BOOK REVIEWS C. Y. Thomas, Dependence and Transformation, Monthly Review Press, 1974. Mr. C.D. Msuya, in Tanzania's 1975/6 budget speech, 1 identified three factors which had caused problems "more devastating than anything we have experienced since 1ndependence". These were fina ncial and economic pro- blems originating outside Tanzania, adverse wea'!her conditions, and "the slack in domestic producti on efforts generally". The speech demonstra ted '!hese with figures showing the rise in imports, the decline in exports, the la rge sums of money invested in unproductive parastatals, etc. The remarkable thing about the speech (beyond its frankness)is '!hatit sees no long-term prospect of changing this si tuation. In this it is no different from any other of '!he many Tanzanian policy statements: for none of these even attempt to describe an economic strategy which might be expected to lift the mass of Tanzania's people from their present material poverty. 2 This is how Clive Thomas described '!he situation: In general, the contradictions ma nifested in Tanzanian planning ha ve stemmed from a number of factors, including poor planning and a lack of vision about the requirements for transformation during the early phases. 1n addition, however, there seems to be strong evidence '!hat the present importance of agriculture to national survival ha s its own over- whelming effect on the planners' attitude towards the role of agriculture and is in part responsible for their inability to see the interaction beh'een SOcial relations and the form and content of production •••• In the typical small underdeveloped economy, dependence has been high and ••• '!he divergence of the productive system from the comnnmity's needs quite marked. In view of this it is difficult to comprehend how one can simultaneously stress the socialist reorga nisa tion of the rura I countryside, and production and output almost exclusively along classical colonial lines. Not surprisingly, this contradiction has been manifested in the loss of public resources in support of agricultural crops which have been unequally exchanged in the wqrld's commoditymarkets, and in '!he frustration over '!he agricultural benefits of the enormous Ujamaa effort. In other words the 'worst of all possible worlds. A fur'!her factor ha s been '!he effect created by '!hepressures for doing something now in order to meet e~sting demands, rather than to transform the system itself. Often this effect becomes transmitted into attitudes which tend to either overlook the requirements for transforma tion or to dismiss them as being impractical ()1" visionary: '!hey are assignee::. no independent weight in short-term activities, and there are thus nei ther forward no backward links between intention and practice. There is in a real sense little planning. Fina lly '!he tendency among urban- based planners (foreign and local) and some elements of the petty bourgeoisi e to romanticize the virtues of poverty and/or to overestimate the qualities of rura 1 life a s it stands has been of inestimable significance. These are not sufficiently seen and understood a s malformations of human existence '!he very fa ctors which call forth socialism in theory and practice in the first place. (pp~ 172-3) This quotation gives an important insight mto one of the reasons that made Clive Thomas write this book: it was to demonstrate the hopelessness of a 111 development strategy (such as Tanzania's) which relies wholly on I'\lra 1 deve- lopment, nation a lisation of the existing means of producti on, and partner- ships with multinational corpora tions to build industries. Thomas had seen his students using bourgeois ideologies of underdevelop- ment (such as the alleged lack of capital, skills or markets, and other vicious circle theories) to argue that rapid industrialisa tion was effectively impossible in Tanzania. The book was also written to confront this position in the strongest possible way - by demonstra ting that industrialisation was not only possible but essential to bril'.g about growth: 3 One of the staggering conseq uences of underdevelopment and dependence is the widespread lack of confidence the leadership in Third World countries has in the capacity of the people to master the environment • ••• Rarely has revolutionary political theory been ma tched by an equa lly radical vision of the capaCIty of the people to transform and master their environment. As a substitute we have had either arcadian predilec- tions for rural life as it is - minus the kulaks - or a drive for sta te control of existing activiti es as an end in itself and as formal proof of socializa- tion. What is also striking is that this has occurred during a period (the last fifty years) when, if a nything is noticeable about huma n soci ety, it must surely be the r~pidi ty with which the ma teial envoronment ha s been mastered and transformed where the people werepolitically liberated for this task. 1t is against this poverty of vision that this work has above all ,been directed. (pp. 305-6) He immediately defends himself from the charge that he is writing about "growth" rather than about"development" : Political revolutions should, as a matter of course, offer the people liberation from, and mastery of, their material environment. lf they cannot do this they cannot introduce a higher mode of production. With- out such a material base increased consci ousness wi 11soon be dissi pated. Revolutionary change, to be self-suttaining, must not only affect relation- ships between people, but also between people and their material environ- ment. 1t is the achievement of both which permits the transition to a higher mode of production. (p. 3(6). The descriptive pa rt of the book thus becomes a descri ption of how the productive forces in an ex-colonial (or ex-neo-colonia 1) economy can be expanded. He makes explicit two important assumptions. One is to assume the existence of the nation- state as handed down by the colonial powers (p. 13 ff.) This leads him to spend muchtime discussing the problems of "smallness", for many writers (socialist and non-socialist) have argued as if self-sustaining internally oriented growth is possible in "large" socialist economies such as the USSR or China but impossible in "small" economies such as Cuba or Tanzania. His second assumption enables him to avoid all questions of politics and class struggle, for he simply assumes that a successful class struggle has put the workers and peasants in power: We shall delineate our a rea of study ••• by confining our attention not just to underdeveloped economies but to those in wbich a political 112 revolution has been initiated and has succeeded in transfering state power to a worker/peasant alliance, thereby fundamentally altering production relations so that the struggle to bring the productive forces under their control and direction, to disengage from international capitalism, and to raise the material levels of welfare of the population are the central economic issues at that stage in constructing socialism. I t follows from this delineation of our area of analysis that eventhough immense political and social problems still remain - such as defining the working relation- ship between the two classes, containing the local petty bourgeoisie and the bureaucracy, etc. - these problems. . .are subsidiary to the major political issue of state power, which we shall take as being solved at the outset. It is only by making such an a ssumption that we can genuinely isolate for consideration the period of the transitional development of productive forces, (p. 29, author's emphasis removed). In this way he assumes away all the political aspects of the transition to socialism, and the question of how the workers and peasants get their revolu- tionary consciousness and capture state power (he never, for example, suggests that class consciousness and revolutionary ideology might actually emerge in the course of a struggle). All this is done to isolate the problems of economic strategy and the means by which the productive forces in a small poor country can be expanded. His analysis starts from the development of under development, drawing particularly on Gunder Frank for Latin America and Walter Rodney for Africa. These writers have shown firstly how the colonial and neo-colonial institutions were part of a system to such surplus out of Latin America and Africa, and that as a direct result local initiative was stiffled and in many cases crushed. They have secondly shown how flag Independence only changed the forms of surplus extraction without ending it. Private investment by multinationals, nationalisation of some of this investment, management agree- ments with or without local share participation, local Directors on Boards of Directors, compulsory localisation of staff, and even inter-state Common Markets or Free Trade Areas have served to increase the outflows of surplus. This ground is covered in two early chapters of Thomas' book (pp. 4-2-98). He shows how a strategy of development cannot igonre these mechanisms, for many of them have a surface appearance of increasing national control and cutting the surplus outflows. Thomas does emphasise the need for national control over the means of production (to be achieved if possible by nationalisation of foreign owned assets without compensation), but only as a necessary step to clear the ground for an effective strategy, not as a strategy in itself. The arguments for structural change grow out of this discussion of "underdevelopment. They are summed up in this first "iron law", which amounts to a statement that development must be based on home markets supplied from local raw materials using locally controlled technology: 113 We have offered an interpretation of structural dependence, economic immaturity, and the way in which during the present era international capitalism dynamically internalizes itself in the production system of a small underdeveloped economy. I t follows logically that one of the most fundamental laws governing the transformation process is the pl8JlJledimplementation of a structure of domestic output consistent with domestic demand patterns. I t is in this sense that it is presented here as an "iron law" of transformation and therefore a fundamental objective of pl8JlJling. We have argued that transformation cannot be achieved through the growth of traditional agricultural exports ••• (p. 141).4 Policy proposals for agriculture and industry arise from the first law. Increased agricultural productivity is obviously needed both to earn surplus to finance industrialisation and to feed the whole population better. Thomas envisaged it comiug through incarea sed use of inputs: seed, fertilizer, mechanisation. If industrialisation is to be locally based then it is necessary that it be planned around the "basic industries" - i.e. those which produce the important inter- mediate goods used in other industries and agriculture. He shows that, pro- vided production is planned and based on local raw materia Is the arguments against such industries in small countries (viz. that the markets for their products will be too small and/or that small sizes of plants will make produc- tion inefficient) are misconceived. The argument for industrialisation is based on the conventional view (e.g. Maurice Dobbs') of the Soviet transformation and on the Marxist re- production modes~ as the economy grows the needs of the people have to be supplied more and more by industrial goods, and agriculture also comes to depend on industrially produced inputs, so industry, and especially those parts of industry that make the machines and materials used to make machines and inputs, ha s to grow. The original part of the argument is the application of it to "small" economies by narrowing down the list of heavy industries to a smaller group of "basic industries" (not all of which are heavy in the sense of capital intensive, or necessarily large-scale) producing the major ba sic materials required as direct or indirect inputs into the domestic consumption of goods (pp. 304- S). Having discussed all this, Thomas comes to his second "iron law" which state that there must be a convergence of the demand structure of the com- munit;yto its needs. This implies a down-to-earth materialism; the object of production is to provide consumption goods for the masses. In some cases this will mem collective consumption, (better health, recreational facilities or education) in other individual consumption. He wants to maximize the element of collective consumption while admitting tha t i1r a period of transition when consumption goods will be in short supply it will not be possible to avoid 114 distributing consumption goods through some sort of market and money wage system (p. 250 ff). This completes our summary of Clive Thomas' main arguments. The presentation ha s several glaring weaknesses, which we shall dis cuss below. In considering these it is important not to lose sight of the ba sic aims of the book; i. e. to challenge anyone who thinks tha t there is no possible path ahead for countries like Tanzania which would enable them to overcome their poverty. None of the criticisms discussed below destroy the main argument, and no other writer (to this reviewer's knowledge) ha d discussed the problem of SOcialist economic planning specifically in relation to small economies. It is in this context that it cannot be igonred by planners and policy-makers. The main pro blems in the argument stem from the over- simplified crass analysis. This can be seen, for example, in the treatment of the second iron law about needs, which is by no means as convincting as 5amir Amin' s cover- age of similar material. 5 Thomas has initially a ssumed that the workers and peasants have seiz ed power. I t should follow from this and from the first iron law that production will converge to needs. 50 why does Thomas have to emphasise the point with a special "iron law"? The answer can only be that in the chapter on needs the cla ss struggle is not won, and the s tate is in some (undefined) transitional stage. Of course there may in a particular country be such a period of transition: the weakness is that there are a lot of other class aspects of such a period of transition which Thomas has chosen not to discuss. He is not consistently following his own assumption that the workers and peasants have seized power. He also states that "there is no fundamental division between the planners and the implementors" (p. 73). If this was really the case, and if all economic and politic a 1 decisions could be argued out democratica lly at every level until everyone agreed, then there would be no possibility of opposition to or mis- understanding of the plan. But Thomas clea rly envisages centralised planning and hence a cadre of planners with considerable de facto power. The exper- iences of democratic centralism should have made him realise that it i s naive to rule out the possibility of a conflict of interest between the planners and the masses during the period oftransition. Clearly Thomas is again assuming different things at different times: at some times the workers and peasants have seized power, at other times only a poli tical party ha s seized power and the struggle to consolidate that power is till going on. Thomas might have realised how serious this la ck of clarity was if he had considered the likelihood of his first la w being implemented without the second law and without a successful class struggle. This might seem to be a first step towards a suceessful transition. But if a basic industry policy was 115 implementedwithout a comlnitmentto mass needs then local resources would be used to meet local demands, but these would be mainly the luxury demands of the richest 20 per cent of the population. A country tha t followed this strategy would end up like India or Brazil with basic industries amid poverty and squalor. This is an important possibility beca use it is almost the inevitable distortion of Thomas' ideas if they are introduced by a petty~bourgeois nationalist party. His assumption of worker/peasant control has allowed him to get away without considering it. 6 His whole attitude to the working cla ss and peasants is ambiguous. There is a section where he supports "democracy and pa rticipation at work" on the grounds that it "contributes toward the reduction of the contra diction between socialised production rela tions and material incentives". (p. 292) This is different from saying that the workers must control the production process in order to overcome alienation from the means of production, and as a precondition for releasing their mental energies to increase production. When it comes to the peasant, he is even more unclear. He seems to regard them a s an essentially reactionary force requiring a long period of transition before theycan be won over to the revolution. He does not appear to see the rural areas as a great store of potentia I surplus, where peasant creativity ha s been repressed and destroyed by colonial and post-colonial rural polici es. Seen this way the problem would be to liberate the creati ve energies of the peasants. I nstead he sees the problem as technical, where peasant "intransigence" (p. 288) is to be solved by the use of industrially produced inputs: We believe ••• that within the existin~ framework fa rmers a re by and large rationa I and efficient in their use of resources. To tra nsform a gricul- lllre, therefore, requires new and modernized inputs which alter both the resource mix availa be to the farmer and the socia I relations on the land. Those who argue that an extension of a cti vity within the present resource framework can result in a dramatic expansion of agricultural production are in fact implying that the farmer is irrational. (p. 1(0) Of course the pea sant farmer is rational - he plans his farm and makes hiw own decisions as best as he can within the social formati on in which he finds himself. If a tax-collector will take away hi s surplus, or burn downhis house, why produce? I f there is little to buy in the shops WIlat is the use of more money? He may even try and withdraw from the market altogether a!ld be as self-reliant a s possible in a subsistence economy. These can all be rational reactions to colonial or neo-colonial rule, and they all disguise the fact that the potenti al surplus is much higher tha n the actual surplu s - tha t peasants could work more hours per day if they wanted to and more days a yea r (on the same land and with more or less the same tools if neces sa ry). The problem of realising this potential surplus is the problem of winning peasa nt support 116 for the revolution, and without this support the revolution can never succeed. The peasants of China and North Vietnam have shown what can be done. Thomas is so impressed by the unpromising existing framework that he forgets his own assumption that this framework ha s been fundamentally changed. The long section on agriculture (p. 143) consequently is the weakest part of the book. Thomasuses data from the U .5., the U. 5 . S. R. and other developed countries to show that "modern" agriculture is capital intensive and ski 11 intensive, and then twists the argument around to try and show that agricul- ture in the countries he is concerned with only develop through the applica tion of professionally trained agriculturalists and industrially produced inputs. He ignores the da ta from Japan, China and Vietnam which could have under- minedhis technocratic vi ews. (This does not mean that the interlinkage between industry and agriculture can be ignored. I ndustry must certainly provide inputs to a griculture, and agriculture to industry. The point is tha t the dynamic in agriculture will come at least as much from the relea se of peasant enthusiasm as from these inputs). The industrial chapter is also technQcratic, and the effort to demonstrate that development really is possible ca n ha rdly avoid giving the impression that development will be automatic if only the basic industries sequence is followed correctly. There are also problems when it comes to converting the list of industries in the book into a practical industrial plan. For example the list of basic industries on p. 196 is very general. it includes virtually the whole industrial classification. Moreover it lists industries rather than factories or plants. Thus the indurtry "iron and steel' could well include 15 factories, or even 50 factories if all the engineering industries were included, and they are not mentioned separately. Moreover there would be little point in starting mining and first-stage processing or iron ore to steel without also starting steel-using industries _ for otherwise the strategy would simply mean export of semi- finished steel. But if the planners have to consider all the steel-using industries from the start then the planning problem is much more difficult than Thomas implies, and would take time, so that the possibility of a short time period of "transition" becomes highly questionable. 7 In considering these criticism one should not forget that the book is an ideological tract, written to counteract a certain sort of defeatism. I t is certai nly not intended to be a plan. In a tract, enthusiasm can be forgiven (and under- estimation of some of the problems) provided the main points get a cross. Thomas' work has certainly changed the climate of discussion in Dar es Salaam since 1972, and influenced the planning work on Tanzania's Third 117 Five Year Plan. Its weakness is because it ignores the questions of class struggle. It can be used to lend ideological support to a technocratic nation- alist point of view. lt is also a pity (certaihly for a tract) that the language is often difficult and the writing repetitive. lt will be hard to recommend it to students. But those who are trying to demonstrate to exploited workers and peasants that there is an alternative to the present neo-colonial domination and stagnation will ha ve to wrestle with it, for nobody else has made a serious attempt to show that development (whatever it means) is possible. FOOTNOTES Most of the ideas here were included in my written comments on Clive Thomas' first paper (Economic Research Bureau, 1972) given to him then. Since then I have greatly benefited from discussion, argument and comment from Clive Thomas, Mark Wuyts, Steve Curry and Yash Tandon, among many other s. 1. Daily News June 17 and 18, 1975. 2. The nearest is the Arusha Declaration: but this is largely a political statement. The economic content involves nationalisation and self-reliance; but the Arusha Declaration does not explain how the surplus comilng from these policies is to be used: it is thus not a complete economic strategy. 3. Another way of confronting these negative attitudes is to examine the bourgeois theories one by one in order to see where they are wrong. This is the approach of Tamas Szentes, in his book "The Political Economy of Underdevelopment", Budapest, 1972. The difficulty with this method is that students who (following deep- seated class instincts) do not want to believe that development is possible will tend to invest their own new theories to justify their position. Thus Clive Thomas' method of suggesting a positive alternative is much stronger in the classroom than S zentes. 4. When Thomas talks a bout an "iron law" he does not mean a low of notion of a secial formation such as ca pitalism observed empiric a lly, and he does not mean a scientific law which is in any sense automatic. What he seems to mean. is a set of prescriptions, things which shoul6 be done. It is questionable whether the word "law" is usefully extended in this way. 5. Samir Amin, e.g. "Accumulation and Development: a theoretical model, Review of African Political Economy, Vol. 1, No.1, 1974. 6. e.g. The Tanzanian Ministry of Planning ha s adopted what it calls a "basic industry strategy", which consists of a list of "ba sic industries" to be built as quickly as possible. While for Thomas the necessary assumption is that a successful class struggle has put a worker/peasant alliance firmly in power, the Devplan planners ignore class struggle altogether. Thomas' ideas have thus been used to support a different strategy, confusingly given the same name as his. The Devplan strategy seems unlikely to win the entusiasm of the workers and peasants (since it offers them little in the short run) and the industries listed already show signs of meeting many luxury dema nds: in which case Tanzania would be struggling and sacrificing to become like India. 7. lt is also highly questionable whether the idea of "tra nsition" should be inter- preted in purely economic terms as construction of a set of projects, rather than in political terms. ANDREW COULSON 118