Plan and Market in the Socialist Economy

The socialist economy implies commodity production organized according to plan. A market, representing the sum total of economic relations connected with the sale of goods and with the transfer of these goods from producers to consumers, is an essential component of any commodity economy. That is why the mechanism of the planned functioning of the socialist economy also includes a market mechanism, whose operation is directed not only by the law of value, but also by the entire system of the economic laws of socialism.

The Problem of the Ruble's Rate of Exchange

Two lines of economic development in contemporary society stand out in relief in the money and currency sphere. On the one hand, the purchasing power of the ruble has been steadily rising, its gold content and rate of exchange have gone up and, by virtue of the powerful advance of the socialist economy, it has become the most stable currency in the world. On the other hand, the purchasing power of the U. S. dollar has been declining systematically, the U. S. gold reserve is being disastrously drained, and there is an ever growing danger of devaluation of the dollar, whose standing has been sinking as the economic crisis keeps mounting in that country. Today, the Soviet Union is the only country in the world whose monetary unit has a higher gold content than before the First World War (in 1913). This inevitable result of the historical development of the currency of the mightiest socialist country can be properly understood only through a scientific analysis of the mechanics of the relationship of the purchasing power, gold content, and rate of exchange of the Soviet ruble.

The Formation of Prices and the Problem of Money under Socialism

In the discussion on the determination of prices under socialism the basic attention of its participants normally is concentrated on defining the principles of determining prices which most completely take into account the demands of the law of value. But some economists ignore, in our opinion, two rather important circumstances. First, the law of value under socialism does not operate in isolation, but in the system of economic laws of socialist society. If one considers that under capitalism the law of value is modified according to the basic law of that order, into the law of prices of production, and then at the stage of imperialism into the law of monopoly prices, so much more is its modification unavoidable under conditions of socialism when it ceases to be the regulator of production and is subjected to the operation of the basic economic law of socialism and the law of planned, proportional development of the national economy. Secondly, all the participants of discussion admit that under socialism price is the money expression of the value of commodities. Nevertheless, when studying the operation of the law of value in the process of the determination of prices, the role of money is often ignored.