Yossi Schwartz ISL (RCIT section in Israel/Occupied Palestine) 22.02.2026
In state capitalism a large part of the economy is nationalized but the capitalist class still exists and makes profit. Nazi Germany was a form of state capitalism, the capitalist class continued to make profits.
Capitalists in Nazi Germany included influential industrial magnates and bankers who financed Hitler’s rise, profited from Aryanization, and used forced labor, such as Fritz Thyssen, Friedrich Flick, Günther Quandt, and Ferdinand Porsche. Major corporations, including IG Farben, Siemens, Daimler-Benz, and Volkswagen, thrived under the regime by collaborating with the Nazi state.
Key Capitalists and Industrialists:
Fritz Thyssen: A major steel tycoon who helped finance Hitler’s rise to power.
Friedrich Flick: A steel and coal magnate who bankrolled the SS and used slave labor, later becoming a major shareholder in Daimler-Benz.
Günther and Herbert Quandt: Industrialists who ran battery factories using forced labor from concentration camps, and whose family later dominated the BMW Group.
Ferdinand Porsche: Developed the Volkswagen Beetle and his son served in the SS, with the family company thriving on war production.
Hjalmar Schacht: As Reichsbank President and Minister for Economics, he facilitated financing for the Nazi regime and its economic policies.
Leading firms used hundreds of thousands of forced laborers, including those from concentration camps, with major reliance by:
IG Farben: Produced materials for the war effort using forced labor.
Daimler-Benz: Relied on slave labor for manufacturing.
Siemens & Bosch: Utilized labor in factories.
Foreign Subsidiaries: Including Fordwerke (Ford) and Adam Opel AG (General Motors).
These capitalists operated within a system where private profit was aligned with the state’s rearmament, expansionist, and racial goals, often described as völkisch capitalism
A workers’ state, even a degenerated one eliminates the capitalists as a class. When there is a restoration of the capitalist class it is no more a workers’ state. Thus, Russia and China are not only capitalist states but imperialist ones.
And what about Cuba?
Cuba has been undergoing a significant, state-guided transition toward a mixed economy, incorporating elements of capitalism to address a severe, long-term economic crisis.
Since 2021, Cuba has allowed small and medium-sized private businesses (MSMEs) to operate in most sectors, expanding authorized activities from 127 to over 2,000.
Constitutional Changes: A 2019 constitution recognized the right to private property and foreign investment.
Foreign Investment: The government is encouraging foreign companies to invest in the private sector to bring in foreign exchange, particularly in tourism.
Economic Drivers: The shift is largely forced by the collapse of Soviet subsidies, the COVID-19 pandemic, intensified US sanctions, and a deep, ongoing economic crisis.
State Control Limitations: While private enterprise is growing, the state still manages major parts of the economy, and the military retains control over large segments of business.
The reforms have led to increased market inequality, creating a divide between those with access to foreign currency (dollars) and those without.
Thus, Cuba from 2019 or 2021 is a capitalist state and is becoming once again a semi colony.
Trump wants to strangle Cuba as part of the US control over Latin America. It is necessary to oppose his plans. However, centrists tend to see Cuba as a socialist state because a large part of the economy is still nationalized and a party calling itself Communist is in power.
Khalea Robertson writes in Seven Charts on Cuba’s Economic Woes
“The Caribbean Island is undergoing its worst economic period in decades while facing rising U.S. pressure.
There will be no more money or oil going to Cuba—zero!” warned U.S. President Donald Trump. The president sent the message on social media days after U.S. forces captured the leader of Venezuela, the beleaguered island’s primary benefactor.
The warning set off emergency bells for what is already believed to be Cuba’s deepest financial and demographic crisis since the “Special Period” of the 1990s, when the collapse of the Soviet Union—then Cuba’s main economic supporter—triggered severe shortages of state-subsidized fuel, food, and decent housing on the Communist-run island.
Thirty years later, Cubans are battling with frequent and lengthy blackouts, water shortages, and double-digit inflation that have pushed hundreds of thousands to leave the island since the Covid-19 pandemic.
Persistent energy shortages have contributed to economic woes. Estimates indicate that the island requires at least 100,000 barrels of oil per day to function normally. Domestic production covers about 40,000 bpd, but Cuba has long relied on Venezuela and, to a lesser extent, Mexico and Russia to make up the difference in its supply needs.
At the height of Venezuela’s oil production during the presidency of Hugo Chávez, the South American country supplied Cuba with up to 95,000 bpd. But Caracas’ oil shipments have fallen dramatically in recent years, and Mexico became the island’s leading supplier in 2025.
The energy forecast for 2026 appears dire. Since the U.S. seizure of Venezuelan leader Nicolás Maduro, no Cuba-bound oil tankers have left Venezuelan shores. As of January 2026, Cuba has received only one 85,000-barrel shipment of Mexican oil, raising concerns that fuel could run dry as early as mid-February. Responding to pressure from the Trump administration, on February 1, Mexican President Claudia Sheinbaum said her country “will continue looking for ways, through diplomatic means, to send oil to Cuba for humanitarian reasons, without seeking confrontation.” She signaled Mexico would be shipping other types of aid instead. A day later, Trump told reporters that Mexico will stop sending oil to Cuba.[i]“
The RCI of Woods writes in the defense of Marxism:
” The Cuban revolution is in grave danger! Trump’s oil blockade has cut off the island’s fuel supplies, plunging the country into prolonged blackouts, halting public transport, and threatening a full-scale humanitarian crisis. With Venezuelan oil cut off and Mexico bowing to US threats, Trump is tightening the noose to asphyxiate the island after 67 years of relentless pressure.”[ii]
Thus,Woods’ understanding of the world is by symptoms (nationalized part of the economy, a party calling itself Communist in power) not by class analysis.
Wood’s method is similar to the Spartacist tendency (International Communist League) who defines China as a “bureaucratically deformed workers state”. They argue that despite capitalist market reforms, the core of the economy remains state-owned, necessitating “unconditional military defense” of the regime against imperialism while simultaneously fighting for a “political revolution” to overthrow the bureaucracy.
In an article in the Spartacists, from August 1, 2024 we find:
“We will show that far from offering a viable political alternative to the CPC, those who argue that China is capitalist and imperialist simply conciliate the U.S. and its allies. As for the arguments employed, they reject basic Marxist principles on the state and imperialism. To start, we will address why China is not imperialist. Then we will argue that despite important capitalist penetration, China retains the basic features of a deformed workers state”[iii]
On the other hand, the British SWP has described Cuba since the Cuban revolution like a good Schachman’s student as bureaucratic state capitalism, denying that Cuba was until 2019 a deformed workers state.
It is important to defend Cuba like the need to defend Iran as both are semi colonies facing the threat of American imperialism. However, Woods et al cannot defend Iran because the Stalinists are not in power in Iran.
Endnotes:
[i] https://www.as-coa.org/articles/seven-charts-cubas-economic-woes#:~:text=Cuba’s%20economy%20has%20failed%20to,growth%20from%202023%20to%202025.&text=Persistent%20energy%20shortages%20have%20contributed,per%20day%20to%20function%20normally
[ii] https://marxist.com/podcast-cuba-under-siege-how-to-defend-the-revolution.htm
[iii] https://iclfi.org/spartacist/en/69/china