It might seem anachronistic today to spend time discussing Third World transitions to socialism when virtually all such models have collapsed, and if there is any transition at all, it is back to capitalism. The industrialization policies and the experiences with a mixed economy of Sandinista Nicaragua could be a case in point. Fortunately, the Dutch economist Geske Dijkstra does not fall for the temptation of just describing the Sandinista strategies, with their weaknesses and implications, but also places the whole issue in a wider perspective, that of the feasibility of socialism in the Third World.
Dijkstra discusses in depth the contradictions inherent in any transition model that has the ultimate goal of establishing some kind of alternative socialist model. The most sensitive part of such a strategy is, of course, how to deal with the private sector. Should a “mixed economy” be regarded as a set of short-term tactics or as a long-term strategy? Is industrialization possible in a mixed economy? What are the reactions and expectations of private industrial entrepreneurs in such a situation? These are some of the questions Dijkstra investigated through interviews in Nicaragua in 1984–85. The interviews reveal that the large private industrial producers were willing to maintain production and investment in spite of the obvious threat of eventual nationalization. The failure of the Sandinista project was thus due more to foreign intervention and sabotage than to weaknesses in the Sandinista strategy.
The issue, however, is more complicated than that. Foreign intervention, embargo, and sabotage no doubt played a major role in destabilizing the Sandinista project; but the key issue today is the very definition of socialism—that is, the kind of society to which the transition is supposed to lead. Dijkstra unfortunately seems to take concepts such as central planning and state ownership as self-evident expressions of such a society. Doing so today is highly questionable.
One final observation. As an introduction to a discussion of the role of a mixed economy in the transition to socialism, Dijkstra offers an extensive review of the so-called industrialization debate in the Soviet Union in the 1920s. That debate is indeed fascinating in itself (and has been the subject of books and dissertations ever since), but its relevance is hard to see in the context of a small country like Nicaragua today. In such an introductory chapter, Dijkstra might have discussed experiences much closer at hand, such as socialist Cuba and the short-lived Unidad Popular government in Chile (1970–73). But perhaps that might become the theme of a future book by Geske Dijkstra that we could look forward to.
