arena with their ideological tracts now being circulated such as Tatiana Azslavskaya and Abel Aganbegyan. Right off the bat Gorbachev began to speak openly in praise of Georgian revisionist leader Edward Shevardnadze which had a second economy second only to the one in Sevastopol.
459p Rather than encouraging internal Party dissent aimed at strengthening the Party and the Government’s most important ideological institutions Gorbachev began advocating that anti-Party (outside the Party) voices be given equal play in the press. He encouraged writers to become what he called the “loyal opposition” to CPSU policies and programs. He began changing the definition of the term “restructuring” (perestroika) and “openness” (glasnost) from the definitions provided by their originator (General Secretary Andropov) with his own definitions which in every case were aimed at enabling outside the Party, anti-communist, voices. Gorbachev by the second year of his administration had placed all of the media in the hands of anti-communists.
p The most dangerous sign for loyal communists should have been read in the appointment of a de facto anti-communist as head of the Party’s propaganda and agitation
work (the Central Committee’s Agitation and Propaganda Department) in the person of Alexander Yakovlev. Yakovlev became Gorbachev’s chief consigliore and henchman in the destruction of the Soviet Party and its Government and State.
p Coup de Grace Part 2: January 1987 — June 1988
Resistance within the Party to the course being followed by Gorbachev and his gang was rising at every level. There was no way out for them now except to go all out in restoring the capitalist world system in the USSR and in the eighteen months beginning with the Full Central Committee meeting at the beginning (January) of 1987 they laid our an entirely counter-revolutionary course they called “radical reform of the political economy of the USSR.” This amounted to an all-out attack on the leading role of the CPSU, called for an end to central planning, indeed to all government planning, abolition of the role of public property, and transferring ownership of public institutions to private hands, and an end to the federal relationship between the Republics.
p Modern Revisionism Enabled Capitalist Restoration
p One wonders perhaps in retrospect why the Party didn’t stand up and throw out the traitors then and there. How could any real Marxist let alone Leninist go along with all of this obvious counter-revolutionary nonsense? The answer is that modern revisionism had paved the way by negating all of the basic Marxist and Leninist laws and had done so for more than 35 years. Everything that Mao Zedong and the Chinese Communist leadership had denounced as the ultimate reality and course being followed by the Khrushchev gang in the years from 1958 forward had come to pass. But, to two generations of persons subjected to the constant revision of the findings of our science these steps of Gorbachev and Gang did not seem as obviously wrong as they do to us in retrospect. In short, modern revisionism enabled capitalist restoration and with or without a second economy the capitalist world order would never have finalized its comeback in the USSR and for that matter would never have gotten off the ground in the first place if it had not been for the successful implanting of clearly stupid revisionist hypothesis as accepted fact. Thus modern revisionism exposed itself as the gravediggers of transitional socialism of the type we have identified as the Stalinist Socialist Stage in the USSR and its East European dependencies.
460p Nowhere else in the Socialist Camp had the modern revisionists been successful albeit not for the lack of trying. In China, Chairman Mao and successors had succeeded in derailing the same attempts via (1) the Cultural Revolution and later (2) in liquidated the petty bourgeois uprising in Tiananmen Square. But it would take years for the CPC to
see if one could control the second economy in the PRC. In the end, so far, it has worked out; namely by fessing up to the reality of “Two Systems, One Country” as a necessary starting point. This same step could have saved the Soviet Union had it been invented there, and given time to work, but steps in that direction had been cut short by the Russian mafia takeover of the Soviet Union under Gorbachev.
p Naive and Theoretically Anesthetized the USSR Succumbs to Two Faces
p Back at the ranch although the Trojan horse was advocating obvious anti-Leninist principles he spoke as if he were a Communist and as if he were trying to advance the cause of Socialism. The Gorbachev leadership would have been sacked in these years instantly had they exposed themselves as anti-Communists bent on destroying Socialism. That is if they had used these words. But Gorbachev and gang had learned under the tutelage of Khrushchev and Brezhnev that as long as one mouthed Marxism and Leninism in words one could get away with fooling some of the people all of the time and all of the people some of the time — that was good enough. Gorbachev proved to be the master of deceit in the way of being what is called the Janus (two faced) pose in Greek mythology. George Orwell would have been proud, as day was pronounced night, right was called wrong, good was actually evil, capitalism was actually socialism, bourgeois dictatorship was freedom.
461p With a massive second economy now under Mafia leadership as the mass base for this new version of what had gone before, with the press in anti-communist hands, with the government having been brigandized and replaced by the brigands, it was now only a matter of time.
Catholic Popes long ago learned that as long as they went through the rituals of Catholic mysticism and the verbiage of Christianity that they could get away with just about anything in the lands where they had police and military power and this is identical to what the modern revisionists had done in the USSR. Party members responded to the symbolism of Soviet power and not the reality of theoretical statements and practical measures. End of Story.
p Troy Victorious
p Collapse: June 1988 to November 1, 1991
p The depressing details of how the collapse of the Soviet Union played out in the three years from June of 88 through November 1, 1991, when the Gorbachev-Yeltsin gang finally outlawed the CPSU and fully restored the capitalist world system are beyond
the scope of this Handbook. However, we shall review a few of the highlights. Next in your reading on this subject should be some of the accounts by our own writers of what in fact did play out. Chief among these studies is Socialism Betrayed, Behind the Collapse of the Soviet Union, Roger Keeran and Thomas Kenny, 2004, International Publishers, New York, 230pp.
p The Sorcerer’s Apprentice
p Gorbachev embarked in 1987 on a series of incredibly destructive adventures. Each of them ended in disaster and instead of taking responsibility Gorbachev declared that the disaster was actually a great victory. Gorbachev began to resemble Walt Disney’s Sorcerer’s Apprentice as his sweeping broom created more and more messes until it overwhelmed his Fantasia. Among these incredible measures were:
p (1) Beginning January 1, 1987 the Gorbachev gang began dismantling the Nomenklatura system (Where the Party center in Moscow assembles lists of persons to be promoted in a way similar to the way US military officer lists are assembled in the Pentagon at Bupers etc.)
p (2) December 1987 — Gorbachev deals fatal sabotage to the public First economy by slashing Government orders to factories by 50%. This threw half of all the USSR’s industrial base onto the mercy of the private (second) economy. It prepared the practical economic way to make the second economy a part of the first economy.
p (3) June 1988 - The 19th Party Conference Gorbachev succeeded in getting the Conference to order the separation of Party, State and Government thus sabotaging Lenin’s entire system of governing.
p (4) September of 1988 - Gorbachev dismantles the entire central Governing apparatus by abolishing 1064 All Union Departments, 465 divisions within the Union Republics, wiping out 44% of Party, Government and State departments at the Federal and Republic levels.
p (5) October of 1988 Capitalism was legalized as a First Economy the with a series of laws about private enterprises in the form of cooperatives as a cover for the private leasing of what had been public property.
p (6) Gorbachev simultaneously began a series of betrayals of the international communist movement, as in Afghanistan, and then the betrayal of national liberation movements as in Namibia. The details of these betrayals are beyond the scope of this Handbook but you cadre will have no trouble in following our writers exposes of the
p treason’s involved. In the end the Gorbachev gang established an open alliance with US imperialism.
The end result of all of this disaster described as success by the Gorbachev gang was by 1988 massive cynicism among the public and a plummeting personal popularity rating for Gorbachev throughout the Soviet Union. Just as it seemed the obvious traitor would be overthrown by someone, the political game was changed a la the way it is changed regularly in the USA. When one wing of the capitalist party that rules Gringolandia is disgraced and finished in popularity (for the moment) another wing of the capitalist party emerges and takes command. The Gringos never seem to learn as they bounce back and forth from disaster to disaster via bouncing back and forth from Republicans to Democrats. Then Gorbachev pulled another rabbit out of the Mad Hatters hat with the emergence of their own equivalent in the form of Boris Yeltsin and his “Democrat” Party.
462p Tweedel Dee Tweedel Dum
p There seemed no end to new innovations in deceit and debauched trickery on the part of the gang of second economy mafia leaders. In 1987 Gorbachev had literally kicked Boris Yeltsin off the Politburo. But, before one could say good bye Yeltsin emerged as the leader of a new Party bent on taking control of the Russian Republic which he did in 1990. The RSFSR was by far the biggest and single most important republic in the Soviet Union. By 1990 this left Yeltsin as President of the RSFSR and Gorbachev as President of the Soviet Union. It was as false a dichotomy as the difference between the Republicans and Democrats in Gringolandia but it sufficed to bring about a total chaos in place of the political unity that had characterized Lenin’s system for seventy years. The difference between Yeltsin and Gorbachev politically was the difference between Tweedel Dee and Tweedle Dum.
463p Now let us look at how US hegemony over the capitalist world next collapsed. Ironic in so many ways is it not, that the evil oligarchy behind the gringo regime, which had the entire world at its disposal, in a few short years managed to throw it all away at the turn of the coming century in a serious of incredible colossal blunders equivalent for the world bourgeoisie to what had happened to the world proletariat with the disappearance of the Soviet half of the global Stalinist Socialist Stage. As of this writing the gringo leadership and its pathetic remnant regime under Mr. Obama have lost it all.
The world capitalist system itself then disintegrated. Again, this was because of the almost unbelievably incompetent administration of that system by its USA leadership. Consequently,
p The New World Order
A new world order is emerging featuring restructuring world capitalism on the one hand and a new kind of socialist camp on the other. In the latter case we have a hard-core of Marxist-Leninist led nations at the center, following the PRC example, and an outer core of nations with no inherent interest in capitalism as personified in US and European imperialism (BRICS) part of which is congealing as a regional core in Latin America (ALBA). This new socialist world order is composed at the center of Advanced Socialist Stage countries (PRC, Cuba, Vietnam, Laos) in alliance with joint class ruled countries (Venezuela, Bolivia, Nicaragua, Ecuador, South Africa, Brazil) bent on a new anti-imperialist sometimes socialist course where capitalist countries such as India find more affinity than they do with traditional capitalist nations of Europe, Asia or North America. Now let us move on to The Collapse of US Hegemony over the Capitalist World.
464B: The Collapse of Gringo Hegemony over World Capitalism
p Meanwhile in the US, among the bosses in command of hegemonized world Capital (the US Ruling billionaire families and trillionaire families) the Right Wing (so-called Neo-cons; who would more appropriately be called neo-Nazi) thought they saw an opportunity to act on their most basic motivations (insatiable greed) by seizing control of the world’s strategic economic inputs. That is, the pricing, supply and most importantly, financing, of such things as oil, natural gas and precious metals (to name only three.) In so doing they would not only get personally rich, but they presented the US ruling families with the spectacle of global stability in the supply and pricing of such fundamental inputs (again, e.g. Oil and Gas.) As importantly, all of this would be financed through gringo financial centers in New York and Chicago (and secondarily, London.)
465p This financing is a matter of life and death to the US ruling families, who must somehow offset the imbalance in the flow of dollars out of the USA and the flow of dollars into the USA. In the world trade economy they created (which features US capitalist exploitation of foreign cheap Labor - but requires the US consumers buy all the stuff being created abroad) the Achilles Heel is the balance of payments deficit and budget deficit the US Regime runs which requires a minimum, right now, of two billion dollars a day to come into the US from foreign investors (Buyers of US T Bills, and /or other things listed below.) —And, the increasingly larger federal budgetary deficit means it soon it will be three billion a day that is required. In fact, there is no end in sight to the accelerating demands of the USA rulers for foreign money, obtained in any way! Then they were unable to borrow at all (mid-2008) and were forced to rely on the ultimate last-step of printing (not even printing now just writing numbers down electronically — technically this is what we call money on account) trillions of dollars overnight! This has never happened before in the history of capitalism or in the history of the world for that matter. Inflationary printing in Germany after World War I is famous everywhere
466p because pictures of it found their way into US school textbooks. But this was nothing at all compared to the absolute disregard for any kind of monetary integrity with the mass creation of paper and electronic money! Two and a half trillion dollars were jacked onto this public debt by the imperialist bosses in the three months November, December and January 2008-09! The resulting monetary crisis has not even begun. When it does set in the next general collapse will get underway.
p All of this began when the greed of the US rulers and their stupid neo-con advisors decided to impose their own brand of fascism on the post-Soviet Camp world. In proposing to stabilize (prop-up) the extraordinarily shaky US economy in this way (via the dream of a "Pax Americana") the US fascist right arose once again like an Alien Phoenix. (The post-1929 period in the USA has been one featuring a see-saw, up and down, now in - now out, struggle between the fascist right and the not-so-fascist remainder of the US ruling class, over foreign as well as domestic policy.)
p In the event, under Bush II, the US "neo-con" were given the helm, and given a chance to put their crackpot plans into effect. Why crackpot? Because nothing they proposed in the 90’s or currently propose (e.g., in 2010) was or is possible - not in the slightest were these policies of world domination possible then, nor are they now! Except, of course, in the fevered imagination of men and women too ignorant of reality and history to see the world for what it is. -And, the fact that the, often more sober, US ruling families went along with these stupid proposals shows how those families have degenerated from the relatively balanced objectivity of the old Rockefeller leadership in the years following Vietnam. Finally, their total ignorance of world reality was reflected domestically as they ran the economy straight to hell in their greed to maximize their profits.
467p But now, as 2010 closes, it is too late for them. The 2000 families in the world who own the US regime may agree to bail it out in the end but I doubt it. The US capitalist system is tottering now and it won’t take a lot to push it over. Humpty Dumpty won’t get back together this time because the mass movement is going to create a real communist party in the USA. In fact, it is forming today as the Communist Party, USA (Foundation). When history moves as quickly as it is now our Party can get big fast, and all it will need is a clear strategy and the ability to make that strategy clear tactically to the working people of North America.
p What is happening?
p The US ruling nutballs were not the only ones acting in an atmosphere of ignorance. One must remember that the North American people have now for four generations been lied to every day, 24 hours a day, about world history, about the US place in it (past, present and future) and about the nature of our economy and the social structure of the few ruling the overwhelming many. Today we hear on the news educated retired people saying things like “we don’t understand what is happening.” Of course they don’t understand what is going on because they have been lied to constantly in all the cap media since the end of World War II and like the workers of 1914, who were tricked and forced into the capitalist imperialist war designed to enrich the cap classes and to liquidate the working classes of Europe and North America, they will pay the price of their ignorance despite their innocence. There are two main theaters of war against working people at the moment: (1) the US War against Arabia and the Muslim World
468p (Europe, Russia and China too) and (2) the collapse of the US economy and the global capitalist economy linked to it. Let us begin with the former and work our way into the latter.
p But first this is a place you can start
p The US has been at war or in a state of forward international military deployment constantly since 1945. Yet in that sixty five year period the US has not won a war — unless banana republic invasions (Granada, Panama, Dominican Republic, etc.) qualify. Of course they do not account for the trillions upon trillions of dollars spent on the war contracting. Could it be the real reason for the constant wars and international deployments has to do with the war contracting? What? You say? The reason was not victory, honor and peace in a just cause?
p You can start here at this point in conversations with fellow civilians. The question the US oligarchs have put off for so long is now front and center: the actual cost of the war in a context of cost analysis of health care, bank bailouts, mortgage relief, credit card relief, etc. Try to get to the point of replacing capitalism as a system — all the data and arguments you will need are in this book — and make a convert.
p Back to Iraq
p As I wrote in the winter of 2006 - 2007, the US adventure in Iraq has turned into exactly the disaster predicted in the previous editions of this Handbook. Worse, for US imperialism is that the world has seen for itself that US supposed military superiority is in fact just a “paper tiger.” The US ruling families stumbled fatally this time when they allowed the Nazi fringe of their class the accession to power they had fought for, and stole two elections for and now cannot produce for. Remember that the capitalists as a world-wide class are just a wolf pack, and like wolves they turn on the weak (old and young) and consume them too. The US fascist would-be bosses are being consumed by Rockefeller-like new bosses, for the worst thing the US imperialists could have done, they have done, and to themselves! Namely,
469p (1) to have shown that they are so inherently weak that a group of what they considered to be rag-headed, camel-driving, Arabs, without international support (as we provided to the Vietnamese for example) could reduce the great scary “Juggernaut” to a helpless Gringo Gulliver, truly a giant captive, flailing around in its death-throws; Iraqi Lilliputians using the simple expedients of hand grenades, dynamite and shaped-charges, to accomplish this embarrassing ignominious defeat of US imperialism. Munitions available on the shelf everywhere and anywhere in the world! The lesson has been learned and there is no putting that genie back into the bottle.
p (2) As I said in this book in the 2007 and 2008 editions: “Mark my words it is not the US Left which is going to drive out the crackpot neo-Nazi Bush II regime but the “responsible” imperialist leaders of the US ruling families. The Wolfowitz-Perle-Rumsfeld gang has been consumed by their rival class leaders (perhaps the Bush family will yet go down too, despite their current desperate attempt to avoid and evade responsibility, who knows.)” The way the responsible leaders did it (e.g., Eagle Scout Gates as War Minister, his words), was to buy off some of their strongest enemies with cash and made promises to the others (Sunni and Shia forces respectively) to get out as fast as possible. What do they get for this cash and this promise? They are being allowed
470p to exit out the barroom back door rather than being chased out. Although they are still being forced to back out of that barroom back-to-back. I am rather sure they are praying that something doesn’t happen that will make their ignominious defeat even worse than it is. All of the massive bombings in Baghdad at the end of 2009 are a lot like, getting slammed in the ass multiple times, by that back room door on their way out, once again. Still the picture most iconic and fitting will always be Bush getting the Bum’s Rush from a local Iraqi reporter. At any rate what has happened to them is the best they could do and the only thing left for them to do. Not that you won’t still hear rather comical references to the “success” of the “surge” and the overall war blah, blah.
471p The Great Iraqi Oil Robbery
p “This is the essence of the Wolfowitz doctrine, first articulated in the Pentagon’s Defense Planning Guidance document for 1994-1999, first leaked to the press in February 1992. This document calls for proactive U.S. military intervention to deter and prevent the rise of a contending peer (or equal) competitor, (for global strategic economic inputs), and asserts that the United States must use any and all means necessary to prevent that from happening.
p this doctrine(is) re-emerging as the official global military policy of the Bush II administration. It has now been incorporated as the core principal of the document known as the National Security Strategy of the United States of America (September 2002), available for download from the White House website. This document states explicitly that the ultimate purpose of American power is to prevent the rise of a competing great power, and that the United States shall use any means necessary to prevent that from happening, including preventive military force when needed, but also through spending so much money on defense that no other peer competitor can ever arise.” (pg 53)
472p The war against Iraq was intended to provide the United States with a dominant position in the Persian Gulf region, and to serve as a spring-board for further conquests and assertion of power in the region. It was aimed as much, if not more, at China, Russia, and Europe as at Syria or Iran. It is part of a larger process of asserting dominant U.S. power in south-central Eurasia, in the very heartland of this mega-continent.
But why specifically the Persian Gulf/Caspian Sea area, and why now? In part, this is so because this is where most of the world’s remaining oil is located-approximately 70 percent of known petroleum reserves. And you have to think of oil not just as a source of fuel-although that’s very important-but as a source of power. As U.S. strategists see it, whoever controls Persian Gulf oil controls the world economy and, therefore, has the ultimate lever over all competing powers. (pg 55)
p(The New Geopolitics, by Michael Klare, in Monthly Review, Vol. 55, No. 3, July-August 2003.)
p (3) The idea that the US had military forces (men and materiel) up to the task of world conquest shows just how out of touch the US neo-con bosses were from reality (it reminds me of the way the same types of foolish men thought that the US Army I had just been in from 1959-1962, was going to do the job they had in mind for it in Vietnam!) However, as bad as Dr. Kissinger’s Vietnam strategy advice turned-out to be, he was at least intelligent. The Wolfowitz-Perle-Rumsfeld gang demonstrated by the way they fucked-up their Iraqi campaign what a group of moronic ignoramuses they really were and were consequently undone.
p (4) However, as true as all of this is, the at-bottom reason for imperialist expansion against the Arab and Muslim world and the inherent implied threat to Capitalist Europe, New Class Russia, and Socialist China, is the absolute need for the imperialists to find some way to offset the costs of foreign oil resulting in shipping huge quantities of money outside the borders of the US economy. The Saudi example is what they wanted to duplicate. We will discuss this in detail in Part III (Chapter 27); that is, the way in which US imperialism expanded in the 20th century, and how it featured the Gringo rulers
p engineering, a post-World War II, true sweetheart comprador deal with the Saud family which gave the Saud family ownership of the money paid to them for their oil but featured the requirement that they spend all of it in the USA! All of it minus of course their multi-million dollar a day lifestyles and its other requirements (in other countries.) The same agreement they reached with the Al-Saba family for Kuwait (where they earn a minimum admitted of 280 million dollars a day.) The same agreement reached with the Bahrain monarchy. Their caveat to this was to have in place in Iraq a US style capitalist government rather than a monarchy. In this they have failed absolutely as we see with the opening of 2010.
p (5) You see at-bottom the general crisis of capitalism also forced the imperialists to send more and more money abroad to utilize the cheap labor available in foreign lands on generation after next generation of new and improved machinery to produce commodities at lower and lower costs. But, how to offset it? If you send all your money outside the boundaries of the USA how will the domestic economy function? In other words, our economy cannot function without money present and available for normal capitalist exchange. In reality the gringo ruling trillionaire and centi-billionaire families confronted an insoluble problem! For decades they printed money against incoming investment capital from foreign central banks and foreign trillionaire and billionaire families. But that came to an end in 2008 and led to the greatest crisis since 1929 for the capitalist rulers.
473p (6) In short, the US politico’s stumbled terribly. For us Bolsheviks this has been some incredibly, almost unbelievably, good luck! To begin with the failures encompassed by the Gringo regime’s Iraq War include:
p A) The US rulers losing their command position over all of the capitalist classes outside the English-speaking World (and as 2010 opens they have lost their hegemony over the English-speaking countries as well);
p B) The Gringo command having accelerated the process of realigning the worlds industrial powers to put the People’s Republic of China in a position no one of us could have realistically hoped for in 2001, including putting Communist China in the position of a responsible equal leader with other responsible states (of the capitalist persuasion) internationally! Remember how the Bush fascists started out so provocatively against China? Now the Chinese leadership has stepped-up to the plate in ways they never would have done eight years ago — because the imbeciles in Washington dropped their sheep’s clothing and exposed their plans for naked aggression;
p (C) The US leaders in their arrogance proceeded to alienate the 1.2 billion people of the globe committed to the Islamic Religion. In so doing they have gone head to head with the radical fundamentalist wing (they had previously trained and used against us in Afghanistan) in a death struggle. Otherwise it would have been our task to liquidate the Islamic crackpots - in fact, some of you may remember that in 2000 I wrote that the Islamic fundamentalists would be our most difficult competitor in the 21st century, and I had thought they would play on a global stage the role they played as imperialism’s cat’s paw in Afghanistan. Instead our most deadly current enemy, US imperialism, has tasked itself with their destruction. Again, incredibly good luck!
474p (D) The blatant obviousness of the Gringo Regime’s strategic planning for world domination has forced the Chinese Communist Party’s leadership to do something it had not wanted to do; that is to take the lead in forming a de facto Global Socialist Alliance
p of China, Cuba, Vietnam-Laos and progressive countries like Venezuela, Brazil, and even Bolivia, Nicaragua, and Ecuador. —And now, China has fielded a strategic nuclear tipped ICBM carrying submarine fleet, far earlier than they would have done had Washington not exposed their plans for world conquest. Finally,
p (E) Washington has scared the living daylights out of those who had thrown in their lot with their would-be "puppet masters" such as the Uribe trafficker-industrialist clique in BogotÃÂÃÂÃÂÃÂÃÂÃÂÃÂá, Colombia. -And, these types, are back treading as quickly as they can from their ill thought out earlier commitments. The August, 2010, transfer of power to a new capitalist President in Colombia opens the possibility that the US long delayed negotiations between Colombia and Venezuela may get underway once again with better prospects for the future than any we have seen for over a half century.
p Uribe had been on the DEA’s “most wanted” list until he was suborned by the CIA in a deal where he was to be used against all the guerilla forces in the Americas. But, now, in power, and potentially somewhat independent of his imperialist sponsors, he has struck out in an “independent” way that will make his “base”, the Colombian big bourgeoisie (including the world’s richest drug traffickers — some of whom I have known for many years — see my books, Shining Path, the Peruvian Revolution, Rivers of Blood and High Finance, South American Style!), the accomplices of Washington’s new ultimate nemesis Hugo Chavez. Caracas has more money to give Uribe than does Washington and Venezuela’s money comes from “honest” sources (e.g. contracts for building an oil pipeline across Colombia where oil can be shipped directly to China from a Pacific port.) However, at the moment the ultra-right section of Uribe’s base is firmly in the saddle with, of course, backing from the most reactionary sections of the gringo capitalist government and state. This unholy conglomeration of evil forces may yet succeed in triggering a general war in northern South America. This is their program and will involve Venezuela and Ecuador and Peru as well as Colombia before it is over. We shall see how the August 2010 transfer of Presidential power in Colombia plays out.
475p (F) With Bush II, U.S. Imperialism immediately embarked upon a program of seizing defeat from the jaws of the victory they could have had. At the very least they could have maintained their hegemony over the capitalist world for several decades into the 21st century. Instead they threw it away in two short years. This is a historic defeat for them of catastrophic proportions; a defeat from which they shall never recover. For them, as for Hitler seventy years ago, all that remains is the running, and dying. For us, whatever short-term advantages some of the timid among us may have thought we might have lost with the disappearance of the Soviet Revisionist Ruling Clique from the historical stage, the stupidity and ignorance of the US hegemonists has more than offset.
476
p
(G) At the moment, there is great
instability in the global class struggle and all of you revolutionary
cadre need to continue to study and observe, the past and the
present, in order to deal the telling blows needed to remove the
Gringo ruling families from the scene, liquidate their State and
Government establishment, and then proceed to the construction of the
(transitional) Socialist World Order in the USA. You should begin by
getting involved in organizing working people so that the next time
there is a mass spontaneous outpouring into the streets (as conducted
by Hispanics in 2006)
you will be doing far more than handing out leaflets — which at any
rate were full of inaccuracies and profound errors, so typical of the
historically ignorant US Left. The US ruling families are prepared to
lock-up militant White workers
p alongside those of the African, Hispanic and Asian origin when the inevitable collapse comes — we must be at least as ready to lead those workers in an armed struggle for the overthrow of the fascist regime in Washington and to substitute working class power in its stead. WE have to build a real communist party and we have to send our cadre into the Army, Navy, Marines, Air Force and into the local, state and federal police forces so we will be in a position to deny the US rulers the use of these forces — or at least deny them all of these forces — as we move inexorably to revolution.
p (7) Moving again to the domestic crisis I want to bring to your attention, as I have in each edition of this book since 2005, the fact that the true Achilles Heel of the Gringo Regime and the billionaire-trillionaire families that own it is its desperate financial and monetary situation. Until the present moment Washington has depended upon an inflow of two to three and soon four billion dollars a day from the following sources to offset the flow of cash out of the country to their cheap labor production centers and for critical inputs. These have been:
p A. European Central Bank purchase of US paper (e.g. T Bills)
p B. Foreign comprador money sent for safe-keeping and/or investment in more US paper.
p C. Payments from foreign governments to support U.S. military forces stationed in these countries.
p D. Debt service payments on the great debt the US has intentionally heaped on 3rd world countries.
p E. Sales of high-tech armaments
p F. US Corporations repatriating profits
p G. New York (and satellite London) financing of everything but especially strategic inputs such as petroleum.
As these sources of income are drying-up, the resulting devastation will make the revolutionary end of capitalism the only logical way forward. In so doing the way will be cleared for the final battle between socialism and capitalism and simultaneously prepare thereby the objective conditions for armed insurrection.
Finally, why did the imperialists spin the so-called subprime mortgage crisis? Was this just greed and stupidity? Of course it was both because that is the nature of capitalism. But, what specifically did they do to create the current mess. What was the way in which the current collapse came about?
C: The Collapse of Global Capitalism
p What Caused the Current Crisis?
p It is not my intention to jump into the daily news lies of the cap media in the USA with regard to the current global capitalist collapse and the place of the US within that context. However, I have been asked daily for continuing input, as my columns over the last five years have been predicting the imminence of the current collapse and explaining why said collapse was imminent. I suspect the least I can be expected to do now is to give whatever my commentary may be worth for the benefit of those who are sufficiently educated to understand what the science of political economy has to say on these matters.
Accordingly, I will begin a series of weekly updates of the financial advisory type, as reluctant as I am to do so, as whatever contribution I can make or have been able to make, is simply a product of studying the masters (Karl Marx and Frederick Engels) and their successors, in analyzing the evolution of capitalism in its final imperialist phase.
Let us begin with the beginning. What has caused this collapse we are currently witnessing? The answer is the General Crisis of Capitalism. As you learned in Chapter 12 this general crisis is caused by the articulation of the need of capitalists to produce “commodities” at competitive prices with the costs of implanting new and next generations of machinery with cheap labor. A commodity in this context means those articles of production coming into existence as a product of labor-power applied to machinery. An individual capitalist always must produce a given commodity (it is an analytical given that outside influence is limited to being unregulated free enterprise) at a price equal to or lower than his competitors. He must, therefore, reduce the cost of labor-power input (wages) or increase the productivity of his machinery. Or both.
478p Now the point is how specifically did this continuing general crisis of the capitalist stage trigger the immediate (no longer imminent) capitalist collapse? Noting for the record that this is just one more depression in the capitalist cycle of boom and bust (See Part III below).
p As to the immediate cause of the immediate crisis what? The answer is that in their struggle to find new sources of cheap labor to apply to their newest generations of machinery, the capitalists sent huge quantities of money to foreign cheap labor centers to set up their factories and then they had to buy the stuff being created in them. In other words imperialism always sent capital abroad — that is the definition of imperialism. But this time they had to send money abroad also to buy all the stuff being created abroad. This created an insoluble crisis for them! Because they were so greedy they just kept doing it. If you are making a billion dollars a day then every day you keep up what you are doing you are getting richer. The capitalist bosses knew what they were doing would someday lead to a terrible collapse. But they could not resist their own greed.
479What is different about this situation is that the cash outflow did not stop with the construction of factories as it used to. What they called “globalization” required, in practice that US consumers buy all the stuff being created by cheap labor power in other parts of the world. The consequence in the USA of this shipment of cash outside the US to implant the machinery and then to bring these commodities back to the USA in order to sell them, is what we are now confronting.
p As the decades passed the US rulers confronted a continuing budgetary deficit within their own country because of reasons of policy. Then on top of this they began to see a continuing imbalance of payments — meaning, more money going out of the country than coming in. The latter because of the fact of having to buy in this country a heavy percentage of what was being created in the cheap labor factories abroad — and — the cost of oil and gas imported from abroad.
p We will deal with the policy matters separately.
p As to the point at hand, the result in sending more and more money outside the economic (essentially the political) boundaries of the USA required new sources of money to be found somewhere outside the USA that could be shifted back into the USA. There are several ways in which this has been done. Including those listed in each previous edition of this book Fundamentals of Historical Materialism. I can’t say this often enough so let’s say it once again: the US ruling families have relied on sources no longer available to them for the cash they needed to offset their crazy international capitalist system, to wit:
p A. European Central Bank purchase of US paper (e.g. T Bills)
p B. Foreign comprador money sent for safe-keeping and/or investment in more US paper.
p C. Payments from foreign governments to support U.S. military forces stationed in these countries.
p D. Debt service payments on the great debt the US has intentionally heaped on 3rd world countries.
p E. Sales of high-tech armaments
p F. US Corporations repatriating profits
G. New York (and satellite London) financing of everything but especially strategic inputs such as petroleum.
So, now what we have is a situation where the struggle of US financial engineers to maintain the dollar inflow from outside the US to match or at least decently counterbalance outflow, has failed. (The ruling capitalist families offered promises about the safety of the US economy for which the capitalist engineers offered a variety of what they claimed were undeniable reasons; for decades they got away with this, until it was accepted by all concerned as sustainable ad infinitum). In reality their justifications were nonsense and they knew it and they were taking increasingly risky adventures in finance. They took these risks they knew would result in a crash some day because of their greed. To be sure they had a well-oiled working theft machine; they paid incredible salaries and bonuses to sales people running into many billions of dollars. That’s it. Quite simple actually. What precisely did they really do to offset this outflow that has created the current crisis?
480They had the foregoing sources of cash. They planned on adding to them with certain measures aimed at dramatically reducing the outflow such as the use of sweetheart deals with ruling kings and queens in Arabia which gave these monarchs title to the cash being paid for “their’ oil as long as they agreed to spend all of this money in the USA (e.g., Saudi Arabia, Kuwait, Bahrain). This was implemented by having all of the spending being done by these Arabian ruling families being done via US contractors (e.g., the Bush family).
When that was insufficient because they needed even more oil they embarked upon their Iraqi war convincing themselves that with that conquest they could put into place a gringo style capitalist government which they foolishly believed would provide them with some insurance against what must eventually happen to the monarchies of Arabia (their eventual inevitable overthrow and dissolution was as obvious to the capitalists as it is to us.) Their (US) military defeat in Arabia (Iraq) and alienation from the entire
Muslim world was the actual result of their military adventure and for that they had no answer. It was their Stalingrad. The turning point in the World War of US imperialism against the rest of the world.
Remember our point. The underlying cause of the current crisis is the General Crisis of Capitalism — which is to say the antagonistic articulation of the need to implant new generations of machinery to cheap labor sources, all of which had to be found outside the political boundaries of the USA, with the inevitable consequence. Namely, the resulting need to send huge quantities of cash outside those boundaries to pay for the commodities thus produced. (Again let me say at this point you must read chapters 12, 18 and Part III of this book: Fundamentals of Historical Materialism.)
To offset the traditional ways of counterbalancing this dollar outflow as listed above something new had to be supplemented. What was that? Subprime mortgages done in “industrial” size, then packaged as new securities and resold all over the world as if they were as “good as US Government T-Bills, full faith and credit.”
Subprime refers to the credit rating of the person asking for a home loan. In my day we would drop to 300 on the FICO scale (where 720 is now considered the beginning of prime loans.) Furthermore the offer was sweetened by offering 1% rates for several years before resetting to more proper norms and/or sold as a “choice” where each month you could select one of four payments ranging from 1% to 8%. The pitch being this way you could adjust your monthly real estate payment to what serves your interests best. No one ever mentioned that you could only make 20% of the total number of payments at the lowest (1%) choice. After that you were confronted with three high payment choices none of which were really within the realm of possibility for you. If the buyer was told this he or she was also told “don’t worry you will never pay the higher rates because in two or three years we will refinance you. When the economy collapsed in 2008 they were not around do this. Thus the subprime mortgage holders confronted foreclosure and homelessness. These people were fucked by capitalism on purpose, not by accident. We need to educate them as to this simple fact. Once people know how and why they have been fucked in the ass without Vaseline they often know what to do about it.
481In other words in the event, the way they did that was to create huge quantities of “derivative” securities based on US house mortgages. Another way of saying it is that they found ways to make North American homeowners put up their homes as guarantees of cash flow which they packaged and sold all over the world like used car sales hucksters. As I have pointed out all kinds of tricks were used to get these mortgages and after they were in hand, in the tens of millions, they were packaged together and sold as supposedly “good as gold” US government backed securities. The plot worked. Bankers all over the world got fucked by one of the oldest cons in financial history. But this time on a far grander scale than Barnum and Bailey could ever have imagined. It turned out that the supposedly good as gold US government guarantee that went with Fannie May and Freddie Mac
482mortgage-based derivative securities were not guaranteed by the US Government at all! The scope of this con against international capitalist bankers by the US trillionaire centi-billionaire banking families is so vast that a run-of-the-mill con man like Bernie Madoff can make off with fifty odd billion dollars and still be considered small potatoes by these same big ruling families. If this were just bankers fucking other bankers, capitalists fucking other capitalists, I doubt if anyone would care. But, I think you can see the scope of their plot against the other international capitalist bankers is also having terrible consequences for the American people and global humanity. By the way these “securitized” mortgage packages were obtained by issuing mortgages in virtually any way (no money no problem. No income no problem. Just sign here. I know because I worked in the industry.) Some fifteen percent turned out to be worthless; perhaps fifty percent troubled.
483That is enough for the moment. Just remember, the at-bottom cause of the current crisis is capitalism as a system itself. Capitalism’s need to constantly lower the cost of producing commodities (the dog eat dog of capitalist against capitalist) led to the insoluble crisis of too much money flowing out of the USA and too little coming in. The US capitalist’s desperate financial engineering attempts at offsetting this fatal imbalance (you can’t run a domestic economy if all the money that should be there isn’t) coming ultimately in the form of the sub-prime mortgage crisis and their simultaneous military failure to obtain offsetting sources of cheap foreign oil. (Iraq not only did not produce the sweetheart deal on its oil but has so far cost nearly a trillion dollars in direct spending and since they borrowed this money there is another trillion in interest on top of that!)
484Finally, the US ruling families knew what they were doing — at the outset, all along and from the beginning. In effect they resorted to the “card mechanic’s” ultimate trick — kicking over the table. Because they knew accounting rules would eventually require the mortgage-based securities to be written down to zero; simultaneously, home prices marked-to-market value collapsed.
p That collapse occurred because banks would no longer refinance homes except when the credit of the person buying is what it should have been all along. Thus, all the people who had been told “don’t worry; you will never pay this higher rate because in two or three years we will refinance you” ended up getting fucked too. Now, when the time came, refinancing could no longer be done for people with subprime credit. Thus, the number of potential buyers of California real estate (for example) dropped dramatically. Thus market value dropped and new value calculations on surrounding homes decreased equivalently.
The Gringo Capitalists Fucked Their Class Brothers Internationally On Purpose
You can’t assess value of an entity with uncertain or even unknown composition and no protection against default, especially when default at a high statistical level is already in process. By loading the other capitalist countries with these poison-pills they would effectively destroy these competitors. In the resulting world the Gringo ruling families given their
greater financial and military resources would stand to stay at the front of the capitalist pack in the global dog fight that has to emerge after the most recent capitalist collapse. These are the real and only reasons for the current crisis. —And, the elite trillionaire-billionaire bosses were right. They are emerging on top of the world capitalist wolf pack as 2009 begins to unfold under responsible leadership. However, the rest of the world will not be happy in the emerging Camp Sunshine. Nor, will the North American people be happy. Workers never really recover from a depression. They just live through it; their conditions deteriorate over a larger number of people, as in the Auto industry over the last half century. Some workers will survive and prosper for the moment but they too will inevitably face this fate capitalism has in store for them unless we solve this problem once and for all.
485p To solve the problem once and for all you have to get rid of capitalism and put people in conscious command of their own daily lives — i.e., socialism. —And, what kind of socialism? Look at China with its mixed economy. Then think of what we could do with all of our modernization and without having to overcome the backwardness which remains China’s greatest curse.
p Nationalization
p The next critical battle we confront as a people will be to see that the current Bush gang program of socializing risk and privatizing profit is grabbed hold of and gutted. It’s interesting once again that people who call themselves communists failed to demand on our part the immediate nationalization of the banks, commanding heights of capitalism in the form of money market funds, insurance companies and so forth, not to mention failing to demand on our behalf the immediate nationalization of the oil and gas monopolies. Properly undertaken both banking and oil can provide the US people with far more income annually than the federal income tax as currently constructed.
p In fact, it was as I say George Bush and his financial gang who immediately moved to nationalize banking and finance. But, their plan is to use your money to save themselves and then once we have stabilized the economy they plan on getting their government in Washington to give them back their banks, money market financing and insurance companies. We have to be sure that they do not get these properties back but that they remain public.
It wouldn’t hurt for Left parties to start asking the question as to whether their leaders represent change we can believe in or just the same old stale and factually challenged politics. Politics completely wrong theoretically and thus practically. It’s not as if there were not alternatives to this kind of leadership which this book among many publications represents.
Notes