What caused the collapse of the Soviet Union? Why does socialism also need financial capital?
The Soviet Union collapsed in 1991. The Russia-Ukraine conflict broke out in 2022, 30 years after the collapse of the Soviet Union. These two events have had a profound and huge impact on the world political and economic pattern. For the reason of the collapse of the Soviet Union, some people ascribe it to economic backwardness, others think it is the system, it can be said that there are differing opinions; as for the truth of the conflict between Russia and Ukraine, people in different camps are even more hostile.
In this regard, Professor Wen Tiejun, a famous scholar, believes that the reason for the disintegration of the Soviet Union lies in the "non-monetization" of its economy; the essence of the Russia-Ukraine conflict is that Western debtors, led by the United States, are once again trying to bring other countries down and harvest their resource assets and industrial manufacturing assets. Behind these two major events, the soft power of Western discourse is acting as a tool of war.
Clear the fog to see the essence, explore the laws behind the facts - welcome to read Professor Wen Tiejun's speech.
Note: This article is based on Professor Wen Tiejun's "Ten Lectures on the Evolution of the Cold War in the Era of Financial Capital (From the Old Cold War to the New Cold War)" series of lectures and "温言铁语" lecture content. Share with you, invite you to ponder together.
The "demonetization" of the Soviet economy - the dominance of financial capital versus the planned distribution of allocated materials
The Soviet economic system is different from the United States and other Western countries in that its materials do not rely on the free circulation of money, but rely on national planning. The result is that although the total amount of industrial and agricultural production in the Soviet Union is a lot, it is not counted in GDP, and the economic growth is slow in statistics.
The reason for the collapse of the Soviet Union, we believe, was mainly the de-monetization of the economy.
When the US economy is transformed into an economic model in which financial capital dominates global profits, it can capture global profits by printing money. At the same time, a large number of developing countries have gradually become Westernized by introducing Western equipment and technology, as well as Western institutions and systems. Developed countries, especially those that have transferred equipment and technology, form their own claims, and then obtain profits through the debt-debt relationship. Of course, this will lead to demands for institutional reform in developing countries. When this happens, it means that the Western system led by the United States is gradually expanding.
Why couldn't the Soviet Union and Eastern Europe expand at the same time? For there is an essential characteristic of the Soviet East European system economically, since Marxism regards financial capital as rotten, parasitic, and dying. Finance capital will be a fundamental cause of the demise of capitalism, so that the Soviet Union and Eastern Europe, in the stage of competition for industrial capital, will continue to develop along the general industrial lines of capitalism.
It is well known that in 1947 two mutually exclusive ideologies emerged: the Soviet Union and Eastern European countries, even after their industrialization, clung to socialist ideology and rejected the liberal capitalist system.
In the 1970s, when Western countries began to enter a new stage of globalization led by financial capital, the parasitism of financial capital was visible to all, so the Soviet and Eastern systems always insisted on not entering into monetization. This does not mean that these countries do not issue currencies, but they do not use them as a primary means of exchange. We both know nothing can happen if you don't have the money. However, in the Soviet Union and Eastern European countries, because of the planned distribution of materials, at the same time an internal formation called "mutual economic cooperation", that is to say, in all the Soviet Union and Eastern European countries in the system of economic cooperation and economic assistance, we can transfer materials to each other, with the transfer of materials in this way of planning, rather than monetary transactions, so that exchange can be completed. It's just that this exchange is relatively slow or not so flexible, but economically sustainable and can grow.
At that time, the total amount of physical economy produced by the entire Soviet Union and Eastern Europe was large, but because it did not use money, but relied on the transfer of materials, it could not monetize the entire economy, and could not generate income (according to the Western statistical system). The Soviet Union and Eastern Europe failed to turn finance into a self-sustaining industry. According to the textbook, if you want to stabilize the value of the currency, according to the original socialist planned economy, you must produce 12 yuan of goods, you can issue 12 yuan of currency; If you produce $8 of goods and you issue $1 of currency, that means the currency is devalued, that means the currency is unstable.
So from the original textbooks, the entire Soviet Eastern European system was a non-monetized economy. Because Soviet Eastern Europe did not use money as the primary medium of exchange, it did have a much higher currency value than if it relied on a monetary economy to drive growth in the formation of virtual capital transactions. Before the collapse of the Soviet Union, one Soviet ruble was worth about three dollars. Therefore, an employee in the Soviet Union at that time, he worked for decades, and he could always save 10,000 to 20,000 rubles, which meant that he had about 30,000 to 60,000 dollars, which was considered middle class. In addition, the resources of the Soviet Union are very rich, as long as you are a worker, with 5 years of service, the state will give you free allocation of 0.5 hectares of garden land.
So the Soviet economy itself did not stop growing or decline, it just did not enter the financial capital-led economic growth as in the West, and it did not grow as fast on the surface.
However, at that time, the developing economies of the whole world, including China, had gradually begun to transfer to the Western system with the introduction of a large number of Western equipment and technology. As a result, most countries have turned to GDP for economic statistics. China previously counted the total output value of industry and agriculture, and since the 1980s we have changed to calculate the added value in exchange, that is, to the Western statistical system.
When the whole world changed, the Soviet Union and Eastern Europe eventually followed suit.
Because Eastern Europe in the Soviet Union has always been a non-monetary transaction, for example, how many tons of wheat from Ukraine to the Czech Republic, or how many tons of vegetables from Romania to East Germany, how many turning machines from East Germany to Ukraine, and how much wheat from Ukraine to Russia. Such a planned distribution system for allocating various resources and materials did not use money, which led to a clear gap between the growth of the Soviet Union and Eastern Europe and that of the West after the GDP statistics were changed. However, this was the trend of the world at that time, and the Soviet Union and Eastern Europe had to follow suit.
By manipulating oil and food prices, the United States triggered internal demands for change
The Soviet Union was an energy exporter and a grain importer. The United States lowered the price of oil, reduced the foreign exchange in exchange for the Soviet Union, and raised the price of grain, forcing the Soviet Union to devote more land resources to food production and reduce the output of other products, resulting in insufficient supply of agricultural products and widespread dissatisfaction among the people, which generated the power to demand reform in the eastern Soviet Union.
During the Cold War, the United States and the Soviet Union carried out arms race for a long time, and both sides turned a lot of resources to military competition. The United States proposed the Star Wars plan, and the Soviet Union also engaged in the Star Wars confrontation. The United States used the Star Wars program to redirect much of the Soviet Union's production capacity into space. This led to a decline in the input into the production of general consumer goods in Soviet society and a decline in the level of social satisfaction.
The Soviet Union was an energy exporter, but it was an importer of food. In the 1980s, the United States played a very interesting price game: pushing down the price of oil and pushing up the price of grain - by pushing down the price of oil, the Soviet Union's income from oil exports fell sharply and its foreign exchange was reduced. The Soviet Union had to use foreign currency (dollars) to buy food, and then the United States raised the price of food. The Soviet Union used limited foreign exchange to buy high-priced grain, forcing the country to convert more land to food production, and fruit and vegetable production fell. In a short period of two or three years, the supply of agricultural products in the Soviet Union changed structurally - the supply of agricultural products was insufficient, and the needs of the people could not be met, which led to widespread dissatisfaction and evolved into social contradictions. The common people thought the Soviet system was bad (the so-called totalitarian system). At this time, the whole West has entered the stage of financial capital, which can drive a large number of developing countries to join the Western system. The surplus created by the Western occupation of the global industrial layout is increasing, so the Western economies are growing at a faster rate and are relatively able to provide more social spending. This comparison gave rise to the belief in the Soviet Union and Eastern Europe that there was a serious problem with their own system, which triggered the impetus for change within the Soviet Union and Eastern Europe.
At this time, the Soviet Union and Eastern Europe began to appear more and more separatist tendencies, and the voices of various internal opposition became more and more loud. The former Soviet leader Leonid Brezhnev aggressively developed military power to fight against the United States. After the leadership of the Soviet Union was replaced by Gorbachev, the so-called reformist leader, first of all, the reformists in the Soviet Union admitted that their system could not work, so they followed the call for reform in society to promote reform, so one after another, the Soviet Union moved toward the road of political reform. In 1989, the bloc of the entire Soviet Union in Eastern Europe was already loosened, and in 1991, the Soviet Union completely disintegrated, marking the collapse of the entire Soviet system.
The disintegration of the Soviet Union and Eastern Europe - the disintegration of political sovereignty and the collapse of the financial system
One of the most striking things about the collapse of the Soviet Union is that the collapse of the financial system coincided with the collapse of the political system. In the early 1990s, China began to introduce deepening reform measures to completely abandon the supply of coupons, and issue more money to promote the exchange of physical products, to avoid repeating the mistakes of the Soviet Union.
At this stage of the collapse of the Soviet Union, I happened to go to the Soviet Union and Eastern Europe to do research. I visited seven countries, and one of the most immediate impressions was that their financial systems collapsed almost simultaneously as political reforms led to the collapse of the regime.
After this investigation of the Soviet Union and Eastern Europe, I began to pay attention to how to explain the collapse of the Soviet Union. Through further research, we find that money is a piece of paper, which is called paper credit. Under the condition of the global abandonment of the gold standard, what is the subject that empowers money and credit? It is national political power, it is the independence of national sovereignty. Whether the power of the state is strong or not is the key factor that determines the value of the currency. Before the collapse of the Soviet Union, one Soviet ruble was worth three dollars. After the collapse of the Soviet Union, it was 4,000 rubles to the dollar or more. What's the reason? That is, after the dissolution of the regime, paper money has no subject of monetary empowerment. Therefore, the monetary system is the core economic sovereignty of a country.
Not only the Soviet Union, but also the entire Eastern European system, before entering into monetization in the past, the national currency they formed was basically empowered by national political sovereignty to form monetary credit. Once the national political sovereignty disintegrated, the financial system of all these countries collapsed.
I went through seven Eastern European countries, and in each country, I took out a dollar check, and I got a bunch of those big bills with a bunch of zeros.
At that time, our own domestic is still the era of gross tickets, has not yet entered the monetization. Throughout the 1980s, until the early 1990s, we did not enter into monetization, so we called it the gross ticket era. We still use plans to distribute goods. At that time, we went to the street to eat bowls of noodles, two or three cents; You make a phone call on the street, two or three cents; You take the subway, 30 cents to 50 cents. Therefore, from an objective perspective, China was not called a monetary economy at that time, and the growth of our economy objectively existed. However, we do not use money as an exchange intermediary, and only count physical output, so statistically there is not much so-called GDP growth.
If we focus the so-called slow economic growth on the backwardness of the system, we can analyze: maybe it is backwardness, maybe it is not. I'm not making any value judgments, I'm just telling you: the difference is that you don't monetize, a lot of physical resources are an objective wealth, but it's not monetized, it can't be measured in money. So that was the root cause of the collapse of the Soviet Union, or at least a large part of it was because a lot of assets, a lot of products produced in eastern Europe were not measured in money, they were still planned distribution, so it did not show up as economic growth. This is a very serious problem. Whether or not we agree with a particular theory, with the generalization of a particular economic phenomenon, depends on the extent to which we can bring our economy to a stage where it can participate in international competition dominated by finance capital.
I returned home after about 40 days of study in the Soviet Union and Eastern Europe. At that time, when the cadres exchanged views and reported, I said that I was afraid that few people were willing to go to the Soviet Union and Eastern Europe at this stage to do in-depth and practical research at the grass-roots level, and that the results of the investigation I got were not from their official documents or from their newspapers, but were formed in the course of field investigation. I visited a number of businesses, met with a variety of different people, and finally wrote a report.
Since then, I believe that China's economic and institutional system has gradually entered the Western system of equipment, technology and even management. In the process of gradual transformation, we need to draw lessons from the disintegration of the Soviet Union and Eastern Europe to promote China's monetary transformation.
After our country summed up the lessons of the collapse of the Soviet Union and Eastern Europe, during the same period of the collapse of the Soviet Union in 1991-1992, China began to introduce deepening reform measures to completely abandon the supply of coupons, and then promote the exchange of various physical products by issuing additional currency. This is an important measure for China to avoid the lessons of the Soviet Union and Eastern Europe.
Soft power and smart power are both tools of war used by the West
The so-called smart power is the Western countries to initiate civil unrest in other countries, and the so-called soft power is a set of political correctness constructed by the West through ideology. Soft power and smart power are both tools of war. And war is mainly derived from the imperialism of mankind at the stage of capitalist history, and imperialism is war, because imperialism is originally born out of the war waged by their joint denial of debt.
Recently, there has been a lot of analysis and discussion on the Internet about the conflict between Russia and Ukraine, many people focus on the comparison of the military details of the hard power of the two sides, but we should pay more attention to the competition of soft power and smart power behind the conflict. The United States and other Western countries have now become debt powers, if you will, debt defaulters. We should note that the biggest risk is not victory or defeat in a military struggle, but to see that behind this war, the debtor countries of the world will unite to try to build political correctness through soft power, smart power, etc., and launch civil unrest in other countries in order to cheat on debts and harvest the assets of creditor countries.
According to the research of western scholars, before the Opium War, China was the largest economy in the world, the economic volume of one country was equivalent to the total economic volume of the whole of Europe, and it was also the largest exporter in the world. The West has a long-term trade deficit in the process of trade, resulting in long-term debt. After entering industrialization, the indebted countries developed into imperialist powers, and in order to solve the debt and trade deficit, they launched two opium wars against China, and China's development came to a standstill. Today, China is once again a country with an absolute share of trade, and it continues to support the hegemony of debtor countries with trade surpluses.
In the 1980s, the United States suffered a severe economic crisis, the effect of financial regulation was very poor, and the depression of selling assets could be seen everywhere. However, after the collapse of the Soviet Union, the assets of the Soviet Union that had not yet been monetized were reaped by the hard currency of the West, and the dollar, mark, franc, lira, etc. rushed into the Soviet Union to make a perfect monetization storm, reaping a wave, and European and American countries once again got a breathing opportunity.
Today, a series of speeches by Western politicians more or less reconstitute the Western defaulters into a new Cold War bloc. Before Trump launched the trade war, there were politicians who declared to "destroy China and deny China's investment in the US Treasury market", when the West uses soft power to stigmatize China and treat China as a strategic rival or enemy, if we do not have the ability to fight, these investments will be forcibly occupied. British politicians were even more explicit: break Russia down and seize its resource assets. Why do Western countries regard Russia, Iran and other countries as their main enemies? Because these countries have a lot of resource assets. If the Western debtors, led by the United States, once again unite to drive these countries into the ground, they can once again harvest and own their resource assets and industrial manufacturing assets.
When the West exported capital and unequal treaties turned developing countries into debtor countries, they not only bossy, but even demanded that they change their national system, and most developing countries had to pay their debts. Now that developed countries have become debtor countries, can we, as the world's largest developing country, exercise the rights of creditor countries as they did back then? No, you even feel guilty, what you do is wrong. When the other side imposes these ideologies on us, we often accept them in their entirety. Many people still use the Western discourse system to interpret the problems of today's world, which means that our soft power is not competitive, so we are losing every battle.
Our biggest weakness is that the people on the front line today have not experienced the old Cold War, we have forgotten the formation and evolution of the old Cold War and local hot wars, and we have forgotten the experience of ideological soft power struggle. Trump and Biden are people from the old Cold War, and the war tools the West uses to launch a new Cold War are exactly the ideology and discourse system of the old Cold War. We do not realize that any hot war is derived from the cold War phase and is a complementary system with the cold War. Imperialism is war, because imperialism is born out of the wars that they join together to wage in order to escape debts.
Therefore, we have to understand that both soft power and smart power are tools of war, and to really see the world situation, it is better to work hard to improve soft power and smart power than to pay too much attention to military details. If we do not have the capacity to deal with ideological issues, the chaos of smart power will likely occur within us at any time.
Historical clouds
The "Star Wars Program" is proposed by the United States, also known as the "Strategic Defense Program." In the early 1980s, when the quantity and quality of strategic nuclear weapons of the two superpowers, the United States and the Soviet Union, were in the balance and entered the dead end of the arms race, the United States put forward the "high frontier" strategy. At the same time, the United States also wants to use its strong economic strength, through space weapons competition, to drag down the Soviet Union's economy. Because the program is primarily based in space, it is also known as the "Star Wars Program."
The main purpose of this strategy is to use the United States' high-tech advantages to build space weapons systems and provide space defense against strategic nuclear weapons attacks to eliminate the growing nuclear threat of the Soviet Union. At the same time, step up the development of the field of space industrialization, in order to obtain the rich resources of space.
Due to the high cost and technical difficulty of the system program, many planned projects were eventually extended indefinitely or even terminated, coupled with the collapse of the Soviet Union. The United States ended the Star Wars program in the 1990s after spending nearly $100 billion.
In January 2019, US President Donald Trump issued a new version of the Missile Defense Review Report at the Pentagon, which proposed that the missile defense system would be greatly expanded. The report has been dubbed "Star Wars" 2.0.
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