141 CHRONICLESnSolzhenitsyn, but the Slavophiles also embrace the Russiannrural commune — and this Solzhenitsyn passionately rejects.nSolzhenitsyn interprets the commune as a more significantnform of serfdom than feudal serfdom itself Thencommune meant the predominant economic power of thenstate, not just of landlords, over the peasantry by means ofntaxes imposed on rural settlements collectively and thenabolition of private land. The collectivist system of thencommune constrained peasants’ incentives and economicndevelopment.nOn many dozens of pages of the new two-volume versionnof August 1914, Solzhenitsyn describes how the Tsaristngovernment, under the premiership of Peter A. Stolypin,nworked hard in the period 1906-1910 to create a new classnof farmers by abolishing the rural commune as an institutionnand by establishing private land property for peasants.nSolzhenitsyn also describes how most of the parties of thennewly emerged Russian parliament, both left and right, andnmost of the intellectual community, resisted this capitalistnreform of Russian history.nThe truth of the matter is that the alleged Russian liberalsnwere not liberal at all in the sense of classical liberalism.nSolzhenitsyn endorsed, in his preface to VictornLeontowitch’s The History of Liberalism in Russia, 1762-n1914, the author’s argument that the only liberal force,nhowever inconsistent, in modern Russian history was thenTsarist government; the most antiliberal, anticapitalist forcenwas the Russian intelligentsia.nHere, of course, is one of the painful points for Westernncritics of Solzhenitsyn, who have a natural affinity withnRussian intellectuals and their fight against Tsarism. Whennin February 1917 Tsarism was finally overthrown, one ofnthe first acts of the liberals who came to power was thenabolition of the Russian parliament, whose rights they hadnostensibly championed against the Tsarist government fornyears. The long-sought dictatorship of liberal intellectuals isnknown in Western literature as the short-lived Russianndemocracy. At that time one could really speak out, withoutnfear of pejorative associations, and the first postrevolutionarynissue of the Journal of the Constitutional-Democratic Partyn{Vestnik Partii Narodnoi Svobody) acknowledged in annarticle by the most sophisticated ideologue of Russiannliberals, A.S. Izgoev, that the Russian liberal movement wasnin effect, in all of its objectives, a socialist movement. VictornLeontowitch noted that the program of the Constitutional-nDemocratic Party did not mention the right to own privatenproperty on its long list of basic rights.nOn the laundry list of proofs of Solzhenitsyn’s antidemocratism,na major item is his critique of the February 1917nrevolution and of that short-lived Russian democracy. As anmatter of fact, this was not a freedom-oriented government,nbut a system that provided a high degree of freedomnexclusively for intellectuals. Socialism with a human facencan and did exist; several cases are available, and Russia ofn1917 was a textbook example. There was little economicnfreedom; land property rights were suspended for good;nmost prices were imposed by the government; grain wasnvirtually confiscated from producers; the country was run bynarbitrary committees of competing intellectuals; there wasnunlimited political freedom for anybody on the left of thennncenter and a tolerable sliding scale of freedom for those onnthe right of the center; there were political prisoners, thoughnmostly former Tsarist officials, and some were kept innsolitary confinement (former Prime Minister Boris V.nShturmer happened to die in jail a few days before thenCommunists took over: his main offense was that he was ofnGerman origin).nThe most significant act of the liberal-socialist Provisionalngovernment was that of June 28, 1917. On that day thengovernment suspended the Stolypin agrarian reforms, prohibitednall land deals and transactions and canceled allnprevious land contracts. In effect, the government abolishednproperty rights and private land ownership by peasantsnthroughout the nation. The great socialist experiment begannmonths before the Communists seized power. It is nonwonder that Solzhenitsyn is less than enthusiastic about thisnpseudodemocracy.nIf Solzhenitsyn is willing to defend Tsarist Russia, thatnalone does not make him a nationalist. Indeed, he deniednthe charge in his open letter to President Ronald Reagan inn1983. As George J. Stigler recently suggested, we are innwant of a good economic theory of nationalism. While wenwill have to wait for its development, a few points willnsummarize the existing literature and my own thinking onnthe subject.nNationalism is a modern reaction to capitalism, whichndestroyed feudal walls between classes and opened equalnopportunities for every individual to compete in the marketnfor social and economic mobility. Many individuals, especiallynintellectuals, would like to avoid too much competition.nThose individuals who do not expect or, in fact, do notnsuccessfully cope with the opportune but also tough conditionsnof the market, prefer to circumvent them. This is alsontrue in the case of those who initially succeed in the marketnbut need to turn their success into feudal-type tenure innorder to avoid being ousted by new market entrants. In anmultiethnic or multiracial country, nationalism establishes anmutual social welfare consensus and network among thenmembers of a homogenous group on the basis of ethnicnorigin. Nationalism is the movement which switches arrangementsnfrom individual competition to competitionnbetween groups and communities.nA few implications follow. First, the most effectivenarrangement for nationalists is reliance on the state againstnthe market. Secondly, the procedure employed by nationalistsnthrough the state is special treatment in terms of verticalnmobility, privileges, direct and indirect subsidies, quotas,nand, last but not least, restrictions imposed on other groups.nThat is why nationalism sees the best opportunities not innthe private sector but in the bureaucracy and works especiallynhard at monopolizing the state apparatus. And that is whynnationalism is especially attractive for intellectuals and is, innfact, their movement par excellence.nWithin the bureaucracy, nationalism establishes a networknfor a protracted arrangement which would guaranteencollective privileges and insure collective success. To put itnplainly, nationalism is a protection racket and insurancenagainst market failure, insurance for which other groups paynthe price of restrictions imposed on them.nWhile nationalistic arrangements allow individual successnto be secured as part of the group’s success, nationalisticn