The Role of the State in Development Processes

Claude Auroi

• Publisher: Routledge
• Year: 2013
• eBook ISBN: 9781135196219
• Edition: 1
• Topic: Politics & International Relations
• Subtopic: Politics
• Index: Politics & International Relations

First Published in 1992. Bringing together papers from analysts from every continent, edited by Claude Auroi, this collection offers insight into the state's role and the challenges in researching its development. The authors recognise the concerns among young nations focused on which type of state system would lead to an organised nation while acknowledging the two major symbols of discussion in the Western type of state and the Marxist state. They argue points of commonality and thus analyse the qualifying adjective of 'state' to suggest patterns and future discernments.

Part III
Economic Reforms and Changes in the Role of the State

7
Economic Reforms and Transformation of the Role of the State

MICHEL BEAUD

Is the state going through a crisis? Is its role called into question? A whole body of facts point to that direction.

In the West, the welfare state which ensured security, solidarity and a certain equity and was set up in some countries by social democratic and left-wing parties with the support of the trade-union movement and the workers, is now facing some difficulties and is even losing ground. This has gradually been the case in Germany, France and Sweden, and more abruptly so in the United Kingdom.

In the East, countries where the construction of socialism led to strengthening an 'all-state' system, with control over the economy, society and the ideology, are now changing course and fostering the development of a market economy and a business mentality. This process, together with the combined effect of democratic aspirations and long suppressed discontent, has led to student and mass demonstrations followed by repression in China, while in the USSR and in eastern Europe it has led to challenging the established order and has revealed innumerable difficulties including nationalistic claims and ethnic or religious clashes.

In the South, the failure of most development policies and the greed of some leaders and governing circles, combined with the consequences of the economic crisis, the debt burden and the strategies of multinational banks and firms, have driven many states into serious difficulties - even to bankruptcy or utter helplessness compelling many of them to appeal to the International Monetary Fund and to accept their stringent lending conditions.

Thus the state appears to be facing crises everywhere in the world except for a few rare cases, notably in Asia (e.g. Japan and South Korea). The aim of this chapter is to suggest some explanations.

The main explanatory elements to the crisis are as follows:

1. Although some important progress has been made in the name of socialism, nowhere has a global socialist logic (in particular a logic of production) succeeded in imposing itself upon a whole country;
2. The generalised state control system, for a long time presented as 'real socialism', has reached a dead-end and led to situations made unbearable by examples of capitalist dynamism from elsewhere in the world;
3. The on-going phenomena of internationalisation, multinationalisation or worldwide modi operandi have deeply affected the concept of national economy or nation-state and called national economic and social policies into question.

1917-1949. the period of the socialist revolutions.

The opponent was clearly identified: beyond the former established order, it was capitalism and imperialist domination. The goal was clear: the construction of socialism. However, changing a society implies some engineering as mysterious as changing life. No one masters it except for the worse, as dictators and masters of totalitarian regimes have shown. So no-one had a recipe for the successful transition to socialism: the simple recipes of the 19th century idealists were not good, the social-democratic recipe allowed the amendment of capitalism by strengthening the role of the State, and the Soviet recipe tried to generalise government control. However, the social formation process is the same as life: whatever the obstacles, the difficulties or the hostile environment, survival instincts are stronger, forms of adaptation are sought and tried so that, one way or another, social reproduction soon gets organised.

After the Bolshevik revolution, the leaders surrounding Lenin had hold of the state. Overnight the hated symbol became the irreplaceable tool. The state machinery proved essential for the war (either external or internal), for compulsion and repression against counter-revolutionaries, for transportation and the food supply of cities, and for controlling and organising production.

For Lenin, the state was supposed to be useful during a short period only, i.e. during the transitory period of 'state capitalism'. With Stalin, the state could not and must not be called into question, so it received the label of 'socialist'. Socialism was going to be built with the help of the state. In the past catch phrases had been 'I am the state', or 'You are the state', from then on one would be able to say 'the state is socialism'.

In fact, the system which spread was state control but neither capitalism nor socialism. The contribution of the state control system has been important: it helped to build a heavy industry, some infrastructures, to define an arms policy or conduct a war economy, and it also helped systematic urbanisation, to mechanise agriculture or the promotion of major research programmes. But as soon as the whole system becomes more complex, its limits are revealed by administrative bottlenecks, malfunctions, waste, shortages, etc.

However, what the state could not provide, social reproduction forces were able to substitute for through household or market activities, either open or clandestine, and even real firms more or less linked to the sectors of the state economy - i.e. through grey or black markets and an underground economy. Therefore, going through successes as well as difficult periods, social forces managed to set up around the core state system the conditions for social reproduction where the features of the past were at times able to find a new efficiency.

Thus, in the name of socialism and because the logic of socialist production could not be applied on the scale of an entire country, a state control system developed in Eastern Europe.

Simultaneously in the West, and specifically in western Europe, the trade-union, cooperative and political struggles against capitalism had led, between the end of the 19th century and up to the beginning of the second half of this century, to the development of 'social-democratic compromises' which enabled important social and democratic progress to be made and contributed to a renewed capitalist dynamism through mass consumption and new markets for leisure, health, education and culture. In this context, a strengthening of the state occurred, particularly in the social sphere, for example the size of the state sector grew through nationalisations.

Though this path was at times given the label of 'socialism' (Swedish, British, West German or even French style), it still remained a long way from the socialist dream of the 19th century.

The main characteristic of a state control system is of course the central and essential role played by the state:

Institutional base for the leaders (statocracy) and the upper-middle classes (techno-bureaucracy);

• - It gives the main orientations to and organises the processes of production, accumulation and negotiation;
• - It decides on the priorities: industrialisation, war economy, reconstruction, modernisation, consumption, production levels, etc;
• - It ensures the overall cohesion, resorting to the ideology (e.g. construction of socialism), to compulsion through police control and repression, to the quest for a social compromise between the various classes and social strata, or to a combination of all three.

Regimes where accumulation was organised by the state were first set up in the USSR, and subsequently in eastern Europe and China. The main objective was the concentration and reinforcement of the power held by the leaders. This 'state control regime' is referred to as Etatisme by Beaud [1982; 1985]. In contrast to the caricature of capitalism, 'a logic of profit for profit's sake', the characteristic of the state control regime would be 'a logic of power for power's sake'.

However, describing a particular country as a state control regime does not mean that government control is the only logic at work. Any social formation is structured by the articulation of many different economic and social logic. For instance, in capitalist countries the capitalist logic predominates but the logics of the market, of the household as well as the logics of dependency an .... state intervention also exist, albeit secondary and subordinated. Equally, in socialist countries the state control logic predominates, but other logics - those of the household, the market and also of dependency and ... capitalism - are at work in the formal sector as in the grey or black economy. For a long time prohibited and confined to secrecy, capitalist realities seem to be assigned a new position within the framework of the current mutations: here tolerated, there accepted, even encouraged in places.

It remains that in view or the weight and influence of the planned sectors on other sectors, and the check kept over free markets, the Soviet-style economy is essentially an economy managed and directed from one and only centre. This type of economy is efficient in such situations as a war or 'social mobilisation' (to fight a calamity and for a national or social project). But it can also be cumbersome to handle with its bureaucratic rigidities and its lack of emulation. It has proved unsuited to periods of fast mutation, innovation, mobility and diversification. Such a period has, in fact, started with the recent evolution of capitalism.

According to the official Soviet line of the past few decades, capitalism was considered as dying - it was considered to be in the final phase of collapse. In reality, capitalism was able to generate successive waves of revival and forceful dynamics. Though the American prosperity of the 1920s, based on mass production and consumption, stumbled over its own limitations, i.e. European protectionism, over-indebtedness and over-consumption, it found a new lease of life in the Second World War, the reconstruction of the damaged countries, the Cold War, and finally the powerful wave of new consumer demand in the 1950s and 1960s. The wave reached the reconstructed western Europe, hit Japan and East Asia and finally, through various channels, reached the elite classes and the new rising generations in the Third World and also in socialist countries.

In fact, this is a key explanatory element in what appears today as the failure of state socialism. If capitalism had reached final collapse, as communist analysts had so often predicted, socialist countries would now appear as havens of security if not of prosperity. But, within the spirale of the worldwide social reproduction and from its American, European and now Far East poles, capitalism has developed and created new needs, new products, new technologies, new ways of life, new dressing habits, new transportation means, new types of recreation and culture acquisition, new ways of working, producing, administrating, informing, controlling, etc. New references valid for almost every country, every generation, every class, every social stratum, etc. have been created on a world scale.

First Lenin and then Stalin had indeed talked about the ground which had to be made up, but it had seemed within arm's reach since capitalism was dying and socialism had an aura of promises for a bright future. And yet Krutchev, Breznev and Gorbatchev had still a lot of ground to make up and the distance had been growing bigger and bigger despite all the efforts to reduce it. The challenger had been able to find a second wind, to open new fields, to create new needs and new expectations, and introduce new products to satisfy those demands, thereby creating new production lines and profit opportunities.

Such has been the unflagging capitalist destructive creativity in the face of which bureaucratic apathy has shown its ineffectiveness. In a static world, the socialist regimes would have been able to provide their state leaders with appropriate tools to uphold power and satisfy the basic needs of the people. But in a world unremittingly revolutionised by the national/worldwide capitalist dynamics and its new needs, new references and new aspirations, the socialist system has appeared crippled, lame, short of steam and unable to follow. Once the political or material incentives and sanctions had worn away, the only possibility left to the power holders was either to make the state sector more efficient through reforms or to create and develop a private and capitalist sector and thereby call the whole socialist system into question.

• To sum up:
• - The socialist countries have cut themselves off from the world capitalist system, and been indubitably marked out.
• - Their state sector, with its whole range of fringe activities (official or underground) has created the economic conditions for the social reproduction.
• - Those countries have proved unable to adapt to the capitalist dynamics, and unable to respond to the needs and aspirations which, among their own people, have sprung from the influence of western capitalist societies.

The limitations and the incapacities of an all-embracing state system are at the origins of the difficulties experienced by socialist countries which, for decades, have represented 'real socialism'. But socialist countries are not the only ones going through a crisis of the state.

During the past few centuries, the nation-state has been the favoured context for various major accomplishments and the framework for the emergence of the modern state.

Unlike some earlier forms of statehood, the state has not been only a site for power and armed forces - i.e. a conqueror, an empire builder, an undertaker of major works programmes building pyramids and temples, ports, canals, irrigation...

Table of contents

• Cover
• Title
• Copyright
• Contents
• Introduction
• I. THE GENERAL PROBLEMATIQUE
• II. PARTICIPATION AND THE STATE
• III. ECONOMIC REFORMS AND CHANGES IN THE ROLE OF THE STATE
• IV. CHALLENGES FOR RESEARCH AND EDUCATION IN SOCIAL SCIENCES
• List of Contributors