Yesterday, in response to the implications posited in Part III of “Investing with State Capitalists and Social Capitalists,” I decided to reread the conclusions which I had made in Work-Standard Accounting Practices (1st Ed.). One significant area of interest concerned whether there was any connection between “Managerialism” (which I had referred to as “Fordism-Taylorism” in The Third Place), and the rise of the Accounting Profession throughout the 20th century. There is no doubt that Neoliberalism’s most pivotal developments in mid-20th century economic life pertained to the harnessing of Financial Technology and the deemphasis on the Manufacturing and Natural Sectors (in favor of the Fractional-Reserve Banking System and the Digital Economy). The latter concurred with the more recent overemphasis on a highly educated, poorly trained technocratic bureaucracy, what certain people would refer to as the “Professional Managerial Class.”
What role did the Accounting Profession in the Western world play during the latter half of the 20th century? Under Liberal Capitalism, the old methodology of Double-Entry Account Bookkeeping remained true to its core fundamentals. What has changed is Technology and the ability to record the process by which Kapital and Schuld accrues and their movements across international borders in the broader Empire of Liberty. Technology in that context was devised for the purposes of greater Kapital Accumulation, which would put the Accounting Profession as one part, but not the only part, of that “technocratic bureaucracy” keeping Neoliberalism going.
The central argument I posited in Work-Standard Accounting Practices was the necessity for the Work-Standard to rely on its own accounting system. It needed its own Bookkeepers or Accountants and Auditors to record the contributions of Arbeit and Geld to the Life-Energy Reserve. But barring the Work-Standard, I was not too surprised to find the roles of the Soviet Accounting Profession within Soviet-Type Economic Planning (STEP) being affected by the Kosygin Reforms and later Perestroika. The Kosygin Reforms in the 1960s-1970s and Perestroika in the 1980s both saw the Soviet Accounting Profession struggling to implement “Managerial Cost Accounting” within the framework of “Material Product System (MPS).” The motive was simple: to acquire a methodology of recording the creation of wealth in the Soviet Economy and find ways of keeping costs down across individual Economic Organizations. It was not until Perestroika that there was a full-scale implementation of Managerial Cost Accounting.
However, the Soviet Accounting Profession lacked the expertise and technical means of recording economic activities across the Soviet Economy. Part of that could have been addressed by developing computational machinery like the kind envisaged by OGAS, the Soviet conceptualization of the Digital Realm, which of course never became realized. The rest boiled down to the fact that Marx and Engels never considered the possibility of a “Socialist Accounting System” being needed to track the overall performance of developing the “Productive Forces” under the “Socialist Mode of Production.” The Soviets certainly realized this when they came up with the Material Product System, because there was no precedent which Marx and Engels could draw from in the 19th century or prior.
The good news about rereading the two Entries on those topics from Work-Standard Accounting Practices is that I discovered several research articles discussing about the Soviet Accounting Profession in relation to STEP between the 1950s and 1970s. I had posted the relevant articles in Digital Library V, but for those interested, I am including links to them here as well. Everything below is statistical, econometric, and historical evidence describing how the Soviet Accounting Profession operated under STEP prior to Perestroika:
- Accounting for Cost Control in the Soviet Economy
- A Model of Soviet-Type Economic Planning
- Planning with Material Balances in Soviet-Type Economies
- Soviet National Income Accounts for 1955
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