Workers’ Councils and Communist Organization of Economy

By Paul Mattick

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Revolt Library Anarchism Workers’ Councils and Communist Organization of Economy

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(1904 - 1981)

Paul Mattick Sr. (March 13, 1904 – February 7, 1981) was a Marxist political writer and social revolutionary, whose thought can be placed within the council communist and left communist traditions. Throughout his life, Mattick continually criticized Bolshevism, Vladimir Lenin and Leninist organizational methods, describing their political legacy as "serving as a mere ideology to justify the rise of modified capitalist (state-capitalist) systems, which were [...] controlled by way of an authoritarian state". (From:

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Workers’ Councils and Communist Organization of Economy

Published: in International Council Correspondence Vol. 1, no.7, April 1935, pp 7-18.
Source: Antonie Pannekoek Archives
Transcribed: by Graham Dyer

We have received the following theses from Prague, as reported by Neue Front No. 20. They are issued under the title Revolutionary Marxism and Socialist Revolution by a group of revolutionary marxists “who organizationally belong to the German Social Democracy”. Their conception of the way that leads to socialism is here expressed. Our criticism follows.

1. The experience of all revolutions during and since the War has shown that a reformist and opportunistic policy leads to the defeat of the working class. The preliminary work for the socialist revolution, the winning of the victory in the socialist revolution and the consolidation of that victory presuppose therefore a radical break with all reformist politics.

2. This radical break demands a fundamental change in the means and methods of the political struggle and in its concrete aims. As a sign of the inner transformation and as an acceptance of revolutionary marxism, the party must lay aside its old name of Socialist Party of Germany (S.P.D.) and become merged in a revolutionary marxist party.

3. The goal is the attainment of socialism on the basis of a socialist German soviet republic, under the sway of the dictatorship of the proletariat. The revolutionary dictatorship is the necessary transitional period to the socialist society. The destruction of the capitalist system through dictatorship of the proletariat is the presupposition for the realization of the personal and moral freedom of all people now under the yoke of Fascism.

4. For conducting this struggle, the proletariat has need of a revolutionary party conscious of the goal. This party can and may embrace only the revolutionary vanguard of the proletariat. Only those persons can become members, therefore, who have stood the test of the revolutionary struggle, acknowledge the dictatorship of the proletariat and subordinate themselves unconditionally to the decisions of the party. The party makes use of all legal and illegal forms of struggle. It is the party’s duty to prepare and organize mass movements, mass strikes and the armed insurrection.

5. In case of a war, the party rejects any open or covert form of “defense of the fatherland”. It rather calls the proletariat to its aid in converting the imperialist war into a civil war, in order to bring about the dictatorship of the proletariat. Among the means to that end are mass strikes and armed insurrection.

6. After the conquest of political power, the old state apparatus will be completely dismantled. All legal power and authority passes over to workers’ councils, small-peasants’ and farm-workers’ councils. The councils exercise the dictatorship of the proletariat. The leadership in the dictatorship lies with the revolutionary-marxist party.

7. The consolidation of power is taken over, until the forming of a socialist army, by the armed proletariat.

8. The professional bureaucracy will be abolished. All persons serving in public capacities are appointed through the councils and can be recalled at any time.

9. For the purpose of lending support to the revolutionary dictatorship, workers and functionaries will organize themselves in industrial unions.

10. Printing establishments and newspapers will be sequestrated. Printed matter, radio and any other kind of news service shall be under inspection and control of the councils.

11. The whole of capitalist property will be expropriated without compensation. General liability to labor will be introduced, and the control of production through the councils.

12. All banks will be combined into a central bank. In the same manner all insurance establishments will be brought together.

13. Farm mortgages will forthwith be declared invalid. Rent will be abolished. Land ownership, insofar as it exceeds in any case the amount required for maintaining a family (Familienackernahrung), will be expropriated without compensation. According to the needs of the small peasants and farm workers, there will be a new distribution of the soil. The peasant enterprises will be brought together in associations (Genossenschaften). Where the necessary conditions are present, model large-scale agricultural enterprises will be established.

14. For assuring the means of subsistence to the population, the union of all consumers will be made compulsory. The entire retail trade will be given its proper place in the distributing system of the soviet republic.

15. Foreign trade will be centralized through the establishment of a foreign trade monopoly.

16. The construction of the socialist economy will be effected under the guidance of an economic planning bureau (Planwirtschaftsstelle).

17. All cultural, educational and recreational institutions will be administered for the common benefit. Art and science will be under the care of the State, which will extend them the greatest possible encouragement. The pedagogical goal of all educational establishments will be preparation for life in the socialist community.

The Way Backward

After the total collapse of the reformist policy, this thesis comes out for the “revolutionary” way. In thesis two, these people call that a “radical break” with the previous policy, demanding a “fundamental change in the means and methods of the political struggle and in its concrete aims.” The goal is then announced (thesis 3) as a “socialist, German soviet republic under the sway of the dictatorship of the proletariat.”

At first sight, this seems really to be a radical break with the old policy of the Social Democracy, for a “socialist German soviet republic” and the “dictatorship of the proletariat” were most hotly contested by the Socialist Party of Germany (S.P.D.). But from the theses following (4 - 7) treating of the role of the Party before and after the revolution, and where it is said that of course the workers councils are to be the organs of the “dictatorship of the proletariat” but under the “leadership” of the Party, it is clear that a radical break with the social-democratic policy is out of the question.

It would be more correct to say that they want to go back to the starting-point of social-democratic policy and to the old conceptions regarding the path and the goal of socialism. For there can hardly at this date be any question that the S.P.D. during and after the war no longer carried on any socialist policy, but that it had sunk, precisely along the road of reformism, to a democratic reform party. And for the very reason that this reform policy ended up in Fascism there can be no talk of a break with this policy. One cannot break with a policy which has ceased to exist.

The old S.P.D. wanted “Socialism” (the purely democratic S.P.D. had ceased to want socialism, and therefore also wanted no dictatorship of the proletariat), but wished to attain it by making use of the legal possibilities apparently offered by bourgeois democracy. The S.P.D. went down with this bourgeois democracy, with which it was inextricably intertwined. Anyone who still wants to achieve socialism finds that such legal possibilities are no longer at hand and must accordingly seek to arrive at the goal along other paths; otherwise it is unthinkable. But this path, which the theses attempt to define, does not differentiate itself on a single point from the conceptions present in the old (not yet bourgeoisified) Social Democracy.

This is shown beyond a shadow of doubt in theses 4 - 7. They reveal nothing more than the conceptions of the social-democratic party of Russia (Bolsheviks), which failed to follow the democratic way of the German S.P.

Here again it is the “revolutionary party conscious of the goal”, the “vanguard”, which leads the masses into the struggles and to victory, prepares and organizes mass movements, mass strikes and the armed insurrection. And after the victory, it is again the party under the leadership of which the workers’ councils are to function as state organs, and workers and functionaries are organized in industrial unions. If a doubt should still remain as to who is supposed to exercise the real power in this socialist soviet republic, it is set aside by thesis 7: “The consolidation of power is taken over, until the forming of a socialist army, by the armed proletariat.”

Which is to say, that after the victory, the armed workers who are necessary for the overthrow of the fascist state forces are to hand over their weapons in favor of a “socialist army”, which naturally is under the command of the party.

Stripped of all wrappings, what remains is the old social-democratic conception regarding the path and the goal of socialism, according to which the beginning and end of the struggle for socialism lies in the conquest of political power through the social-democratic party.

Now the development of the Russian Revolution has proved that the exercise of state power through the Party cannot be called a “dictatorship of the proletariat”; nor is it a dictatorship of the proletariat through the dictatorship of the party (as the Russian Social Democracy formulates it), but it is a dictatorship over the proletariat. That finds its basis in the fact that the party-ruled state in converting the former private-capitalist economy to state economy again subordinates the workers, as wage-workers, to this state management.

From theses 7 - 17 it becomes clear that also in the construction of “socialism” - that is, in the organization of economy through the party-ruled State - it is desired to follow the Russian pattern. The essential point of this organization of economy is that the means of production are declared to be state property and the State comes forward as the single entrepreneur under the control of the workers’ councils. Small enterprises in agriculture and industry are to maintain an independent existence (obviously a mere concession to momentary conditions.)

Wage Labor and State Economy

The socialism which it is desired to construct thus proves to be state economy. It is thought, with economic planning, the elimination of disrupting competition and of profit, in conjunction with the full employment of the increased forces of production, to raise the standard of living of the masses in general. For the very reason that private ownership of the means of production stands in the way of a rational economy - still more: in the permanent crisis, hinders employment of the productive forces at all - the abolition of private ownership appears as the next goal. From this then follows the concentration of economy under the central authority of the State. And here it is the task of the scientists, statisticians, engineers, etc., to carry out the actual construction. In this way the socialist construction of economy appears as an organizational problem (Lenin), as an unrestricted generalizing and bringing to final completion of the tendency already foreshadowed by capitalism in the forming of trusts and cartels. The State becomes a mammoth trust which through organization overcomes the obstacles which stand in the way of a further expansion of production.

The Russian development has proved that such a state economy can be nothing other than state capitalism. The worker remains a wage-worker, now bound by state liability to labor (thesis 11). He works in state enterprises and sells his labor power to the State. His wage is the price which the State pays him for it. Thus the State steps into the place of the expropriated private capitalist. It is the State which now exercises command over wage labor and thus also rules and exploits the workers. Labor power becomes a commodity, just as under private capitalism; it is set equal to an already created product (the means of existence which the worker receives by way of the wage). It becomes a commodity; which means also that it is degraded to a thing, deprived of all personal will. It is converted from subject to object. Since, however, the worker cannot be separated from his labor power, the same thing holds of the wage-worker himself; he becomes a thing, is degraded to an object, in order to be employed by the owner of the means of production, as another “means for producing”. No further argument is needed in order to state that the fact that in this state economy the worker remains a wage-worker involves also the determination regarding his social position.

But the Russian example is not only a demonstration of the fact that the proclaimed socialism is in reality state capitalism. It has not only proved that state production is not production for need, but ordinary commodity production. There also arose from it a new ruling element which disposes over the state property and thus comes to occupy a privileged position. This element is interested in the further extension of state power, because it is precisely this state power which guarantees its privileged position in society. It also prescribes the direction for the further development, for in its hands are concentrated all the material means and other forces of society. And what else can it do than strive for increase of the state property and magnification of the state power?

Once social production has taken the form of state enterprise, it follows a development, conditioned by way of the relations of power thus created.

The workers are dispossessed, each day anew, when they perform labor; and, in fact, by way of the State, the general proprietor, which appropriates the products of labor. The state is the proprietor, the administrator of the social wealth. It is the organizer, leader and conductor of the social process of production. And it is at the same time the power which determines the portion of the individual and distributes the goods. This is a social organization which is best comprehended if one thinks of the administrative apparatus of all private-capitalist enterprises, stock companies, syndicates, trusts, etc., as combined with the political power of the State. The State as the single entrepreneur is nothing other than such a conglomeration of all administrative organs of private ownership; for just as the administration of private capital is unproductive, and serves merely as an organ for the appropriation of the products of others’ labor, so also the bureaucratic apparatus of the State creates no product and has no other task than to assure to the State what is produced through wage labor in the state enterprises.

Thus the development of state management is marked by an antagonism which is bound continually to intensify. On the one side, accumulation of possession and power in the hands of the state bureaucracy, for it is the State; on the other side the wage-workers, the products of whose labor the State appropriates.

The more the wealth of society as state property increases, the greater is the exploitation of the wage-workers, and the more powerless they are. With the wealth of society as state property, there increases also the impoverishment of the wage-workers; its necessary consequence is the class struggle between wage-workers and state bureaucracy. For the sake of asserting itself in this struggle, there remains to the bureaucracy no other choice than to extend the state’s apparatus of suppression which must grow in the same measure as the cleft deepens. The richer the State, the greater the poverty of the workers and the sharper the class struggle.

The Problem from the Proletarian Point of View

The wage-workers cannot be content with this “Socialism”, even though it should shower them with material blessings (which, moreover, is very much to be doubted). The aim of their striving must be that the rule of capital shall be abolished for them also. Their struggle is directed to doing away with the capital relation itself; that they shall no longer be purchased as labor power and be ranged as a productive force into the productive process on a level with the machines, under the command of the new masters. They must themselves become the masters of production, of their own and the mechanical productive forces. They themselves must take possession of the means of production, in order to use and administer them in the name of society, and answerable to this society. They must themselves rise up to become the director and manager of production, the administrator and distributor of the goods produced, if they wish to unite humanity in the classless society and avoid falling into thralldom again themselves.

From this striving, otherwise than in the case of the intellectuals, there results also another statement of the problem, and new perspectives are opened. In this way conceptions are formed regarding the regulation of the mutual relations of human beings in social production, conceptions which to the intellectual elements appear incomprehensible and which they declare to be utopian and unrealizable. But these conceptions have already unfolded a powerful force in the revolutionary uprisings of the wage-workers, of the modern proletarians. This force was shown first on a major scale in the Paris Commune, which sought to overcome the centralized authority of the State through the self-administration of the communes. It was the cause also of Marx’s giving up his idea (expressed in the Communist Manifesto) that state economy would lead to the disappearance of class society. In the workers’ and soldiers’ councils of the Russian and German revolutions of 1917-23, it arose once more to a mighty and at times all-mastering power. And in future no proletarian-revolutionary movement is conceivable in which it will not play a more and more prominent and finally all-mastering role. It is the self-activity of the broad working masses which manifests itself in the workers’ councils. Here is nothing utopian any longer; it is actual reality. In the workers’ councils the proletariat has shaped the organizational form in which it conducts its struggle for liberation.

So it is no utopia, no empty theory, that these workers’ councils, wherever they group themselves around production, in the shops, as shop organizations, themselves aim to take possession of the means of production, and themselves direct and manage production. It is a demand which is raised in the course of developments by broad masses of workers. The intellectual element will have to suppress this striving with force if it wants to assert its control in the state economy.

From the viewpoint of the workers’ councils, the statement of the problem in matters of economic organization is not as to how production must be governed, and in this sense best organized, but as to how the mutual relations of human beings to each other and among each other are to be regulated in connection with production. For, to the councils, production is no longer an objective process in which the labor of man and the product thereof becomes separated from him, a process which one computes and directs like lifeless material, but to them production is the vital function of the workers themselves. If production – the vital function of human beings when everyone is obliged to work – even today is social in practice, then also the participation of human beings in that production, their own vital function, can be socially regulated without putting them on a level with their own working instruments and without subjecting them to the command of a special class or element. Once the problem is put in this way, its solution is no longer so improbable, but rather easy to find. It presents itself, as it were, of its own accord. It is the labor of human beings itself, their own vital function, in the fields of production, which serves as a criterion for the adjustment of their mutual relations. Once the labor of individuals, as well as their union in shop organizations, has been introduced as the determining factor in the social adjustment of the mutual relations, there is no longer room for any sort of leadership or management which does not itself take part in the productive process, which merely exercises governing functions and appropriates to itself the products of others.

The Workers’ Councils

The theses make it clear that the authors do not believe in the creative force of the proletariat. Even after the workers’ councils as an undeniable fact have produced the proof of that force. No leader of the Social Democracy, not even Lenin, prior to 1917 had recognized the significance of the workers’ councils, and yet they had already played an important part in St. Petersburg in the Russian revolution of 1905. It was not until 1917 in Russia, then in Germany and elsewhere, when the workers’ councils had proved themselves as the form of struggle of the revolutionarily acting proletariat, not until the broad masses of workers were exercising a decisive influence through the workers’ councils upon politics and economics, it was only then that the attention of the political big-wigs of the Social Democracy was directed to them. But not at all in the sense of perceiving in them the first, independent step of the proletariat in the direction of taking its fate in its own hands. The workers’ councils were to them a new phenomenal form which must serve to bring the big-wigs themselves into power. The proletariat, this mighty and constantly still growing social force, was in their eyes just so much social force, like the productive forces in the shops - a force which one employs to arrive at determinate results, to put into practice worked-out plans. Such is the thought of the intellectual as leader of the capitalistic process of production, and such is also his thought when as a Social Democrat he thinks of directing the social forces. To him, the proletariat has no thinking of its own; it thinks and acts just as its leaders think. For that reason, the “revolutionary-marxist party” (thesis 6) must have the leadership in hand if the proletarian forces are to be thrown into the struggle in accordance with the socialist plans. If it is not the revolutionary-marxist party, then it is simply another party which uses the strength of the proletariat in order to carry out its special plans and designs. Anyone who looks at the matter from this angle can come to no other conclusion than: Without the leadership of the party, no socialism. From this standpoint, the workers’ councils appear as new proletarian organs in which the leadership must be won; they must become an instrument in the hands of the leadership, in order thus to influence the thinking and acting of the masses. It is in this spirit also that the workers’ councils are seen and defined in the Theses.

But the force which goes out from the workers’ councils came into being along the exactly opposite way. It was the mass-will born in the shops and mass-gatherings which raised up deputies and delegates out of the mass, as its mouth-pieces, ready at any moment to stand up for the mass with the uttermost means. This mass-will has hitherto still taken form only in conjunction with a few problems of quite general interest, the solution of which could finally be evaded by no one. Thus the will of the masses in Russia in the year 1917 and in Germany in 1918 was directed to ending the war. The war had to be ended, at any cost; all scruples on that point, artificial, cultivated and rooting in the masses themselves, were finally set aside.  In this way there took form everywhere the general will to put an end to the war, and for that purpose to take up the struggle against the military power of one’s own country. The workers’ and soldiers’ councils were merely the organizational form in which this will was converted into action. Thus the workers’ councils are possible only as the organizational form of the will of broad masses of workers; though in this connection it must be borne in mind that such a will takes form only under certain presuppositions and is certainly not called into being through the slogans of this or that party.

Now when the “revolutionary-marxist party” strives for leadership in the workers’ councils, it follows the opposite course. It wants to make use of these organs of the mass-will as a means of causing the masses to act in accordance with the will and plans of the “leaders”. The leader, however, can see the mass merely as material with which he must work, and the independent mass-will is in this connection a hostile element. Hence the workers’ councils under the leadership of a party are robbed of their own strength, and if they live on, it is only through deception, that is, when they conceal from the masses the fact that they have become instruments in the hands of the leaders. And that was the fate of the workers’ councils in Russia and Germany after the first goal, the ending of the war, was attained and opinions diverged with reference to the reconstruction of the social order, - a unified will, that is, on the part of the working masses was no longer present. They were “won” by the mutually competing party tendencies, soon lost even their influence upon the working masses and accordingly have no further value for the party politics of the leader. They have disappeared. It is only in the plans of the “revolutionary-marxist” parties, which are making ready to win the leadership in the coming mass uprisings, that they continue to live as organs through which it is thought to lead the masses.

Yet the spirit which came to expression in the revolutionary workers’ councils is not dead. In truth, the essential point consists in the fact that the workers find in these organizations the coordination of their class force, the overcoming of their dispersion in trade-unions, parties, tendencies. When the workers find this unity in the daily class struggle, when they themselves conduct the struggle by way of spontaneously formed organs while setting aside the old organizations by which they were separated, then is the spirit of the revolutionary workers’ councils again in the working masses; then do the masses reveal their will.

In the present-day struggle, we see again and again the embryonic forms of this class action, but we see also at the same time the hitherto almost always successful attempts of the old labor movement to snatch away from the workers the leadership of the struggle and place it in the trade-union offices. Just as the “communist” economy of the leaders is to be accomplished along the roundabout way of the state official apparatus, so also the conduct of the struggle is to be taken away from the direct authority of the workers and redirected by way of the trade-union apparatus.

But the power of the ruling class under capitalism is so enormous that only the power of the whole undivided working class is capable of overcoming it.

Thus the class relations tell us that the workers can win only when they have overcome the old labor movement through their council-unity; that they can win only when the “legislative and executive power” in the struggle is exercised by the mass itself.

In the year 1918, in Germany, the revolutionary slogan of the proletariat was: “All power to the workers’ councils.”

This slogan has meaning, however, only when the power of the councils is the expression of the unified will of broad masses of workers – yes, of the whole working class. Unity in will and action of the whole working class; that is the soil on which the power of the workers’ councils arises. To this end it is not enough when broad masses in extreme need put an end through their own action to an unbearable condition. They did that in 1918 and brought about only the ending of the war. There must be added to this the positive will to the reconstruction of society, to the readjustment of the relations of human beings in this society.

The former, the intolerable condition, may safely be left to capitalist society itself. The situation of the working class becomes ever more unbearable; wage-labor becomes for a constantly growing mass of millions a curse, a nightmare which cannot be evaded. The situation finally becomes so tense that in broad masses the will is born to put an end to this unbearable condition, cost what it may. But they cannot end it without at the same time doing away with wage-labor. Even the state socialism of the leaders brings no salvation, for it lets wage-labor, organized anew through the state power, remain in existence. For that reason there must be added to the action under compulsion of extreme need the conscious transformation of the social relations. The ending of the state of distress and the reordering of the social relations is a single deed; they are only two sides of one and the same action. Out of the condition which has become unbearable to the working masses, who as wage-workers are given over to absolute impoverishment, there is only this one salvation: that the wage-workers themselves take possession of the means of production. But they can do that only when, combined in the councils, they become the social power and at the same time employ the means of production in common, that is, on communist bases, for the social need.

Communist Economy

The council or soviet power does away with wage labor; it makes the worker the determining factor in production. Its task is to bring about the liberation of the working class, in that it converts the wage-workers to free and equal producers. But these free and equal producers have to adjust their relations to each other. The firm adjustment of these relations, through which the equality and hence also the freedom of the producers is assured, when it has become an all-mastering law; that is, in the last analysis, the solid foundation on which the communist society rests.

This adjustment, however, is nothing other than the regulation of the interacting process of society - the regulation of production and consumption; of the participation of the individual producer in the production of goods and of his consumption of the goods produced in common. And where the labor of the individual producers is at the same time his participation in the social production of goods, it necessarily follows that this labor decides also regarding his share in the goods produced. The social measure by which the relations of the producers among each other must be governed is labor, according to the time through which it operates, the labor-hour. The individual, special labor-hour of the single producer is, however, no social measure; it is different in each case and ever and ever anew. It is therefore necessary to find the social-average labor hour, the average of all the different labor-hours, and this must be made the socially regulating factor.

It is impossible at this place to be more precise regarding the movement of the communist economic life on the basis of the social-average labor hour. On this subject we recommend the work entitled, Grundprinzipien kommunistischer Produktion und Verteilung, brought out by the Group of International Communists (Holland). We merely point to the carrying out of the labor-time accounting in communist society as an immediate goal and hence do not regard it as something to be “attended to later on”.

The economic promotion of labor-time accounting expresses itself politically in working-class control of society. The one does not exist without the other. If the working class is not capable of carrying through the labor-time accounting, that can have no other meaning than that it is not capable of doing away with wage-labor; not capable of taking over the conduct and administration of the social life. If labor time is not made the measure of individual consumption, then wage-labor is the only solution. Which is to say: there is then no direct relation between the producers and the social wealth. It means that through the wage of labor the separation of the workers from the social product, has become a fact. Or, to state the same thing in other words: the management of the production process cannot lie in the hands of the workers. The management of the production process passes over to the “statisticians” and other scientists charged with the distribution of the “national income”. Either abolition of wage labor, with the social-average labor hour as fulcrum of the whole economy, under direct control of all workers, or else wage labor in behalf of the State.

We therefore raise as the immediate slogan of working-class power: the workers bring all social functions under their direct control; they appoint all functionaries and recall them. The workers take the social production under their own management through combining together in shop organizations and workers’ councils. They themselves enter their shop under the communist form of economy, in that they gauge their production according to the social-average labor time. Thus the whole of society goes over to communist production. This does away with the distinction between enterprises which are “ripe” for social management, and enterprises which are not yet “ripe”.

That is the political and at the same time the economic program of the wage workers; it is in this sense that their councils will transform economy. Those are the highest demands which we can raise in these questions; but at the same time also the lowest, because it is a question of the be or not-to-be of the proletarian revolution.

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