Excerpts from

The Impending Catastrophe and How To Combat It

V. I. Lenin

Written: September 10-14, 1917, Published: Late October 1917


Famine Is Approaching

Unavoidable catastrophe is threatening Russia. The railways are incredibly disorganised and the disorganisation is progressing. The railways will come to a standstill. The delivery of raw materials and coal to the factories will cease. The delivery of grain will cease. The Capitalists are deliberately and unremittingly sabotaging (damaging, stopping, disrupting, hampering) production, hoping that an unparalleled catastrophe will mean the collapse of the republic and democracy, and of the Soviets and proletarian and peasant associations generally, thus facilitating the return to a monarchy and the restoration of the unlimited power of the bourgeoisie and the landowners.


The danger of a great catastrophe and of famine is imminent.... Everybody says this. Everybody admits it. Everybody has decided it is so...Yet nothing is being done... after six months of revolution (which some call a great revolution, but which so far it would perhaps be fairer to call a rotten revolution), in a democratic republic, with an abundance of unions, organs and institutions which proudly call themselves "revolutionary democratic", absolutely nothing of any importance has actually been done to avert catastrophe,

...principal measure of combating, of averting, catastrophe and famine. .... is control, supervision, accounting, regulation by the state, introduction of a proper distribution of labor-power in the production and distribution of goods, husbanding of the people's forces, the elimination of all wasteful effort, ...And absolutely nothing is being done to introduce such control, accounting and supervision by the state ...

Complete Government Inactivity. There is a universal, systematic and persistent sabotage of every kind of control, supervision and accounting and of all state attempts to institute them.


The need for the regulation of economic life was already recognised under tsarism, and certain institutions were set up for the purpose. But under tsarism economic chaos steadily grew and reached monstrous proportions. It was at once recognised that it was the task of the republican, revolutionary government to adopt effective and resolute measures to put an end to the economic chaos. When the "coalition" government was formed with the Mensheviks and Socialist-Revolutionaries participating, it promised and undertook, in its most solemn public declaration of May 6, to introduce state control and regulation. 

How, one may ask, are we to explain this astonishing blindness of the Mensheviks and Socialist-Revolutionaries? Are we to regard them as political babes in the wood who in their extreme foolishness and naiveté do not realise what they are doing and err in good faith? Or does the abundance of posts they occupy as ministers, deputy ministers, governors-general, commissars and the like have the property of engendering a special kind of "political" blindness?


Control Measures Are Known To All and Easy To Take. In reality, however, even tsarism, even the "old regime", when it set up the War Industries Committees knew the principal measure, the chief method and way to introduce control, namely, by uniting the population according to profession, purpose of work, branch of labour, etc. But tsarism feared the union of the population and therefore did its best to restrict and artificially hinder this generally known, very easy and quite practical method and way of control.

The only obstacle to this — an obstacle concealed from the eyes of the people by the Cadets, Socialist-Revolutionaries and Mensheviks — was, and still is, that control would bring to light the fabulous profits of the capitalists and would cut the ground from under these profits.


These principal measures are:

(1) Amalgamation of all banks into a single bank, and state control over its operations, or nationalisation of the banks.

(2) Nationalisation of the syndicates, i.e., the largest, monopolistic capitalist associations (sugar, oil, coal, iron and steel, and other syndicates).

(3) Abolition of commercial secrecy.

(4) Compulsory syndication (i.e., compulsory amalgamation into associations) of industrialists, merchants and employers generally.

(5) Compulsory organisation of the population into consumers' societies, or encouragement of such organisation, and the exercise of control over it.


Nationalisation of the Banks

The banks, as we know, are centres of modern economic life, the principal nerve centres of the whole capitalist economic system. To talk about "regulating economic life" and yet evade the question of the nationalisation of the banks means either betraying the most profound ignorance or deceiving the "common people" by florid words and grandiloquent promises with the deliberate intention of not fulfilling these promises. ... It is absurd to control and regulate deliveries of grain, or the production and distribution of goods generally, without controlling and regulating bank operations..

... nationalisation of the banks, which would not deprive any "owner" of a single kopek, presents absolutely no technical or cultural difficulties, and is being delayed exclusively because of the vile greed of an insignificant handful of rich people. If nationalisation of the banks is so often confused with the confiscation of private property, it is the bourgeois press, which has an interest in deceiving the public, that is to blame for this widespread confusion.

What, then, is the significance of nationalisation of the banks?

It is that no effective control of any kind over the individual banks and their operations is possible (even if commercial secrecy, etc., were abolished) because it is impossible to keep track of the extremely complex, involved and wily tricks that are used in drawing up balance sheets. founding fictitious enterprises and subsidiaries, enlisting the services of figureheads, and so on, and so forth. Only the amalgamation of all banks into one, which in itself would imply no change whatever in respect of ownership. and which, we repeat, would not deprive any owner of a single kopek, would make it possible to exercise real control — provided, of course, all the other measures indicated above were carried out. Only by nationalising the banks can the state put itself in a position to know where and how, whence and when, millions and billions of rubles flow. 


Nationalisation of the Syndicates

Capitalism differs from the old, pre-capitalistic systems of economy in having created the closest interconnection and interdependence of the various branches of the economy. Were this not so, incidentally, no steps towards socialism would be technically feasible. Modern capitalism, under which the banks dominate production, has carried this interdependence of the various branches of the economy to the utmost. The banks and the more important branches of industry and commerce have become inseparably merged. This means, on the one hand, that it is impossible to nationalise the banks alone, without proceeding to create a state monopoly of commercial and industrial syndicates (sugar, coal, iron, oil, etc.), and without nationalising them. It means, on the other hand, that if carried out in earnest, the regulation of economic activity would demand the simultaneous nationalisation of the banks and the syndicates.

All that remains to be done here is to transform reactionary-bureaucratic regulation into revolutionary-democratic regulation by simple decrees providing for the summoning of a congress of employees, engineers, directors and shareholders, for the introduction of uniform accountancy, for control by the workers' unions, etc. This is an exceedingly simple thing, yet it has not been donel 

Take the oil business. It was to a vast extent "socialised" by the earlier development of capitalism. Just a couple of oil barons wield millions and hundreds of millions of rubles, clipping coupons and raking in fabulous profits from a "business" which is already actually, technically and socially organised on a national scale and is already being conducted by hundreds and thousands of employees, engineers, etc. Nationalisation of the oil industry could be effected at once by, and is imperative for, a revolutionary-democratic state, especially when the latter suffers from an acute crisis and when it is essential to economise national labour and to increase the output of fuel at all costs.


Abolition of Commercial Secrecy

Unless commercial secrecy is abolished, either control over production and distribution will remain an empty promise, only needed by the Cadets to fool the Socialist-Revolutionaries and Mensheviks, and by the Socialist-Revolutionaries and Mensheviks to fool the working classes, or control can be exercised only by reactionary-bureaucratic methods and means. Although this is obvious to every unprejudiced person, and although Pravda persistently demanded the abolition of commercial secrecy (and was suppressed largely for this reason by the Kerensky government which is subservient to capital), neither our republican government nor the "authorised bodies of revolutionary democracy" have even thought of this first step to real control.

It is modern large-scale capitalism, which is everywhere becoming monopoly capitalism, that deprives commercial secrecy of every shadow of reasonableness, turns it into hypocrisy and into an instrument exclusively for concealing financial swindles and the fantastically high profits of big capital. Large-scale capitalist economy, by its very technical nature, is socialised economy, that is, it both operates for millions of people and, directly or indirectly, unites by its operations hundreds, thousands and tens of thousands of families. It is not like the economy of the small handicraftsman or the middle peasant who keep no commercial books at all and who would therefore not be affected by the abolition of commercial secrecy!


Compulsory Association

Compulsory syndication, i.e., compulsory association, of the industrialists, for example, is already being practised in Germany. Nor is there anything new in it. Here, too, through the fault of the Socialist-Revolutionaries and Mensheviks, we see the utter stagnation of republican Russia, whom these none-too-respectable parties "entertain" by dancing a quadrille with the Cadets, or with the Bublikovs, or with Tereshchenko and Kerensky.

Compulsory syndication is, on the one hand, a means whereby the state, as it were, expedites capitalist development, which everywhere leads to the organisation of the class struggle and to a growth in the number, variety and importance of unions. On the other hand, compulsory "unionisation" is an indispensable precondition for any kind of effective control and for all economy of national labour.

The German law, for instance, binds the leather manufacturers of a given locality or of the whole country to form an association, on the board of which there is a representative of the state for the purpose of control. A law of this kind does not directly, i.e., in itself, affect property relations in any way; it does not deprive any owner of a single kopek and does not predetermine whether the control is to be exercised in a reactionary-bureaucratic or a revolutionary-democratic form, direction or spirit.


Regulation of Consumption

The war has compelled all the belligerent and many of the neutral countries to resort to the regulation of consumption. Bread cards have been issued and have become customary, and this has led to the appearance of other ration cards. Russia is no exception and has also introduced bread cards.

Using this as an example, we can draw, perhaps, the most striking comparison of all between reactionary-bureaucratic methods of combating a catastrophe, which are confined to minimum reforms, and revolutionary-democratic methods, which, to justify their name, must directly aim at a violent rupture with the old, obsolete system and at the achievement of the speediest possible progress.

The bread card — this typical example of how consumption is regulated in modern capitalist countries — aims at, and achieves (at best), one thing only, namely, distributing available supplies of grain to give everybody his share. A maximum limit to consumption is established, not for all foodstuffs by far, but only for principal foodstuffs, those of "popular" consumption. And that is all. There is no intention of doing anything else. Available supplies of grain are calculated in a bureaucratic way, then divided on a per capita basis, a ration is fixed and introduced, and there the matter ends. Luxury articles are not affected, for they are "anyway" scarce and "anyway" so dear as to be beyond the reach of the "people". And so, in all the belligerent countries without exception, even in Germany, which evidently, without fear of contradiction, may be said to be a model of the most careful, pedantic and strict regulation of consumption —even in Germany we find that the rich constantly get around all "rationing".


Financial Collapse and Measures To Combat It

There is another side to the problem of raising the fixed grain prices. This raising of prices involves a new chaotic increase in the issuing of paper money, a further increase in the cost of living, increased financial disorganisation and the approach of financial collapse. Everybody admits that the issuing of paper money constitutes the worst form of compulsory loan, that it most of all affects the conditions of the workers, of the poorest section of the population, and that it is the chief evil engendered by financial disorder.

And it is to this measure that the Kerensky government, supported by the Socialist-Revolutionaries and Mensheviks, is resorting!

Large issues of paper money encourage profiteering, enable the capitalists to make millions of rubles, and place tremendous difficulties in the way of a very necessary expansion of production, for the already high cost of materials, machinery, etc., is rising further by leaps and bounds. What can be done about it when the wealth acquired by the rich through profiteering is being concealed?

An income tax with progressive and very high rates for larger and very large incomes might be introduced. Our government has introduced one, following the example of other imperialist governments. But it is largely a fiction, a dead letter, for, firstly, the value of money is falling faster and faster, and, secondly, the more incomes are derived from profiteering and the more securely commercial secrecy is maintained, the greater their concealment.

Real and not nominal control is required to make the tax real and not fictitious. But control over the capitalists is impossible if it remains bureaucratic, for the bureaucracy is itself bound to and interwoven with the bourgeoisie by thousands of threads. That is why in the West-European imperialist states, monarchies and republics alike, financial order is obtained solely by the introduction of "labour service", which creates war-time penal servitude or war-time slavery for the workers.


Everybody talks about imperialism. But imperialism is merely monopoly capitalism.

That capitalism in Russia has also become monopoly capitalism is sufficiently attested by the examples of the Produgol, the Prodamet, the Sugar Syndicate, etc. This Sugar Syndicate is an object-lesson in the way monopoly capitalism develops into state-monopoly capitalism.

And what is the state? It is an organisation of the ruling class — in Germany, for instance, of the Junkers and capitalists. And therefore what the German Plekhanovs (Scheidemann, Lensch, and others) call "war-time socialism" is in fact war-time state-monopoly capitalism, or, to put it more simply and clearly, war-time penal servitude for the workers and war-time protection for capitalist profits.

Now try to substitute for the Junker-capitalist state, for the landowner-capitalist state, a revolutionary-democratic state, i.e., a state which in a revolutionary way abolishes all privileges and does not fear to introduce the fullest democracy in a revolutionary way. You will find that, given a really revolutionary-democratic state, state- monopoly capitalism inevitably and unavoidably implies a step, and more than one step, towards socialism!

For socialism is merely the next step forward from state-capitalist monopoly. Or, in other words, socialism is merely state-capitalist monopoly which is made to serve the interests of the whole people and has to that extent ceased to be capitalist monopoly.


For if a huge capitalist undertaking becomes a monopoly, it means that it serves the whole nation. If it has become a state monopoly, it means that the state (i.e., the armed organisation of the population, the workers and peasants above all, provided there is revolutionary democracy) directs the whole undertaking. In whose interest? Either in the interest of the landowners and capitalists, in which case we have not a revolutionary-democratic, but a reactionary-bureaucratic state, an imperialist republic.Or in the interest of revolutionary democracy — and then it is a step towards socialism.

There is no middle course here. The objective process of development is such that it is impossible to advance from monopolies (and the war has magnified their number, role and importance tenfold) without advancing towards socialism.

The dialectics of history is such that the war, by extraordinarily expediting the transformation of monopoly capitalism into state-monopoly capitalism, has thereby extraordinarily advanced mankind towards socialism.

Imperialist war is the eve of socialist revolution. And this not only because the horrors of the war give rise to proletarian revolt — no revolt can bring about socialism unless the economic conditions for socialism are ripe — but because state-monopoly capitalism is a complete material preparation for socialism, the threshold of socialism, a rung on the ladder of history between which and the rung called socialism there are no intermediate rungs.


Our Socialist-Revolutionaries and Mensheviks approach the question of socialism in a doctrinaire way, from the standpoint of a doctrine learnt by heart but poorly understood. They picture socialism as some remote, unknown and dim future. But socialism is now gazing at us from all the windows of modern capitalism; socialism is outlined directly, practically, by every important measure that constitutes a forward step on the basis of this modern capitalism.

What is universal labour conscription? It is a step forward on the basis of modern monopoly capitalism, a step towards the regulation of economic life as a whole, in accordance with a certain general plan, a step towards the economy of national labour and towards the prevention of its senseless wastage by capitalism.

In Germany it is the Junkers (landowners) and capitalists who are introducing universal labour conscription, and therefore it inevitably becomes war-time penal servitude for the workers. But take the same institution and think over its significance in a revolutionary-democratic state. Universal labour conscription, introduced, regulated and directed by the Soviets of Workers', Soldiers' and Peasants' Deputies, will still not be socialism, but it will no longer be capitalism. It will be a tremendous step towards socialism, a step from which, if complete democracy is preserved, there can no longer be any retreat back to capitalism, without unparalleled violence being committed against the masses.

source: Marxists.org Internet Archive





OK Economics was designed and it is maintained by Oldrich Kyn.
To send me a message, please use one of the following addresses:

okyn@bu.edu --- okyn@verizon.net

This website contains the following sections:

General  Economics:


Economic Systems:  


Money and Banking:


Past students:


Czech Republic


Kyn’s Publications


 American education


free hit counters
Nutrisystem Diet Coupons