Living standards in the 1970s

Before the war, when Stalin announced the dawn of ‘a happy life’, Trotsky pointed out that in the Soviet Union there was only half a pair of shoes for every worker. Under Brezhnev this was no longer the case. In 1979, the USSR was producing more shoes than any other country and there were five pairs of shoes per person. For a period of 30 years after the death of Stalin the rate of consumption grew by an average 3.6 per cent per annum. Living standards more than doubled. True, living standards in the USSR at the end of the 1970s still lagged far behind the West. Nevertheless, consumption continued to rise under Brezhnev, as table 6.4 shows.

However, the growth in living standards gradually slowed down in the 1970s, as the figures in tables 6.5 and 6.6 show.

Marx assumed that the starting point of a movement in the direction of socialism would be a high level of living standards. Only by completely satisfying all the material aspirations of men and women will it be possible to arrive at a level where such aspirations cease to dominate people’s lives and thoughts, preparing the way for a qualitatively superior level of human civilisation. So long as scarcity exists, and with it the humiliating struggle for material things, class barbarism, and all its attendant evils, will never be overcome. The vision of a classless society will remain a tantalising phantom, like a horizon which recedes further into the distance as you approach it. This explained the growing mood of scepticism and even cynicism among layers of Soviet society in relation to the hypocritical speeches of the bureaucrats who lived in luxury while the ordinary Soviet citizen had to stand in endless queues to obtain scarce goods.

Nevertheless, there is no doubt that the living standards of the Soviet population did experience a dramatic improvement in comparison to the past. According to a report in The Guardian in the mid-1980s:

Almost every home now has a TV set and a refrigerator. Seventy per cent of households have a washing machine, and 40 per cent have a vacuum cleaner and about 15 per cent have a car. Nearly half have a motorbike or a moped. (The Guardian, 7/2/86.)

Moreover, these figures do not tell the whole story. The growth in living standards was achieved with virtually no inflation. Above all, the prices of basic necessities were kept low. Bread was so cheap that the peasants would feed it to their livestock instead of grain. A particularly important gain was low rents. Whereas a worker in the West spends anything between a third and a half of his wage on rent, the situation in the USSR was totally different. Out of a 200-rouble monthly wage, only 10 roubles a month went on rent, and this included hot water, central heating, and, at least in Moscow, free local phone calls. There was a completely free education and health service, no unemployment and a month’s free holiday at resorts run by the trade unions. The Soviet Union probably had the best public transport system in the world, with extremely low fares – five kopecks for any distance in Moscow, for example.

However, despite these improvements, living standards still lagged behind those of at least the most advanced capitalist countries. The housing shortage remained serious. Living conditions for the great majority were still very cramped, and in many cases intolerably bad. One quarter of families shared a bathroom and/or kitchen. The workers no longer suffered from the privations of the earlier period. There was no real shortage, at least of the basic commodities. There were queues, of course, but eventually people got what they were waiting for. But the quality of the goods produced under the bureaucratic system was another matter. Trotsky already pointed out before the war that quality escaped the bureaucracy like an elusive phantom. The nearer the product stood to the consumer, as a rule, the poorer the quality. The lack of democratic control revealed itself most glaringly in the field of consumer goods. Above all in a society which claimed to have built ‘socialism’, the material well-being of the population cannot be measured purely in terms of how much bread and potatoes are consumed, or, for that matter, how much meat and butter.

There is an intimate connection between economic growth and living standards. Above all, the correct balance between heavy and light industry, and between industry and agriculture, is a fundamental question. In 1971, the Ministry of Light Industry received complaints about 7.6 million pairs of shoes, 1.5 million pairs of hosiery, 1.7 million items of knitwear, and 175,000 suits. In the first half of 1971, the retail network in Moscow alone rejected 33 million roubles’ worth of industrial goods. In the same year, total losses from rejected industrial output were estimated at over Rbs600 million, but the journal Finansy USSR commented that “such losses were actually much larger”. In 1970 and 1971, 50 per cent of the goods checked by the Inspectorate of the Trade Ministry of the Russian Soviet Republic did not meet official minimum standards. This resulted in the stockpiles of unsold goods in the warehouses increasing yearly. From 1968 to 1971, the unsold surplus came to 32-52 per cent of sales. By early 1972, the surplus totalled Rbs3,400 million.

Here we see the fundamental defect of bureaucratic planning. Without the democratic control and participation of the working class, it inevitably leads to an uncontrolled flourishing of waste, corruption and mismanagement. This was always true – even in the best period in the USSR – but under the conditions of a sophisticated modern economy, producing a million different commodities each year, it became a nightmare. The Soviet press in the period under examination was full of the most appalling examples of bureaucratic bungling. The following is a typical example:

The more expensive the material is, the fewer clothes required to fulfil the plan!… The cheaper the model, the more cars needed to be manufactured in order to fulfil the plan, and that would require additional capacity and manpower… A power engineer once praised me for leaving the electric light on: “Good for you! The more energy you consume, the bigger our bonus!” The director of the Riga Electro-Mechanical Plant commented: “Any quantitative index used as the basis for planning and evaluation will inevitably be one-sided and ultimately damaging. If the ton is the measure, output will get heavier. If the rouble is the measure, it will get costlier. If consumer satisfaction were used as the base, then production volume would certainly never be the measure”. (Managers quoted in Literaturnaya Gazeta, November 1976.)

The purely quantitative approach to planning inevitably produced the most grotesque distortions in the absence of the democratic control and participation of the working class:

If the director can get away with producing only a few styles of shoes, he will have long production runs and be able to cut costs. If he can bias his production toward small-size shoes and away from large ones, he can save on leather inputs. Finally, although the state sets the prices for his shoes, different styles will yield him different profit mark-ups. The director can try to specialise in those styles which offer the highest profit.

How far the director can go in all this depends on his bargaining position. In the past, this position has been good, indeed. Always less has been produced than the customers would buy. Thus, wholesalers have been fairly easy to deal with; since they could sell anything, why antagonise the producer in a sellers’ market? Only the final customer complained bitterly about the results of this system. (David Granick, The Red Executive, p. 34.)

Trotsky pointed out that to portray economic growth purely in terms of volume is like attempting to demonstrate the strength of a man on the basis of chest measurement alone. The purely quantitative approach to targets led to the production of the most heavy and cumbersome vehicles, so that a given number of tonnes would meet the target; or so many thousands of shoes would be produced, but all left-footed. Of course, such ‘mistakes’ would be noticed by the workers, but, in the absence of free speech and independent trade unions, there was no way of denouncing them. Too outspoken criticism would only lead to problems, dismissal, imprisonment or confinement in a mental home. It was better to keep your head down and your mouth shut, get your pay packet at the end of the month, and hope that things would get better, which in many ways seemed to be happening.

In a speech at the Party Congress in 1986, Gorbachev described the position in Soviet light industry:

Last year millions of metres of fabrics and millions of pairs of leather footwear and many other consumer goods were returned to the factories or marked down as inferior grade goods. The losses are significant: wasted raw materials and the wasted labour of hundreds of thousands of workers. Bureaucracy is today a serious obstacle… Bureaucratic distortions manifest themselves all the stronger where people are held less accountable for what they do. (The Times, 27/2/86.)

Freed from all popular controls, the bureaucracy behaved in an absolutely irresponsible manner. They showed the same short-sightedness, the same criminal disregard for the broader interests of society as the big monopolies. In general, they were just as bad as the bourgeois in relation to the environment. This was shown by the nuclear disaster at Chernobyl, by the destruction of the Aral Sea, the poisoning of the Caspian Sea and Lake Baikal and the sinking of nuclear vessels in the Arctic Ocean.

The absolute mess and chaos was indicated by the crazy proliferation of ministries of all kinds. In the machine-tool sector alone there were no fewer than 11 separate ministries – the Ministry of General Machine Building, the Ministry of Heavy Machine Building, etc. In transport, there were five ministries, and so on. There were many examples of the problems caused by this situation. For example, natural gas was discovered in Central Asia. But in order to commence exploitation, they had to obtain the signatures of 27 different ministries and departments. This took seven years, after which the gas had been lost.