chapter  I
Economic Planning in U.S.S.R
Pages 37

ONE sometimes meets the statement that the "profitmotive" still plays a prominent role in the economic system of the ·U.S.S.R.; from which it would seem to follow that this system is in essentials similar to our own. Those who make this statement often turn out, however, to mean no more than that the part played by monetary incentives in relation to productive work remains a prominent one. In other words., they are using profit-motive and monetary incentive as synonymous terms. But to ignore the difference between wages or salaries as payment for work and profit in its usual signification as the income of the capitalist entrepreneur, or of the owner of a business enterprise., is, surely., to darken counsel; and, as some recent correspondence in The Times on the subject of the " profit-motive'" suggests, can lead to a good deal of nonsense being talked. An essential difference between Soviet economy and the capitalist economies of other countries is that the maximisation of profit hy the individual firm or business man is no longer the decisive factor in determining industrial policy-in determining output and investment and the direction and volume of sales. What is determi:ned elsewhere by the separate decisions of thOltsands of autonomous entrepreneurs is determined in Soviet economy by a single co-ordinated complex of decisions which constitutes the economic -plan. This difference is connected \vith another one: the fact that in U.S.S.R. land and capital are in social, not in private., o"vnership. Consequently, not only does the State have complete power of disposal over all productive equipment, hut

neither profit nor any other income acquired by right of ownership exists as a category of income (whether it exists as an accounting-category in the financial relations between various branches of State activity is a quite different question). The State is therefore able to control the use of productive resources by direct, and not merely by indirect, intervention; and personal income has a homogeneous character as being work-income, graded according to the amount and the kind of work that is done. Income differences exist, but are naturally much smaller in extent than income differences due to ownership of property; and there are not two sources of income, with social or class differences contingent on them, hut only one.