Professor Reynolds teaches in the economics department at Texas A & M University.
On January 7, 1979, the Vietnamese communists marched into Phnom Penh and replaced the Khmer Rouge nightmare with a more familiar brand of tyranny. Western journalists and scholars eventually reported the chaos, famine, and genocide that brutalized Cambodia from 1975-1979, but something is still missing—a coherent explanation for the tragedy. Like the fiasco in Jonestown, Guyana, a socialist experiment gone so dramatically awry seems to be dismissed as crazy, fanatical, or insane and then quickly forgotten.
But was it all so incomprehensible, so hard to decipher? No. A close inspection reveals nothing illogical or irrational about the Khmer Rouge and Cambodia, given their goals. The episode was a conscious ideological effort to completely replace the market economy with socialism. To be sure, it was much more determined and extreme than most socialist efforts, but this only makes the Cambodian experiment all the more essential to understand as an example of the pre-eminent issue of our age—socialism versus capitalism, collectivism versus individualism, death versus life. Originally, the word “socialism” was coined to express opposition to individualism. The brutal attempts of the Khmer Rouge and other communists to suppress all traces of individuality are not irrational but quite predictable and intelligible.
Socialism in all its variants has been widely associated with economic failure, yet two episodes stand out as virtual laboratory experiments in the perennial war on commercial activity—Lenin’s effort of 1918-1921 and the Cambodian disaster of 1975-1979. The parallels are impressive.
Early Western news accounts described the Bolsheviks’ economic policies as silly and irrational, although the 1917 revolution had followed 70 years of socialist theorizing, agitation, and the famed declaration of Marx and Engels in The Communist Manifesto of 1848 that “The theory of the Communists may be summed up in the single sentence: Abolition of private property.” The idea of central planning grew from the socialists’ desire to eliminate decentralized ownership of the means of production and the “chaotic” market economy in favor of socialization of the means of production and the application of science to society, thereby allowing man consciously to direct history in any manner desired.
The Destruction of Trade
Economic historians—e.g., Boris Brutzkus (1935), Lancelot Lawton (1932), Alexander Baykov (1947), T. J. B. Hoff (1949), Paul Craig Roberts (1971)—agree that the Bolshevik program from 1918 to March 1921 was a conscious effort, however muddled, to replace the market economy with a system of planned, non transferable, in-kind assignments of inputs and outputs. There was a deliberate destruction of commercial trade and abolition of money and banking rather than a war-caused “breakdown of normal trade.” The economy—voluntary social cooperation—came to a virtual halt under state restrictions and direction. Production became so disorganized and anarchic that Lenin abandoned the planning effort to preserve his power. Famine took the lives of an estimated 5.5 million people before some 10 million were saved by relief from the capitalist West. Peasant uprisings and the Kronstadt rebellion in February 1921 forcibly brought home growing domestic discontent to the Bolsheviks. Workers were particularly outraged by the regime’s effort to prevent individuals from supplying themselves with necessities.
By March 15, 1921, Lenin had seen enough. He decided that communism could only be built upon the rationality of the bourgeois economy: “Whoever dreams of a mythical communism should be driven from every business conference, and only those should be allowed to remain who know how to get things done with the remnants of capitalism.” Further, Lenin said, “We are very much to blame for having gone too far, we overdid the nationalization of industry and trade.” Abandoning the original vision of socialism posed doctrinal difficulties for Lenin, but new words ushered in a New Economic Policy (NEP)—meaning private property and the market economy were allowed partial operation, especially in agriculture and trade—d recovery quickly followed.
Like the inexperienced intellectual V. I. Lenin, Khmer Rouge leaders fervently embraced Marxist doctrine and tried valiantly to implement it. A docile nation composed 90 percent of peasants in an apparently simple economy seemed an ideal place for true socialism to “work.” Yet the dream of a blueprinted, harmonious society should be traced back to Plato’s Republic rather than to Marx and Lenin:
. . . what has been said about the State and the government is not a dream, and although difficult not impossible . . . when true philosophers are born in the reigning family in a state, one or more of them, despising the honors of this present world which they deem mean and worthless . . . will begin by send-ing out into the country all the inhabitants of the city who are more than ten years old, and will take possession of their children, who will be unaffected by the habits of their parents; these they will train in their own habits and laws, which will be such as we have described: and in this way the State and constitution of which we were speaking will soonest and most easily attain happiness, and the nation which has such a constitution will gain most.
Each Khmer Rouge leader was from an advantaged family, each studied law or economics in Paris in the 1950s, each embraced Marxism-communism as a means to save the people from capitalist exploitation, and each wrote tracts and dissertations which announced his ideological dedication and intentions. Like Lenin and his fellow armchair intellectuals, none of the Cambodian philosopher-kings ever did manual labor for a living or managed any enterprise.
Once in power the Khmer Rouge leaders refused, in contrast to Lenin, to temporize in order to preserve their political power and revolution. Full speed ahead, the Khmer Rouge leaders were undeterred by early disaster; they proceeded with their quest, although in 1978 Pol Pot admitted, “We are building socialism without a model.” Anticipating Pol Pot’s problem, economist Ludwig von Mises argued in 1920 that socialism could not begin to work in a remotely efficient manner under real world conditions of continual change, and he added, “Historically, human rationality is a development of economic life. Could it then obtain when divorced therefrom?”
The Khmer Rouge deliberately isolated the renamed “Democratic Kampuchea” from the markets of the outside world and destroyed all vestiges of the old days in favor of starting afresh: the government acted to abolish money, all private property, exchange, and therefore prices, and to move labor from the cities to rice production as commanded by “Angka” (the organization). By abandoning cities the program eliminated Lenin’s problem of supplying food to the cities, which supposedly had been the source of “class conflict.” Of an estimated 7-8 million inhabitants in 1970, an estimated 2-3 million were killed or died of starvation, mass suicide, and disease after almost four years of Khmer Rouge rule. Combat troops never exceeded an estimated 70,000 or 1 percent of the population, a macabre confirmation of docility and political susceptibility to collectivism. Even though the Khmer Rouge earlier had followed the same policies in the areas under their control, and intellectuals since Plato have ad vocated a utopia designed and ordered by a single will, the world expressed amazement at events in Cambodia.
Many Western journalists, in contrast to revolutionaries, do not treat ideas seriously, and therefore fail to recognize the power of ideas in action. They don’t realize that chaos and brutality must accompany a determined effort to implement what economists Mises and Hayek called an impossible or unworkable economic scheme, namely, thorough-going socialism. For example, Sydney Schanberg in The Death and Life of Dith Pran—the basis for the film The Killing Fields—puzzles over the words used by the regime: angka = the organization, opakar = people or instruments, Khmer = nation or machine. Uncomprehending, Schanberg calls the terminology strange for a government trying to erase the colonial past.
Another writer, Craig Etcheson (1984), points out that the revolution was so ultra-radical that even the communists were appalled. Yet Etcheson is inconsistent in terming market phenomena like rent and credit archaic while calling the Khmer Rouge’s elimination of money, banking, and other financial institutions “backward.” Other academic writers blankly decry the lack of bureaucratic information about the Khmer Rouge, vainly hoping that documents alone might tell them why certain poli-ties were put into effect and why others changed at certain times.
Private property, money, prices, unequal rewards, and commerce often offend intellectuals. They yearn for an alternative, an economic system where commercial institutions are suppressed or controlled, if not totally eliminated. They sympathize with vague ideals about an earthly paradise built on planning, socialism,and communism. At a minimum, they oppose markets and capitalism. As a result, they remain blind to the cause of the events they so poignantly relate about Cambodia.
A Descent into Barbarism
Economists still debate whether rational economic management of a complex society based on monopoly control of the means of production under a single mind or committee can work in a tolerably efficient fashion. While a single case is not decisive, the Cambodian experience strongly suggests that it cannot work. Oblitera- tion of private ownership, market exchange, and prices threatens civilization because without the exchange mechanism, the economy and, therefore, society collapses. Productive coordination of human effort is impossible without trade in productive assets (capital markets). There is no demonstrated, superior alternative to the price system and Wall Street. Though most intellectuals would recoil from the idea, a logical corollary is that each step away from capitalism (individualism, private ownership, and limited government) is a descent into barbarism, degradation, and irrationality.
Experiments in unalloyed socialism have quickly ended in failure. This explains why every communist government, including Heng Samrin’s Post-Khmer Rouge regime, is “advancing to socialism” but never reaches it. The bones of millions of Cambodians suggest why living human beings will never reach socialism.
Alexander Baykov, The Development of the Soviet Economic System (New York: Macmillan, 1947).
Boris Brutzkus, Economic Planning in Soviet Russia (London: G. Routledge & Sons, 1935).
Craig Etcheson, The Rise and Demise of Democratic Kampuchea (Boulder, Colorado: Westview Press, 1984).
Trygve J. B. Hoff, Economic Calculation in the Socialist Society (London: W. Hodge, 1949).
Lancelot Lawton, An Economic History of Soviet Russia (London: Macmillan, 1932).
Paul Craig Roberts, Alienation and the Soviet Economy (Albuquerque: University of New Mexico Press, 1971).
Sydney H, Schanberg, The Death and Life of Dith Pran (New York: Viking, 1985).