Abstract
The French Marxist economist Charles Bettelheim (1913–2006) conducted after the end of World War II important scientific activity on economic planning, together with an international consulting activity in developing countries, as a non-Soviet expert on Soviet planning. He was the Frenchman who whispered the Soviet way of planning in the ears of Nasser in Egypt, Nehru in India, and Che Guevara in Cuba, to mention only three obvious examples. The expression “planning doctors” is proposed in this article to designate this kind of economist who advised governments in the setting up of socialist five-year plans. In order to understand how Bettelheim became a planning doctor, the article reconstructs the formative period of his career and what role World War II played in this making, starting with his studies in political economy in France, his trip to the USSR in 1936, and his works on Soviet statistics. It is shown how World War II affected Bettelheim from an intellectual point of view, with his study of the German economy at war, and from an institutional point of view, as his encounters during the war proved instrumental for the setting of his postwar career as a planning doctor.
1. Introduction
Charles Bettelheim (1913–2006) was a French economist at the EHESS who carried out for over three decades after World War II numerous missions abroad of economic expertise.1 He was not the only economist involved in this kind of activity. Other economic experts, or “development economists” as they were often called, are discussed in the literature, like Albert Hirschman and Paul Rosenstein-Rodan (Alacevich, this issue), Raúl Prebisch and Celso Furtado (Calcagno and Duarte, this issue), Lauchlin Currie (Chao and Lin, this issue), and Jan Tinbergen (Dekker 2021), to give a few examples. Bettelheim belonged to a particular subspecies of these development economists: he was—along with Paul Sweezy, Maurice Dobb, and Michał Kalecki—an economic expert on Marxism and a convinced Marxist. More precisely, he advised governments on the implementation of socialist five-year plans, drawing on the expertise he had acquired on Soviet planning before World War II. His personal archives are therefore full of correspondence with his clients: Che Guevara in Cuba, Gamal Abdel Nasser in Egypt, and Jawaharlal Nehru in India. One must add China, Vietnam, Algeria, Mali, and other countries to realize the extent of the consulting activity of one of the best specialists on Soviet planning outside the Soviet Union. In what was then called the Second and Third Worlds he was a famous planning doctor.
The term “planning doctor” does not yet exist to our knowledge. It is proposed here in analogy with the more established term “money doctor,” which applied for instance to Edwin Kemmerer and his consulting missions in South America or Southeast Asia for the establishment of central banks (Gomez Betancourt 2017). Like money doctors, planning doctors are also concerned with consulting missions abroad, but for the installation or improvement of five-year plans inspired by the Soviet experience. In the case of a fragile sovereign, this is how the medical metaphor works: the sovereign or his ministers call a doctor, or more often several doctors. The doctors arrive with their toolbox—economic expertise, collaborators. They conduct a diagnostic test during a visit that may last several weeks or longer, with visits to factories and offices and interviews of economic and political actors. Eventually, before leaving, they deliver a prescription, in the form of a written report, with cures to be applied. Advice might converge, but more frequently doctors propose different cures, and the sovereign is left with choices.2 Not all sovereigns like the pills, and it is not always possible to know if the cure would have worked. There exist several kinds of planning doctors. Some are more interested in curing the symptoms; others, in understanding the causes of underdevelopment. Some are generalist planning doctors, interested in the general outlook of the plan, and others are specialists, interested either in the collection of statistics, in the techniques of calculation, or in specific technological sectoral innovations to be applied.
How does one become a planning doctor? In the case of Bettelheim, World War II played an important role, both institutionally and intellectually. From an institutional point of view, it is shown below that the war clearly changed his career path: the events shattered the beginning of his career but offered him new opportunities and gave him a stature after the war unreachable otherwise.3 The war also provided him with new material to observe, in this case the German war economy under Nazism, which, from an intellectual point of view, gave him food for thought on the difference between capitalism and socialism and on the subtleties that certain market categories play in the transition to socialism. This allowed him, from an observer of Soviet planning in 1939—the date of publication of his PhD dissertation on Soviet planning (Bettelheim 1939)—to become a world-renown specialist on economic planning in theory and practice, to borrow the title of the book that will establish him as a specialist (Bettelheim 1946b).
In what follows, Bettelheim's path is reconstructed before, during, and just after World War II, with a focus on two significant episodes: one on Soviet statistics and one on the German economy. I will show how these two episodes contributed to make of Charles Bettelheim a convinced Marxist planning doctor.4
2. The Pathways of a Faithful Marxist and Communist
What could have destined Bettelheim to become a Marxist and a Communist?5 Charles Bettelheim was born in November 1913 in Paris, into a rather bourgeois family. His father, Heinrich Wolfgang Bettelheim (1873–1924), who represented a Swiss bank in France, was a Protestant of Austro-Hungarian nationality,6 from a family of Jewish Viennese doctors originally from Bratislava. His mother, Lucienne Adrienne Ernestine Bettelheim (born Jacquemin, 1894–1983), was Catholic and of French nationality. The family moved several times: from Paris to Lausanne and Zurich during World War I, and from there to Cairo after the war, following the activities of the father. Charles went back to Paris with his mother for his studies. His father died in 1924 in Egypt (Charles would only learn much later of his father's suicide, in the context of a bankruptcy). Charles suffered at the time from a bone disease, called osteomyelitis, that immobilized him for two years as a teenager but that would also keep him out of World War II. With his parents, Charles spoke French. He learned German with a nanny and during his stays with his father's family in Austria, especially during his convalescence. There, in Vienna, he discovered an intellectual bourgeois milieu in which he cultivated a love of Russian literature, while also learning English. After obtaining his baccalaureate in 1931 in Paris, he embarked on university studies, and although he wanted to do everything, he quickly limited himself to law, political economy, and philosophy.
How did Bettelheim become interested in politics? Certainly not through his family. The crisis of 1929 and the rise of Nazism and Fascism seemed to play a crucial role. They made him consider the current economic and social system as absurd, and he would later recall being impressed by the fact that the Bolsheviks were able to undergo a world crisis without unemployment. For this reason, and because the Social-Democratic Party in Germany was unable to fight the rise of Nazism, he preferred, in France, the Communist to the Socialist Party. At the age of nineteen, he joined the Youth Communists in Paris, and very soon after got his card from the French Communist Party. With other students, including Gilles Martinet and Jean-Pierre Vernant, he enjoyed being a local activist. At the same time, he started to learn Russian at the École nationale des langues orientales.7 He graduated in law and philosophy in 1936. In the law department, he was especially interested in political economy. His teachers were Gaëtan Pirou, Jean Lescure, and Albert Aftalion.8 About them, he wrote that “they introduced me to the dominant economic thought, to liberalism and neo-liberalism. The very clarity of their presentations helped me to criticize these doctrines” (Bettelheim 1997: 12). At the same time, he read as an autodidact David Ricardo, Karl Marx, Immanuel Kant, Friedrich Hegel, French Marxists (Jean Duret, Lucien Laurat, Jean Baby), and Soviet Marxists (Nikolay Bukharin, Eugen Varga).
A decisive moment in his training was his trip to the USSR in 1936. Officially planned as leisure travel for two weeks, he managed to stretch his stay over six months, thanks to his knowledge of Russian, by working for different organizations in Moscow: visits in French for tourists with INTOURIST, proofreading French for the foreign-language editions, and dubbing French movies for MOSFILM.9 He was at first amazed by this new society, but very soon he began to be disappointed. He saw huge social inequalities, with privileges on one side and a mass of workers left with almost nothing on the other. He saw little democracy in society, and especially no democracy in factories. He was therefore not entirely surprised that he saw no strong desire to work for socialism among the workers. At the time, he did not know that real wages had decreased dramatically since the end of the New Economic Policy era and the beginning of the planned economy. During this travel, he did not meet with other economists. In Moscow, he met André Gide, who was officially invited by the Soviet authorities. The latter confided to him that he was disgusted by the official lies and the inequalities. On his return, Gide publicly denounced this situation. His Retour de l'URSS (Gide 1936) was a huge commercial success and made him an enemy of a large part of the French left, who accused him of being a Fascist agent, a traitor to the Communist cause.
Another event disturbed Bettelheim. In August 1936, he followed the so-called Trial of the Sixteen, which was the first public trial of Lenin's former comrades, which allowed Stalin to get rid of his former allies Zinoviev and Kamenev, accused of Trotskyist conspiracies. All sixteen were eventually sentenced to execution. Bettelheim was unaware that Stalinist purges had already begun, albeit more discreetly, back in the early 1930s. Bettelheim felt that this trial put Communism in great danger, and he wanted to have conversations about it, but he did not find within the USSR someone willing to speak about it. His visa was about to expire, and he did not manage to extend it. He returned to France disillusioned but—and this character trait will remain constant—still confident in the future of socialism: “Thus, I leave the USSR having lost many of my illusions about the country and the way it is run; yet, if I have doubts about the ‘Soviet way,’ I still have confidence in ‘a socialist future’ of the USSR” (Bettelheim 1997: 27). Socialism is seen by him as superior to capitalism: “The trial of the 16 does not call into question my conviction that a true socialism will be superior to capitalism, that it will ensure infinitely better than the latter a real development of values that seem essential to me: respect for human dignity, political and economic democracy, concern for the standard of living of all” (Bettelheim 1997: 24).
At the Youth Communists meeting in Paris, he met with a young Communist advocate, Lucette Beauvallet. She was studying physics and mathematics to become a teacher. They very soon married, in 1937. About his travel in USSR, Bettelheim's plan was not to follow André Gide's public testimony, that is, to give weapons to enemies of socialism, for he remained a convinced Communist and Marxist. He wished to discuss his doubts with members of the French Communist Party only, who would presumably keep what he said private. But his internal testimonies got him suspended in 1937. Disgusted by the reaction of the party to his honesty, he decided to leave it definitely, “without any noise” (Bettelheim 1997: 31).
Bettelheim prepared himself for an academic future and was torn between two subjects for a PhD: the New Deal or Soviet planning. Gaëtan Pirou, who agreed to be his supervisor, encouraged him to work on Soviet planning. The dissertation was to be researched and written entirely in France, as his visa application to the USSR had been declined. His wife, Lucette, conducted research with him in libraries for his dissertation when she was not teaching. Therefore, the dissertation was readily defended on March 8, 1939, with first-class honors (mention très honorable), and was published by Marcel Rivière in Paris (Bettelheim 1939). Despite a silent boycott by the French Communist Party, the book sold very well, with several editions and translations. It gave rise to his first contacts with Trotskyists, in the person of Pierre Naville. And the book also opened to him the doors of the Institut de recherches économiques, an economic research institute headed by Charles Rist. In 1939, Bettelheim was appointed as lecturer (chargé de cours) to teach economics at the Department of Law in Caen, where Charles and Lucette spent a whole summer reading Marx in the original language.
But then came World War II, with the German occupation in 1940, which had a major impact on Bettelheim's career: he was expelled from the university because his father was a foreign national. He lost his job, and Lucette, suffering from a lung disease, could no longer work. To survive, Bettelheim gave private lessons, thanks to friends like René Metayer and Maurice Merleau Ponty who found clients for him. His few Trotskyist contacts suggested that he joined the French section of the Fourth International, the Parti Ouvrier Internationaliste (POI), an anti-Vichy and anti-Nazi organization. Bettelheim participated in the clandestine meetings of the POI political bureau. He was given two missions (besides once helping a person to cross into the free zone): to write a report on the Nazi economy (which circulated under the pseudonym Jacquemin; see sec. 4 below) and another on the French economy. He made many new friends in the Trotskyist and Communist spheres, who would be very useful after the war—we will come back to this in section 5—Olga Raffalovich, Lucien Febvre, Pierre Bessaignet. In 1943, several members of the network were arrested, and Bettelheim had to live in hiding for a while.
When the war ended, Bettelheim was still fighting alongside the Trotskyists. Later in his political evolution, he would become a Maoist, and then he would eventually leave Maoism. Stalin, Trotsky, Mao: he always preferred the camp of those who represented for him the best chance of success to build socialism in real life: efficiency seemed to be his political lodestar. From a scientific point of view, however, he always remained faithful to Marx's method, even if the method were imperfect. At the end of his life, he said that “insofar as there is no science of the future, there are things that one cannot affirm about the future, and Marx, with great caution, however, tried to say that socialism will be the continuation of capitalism. And that seems to me to be a wish, which I also have, but not a historical necessity. It is not certain that socialism will win” (Bettelheim 2004).
Marx the optimist nevertheless painted a picture of the future, even if he did not want to do so. “Apart from this, from a scientific point of view, Marx's method in its principle is the only one that seems to me coherent and able of bringing to light the movement of history, the contradictions that make it move, and the way in which these contradictions develop. It is an incomparable instrument of analysis, next to which the ramblings of the liberals are childish” (Bettelheim 2004).
But before becoming a renowned specialist on Soviet planning, Bettelheim had first to grapple with Soviet statistics and show that he was able to make sense of them, a prerequisite for those who wanted to appear as Soviet experts. Not an easy task.
3. Making Sense of Soviet Statistics
Bettelheim comprehensively described the Soviet planning system in his 1939 doctoral thesis, where he indicated his sources in the bibliography and briefly discussed the question of Soviet statistics (Bettelheim 1939: 263–66). In an article published the following year, he went further into the discussion and concluded that Soviet statistics, although incomplete, imprecise, and sometimes inaccurate, were nevertheless perfectly usable for those who knew how to handle them (Bettelheim 1940). Let us see how he arrived at this conclusion.
The author began by recalling the institutional history of the collection and publication of statistics in the USSR: the imperial Central Statistical Committee was put on pause for a more than one year after the revolution and was then rebuilt in the form of a Central Statistical Agency, which would become the People's Commissariat for Statistics, while research institutes were created in early 1920s, including the Institute of Conjuncture headed by Nikolay Kondratiev (in which Slutsky, Raynov, Konyus, and others would work). This institute published beginning in 1922 a monthly Conjuncture Bulletin (in Russian) full of statistics, including various price indexes, which was very useful at a time when everything was moving quickly and on a massive scale. This NEP period was therefore one of an abundance of statistics. The beginnings of planning with the first five-year plan, 1928–33, saw several upheavals from this point of view: the People's Commissariat for Statistics was relegated as a subentity under the direction of the Gosplan (the State Planning Commission), and, as Bettelheim (1940: 17) modestly put it, “the Institute of Conjuncture disappeared.”10 The sources of production of statistics became scarcer. However, the mass produced remained significant: several general annual compendiums were published, as well as a few sectoral surveys (on agriculture, on transportation and communications, on labor). But at the time, the Foreign Trade People's Commissariat was the only one still publishing monthly statistics. Still, the daily press, as well as many specialized newspapers, regularly provided intermediate or sectoral statistics. Most of these publications were available in the Western world, and for some annual volumes, even in official translations. Notwithstanding this, the scientific journals that published economic statistics all merged into the main Gosplan publication, Planovoe khoziajstvo (Planned Economy). It was in these journals that one kind of data was available and became almost impossible to find afterward and that will prove crucial: price indexes.11
What is the value of these statistics according to Bettelheim? First, they are clearly “incomplete”: many questions that arise can be answered only by estimation or extrapolation. Movements in prices and in population are unknown. Soviet statistics also “lack precision”: the survey forms are not very detailed, or the methods of obtaining data are unknown, and the units of measurement not always clear. Even more problematic is the “inaccuracy” of some of the data, either because of untrained statistical personnel or because of dishonesty or fraud. The latter is likely to undermine confidence in these statistics. It may be in the interest of a factory director to indicate that he has produced more than was really produced, in order to get a promotion or to meet the objectives of the plan. But the reverse is also true, as it can be rational to sell the undeclared surplus on the black market, either for personal profit or also to have the funds to acquire on the same black market the raw materials that the plan promised but that did not exist. These difficulties were seen as unavoidable to Bettelheim. For him the daily press could help a bit, by supplying testimonies of such frauds and corresponding correction of statistics. For one of the examples he gave, in the November 13, 1918, edition of Pravda, the official Soviet newspaper, one could read that the real number of apprentices-sellers in commercial schools was six thousand and not thirteen thousand (Bettelheim 1940: 22).
But there was the other source of potential deception: rigging by the government for the sake of propaganda. Here Bettelheim's solution was quite pragmatic: a government that employed thousands of civil servants who worked on the statistical data to elaborate the plan simply should have no interest in perpetrating fraud. It would be a huge waste to mislead and make these thousands of civil servants work on false data. The consequences would be too great. According to him, when data are embarrassing, rather than manipulating them, the Soviets simply did not publish them. Bettelheim (1940: 22) gave a sad example: “The census of January 6, 1937, was not published, its results were cancelled, and its authors imprisoned or shot. These facts can be explained in only one way: the population of the USSR did not increase as predicted. The 1936 ban on abortion (which had been permitted since the beginning of the regime) confirms this hypothesis.”12
When the Soviets did nevertheless publish bothersome statistics, they might do it in a delayed way, or they published the correct figure first and then rapidly changed it when they needed it for propaganda. Based on this reasoning, Bettelheim gave this simple advice: “In the latter case, the inaccuracy is revealed by the contradictions that appear when the statistics are consulted at different times (in principle, it is the oldest statistics that should be used)” (Bettelheim 1940: 20).
It allowed him to qualify Stalin's affirmation that the first plan was realized at 93.7 percent, while the rate of growth in industry was 8.5 percent according to the first figure published, and then 26.6 percent according to the second one, with the plan itself hoping for 36 percent in this area (Bettelheim 1939: 274–77). So even if some data were difficult to get, especially those on prices, population, and real wages, Soviet statistics were usable, if one considered them as mere approximation and if one had a good knowledge of the system that produced them, knowing the most reliable statistics and the lesser ones.
It is interesting to compare Bettelheim's position with those of other specialists because the issues at stake have important political implications.13 The Marxist and British Communist economist Maurice Dobb acknowledged that Soviet statistics before World War II were far from perfect (as were those of other countries) and in particular, the fact that the reference years of 1926–27 were used during the 1930s and 1940s undoubtedly tended to inflate—to some extent—the figures of industrial production.14 But, for Dobb, this was not a matter of manipulation. The structure of the Soviet economy was changing so rapidly during the first two five-year plans that any benchmark—weightings and prices—would have been a problem. He cleared the Soviet statisticians:
The view that all Soviet figures are naturally suspect, designed as propaganda-instruments to deceive the unwary, is no longer seriously held, and scarcely merits attention here. Though commonly met within uninformed circles before the war, it was seldom if ever accepted, at any rate in its crude form, by anyone with much experience of handling Soviet statistics and submitting them to normal tests of consistency. (Dobb 1949: 18)
The British economist and statistician Colin Clark is one who subjected Soviet statistics to consistency tests. This pioneering scholar in the modern estimation of the English national income is someone who cannot be accused of having Soviet sympathies: according to Millmow, “Clark was among the first to debunk claims about the relative superiority of the Soviet economic model” (Millmow 2021: 238). Clark's book, A Critique of Russian Statistics (1939), did indeed do a useful job, not yet done systematically: subjecting Soviet statistics to consistency tests, both internal and external. By internal consistency, Clark meant comparing various sources and figures and trying to calculate estimates according to principles found in national income determination.15 Fake or invented data do not stand up to such tests. External consistency tests Clark involved transforming Soviet goods and services with British prices at a base year. This was needed for comparison purposes, “because prices in Russia do not necessarily bear any determinate relation either to the cost of production of goods, or to the consumers’ demand for them, being fixed by the planning authorities in accordance with their own decisions” (Clark 1939: 1). An important result that Clark obtained in terms of internal consistency is that there is no systematic optimistic bias in Soviet statistics, which exonerated the suspicion of large-scale manipulation (46). But as soon as he used external consistency tests, he arrived at results that were inferior to those of Soviet statisticians: the growth of industrial production looked more impressive when expressed in 1926–27 Soviet rubles than in 1934 British pounds. But one cannot blame the Soviet statisticians for their choice, as both (rubles and pounds) are arbitrary. Clark was more concerned in the end with the lack of data on population: without them, it is impossible to derive clear trends in productivity and well-being.16
Bettelheim was most certainly more optimistic about Soviet statistics. For him, they were nevertheless usable, even if some were missing: “These are data which, for one reason or another, statistics must not reveal” (Bettelheim 1939: 266). But at the end of the journey, Bettelheim was seen as one of those experts who could handle Soviet statistics.17
4. Analyzing the Nazi German Economy at War
During the war, Bettelheim was commissioned to write a report on the Nazi economy by his Trotskyist organization, the POI. Although this report circulated clandestinely, no trace of it has been found. However, a version was published after the war, in 1946, under the title L’économie allemande sous le nazisme (The German Economy under Nazism; Bettelheim 1946a), whose subtitle can be translated as An Aspect of the Decadence of Capitalism, which resonates well with the objective that this pamphlet had for the POI: to convince the French people and leaders that the forms of planned economy and state interventionism under Nazism were anything but socialism. The book is also interesting in that, until now, Bettelheim had studied only the Soviet economy. Here he provides his first analysis of a capitalist economy, in which he will use, even if not explicitly stated, a Marxist analytical framework.
The German experience sheds light on two issues for Bettelheim. First, there was the problem of outlets. To answer that, one must study the contradiction between the productive forces and the absorptive capacities of the German domestic market to begin with, and at the international level to continue. Bettelheim set the scene: monopolies with their high prices have shrunk national markets; and at the international level, industrialized nations were struggling to import resources cheaply and export high-value-added goods. And on this last point, Germany's history, with its very late unification, explains to a large extent its weak position in the world market compared to its European competitors. As for National Socialism, it was built according to Bettelheim on two foundations: an economic one—with the growing difficulties of the German economy in coping with the crisis of 1929—and a political one—with resentment against what was perceived as the humiliations of the Treaty of Versailles, on the one hand, and a fear on the part of the business world of seeing a revolutionary workers’ movement taking power, on the other. Hitler hoped to revive the private machine by placing numerous orders (especially large public and military contracts) in the hope that the private sector would take over, which eventually never happened (Bettelheim 1946a: 23–27).
The second issue, which will be our primary interest here, is about “true socialism,” because capitalism, with its monopolies and the increasing intervention of the state in its affairs, was often mistaken for socialism. In order to answer this question, Bettelheim applied his Marxist grid of analysis: he studied “the real structure of the German economy, i.e. the study of property relations, the role of private property, of large monopolistic formations and banks, the role of the state as well as the study of the failure to which the economic policy of Nazism led” (Bettelheim 1946a: xii). In order to understand this structure, one has to look at the dominant form of appropriation by the social content of the economy and not be satisfied with the political forms taken by the state. Thus, it is necessary to study “the character of the forms of property, and of the legal relations, which the State gives, safeguards and defends” (29): “The economic and social structure of a country is characterized by multiple elements: by the relative importance of the cities and the countryside, by the relative importance of the different social classes, by the distribution of property (private property, capitalist property, public property)” (29).
In Germany, public ownership remained the exception. In 1938, it represented only 5 percent of the national wealth, and when debts were added, the net assets of the public authorities were negative. The dominant form of property was private ownership of the means of production. Among private property, capitalist property dominated,18 and among capitalist property, trusts, cartels, and Konzern were prominent.19 The historical analysis that Bettelheim offered to his readers showed that the Third Reich only strengthened private and capitalist property and furthered its concentration. It is true that the war economy restricted the range of freedoms of capitalists: scarce resources were reserved for the war economy, imports were limited to the essentials, and many prices were regulated. But on closer inspection, Bettelheim pointed out, these had exactly the same effects of cartels, trusts, and Konzerns: they lowered prices in order to sink a newcomer or prevent a newcomer from getting his hands on a resource by monopolizing it entirely. The war economy, in fact, favored the great capitalist powers, while at the same time it reduced the power of the small owners of capital. Nazi policies essentially facilitated the concentration of private capitalist power: by privatizing profitable public enterprises, by expelling and expropriating many small Jewish entrepreneurs, and by imposing specializations for the various Konzerns, which then became dominant in one market, rather than having large shares in several markets.
As for state intervention and planning, what form did it take? With regard to price regulation, the state accepted free prices in principle, but sought to stabilize some of them by imposing upper or lower limitations. The measure that lowered prices had above all the effect of compressing the profits of small firms, to the benefit of the large groups, and thus of big capital. And the only prices that the Nazi state really controlled, for Bettelheim, were the prices of public orders, which only suppressed the effects of competition (Bettelheim 1946a: 151–56). Wage regulation, on its side, was only a “close collaboration of the State apparatus and the capitalists to keep wages low” and thus increase profits (192). As for the “four-year plan” (1936–40), despite some public enterprises created by Göring who headed the plan, its essential aim was to orient activity, but not to carry it out. And the methods used to direct the activity were often inducing large profits, which further reinforced the capitalist character of the economy. In Bettelheim's (1946a: 159–60) words,
This is the place to clear up the many misunderstandings about Nazi “planning.” The four-year plans were by no means plans for the German economy as a whole. On the contrary, the state was never so deprived of broad economic perspectives as it was after the Nazis came to power. The Nazis’ plan to reduce unemployment was to limit the use of machines; in fact, machinery and rationalization flourished. The Nazis had a ‘plan’ of return to the land; in fact, as we have seen, 1,450,000 workers left agriculture. The Nazis wanted to put an end to the professional activity of women; in fact, the percentage of women employed in industry only increased, reaching 32.8% of total workers in 1938, etc. . . . They set the importance of the tasks to be carried out, they also set deadlines, but they did not impose anything; the companies working to satisfy the orders set out in the plans, only to make a profit. When necessary, this profit was secured through price increases and protective tariffs. . . . When price increases were to be avoided, subsidies were used, or the state directly managed loss-making sectors (Hermann Göring's factories).
Planning was partial and poorly coordinated, and whatever the significance of the state during the war economy, Nazi planning always sought to leave as much room as possible for the initiative of private capitalists, by encouraging them through prices, subsidies, and customs protection and by inviting them to attend meetings of economic officials of the state, and, in fact, some of the capitalists thus became a part of the state. In conclusion, the experience of the German economy under Nazism was that of a command capitalist economy:
The difference between a command capitalist economy and a competitive economy is less than is often believed. There is, however, a difference, and not a small one, in that with the disappearance of competition, the limitation of the capitalist market exerts its restrictive action on production not a posteriori and in fits and starts (separated by periods of expansion), in crises of overproduction, but a priori and in an almost constant way, so that we witness an almost chronic paralysis (of which permanent unemployment is one of the main manifestations), masked only by the artificial economic expansion linked to the preparation for war. (Bettelheim 1946a: 275)
Under the stated conditions of a lack of outlets, German companies refused to invest; they just waited for the next public orders, while the German state was going deeper and deeper into debt, and the private sector was accumulating financial resources. Would it have been possible to do otherwise? Here, Bettelheim's answer, while distinguishing between the case in theory and the case in practice, was categorical. Yes, theoretically: with a distribution of income more favorable to the workers, this would have enlarged the domestic market by reducing profits. But in practice, no, because the system obeys the type of property: “It is not possible to conceive that a social distribution of income should be superimposed on a private distribution of property. This is the stumbling block to attempts at planning under private ownership. . . . We believe that this is one of the main lessons to be learned from the economic experience of National Socialism” (Bettelheim 1946a: 279).
His Marxist analysis of the German economy at war contrasted with other publications of the time, which focused more on the efficiency of the German economic system.20 It is interesting to compare the sources used by Bettelheim and other analysts, as it gives us the sense that this is an issue of focus. For instance, Bettelheim used almost the same sources as the German-economist-in-British-exile Hans Singer in his series of twelve articles on the German economy during the war that were produced for the Economic Journal at Keynes's request (Singer 1940–41, 1942–44).21 But besides German periodicals, official statistics, and a few general references, there is a difference: Singer used secret material from Germany and interviews, while Bettelheim used Marxist literature, written by such authors as Jürgen Kuczynski and Rudolf Hilferding (the latter to explain the process of concentration of capital in trusts and Konzerns). This explains the fact that Bettelheim insisted on something else: planning was possible under both socialism and capitalism, but as the German case demonstrated, they were quite different things, and they should not be confused.22
5. Becoming a Planning Doctor
At the end of World War II, Bettelheim thought that his academic career was over, but new doors opened to him and his entourage. For example, in 1944, at the liberation, his friend Gilles Martinet of the Youth Communists was asked to set up the Agence France Presse (AFP). For Bettelheim, an opportunity came from Alexandre Parodi, a civil servant active in the French Resistance, who obtained the Ministry of Labor from General de Gaulle in 1944. Parodi was especially close to Olga Raffalovich, within the French Resistance network, who knew Charles Bettelheim well from his Trotskyist activities during the war. She recommended Bettelheim to Parodi, who appointed him director of a new Center for Research and International Relations at the Ministry of Labor: a center for documentation, surveys, statistics, and publications, where everything had to be done. Bettelheim cofounded and animated there the Revue française du travail,23 and he was personally involved in international relations, where he represented France, mainly on the board of the International Labor Office. This implied many trips, including to Quebec and the United States. He took the opportunity to observe from New York the largest American strike of 1945–46 with its millions of participants. He even succeeded in carrying out, with Lucette, a survey of the American unions at that time: he did not see in them an alternative way out of capitalism.
During the same busy period, he was also in charge of teaching at the ENA (Ecole nationale d'administration) and at the ENOES (École nationale d'organisation économique et sociale) directed by Georges Lutfalla and where Alfred Sauvy also taught.24 There, Bettelheim gave lectures in which he systematized his thoughts on planning, which led to the publication, in 1946, of his book Les problèmes théoriques et pratiques de la planification (Bettelheim 1946b). In that book, he had already moved away from the Soviet model, advocating, for example, a flexibility of retail prices to avoid the shortages characteristic of the Soviet economy. Above all, he had experienced the German war economy, and he now paid particular attention to the different categories (prices, profits, interest) and their meaning under capitalism, under the transition to socialism, and under socialism. He mentioned in the book the dangers of the persistence of capitalist categories and thus announced his future works on planning. During the same period, he also took the opportunity to revise his report on the German economy in a book form (Bettelheim 1946a).
Finally, he participated with his friends, most of whom he had met during the war, Gilles Martinet, Jacques Charrière, Pierre Naville, and Pierre Bessaignet, in the creation of a journal, the Revue internationale, which published political, historical, economic, literary, philosophical, scientific, poetic, and architectural texts from a nondogmatic Marxist perspective.25 Bettelheim published texts on the Soviet economy, sometimes under a pseudonym. It also allowed him to offer translations of other Marxists for the first time in French: Paul Baran, Paul Sweezy, Raya Dunayevskaya, and others. This adventure with his Trotskyist friends lasted from 1945 to 1951 and helped establish Bettelheim's reputation in international militant and intellectual circles.
The period from 1944 to 1948 was full of activities for Bettelheim. But in the spring of 1948, the French Socialist Party took over the Ministry of Labor, and they cleaned out all the Communists and their sympathizers. Bettelheim was dismissed. And this is where his meeting during the war with the historian Lucien Febvre was to prove crucial: he first obtained a position as a researcher at the CNRS, and then, in the fall of 1948, had him elected to the 6th section of the École pratique des hautes études (the future EHESS),26 of which he was the director. Bettelheim had not applied, but Lucien Febvre had done so for him. This marked the beginning of a long period of stability:27 he would have his own research center on planning and development; he would have disciples, he would edit his book collection at the publisher François Maspéro, and he would continue his publications on planning and development; eventually, his seminars would attract a large number of students from various national liberation movements against their colonial occupiers, and once in power, would succeed in getting him called on a mission.28 His career as a planning doctor began. Internationally famous, but little considered in France, Bettelheim became a specialist in Soviet planning, whom the Gosplan in Moscow, from the beginning of the 1950s, considered as one of their own. Thus did the war turn Bettelheim into a planning doctor.
6. Epilogue: A Mission in Nasser's Egypt
On January 31, 1963, Charles Bettelheim went to Egypt on a twenty-four-day mission at the invitation of Nasser's government.29 There, he gave three lectures on the notion of economic surplus that were attended by professors of economics from Cairo and Alexandria and by high-level civil servants. He had several discussions on general principles of economic planning with the director of the Institute of National Planning, a three-hour discussion on the economic situation of the country with President Gamal Abdel Nasser (together with two vice presidents), another one with the ministry of finances and planning, and many with other high-level civil servants, professors, and statisticians. He visited several factories (including a steel and iron factory) and a few agricultural centers, and he saw the construction of a dam. But the most important part of his stay was spent at the Institute of National Planning in Cairo, where he spent time evaluating the current and future research projects of the institute with its director. He even agreed to supervise by distance two research projects in particular—one on the evaluation of the needs of labor for economic development, the other on the evaluation of rural underemployment.
This example of one of his missions as planning doctor is similar to many others he did in the 1950s, 1960s, and 1970s. Some involved shorter or much longer visits (up to a few months). Some were a one shot, others regularly repeated every year. He sometimes traveled alone, most often with his wife, and in some cases with one or two collaborators (whom he even left on site to collect information for him for several months). In all cases, he had talks with officials, academics, statisticians, factory managers, and planning staff. He often delivered a written report, sometimes ensured follow-ups, and maintained a correspondence with selected people. At this point, it is fair to wonder whether the people he talked to learned more from him, or whether he learned more from them. In any case, his missions certainly contributed to his knowledge as a planning doctor. The fact that he was regularly called back is an indication that his missions were pleasant—at least for some time—for those who invited him. In particular, his knowledge of Soviet statistics and of the difference between a socialist economy and a war economy ensured that his opinion was highly respected and sought out.
Charles Bettelheim was a planning doctor who provided a general kind of advice on planning, always keeping in mind the political and social goals of planning and ensuring that the economic development plans were in line with these goals and were feasible in light of the existing constraints in the economy. He was not much interested in the details of calculation and in the latest technologies of planning. He was not a specialist planning doctor. He was a generalist—Marxist—planning doctor.
I would like to thank the guest editors of this special issue and the participants at the conferences where I presented it (Gide 2022 in Paris, ESHET 2022 in Padova, THETS 2022 in Cambridge, BETA Seminar 2023 in Strasbourg, and the 2023 HOPE conference at Duke). For their advice and comments, I am also particularly indebted to Amanar Akhabbar, Ivan Boldyrev, Bernard Chavance, Emily Evans, Verena Halsmayer, Thomas Irace, Michel Prat, David Sarech, and Ramon Tortajada. I am the sole one responsible for the use of their suggestions.
Notes
EHESS stands for École des hautes études en sciences sociales, or School for Advanced Studies in the Social Sciences, in Paris.
Among planning doctors, Bettelheim was optimistic about the chances of building efficient socialism with economic planning, on the opposite side of János Kornai’s (1980) pessimistic outlook.
Without these events, he may have pursued his collaboration with Charles Rist, François Perroux, and others, and thanks to his knowledge of Soviet planning, he could have become a contributor to the French Commissariat général du plan and work on French-style indicative planning (see Dal Pont Legrand and Caldari, this issue).
We explored at length the archives of Charles Bettelheim (officially deposited at the EHESS, but temporarily located at the National Archives in Pierrefitte-sur-Seine, before going to their final destination, the Campus Condorcet in Aubervilliers). These archives were, however, disappointing for our purpose in that they contain only material from after 1950. We also consulted with more success, in order to find older documents by Bettelheim, the archives of Pierre Naville, which were located in the archives of the CEDIAS/Social Museum in Paris but are in the process of being moved to the same Campus Condorcet.
This section is primarily based on Denord and Zunigo 2005 and on two unpublished autobiographical memoirs (Bettelheim 1997, 1985–97). The memoirs were used with circumspection. Faulty memory, distance from the events, and the desire to present oneself in a different light (the memoirs were supposed to be published, although they never were), as well as differences in the way the same events are treated in different versions of the memoirs, all needed to be considered. On these tensions, and on the use of autobiographies in the history of economic thought, see Düppe 2019 and Weintraub 2019.
According to the genealogical website Geni.com, it appears that Bettelheim was only a distant relative of the Viennese and later American psychoanalyst Bruno Bettelheim (1903–90).
The national school of oriental languages in Paris is now knowns as INALCO (Institut national des langues et civilisations orientales), or the National Institute for Oriental Languages and Civilizations.
Gaëtan Pirou (1886–1946) was especially crucial in renovating economics in France with the importation of foreign theories (Cot 2000). Jean Lescure (1882–1947) was known for his theory of business cycles (Raybaut 2000). Albert Aftalion (1874–1956) was a specialist on monetary circulation and business fluctuations (Dangel and Rainelli 2000).
Five decades later, Bettelheim published a half-fictional novel: Moscou, place du manège, in which he portrayed himself during his stay in the USSR.
On the Moscow Institute of Conjuncture, see Barnett 1995 and Vianna Franco, Costa Ribeiro, and Albuquerque 2022. NEP stands for New Economic Policy.
An economist-statistician from the Russian empire worked in exile to reproduce statistics on the Soviet economy: Professor Sergey N. Prokopovich (1871–1955), an anti-Bolshevik, published from Prague a well-known Bulletin of the Economic Cabinet of Professor S.N. Prokopovich (in Russian). It is interesting to note that Bettelheim quoted and used Prokopovich’s periodical and alluded to his method (Bettelheim 1940: 23–24).
For a history of Soviet statistics that includes episodes of saboteur hunts within the statistics profession, see Sheynin 1998.
This is why even the CIA had Soviet statistics in mind. See Kuehn 2020.
This question is also discussed by Bettelheim, and it is the main issue behind the symposium on Soviet statistics that involved Seymour E. Harris, Colin Clark, Alexander Gerschenkron, Paul A. Baran, Abram Bergson, and A. Yugow in the Review of Economic Statistics (Harris et al. 1947).
Comparing German wheat imports from the USSR and Soviet wheat exports to Germany is also part of the internal consistency tests.
On Clark’s study of Russian statistics, see Dobb 1940 and Millmow 2021: 113–15. Millmow also shows that Clark continued to interest himself with this issue. For him, “‘the real connoisseur’ of Soviet statistics drew his conclusions, in part, from figures that were not published. Simply put, the Soviets suppressed unfavourable statistics” (Millmow 2021: 237).
Later in his life, Bettelheim recognized that he had no real idea of what was going on in the USSR, in part due to his political commitments: “Reading my dissertation again today, I can see how much—despite a critical attitude towards the policy of the leaders of the USSR and the social and political development of that country—I remained influenced by the ideology of the parties belonging to the Third International, even as I tried to free myself from it” (Bettelheim 1997: 33). And so, he recognized that his knowledge of actual planning was incomplete:
My presentation of the problems of planning was essentially descriptive; it showed, above all, the formal scheme that the Party and the planners wished to implement (I also learned, after the war, in 1954, that this part of my dissertation had been used as teaching material for planning in the USSR). In 1939, however, due to lack of information, I did not see how far the actual practice of drawing up and implementing plans deviates from the announced principles; on the other hand, dealing with what I call “the limits of Soviet planning,” I reported on the repeated discrepancies between the objectives of the plans and the actual development. (Bettelheim 1997: 34)
In La planification soviétique (Bettelheim 1939), he described Soviet planning as it should have been, but not as it was. This is important to know, but at the time, neither Bettelheim nor those around him knew that, so this footnote deserves to remain here in this story—as a footnote.
The distinction between private and capitalist ownership lies in whether the capital is small enough for the owner to exploit it alone, without salaried employees. In practice, however, very small firms are not always capitalist in character, and this is why statistics in this area often set an arbitrary threshold of five employees to distinguish private from capitalist forms of ownership (Bettelheim 1946a: 42–43n).
Konzerns referred specifically to enterprises under a common management that combine horizontal and vertical integration.
On the analyses of Hans Singer, Erwin Rothbarth, and Hal C. Hillmann on the German economy at war, see Hagemann (this issue).
Strictly speaking, there were two articles, one in four parts and titled “The German War Economy in the Light of Economic Periodicals,” the other in eight parts (with the first part numbered as pt. 5) and titled, simply, “The German War Economy.”
It seems that Bettelheim was unaware of the sensibly similar analysis about capitalist and socialist planning earlier elaborated by Pollock (1932).
On the early history of the Revue française du travail (French Labor Review), see Le Crom 2006.
The ENA was the national school of administration, and the ENOES was the national school of economic and social organization.
On the history of the Revue internationale (International Review), see Roche 2007.
The CNRS is the French acronym for the Centre national de la recherche scientifique (French National Center for Scientific Research). On the 6th section of the École pratique des hautes études (Practical School of Advanced Studies), see Benest 2019 and Popa 2016.
This stability was not without its troubles: Benest (2024) reconstructs Bettelheim’s difficulties with Fernand Braudel while both were at the school.
Here are some of the subjects of his seminars (which were given in French): employment and investments in a planned economy (1956–57), economic calculation and fixation of social objectives (1966–67), the recent evolution of Soviet planning and management methods (1965–66), comparative analysis of the process of industrialization in the USSR and in China (1973–74), economic calculation forms and methods in the framework of centralized planning (1964–65), and contemporary problems of the Indian economy (1956–57). Archives of Charles Bettelheim, EHESS, Box 117-EHE-1, A-1, file 3.
This mission, one among many, left traces in Bettelheim’s archives (letters, documents, field notes, etc.) as well as in other places. In this case, as he had to ask the permission to leave the EHESS to the French minister of national education, he also had to report back to him about the details of his activities. (Archives of Charles Bettelheim, EHESS, Box 117-EHE-1, A-2.) Much remains to be done to document Bettelheim’s planning-doctor activities after World War II. So far, only the case of Cuba is well documented (Leleu 2013, 2018).
