There has never been such a thing as a purely proletarian party with a purely revolutionary program and the FLN of Algeria was no exception. It contained political contradictions between Marxist and bourgeois- nationalist groupings. These contradictions were most often expressed through the words and actions of the revolutionary government which acted at cross-purposes.
The Tripoli program of 1962 stated that "it is the peasants and the workers who are the active base of the movement" and called for socialism. The leadership of the FLN had an ambiguous relationship to the mass movement whose name it spoke on behalf of. In 1962, for example, a major crisis broke out between the Ben Bella and Ben Khedda factions over who would control the military arm of the movement. This crisis reflected personal rather ideological differences. The struggle eventually took a violent turn and 3000 combatants died. The masses demanded an end to the power struggle and called out 'Barakat seba senin' (seven years is enough!) in reference to the bloody civil war with France. This was not an auspicious beginning for a new revolutionary movement that intended to build socialism in Algeria.
The Evian agreements of 1962 marked the formal end to the war of independence with France. The FLN allowed France to maintain its naval and air force bases for fifteen and five years respectively. A more insidious legacy of the colonial era, however, was the persistence of the bureaucratic machinery of the old colonial state. It was not to be smashed but preserved and modernized. Seventy-seven percent of the new Algerian state personnel holding managerial positions owed their appointments to the colonial administration. This layer was augmented by FLN officials from exile in Tunisia and Morocco whom the Evian agreements recommended be trained in France All of this would be analogous to, for example, a decision by the Vietnamese to retain most of Thieu's bureaucracy and to train new hires at American universities after the US had been expelled.
The development model chosen by the new revolutionary government had been conceived by Belgian economist Destane de Bernis whose goal it was to address Algerian needs specifically and the Third World in general. The FLN turned these ideas into a doctrine. The basic premise was that a modernized Algerian economy that achieved rapid industrialization would achieve a high degree of growth that would enable the peasant masses to be absorbed into the new economy. To reach this goal, the most advanced technology would have to be utilized. Not much analysis was done on the impact this path would have on the working-class or peasantry of the nation. It was the nation as nation that took precedent. Bernis would not let anything stand in the way of this modernizing model. He said, "We have decided that our equipment has to be ultra-modern, because it is more profitable in the middle term. We cannot accept machines dating from the 1940s, even if their use would provide jobs for a greater number of workers." The lack of sensitivity to the needs of the working-class has to be understood in terms of the character of the new state which is composed of bureaucratic-military cadre of the FLN and officials from the colonial administration.
While gestures toward self-management of firms and farms were made, the "socialist" government of Algeria appeared more interested in the quantity of growth rather than its quality. In this respect, it shared many of the characteristics of less progressive states in the region that were following a "modernizing" agenda, such as Iran and Iraq. Simultaneous with the technocratic approach to economic development that was taking shape in huge oil and chemical state-owned enterprises, Algeria began to witness the emergence of a private sector. The state sector actually began to fuel the growth of the private sector. Capitalism had never been abolished in Algeria, as it was in Cuba, so there ample opportunities for it to grow in the booming energy-based economy. An Algerian radical newspaper commented in 1983 that "Not only old agrarian and commercial capitalists have invested, but also party cadres, veterans of the liberation war, and even public sector cadres."
Colonel Boumedienne hailed this process. "National capital must play its role and accomplish its duty to the nation, the state is disposed, on its part, to supply it with all guarantees in a defined framework. It is not in the interest of the country that (private) capital remain unproductive." The private sector has grown steadily in Algeria. Charts available in Rachid Tlemcani's book "State and Revolution in Algeria", the source of the information in this post, end prior to 1986, the publication year. The trend is obvious, however. In 1982, private industry accounted for 40% of all jobs in transportation, 70% in agriculture and 75% in commerce.
The US embassy in Algiers published a report the same year that pointed to the existence of 315,000 capitalist firms. There are class loyalties between the bourgeoisie who run these firms and the petty-bourgeois bureaucrats who run state industry. Both tend to view labor as "inputs" to an economy that will produce growth for the nation rather than as an end in itself. Not only does the state sector have a compromised relationship to the domestic private sector, it is linked to international capital in a way totally unlike state firms have been in Cuba up until recently. The state firms in Algeria owe their existence to loans advanced by imperialist banks. The class relationship that underlies this debt is entirely different from those that Cuba owed to the former Soviet Union.
Imperialism uses these debts as leverage to accelerate the bourgeoisification of Algerian society while a similar process never took place in Cuba. In 1975, foreign debt amounted to $504 per Algerian citizen. This amounted to approximately half the per capita income of the urban population and the equivalent of the peasantry's. The World Bank has fostered a typical dependent relationship to Algeria. At the end of 1982, it agreed to fund eleven big development projects, as well as provide nearly a billion dollars for various social projects in Algeria. Private banks have also taken advantage of investment opportunities in Algeria. In 1979, Sonatrach, a big state enterprise, borrowed one-half billion dollars from a consortium that included Chase, Citicorp and United California Bank. Algeria's dependency on the United States has not only been tied to financing of major state projects. It has also been reflected in foreign trade.
After France cut off oil imports from the former colony, the United States stepped into the breach. Big delivery contracts were signed with Exxon in 1972 and Gulf in 1982. Around this time, the US was taking over half of all Algerian oil exports and US companies had large contracts to develop new energy sources. Less than 2% of Algeria's trade was with Third World countries and only 5.7% and 1.2%, respectively, of its exports and imports were with the Soviet block in the early 1980s. The final thing to consider is the relationship of the Algerian state sector and the high-technology engineering companies who were invited in to exploit the natural resources. 95% of the contracts are awarded on a bid system.
Once the contract is won, the foreign firm take total responsibility for the implementation. They hire and impose work discipline in the areas under their jurisdiction. They function as capitalist enclaves in the state sector. Firms like Brown and Root and George Bush's Zapata have established profitable footholds in Algeria with no regard for either the needs of the Algerian workers or the long-term viability of the Algerian economy. "Socialist" Algeria is as much of a boondoggle as Saudi Arabia for these smooth operators. The technocratic model adapted by Algeria in combination with the powerful private sector have led to explosive social contradictions.
Since the development model is based on heavy industry using high technology, unemployment has grown into a severe problem. Highly automated oil refineries are just not labor-intensive. The consequences were that in 1977 unemployment amounted to 18.6% percent of the economically active population. As the oil boom has wound down, the Algerian economy has also suffered. The debt crisis has accelerated and social and economic misery has increased. This has led to growing polarization between the FLN bureaucracy and the national bourgeoisie and, finally, civil war. These are the class realities of post-independence Algeria. It has everything to do with the ravages of the world capitalist system, which Algeria has been tightly integrated with from its infancy. When I analyze the Cuban revolution, it will be obvious that none of these contradictions--until recently--were able to take root. Capitalism, both internally and externally, have been a problem in Algeria from the beginning. Cuba was a different story.