Problems in the theory of state capitalism

Our analysis has focused on the concept of state capitalism as applied by its various proponents to the Third World and advanced capitalist countries as well as the socialist countries. This concept was employed to explain the changes which occurred in the nature and role of the state in contemporary societies, particularly its intervention in and regulation over their economies. The proponents of the thesis of state capitalism for the Third World and advanced capitalist countries accurately describe the greater intervention of the state through nationalization measures and the introduction of state planning. Their interpretation of these processes as the emergence of state capitalism emanates from a conception of the state as external to capitalist production relations. They have failed to demonstrate that capitalism, in either the Third World or advanced countries, has taken a qualitatively new form; more specifically that (1) private capital has been subordinated to the state, and (2) that the operation of the market is controlled by national plans. Our critique has shown that the increasing intervention of the state, which albeit plays an important role in these societies, is explainable in terms of the logic of capitalism in its various manifestations, The state, therefore, has always been an intrinsic component of capitalist relations of production, and the concept of state capitalism, which attributes new properties to the character of capitalism, is untenable. Adherents of the state capitalist model for the socialist countries attempted to reveal that capitalist forces (embodied in the state bureaucracy) and relations had restored their dominance in these societies subsequent to anti-capitalist revolutions. However, we have shown the inadequacy of their argument by demonstrating that (1) capitalist relations of production within these societies, and that in fact some sectors (the completely planned sectors), have lost their commodity character; (2) that the state bureaucracy cannot correspond to a capitalist class because it neither can accumulate means of production nor purchase labor power for its own ends; and (3) that they neglect to see that societies in early forms of socialism, particularly within the context of a capitalist world market, retain certain capitalist elements and forms of inequality. Although we do not deny that capitalist relations of production may regain their dominance within these societies and that the state bureaucracy may correspond to a capitalist class, these have not yet been demonstrated. Consequently, the use of the concept of state capitalism to characterize these societies does not accurately reflect reality. We therefore maintain that state capitalism as a sociological concept is presently overused and lacks the theoretical rigor a concept requires if it is to be useful for social analysis. State capitalism, therefore, must be used as an analytical category and not merely as a loose descriptive device. Our critique of the state capitalism concept is not merely semantical, but is based on a fundamentally different conception of the character of the state in capitalism as well as in socialism. The adherents of state capitalism - in capitalist or socialist societies - must demonstrate that social reality indeed expresses new properties which necessitate the creation of a new concept.