A new socialism for the 21st centuryhttps://indianexpress.com/article/opinion/columns/a-new-socialism-for-the-21st-century/

A new socialism for the 21st century

The CPM is reinterpreting Marx to emphasise ‘socially-owned’ rather than ‘state-owned’ means of production

The CPM is reinterpreting Marx to emphasise ‘socially-owned’ rather than ‘state-owned’ means of production

CPM General Secretary Prakash Karat made a significant public statement at the end of his party congress held recently. He suggested that some of the key assumptions of 20th century socialism were perhaps not valid in the political economy of 21st century India. In what seemed like a reinterpretation of some practised Marxist tenets,Karat said the means of production must be “socially-owned” but not necessarily “state-owned”. In this context,the CPM also distanced itself from the Chinese model,in which the means of production are substantially owned and driven by the state.

It was also interesting that the CPM leadership spoke of the need for a more decentralised mode of production in the economy rather than a centrally planned,state-led system. It was a clear admission that a Soviet Union-type command economy was a thing of the past. Needless to say,in any decentralised system of production,the market must have some role to play. After all,socialisation of capital has occurred in the West through pension funds-owning big companies. This seemed to be the unstated part of the new thinking in the CPM. Indeed,this is a significant departure in the thought process of the leading communist party in India. This process may have been accelerated after the Left parties were defeated in West Bengal and Kerala.

It appears that Karat partly got his new inspiration from the renowned Marxist,economic historian Eric Hobsbawm,who,in one of his recent works,has given a view of Marx in today’s world. We are told that the CPM leader has been in close touch with Hobsbawm in recent times,perhaps to get greater clarity on what is going on in the new world of evolving capitalism and socialism,especially post the 2008 global economic crisis and the continuing uncertainties that surround the western economies.


Karat may have been influenced by Hobsbawm’s view that Marxism in the 21st century has to be based on the posthumous interpretation of his writings. The historian then goes on to say that “the claim that socialism was superior to capitalism as a way to ensure the most rapid development of the forces of production could hardly have been made by Marx”.

In fact,Hobsbawm says,Marx had nothing to say about central planning as a key component of the socialist economies of the 21st century. The project of the socialist economy was not particularly Marxist,though Marxist-inspired parties shared such a project and actually claimed to have instituted it. This seems to be the paradox that Hobsbawm tries to drive home while reinterpreting Marx in the context of the realities of the 21st century.

He says that “socialism,as applied in the USSR and other centrally-planned economies has gone and will not be revived”. It is also crucial to note,he adds,that Marx himself deliberately abstained from specific statements about economics and economic institutions of socialism. Or even about the concrete shape of communist society,except that it could not be constructed or programmed. Hobsbawm has explained this in his recent book,How to Change the World: Tales of Marx and Marxism. All that Marx said was that the “jagged rhythm of capitalist growth” would produce periodic crises of overproduction (called recession in today’s parlance),which would sooner or later prove incompatible with a capitalist way of running the economy. In some ways,this has proved prophetic as most Western capitalist economies of 20th century vintage are currently having to inject massive doses of social welfarism to sustain further capitalist progress. Massive future public spending on healthcare,etc is at the heart of the political economy debates in the United States,for instance.

Hobsbawm also recognises the enormous and accelerating progress of globalisation and the sheer wealth-generating capacity of humans,which has “reduced the power of economic and social action by nation-states and therefore the classical policies of the social democratic movement”.

Indeed,if Hobsbawm has got India’s mainstream Left leadership rethinking the efficacy of central planning and state-owned means of production,it is a welcome development. This is important because the Left has always had an unsaid influence on mainstream parties like the Congress. Even today,the Congress party has a significant,even if unconscious,thought process that is based on the centrally-planned,socialist framework of Nehru’s vintage.

The way most of our public sector companies have been run to the ground since the 1970s shows how the old socialist institutions have degenerated. The key challenge for the Congress party,which ushered in economic reforms in the 1990s,is how to invent new institutions that adequately meet the challenges posed by the process of globalisation.

At the heart of this process is to create new frameworks that enable a smooth transition from state-led economic activity to empowering people to participate in broadbased wealth creation. Only this endeavour will ensure a genuine public ownership of wealth in a decentralised manner.

Last week,the honorary economic advisor to the prime minister,Raghuram Rajan,made some telling remarks in the presence of the PM at a function in Vigyan Bhavan. He said the economic reforms of the 1990s got rid of the control raj,but the Indian economy is now debilitated by a “resource raj”. This is characterised by a “coalition of the connected” (a polite term for the nexus between the political class and big business),which is cornering key natural resources and preventing real reforms which lead to greater decentralisation in the ownership of wealth.

In the 21st century Marxian context,as reinterpreted by Hobsbawm,instead of depending on state-led institutions to deliver,it is imperative that new,socially inclusive,market-based projects are put in place. India’s political economy is unique in the sense that nearly 50 per cent of its 470 million employed are self-employed. Today big businesses have a free run and face no entry barriers to wealth creation. But the millions of small self-employed face myriad controls imposed by a heartless bureaucracy,a vestige of 20th century socialism. We cannot have a reasonably decentralised and socially-owned means of production unless the self-employed,who dominate the economy,are released from the vice-like grip of an insensitive state apparatus. The Anna Hazare movement also has something to do with this intractable political economy issue.

The writer is managing editor,‘The Financial Express’,mk.venu@expressindia.com