What led the proponents of “Populist” theory in Russia to the problem of capitalist reproduction was their conviction that there was no prospect of capitalism in that country, and more precisely, their belief that this was due to the lack of markets in which to sell commodities. Vorontsov laid out his theory in this regard in a series of articles in the magazine Otechestvennye Zapiski* [Jottings from Our Native Land] and in other journals that were collected and published in 1882 under the title Sudby kapitalizma v Rossii [The Destiny of Capitalism in Russia]; he gave subsequent expositions in “The Commodity Surplus in the Supply of the Market” [1883],221 “Militarism and Capitalism” [1889],222 in a volume entitled Nashi napravleniia [Our Trends (1893)], and finally in Outlines of Economic Theory [1895]. Vorontsov’s position vis-à-vis capitalist development in Russia is not so easy to identify. He stands neither on the side of the purely Slavophile theory that derived the perversity and perniciousness of capitalism for Russia from the “peculiarities” of the latter’s economic structure and its particular “Volksgeist,” nor on the side of the Marxists, who regarded capitalist development as an unavoidable historical stage that would, also in the Russian case, clear the only viable path toward social progress. For his part, Vorontsov maintained that capitalism was simply impossible in Russia: it had no roots, and no future. It would be equally as perverse to execrate it as to wish for it, since in Russia the very preconditions for capitalist development are lacking; accordingly, all attempts by the state to nurture capitalism in Russia, with all the sacrifices they imply, would be in vain: love’s labor’s lost. However, on closer inspection, it can be seen that Vorontsov subsequently qualifies this assertion very substantially. If the focus is not the accumulation of capitalist wealth, but rather the capitalist proletarianization of petty producers, the precarious existence of workers, and periodic crises, then Vorontsov does not deny any of these phenomena. On the contrary, he explicitly states the following in the preface to The Destiny of Capitalism in Russia: “While I dispute the possibility of capitalism becoming the predominant form of production in Russia, I do not intend to commit myself in any way as to its future as a form or degree of exploitation of the nation’s forces.”
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*Otechestvennye Zapiski (Jottings from Our Native Land) was a Russian literary-political magazine founded in St. Petersburg in 1818. In the 1830s and 1840s it became an important vehicle for discussions among the Russian intelligentsia; its contributors included Alexander Herzen and Vissarion Belinsky. By the 1880s it became a major voice of the Narodniks. In 1877 Marx wrote a letter to its editors, objecting to an article by N. Mikhailovsky that attributed to him the view that Russia’s indigenous communal formations of land ownership needed to undergo dissolution before Russia could enter a socialist stage of development. The title of the journal was mistranslated as “Patriotic Memoirs” in both the German edition of The Accumulation of Capital found in Luxemburg’s Gesammelte Werke, Vol. 5 (Berlin: Dietz Verlag, 1975) and in Anges Schwarzschild’s earlier English translation (New York: Modern Reader, 1951). The adjective otechestvenny is generally used for an item of domestic, or native, manufacture; hence, the literary-political editors and authors of the magazine clearly meant it as a vehicle for writings from our native land (as opposed to material written by foreigners). Zapiski comes from the verb zapisyvat, which means to “note down, write down, jot down, record.”
Vorontsov thus considers that capitalism in Russia simply cannot reach the same degree of maturity as in the West; by contrast, the process of the separation of the immediate producers from the means of production is to be expected in Russian circumstances. Indeed, Vorontsov goes even further. He does not at all dispute the possibility of the development of capitalist forms of production in certain branches of Russian industry, and even allows for capitalist exports from Russia to external markets. However, he states the following in his essay “The Commodity Surplus in the Supply of the Market”:
In several branches of industry, capitalist production develops very quickly [in the Russian sense of the term—R. L.].223
It is most probable that Russia, just like any other country, enjoys certain natural advantages that enable her to act as a supplier of certain kinds of commodities on foreign markets. It is extremely possible that capital can take advantage of this fact and take hold of the branches of production concerned—that is to say the (inter) national division of labor will make it easy for our capitalists to gain a foothold in certain branches. This, however, is not the point. We do not speak of a merely incidental participation of capital in the industrial organization of the country, but ask whether it is likely that the entire production of Russia can be put on a capitalist basis.224
Expressed in this form, Vorontsov’s skepticism clearly looks somewhat different from what might have been assumed at first. He entertains doubts as to whether the capitalist mode of production will ever be able to take hold of all production in Russia. However, it has yet to perform such a feat in any country in the world, including the U.K. Such skepticism in relation to the future of Russian capitalism would thus apply across the board internationally. Vorontsov’s theory does indeed imply general considerations on the nature of capitalism and the essential preconditions its existence, and it rests upon general theoretical conceptions of the process of reproduction of total social capital. Vorontsov provides a clear formulation of the particular connection between the capitalist mode of production and the question of markets as follows:
The (inter)national division of labor, the division of all branches of industry among the countries engaging in international trade, is quite independent of capitalism. The market that comes into being in this way, the demand for the products of different countries resulting from such a division of labor among the nations, has intrinsically nothing in common with the market required by the capitalist mode of production … The products of capitalist industry come onto the market for another purpose; the question whether all the needs of the country are satisfied is irrelevant to them, and they do not necessarily provide the entrepreneur with another material product in exchange that may be consumed. Their main purpose is to realize the surplus value they contain. What, then, is this surplus value that it should interest the capitalist for its own sake? From our point of view, it is the surplus of production over consumption inside the country. Every worker produces more than he himself consumes, and all these surpluses accumulate in a few hands; the owners of these surpluses consume them themselves, exchanging them for the purpose against the most variegated kinds of means of consumption and luxuries. Yet eat, drink, and dance as much as they like—they will not be able to squander the whole of the surplus value: a considerable remnant will be left over, which they do not exchange for other products, but which they simply have to dispose of. They must convert this remainder into money, since it would otherwise go to waste. Since there is no one inside the country on whom the capitalists could foist this remnant, it must be exported abroad, and that is why foreign markets are indispensable to countries undergoing capitalist development.225
The above quotation, which has been translated literally, preserving all of the peculiarities of Vorontsov’s mode of expression, can be taken as a sample to give the reader an inkling of this brilliant Russian theorist, and of the most delightful moments that can be spent reading his work.
Later, in 1895, Vorontsov summarized these ideas in his book, Outlines of Economic Theory; it might be instructive to hear what he has to say here. He polemicizes against the viewpoints of Say, Ricardo, and above all John Stuart Mill, who deny the possibility of general overproduction. In so doing, Vorontsov discovers something that was previously unknown to all: he detects the source of all errors of the classical school in relation to crises. According to Vorontsov, this source lies in the bourgeois economists’ penchant for an erroneous theory of the costs of production. Yet from the standpoint of the costs of production (which Vorontsov assumes not to include profit, which is likewise an insight that had evaded all before him), both profit and crises are inconceivable and inexplicable. This original thinker deserves to be appreciated in his own words, however:
According to the doctrine of bourgeois economists, the value of a product is determined by the labor employed in its manufacture. Yet bourgeois economists, once they have given this determination of value, immediately forget it and base their subsequent explanation of the exchange phenomena upon a different theory that substitutes “costs of production” for labor. Thus two products are mutually exchanged in such quantities that the costs of production are equal on both sides. Such a view of the process of exchange indeed leaves no room for a commodity surplus inside the country. Any product of a worker’s annual labor must, from this point of view, represent a certain quantity of material of which it is made, of tools that have been used in its manufacture, and of the products that served to maintain the workers during the period of production. It [presumably the product—R. L.] appears on the market in order to change its use-form, to reconvert itself into materials, into products for the workers and the value necessary for renewing the tools. As soon as it is split up into its component parts, the process of their reunification, the production process, will begin, in the course of which all the values listed above will be consumed. In their stead, a new product will come into being that is the connecting link between past and future consumption.
From this very peculiar attempt to present social reproduction as a continuous process from the standpoint of the theory of costs of production, the following conclusion is suddenly drawn, as if shot from a pistol:
Considering thus the total mass of a country’s products, we shall find no commodity surplus at all over and above society’s requirements; an unsalable surplus is therefore impossible from the point of view of a bourgeois economic theory of value.
After Vorontsov has thus, through his extremely high-handed mistreatment of “bourgeois value theory,” excluded profit on capital from the costs of production, he then proceeds to pass off the identification of this omission as a brilliant discovery: “The above analysis, however, reveals yet another feature in the theory of value prevalent of late: it becomes evident that this theory leaves no room for profits on capital.”
There now follows an argument that is striking in its brevity and simplicity:
Indeed, if I exchange my own product, representing a cost of production of 5 roubles, for another product of equal value, I receive only so much as will be sufficient to cover my expense, but for my abstinence [literally—R. L.] I shall get nothing.
Here Vorontsov gets to the root of the problem:
Thus it is proved on a strictly logical development of the ideas held by bourgeois economists that the destiny of the commodity surplus on the market and that of capitalist profit is identical. This circumstance justifies the conclusion that both phenomena are interdependent, that the existence of one is a condition of the other, and indeed, so long as there is no profit, there is no commodity surplus … It is different if profit is generated inside the country. Such profit is not organically related to production; it is a phenomenon that is connected with the latter not by technical and natural conditions but by its external, social form. Production requires for its continuation … only material, tools, and means of subsistence for the workers, therefore it consumes by itself only a corresponding part of the products: other consumers must be found for the surplus that makes up the profit, and that finds no place in the constant element of industrial life, in production—consumers, that is, who are not organically connected with production, and are characterized to a certain extent by a certain contingency. The necessary number of such consumers may or may not be forthcoming, and in the latter case there will be a commodity surplus on the market.226
Highly satisfied with this “simple” elucidation, in which he has turned the surplus product into an invention of capital and the capitalist into a “contingent” consumer “not organically” connected with capitalist production, Vorontsov proceeds to unfold crises directly from surplus value on the basis of Marx’s “logically consistent” labor theory of value, which he claims to have “employed” to develop his argument, as follows:
If the working part of the population consumes what enters into the costs of production in form of the wages for labor, the capitalists themselves must destroy [literally—R. L.] the surplus value, excepting that part of it that the market requires for expansion. If the capitalists are in a position to do so and act accordingly, there can be no commodity surplus; if not, overproduction, industrial crises, displacement of the workers from the factories, and other evils will result.
According to Vorontsov, however, it is “the inadequate elasticity of the human organism that cannot expand its capacity to consume as rapidly as surplus value increases” that is ultimately responsible for these evils. He then reformulates this ingenious insight as follows: “The Achilles’ heel of capitalist industrial organization thus lies in the incapacity of the entrepreneurs to consume the whole of their revenue.”
Here, then, having “employed” the Ricardian theory of value in its “logically consistent” Marxian conception, Vorontsov arrives at the Sismondian theory of crisis, which he also appropriates in the most raw and simplistic form possible. In regurgitating Sismondi’s conception, however, he of course believes he is adopting that of Rodbertus: “The inductive method of inquiry,” he declares triumphantly, “has resulted in the very same theory of crises and immiseration that had been objectively established by Rodbertus.”227 It is not actually clear what Vorontsov understands by the “inductive method of inquiry” that he contrasts with the “objective” one, but, since everything is possible with him, it might be that he is referring to Marx’s theory. Yet nor is Rodbertus to be left “unimproved” by his treatment at the hands of the original Russian thinker. The only correction Vorontsov makes to Rodbertus’s theory is to exclude what was for the latter the very core of his system: the setting of a fixed wage-share of the value of the total social product. According to Vorontsov, this measure against crises would also merely be a palliative, since “the immediate cause of the above phenomena (overproduction, unemployment, etc.) is not that the working classes receive too small a share of the national income, but that the capitalist class cannot possibly consume the mass of products falling annually to its share.”228
Yet, having thus rejected Rodbertus’s reform of income distribution, Vorontsov, with his characteristic “strict logical consistency,” comes up with the following prognosis for the future destiny of capitalism:
In the light of the foregoing, if the industrial organization that prevails in West Europe is to prosper and flourish further still, it can only do so provided that some means will be found to destroy [literally—R. L.] that portion of the national income that exceeds the capitalist class’s capacity to consume but nonetheless falls to its share. The simplest solution of this problem would be a corresponding alteration in the distribution of national income among those who take part in production. If, with each increase in the national income, the entrepreneurs retained for themselves only the portion they need to satisfy all their whims and fancies, leaving the remainder to the working class, i.e. to the mass of the people, then the régime of capitalism would be assured for a long time to come.229
This hotchpotch of Ricardo, Marx, Sismondi, and Rodbertus thus ends with the discovery that capitalist production would be radically cured of overproduction, that it could “prosper and flourish” for all eternity, if the capitalists refrained from capitalizing their surplus value and instead donated the corresponding part of the surplus value to the workers.* Since the capitalists have not yet become sensible enough to heed the good advice offered to them by Vorontsov, they resort in the meantime to other means for the “destruction” of a part of their surplus value each year. According to Vorontsov, one of these tried and tested means, among others, is modern militarism, and, to be more precise—since Vorontsov can be relied upon to turn everything upon its head—exactly to the extent that the costs of militarism are met from the revenue of the capitalist class rather than from the means of the working population. In the first instance, however, the remedy for capitalism consists, according to Vorontsov, in external trade. This is in turn Russian capitalism’s Achilles’ heel. As the last to arrive at the table of the world market, it comes up short in the face of competition from the older capitalist nations of the West, and thus, with its lack of prospects vis-à-vis external markets, Russian capitalism is deprived of the most important condition for the viability of its existence. Russia remains a “realm of peasants” and “handicraft production.”
“If all this is correct,” states Vorontsov in the conclusion to his essay on “The Commodity Surplus in the Supply of the Market,”
then the restrictions upon capitalism’s predominance in Russia are given as a result. Agriculture must be removed from its control, and its development in the industrial sphere must not be too devastating for the domestic industry that under our climatic conditions [!—R. L.] is indispensable to the welfare of the majority of the population. If the reader is prompted to comment that capitalism might not accept such a compromise, our answer will be: so much the worse for capitalism.
This is how Vorontsov ultimately washes his hands of the matter and declines any personal responsibility for the future destiny of economic development in Russia.
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*This perspective later became the basis of Keynesian fiscal policies.