Planned Proportionate Development of the National Economy, Law of

an economic law of socialism that expresses the objective necessity and possibility of directing the economy by a single state plan and establishing and maintaining proportions throughout the national economy, in the interests of rapid growth in production and consumption.

The law of planned proportionate development requires conscious, centralized regulation of production on the level of the entire economy, individual sectors, and single enterprises. It operates in a society where power is in the hands of the working people and social ownership of the means of production has been established. Continual disruptions of proportions are typical of the capitalist economy. Only under socialism is it possible to maintain proportionality. “Constant, deliberately maintained proportion would, indeed, signify the existence of planning” (Lenin, Poln. sobr. soch, 5th ed., vol. 3, p. 620). Under socialist economic conditions, proportionality is a condition of continuous national economic planning.

The objective basis for the supervision of production in conformity with a plan is created by the socialist economic system, a well-developed system of the social division of labor, and a high level of concentration, as well as rapid scientific and technological progress.

The operation of the economic laws of socialism lends itself to planning. Under capitalism, anarchy and competition constitute the foundation of the economic mechanism, the mode in which economic laws and categories are manifested. Under socialist conditions, all aspects of production relations, all economic ties, operate in conformity with a plan. Without planning, they could not be utilized to expand production and increase consumption.

In order to provide for a steady improvement in the standard of living of all members of society and for the more and more complete satisfaction of their material and cultural needs, the socialist state plans the development of social production and distributes material, labor, and financial resources on a statewide basis among the various spheres and sectors of the national economy. Proportionate development of the socialist economy implies planning and resource allocation that will ensure the most advantageous possible correlations, from society’s standpoint, between various types of economic activity.

The most important proportions, the establishment and maintenance of which are necessitated by the requirements of the law of planned proportionate development, include the proportions between subdivision I of social production (the production of the means of production) and subdivision II (the production of consumer goods), between industry and agriculture, between commodity circulation and the money income of the population, between production and consumption, and between production and accumulation. The growth of the productive forces is promoted by the most rapid possible introduction of scientific and technological advances into production, by optimum distribution of the productive forces among various economic regions, by comprehensive development of economic regions, and by rational interregional economic links.

The development of the world socialist economic system makes it necessary to coordinate economic proportions for the entire community of socialist countries, on the basis of the strengthening of the international socialist division of labor. In elaborating their economic policies, the Communist and workers’ parties of the socialist countries take into account the requirements of the law of planned proportionate development of the national economy and the other economic laws of socialism.

The development of the national economy in conformity with a plan is one of the chief advantages of socialism over capitalism (see).

Intense ideological struggle has arisen over various approaches to problems in the theory of planned economic development. Some bourgeois and right-wing socialist theoreticians seek to demonstrate that planned organization of production is unrealizable or inexpedient. Others contend that capitalist socialization of production is sufficient for the organization of a planned economy. Marxist-Leninist economic theory and historical experience show these views to be groundless. The revisionists essentially deny the operation of the economic law of planned proportionate development of the national economy under socialism, substituting for it the law of value, which, in their opinion, regulates production. The revisionist point of view is closely related to right-wing socialist theories of “market socialism.”