Restorationism: will capitalism be restored?

Labour Briefing no. 96, 7 February 1990, p. 9

Transcribed or corrected by hand from the printed page.

The Nineties opens with the outcome in Eastern Europe still in the balance. Every socialist must be overjoyed at the workers revolution in Romania, and the mass mobilisations beginning to sweep away Stalinist tyranny in East Germany, Czechoslavakia and Bulgaria. But our enthusiasm for this revolution has to be tempered. The outcome could be a victory for capitalism of truly historic proportions.

If capitalism were to be re-established in Eastern Europe, and especially in the Soviet Union as well, the political repercussions would be catastrophic.

Eastern Europe would become a source of cheap labour for the multinationals, which would be an important step towards resolving the capitalist crisis which has lasted since the late 1960s. The way would be cleared for huge new assaults on the third world.

Clearly, Western socialists cannot be indifferent to the restoration of capitalism in Eastern Europe.

How could capitalism be reintroduced in Eastern Europe? Of course, a change in political regime does not in itself mean a restoration of capitalism. There are powerful obstacles to privatisation. In strict profit-and-loss terms many of the enterprises in East Germany and Czechoslavakia — let alone Romania and Poland — are bankrupt. Why should capitalists in the West want to buy them therefore?

However, this line of argument only holds true in the short term. The Western bourgeoisie is not going to start by buying bankrupt industry, but by investing in modern and profitable ventures. This is already happening. For example, in Hungary the US giant General Electric has spent $150 million in taking over the famous Tungsram electric enterprise and Robert Maxwell is investing in publishing.

Capitalism

But even in the short-term Western capitalism can start taking over less profitable, or even bankrupt, enterprises. The objective will be to asset-strip them. But the key asset which imperialist capital wants to get its hands on is cheap labour.

This is indeed what the Polish government, in the shape of Lech Walesa, has been openly offering the West. The cheapest labour in any advanced country — a mere £20 a month! — in exchange for Western investment.

Any move towards capitalism will bring untold misery. The IMF's aid package to Poland will cost wages increases being held to only 50 per cent of the rate of inflation. This means absolute impoverishment and misery for the masses.

The prospect of Eastern Europe being used as a pool of ultra-cheap labour is a dagger pointed at the heart of Western Europe's trade unions and those of other advanced capitalist countries. The threat of relocation to Eastern Europe would be used to wage an all-out assault on wages and conditions.

Austerity

Of course, for capitalism to triumph in the East, a political battle has to be won against the working class. Violent austerity measures have to be imposed on the debt-laden East. It seems unlikely that in a period of mass mobilisation, when the workers have won huge victories, they will easily accept such measures. New independent trade unions, and the militant left of Solidarnosc in Poland, will surely fight back against austerity.

The workers reaction to privatisation is less certain. In Poland there have already been struggles against it. But the fight against privatisation, like the fight against austerity, depends on the outcome of a political battle.

Apparatus

While a section of the bureaucratic apparatus will champion capitalist restoration, seeing its only future within a new capitalist class, others will fight against it. But the key to the struggle lies in the ideology of opposition leaders and their working class base. The prospects here are very uncertain.

Economic

Almost everywhere one or other form of "marketisation" is seen as the only solution to the economic crisis. Even in East Germany, where adherence to socialism predominates, there is little opposition to "marketisation" as the economic solution.

If the workers of Eastern Europe can spontaneously fight austerity, they cannot spontaneously create a democratic socialist society. It needs a conscious political fight, and explicitly socialist democratic current in the working class to fight for it. Socialists in Britain have to do everything possible to aid socialists in Eastern Europe in this fight.

transcribed from the page image, 2 Nov 2026; spelling as printed (Czechoslavakia, "workers revolution" without apostrophe, "The workers reaction", "The Nineties opens", "cost wages increases"). Kicker "Restorationism" in a bar above the headline. By-line "By PHIL HEARSE" set between rules in the first column under the bold standfirst (two paragraphs, set here as one). Complete on the right half of page 9 (Eastern Europe); no jump. In "champion" the p is partly lost at a line break; read as printed. Left out: the photograph and caption ("Polish workers: will they resist \\"market reforms\\"?", photo Jacek Wasilo). The left half of the page (the end of a piece on democratising economic gains, the Sotsprof appeal, and a demonstration photograph) is not his.