“Foundations of Soviet Strategy for Economic Growth”
THE BALANCE OF THE NATIONAL ECONOMY
...Marx himself had no occasion to construct a balance of a national economy. He lacked the statistical data to accomplish this. In undertaking, however, to explore the reproduction and circulation of all social capital, Marx came close to balance formulations. His scheme for simple and expanded reproduction is the pivotal element of the balance....
The balance of the national economy should, in accordance with Marx’s idea, show production, distribution, exchange, and consumption in their mutual interdependence asan organic unity. A planned economy assumes that a balance of the national economy will be constructed. From its very first efforts, therefore, Gosplan set about drafting the outline for the balance and began itself to fill it in. In this, however, it encountered an insuperable obstacle in the absence of statistical data, and in the summer of 1924 Gosplan proposed to the Council of Labor and Defense that it commission the Central Statistical Administration to draft a balance for 1923/24. This work was not published until June 1926.
The editor of the book, Comrade P. I. Popov, former director of the Central Statistical Administration, proceeded from the fundamental idea that the balance of the national economy “signifies a statistical operation intended to show how the social economy is reproduced in specific conditions.” (Introduction, p. 1.) In his opinion, “the balance of the national economy, as a statistical operation, is a system for studying society at a given historical moment.” Unlike Marx, P. I. Popov avers that “all market relationships are jettisoned and production-and-distri-bution relations emerge in their pristine form.” In the chapter entitled “Theoretical Bases of the Balance” he presents Quesnay’s scheme as well as Marx’s scheme for simple and expanded reproduction, as we have done. He refers to Comrade Bukharin’s attempts to give Marx’s scheme an algebraic expression. He also describes Ballod’s attempt at constructing a balance for the future society in his work “The State of the Future,” and finally, Comrade Sotnikov’s attempts at a theory of a global economy. While he is critical of Ballod’s and Sotnikov’s ventures, he himself expatiates on the following scheme.
He divides the national economy into branches, selecting agriculture, industry, construction, and transport. In the case of each of these branches he investigates income, consisting of reserves plus production plus imports, expenditure with its subdivision for productive and nonproductive purposes, and then exports and reserves at the end of the year. He breaks nonproductive consumption down by the agricultural and nonagricul-tural population and public institutions. Industry he divides into large- and small-scale. The output of industry as well as of agriculture is broken down into products of personal consumption, raw and other materials, fuel, and tools of production; and the output of construction is broken down into only two groups: products of personal consumption and tools of production. Strictly speaking, he does not define the output of transport.
This scheme, of course, has very little in common with Quesnay or with Marx. It is rather a balance sheet of the national economy. This scheme for the balance does not show class divisions, capital, outlays of manpower and mechanical energy, or national income. The publication of the Central Statistical Administration therefore includes, separately from the balance of the national economy, a balance for capital, for outlays of manpower and mechanical energy, and a study of national income. The most essential idea of a balance-the organic unity of all fundamental factors: production, distribution, exchange, and consumption-therefore remains unrealized....
The study of the history and theory of the problem and critical examination of the national economic balance prepared by the Central Statistical Administration oblige us to propose a positive outline, the oldest form of which is the preparation of a scheme for a balance sheet.
In application to the Soviet economy we must select the social forms of the economy as the broad headings, e.g., state-socialist, cooperative, state-capitalist, private-capitalist, small-scale commodity, and seminatural. Ne¿ come the branches of the national economy, in which we include agriculture, industry, housing, transport, trade, credit institutions, and state and local
The listings will be a combination of these two subdivisions and will thus have the following appearance:
In each of the first five branches which are directly concerned with the creation, promotion, or distribution of material values, the following must be shown: capital at the beginning of the year, subdivided into fixed-in its two forms, construction and equipment-and circulating-with a breakdown for material objects, monetary values, and excess of credits over debits. Next tobe shown are wear and tear of fixed capital, new investments in fixed capital, the change in all the factors of circulating capital (including what is received from the state treasury), capital increment and diminution, and, therefore, the state of capital at the end of the year. Next, the scheme should contain the total figures for production. For transport this will be the total of receipts; for trade, gross profits after deducting defrayals for transport; for housing, total rental receipts in a year; and for industry, total output produced by all enterprises, deducting only raw materials and semifinished goods consumed in these same enterprises (the method of plant appraisal). Next, productive expenditures must be established, e.g., amortization deductions, outlays on raw materials and fuel (capital investments have already been shown under the section on capital). After deducting productive outlays from gross output we get the net product, which should be divided into wages of workers and employees, supplementary wage charges, overhead, interest, and taxes; accumulation (profits) or losses must be ascertained. For trade, for example, in the productive expenditures category should be placed the purchase price of goods.
All the first five branches can be totaled.
Credit institutions may be entered in the table in analogous fashion. For example, the total of active transactions should be entered in the chart of production, and passive transactions under productive outlays. The state budget can be included in the table in reverse order: expenditures should be balanced with the respective charts of receipts from the state treasury (left-hand side) and income with payments to the treasury.
These sections of the table complete the analysis of capital, production, and accumulation. The table must next include a calculation of human and mechanical power used by the given branch and social form of the economy, and then the number of dependents supported by persons employed in the given branch; it must show the total sum of consumption as well as savings both of material products and for the satisfaction of other needs, effected by both employed persons and dependents.
This scheme will make it possible to express the mutual interconnections of branches and social forms of the national economy.
This scheme will be consonant with the pivotal idea which Marx expressed in his “Introduction to the Critique of Political Economy”: production, distribution, exchange, and consumption are parts of a whole, diversity within unity.
“Balans narodnogo khoziaistva,” Planovoe khoziaistvo, November, 1926, pp. 62-80.
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