Red markets
ONE DAY IN 1952, nearly six and a half years after the communists seized power in Yugoslavia, a member of the Politburo spoke to the nation’s legislature. The old “exploiting elements of society” had been safely isolated, he announced. Bureaucracy was now the greater threat. To combat it, the country would take a step that Marxists typically relegated to a distant future.
It was time, he said, to commence “the withering away of the state.”
He was speaking on April 1, but this wasn’t an April Fools’ joke. And while the Socialist Federal Republic of Yugoslavia did not wither away just then—that happened 40 years later, for rather different reasons—the place really was embarking on a new social system. It had, in fact, been making some hesitant moves in this direction for a couple of years already.
Yugoslavia had broken with the Soviet Union in 1948, but its government initially showed no signs of abandoning Stalinist economics. Indeed, it soon started a brutal drive to collectivize agriculture. By 1951, the number of state farms had leaped from 1,318 to 7,012, and in the process the government had not just seized land but demanded absurdly high production quotas—and sent many of the farmers who couldn’t meet them to internment camps. The push prompted violent resistance in the countryside, most notably the Cazin Rebellion of May 1950, in which hundreds of peasants took up arms against the state.
Yet some of the country’s leaders were starting to rethink their economic approach, especially as they watched newly nationalized industries churn out products
