The Socialist Forum: Can Russian Peasants be Industrialised? (1932)

Letter to the Editors from the April 1932 issue of the Socialist Standard

A correspondent writing from St. John (New Brunswick) asks some interesting: questions about the possibility of making efficient factory workers out of the Russian peasants:—

Isaac Don Levine, author of the “Life of Stalin,” … in a recent article in the New York Scribners’ Magazine, would have us believe that a Dictatorship such as the one in Russia can by no manner of means create a proletariat, capable of working in machine industry in anything less than several generations or centuries. He implies that the Slav is racially an inferior type, not amenable to factory discipline, and a clumsy animal in other respects.

If it is true that an agricultural population is not of a type that can readily be adapted to machine production, and it takes generations of workers coming originally from rural districts to make mechanics, how can we account for the remarkable rise of German industry in the space of forty or fifty years up till about 1914? The majority of Germans, prior to 1860 or 1870, were villagers and farmers, and in a very few years after coming to the cities, turned out lo be capable mechanics, and this same thing happened in other places. Any number of Polish, Hungarian and Balkan peasants who arrived in the United States prior to 1915, took their place in machine industry without any experience, and fitted right into the scheme of things, their children even more so, after them.

If the Soviet Government succeeds in obtaining the required number of capable technicians and foremen to manage the factories and shops built and building, in this five-year plan, what is there to prevent the transformation of millions of mujiks into machine tenders as has happened in other countries?

Yours, etc.,

M. Wasson.

Reply

Not having seen the article by Mr. Levine we do not know what evidence he adduces to show either that Russian peasants or Slavs generally are incapable of being trained as industrial workers.

It is true that some employers (e.g., Ford Motors) in their selection of workers give preference to American or Canadian born, or to immigrants from Great Britain, Germany, etc., and often reject applicants from the more backward European States. There is, however, no evidence to show that the latter are unsuitable because of racial characteristics. An explanation is that some countries, having reached a fairly high level of capitalist development, have framed their general and technical education in a way which produces workers suitable for up-to-date factory work. Workers from backward countries and rural areas are unlikely to possess the qualifications of training and education needed.

It is interesting to recall that in Great Britain, in the early days of the factory system, employers found the same difficulty in compelling handicraftsmen and peasants to fit themselves into the discipline of machine production.

The whole question of racial differences is discussed very thoroughly by Friedrich Hertz in his “Race and Civilization” (Published by Kegan Paul, London, 1928, and by the MacMillan Co., New York). He shows how old are the theories of racial superiority, and how completely they cancel each other out; for there is no race that at some period has not cherished the illusion of its own innate superiority. Hertz deals with the capacity for social progress and reached this conclusion :—

“The differences between distant groups of one and the same linguistic family or race are greater than those between any two ‘unrelated’ races as a whole. This assertion can be proved up to the hilt. Therefore it follows from this that it is not racial character which has prevented the backward from progressing, but environmental influences.” (P. 259.)

He gives a neat answer to the belief in the superior fitness for industrialism supposed to be possessed by non-Slav races by pointing out that early in the 19th century it was said that the Germans also were inherently a backward race. He quotes Genovesi as having written in 1820 that the Germans would never be able to develop a trade and commerce or produce a population like the French and English. A German writer when he first heard of railways being built was of the opinion that such things were of no good to Germany, because the German character was too easy-going (p. 59).

In Hertz’s book there are a large number of illustrations of stupid theories of racial superiority being encouraged by ruling classes for their own interests. He shows, for example, how these theories were used by the Governments during the war.

As regards the Russian Five-Year Plan, the Soviet Government have banked very heavily on early success of their industrialisation schemes. The slowness with which peasants can be trained to equal the efficiency of workers in advanced capitalist countries is likely to present a very difficult problem to the Government there, hardly less difficult than the problem would be if—as Mr. Levine suggests—the Slavs could for racial reasons never be industrialised. The Russians themselves claim, with what justification we do not know, that they have every reason to be optimistic about their ability to produce skilled workers. According to Mr. J. C. Crowther (an English scientist who visited Russia) :—

“The Russians have evolved their own system. They say a raw worker can become as skilled in six months by this training as he would in four years casual work as an artisan’s mate in the shops. They propose to put 700,000 workers through such courses in 1931” (“Industry and Education in Soviet Russia.” Pub. Heinemann, 1932).

Ed. Comm.

Letter: The Progress of Russia (1939)

Letter to the Editors from the January 1939 issue of the Socialist Standard

A correspondent (W. T. Fielding, Shrewsbury) asks us to comment on an issue of the News Bulletin of the Anglo-Russian Parliamentary Committee. The issue in question (September 10th, 1938) is devoted largely to information and statistics about the progress of Russian industry and services, given in the speeches of the Commissar for Finance, A. G. Zverev, and others. Much of the speeches consisted of figures of State expenditure. The more interesting statements include the following : —

“He stated further that over 80 per cent. of the output of the industry in the U.S.S.R. is being manufactured in enterprises newly built or completely reconstructed during the last ten years. By 1937, the total output of Socialist industry exceeded the pre-War level eightfold. Tsarist Russia occupied fifth place in the world and fourth place in Europe in industrial output; the Soviet Union now holds first place in Europe and second in the world for industrial output.

The continuous progress of the national economy, together with price reductions on consumers’ goods, had resulted in a further considerable rise in the well-being of the people in the Soviet Union; this is shown, for instance, by the projected rise in the total wages of workers and offices employees from 82,000,000,000 roubles in 1937 to 94,000,000,000 roubles in 1938.”

Regarding educational progress, it was stated that there are now 33,000,000 pupils at elementary and secondary schools, and that the number of pupils in higher educational establishments considerably exceeds the number in the higher schools of Britain, France, Germany, Italy and Japan taken together.

Much information was given about agricultural developments, mechanisation, etc. : —

“According to the 1910 census, the peasant farms of Russia had 7,800,000 primitive wooden ploughs, 2,200,000 improved wooden ploughs, 4,200,000 iron ploughs and 17,700,000 wooden harrows.

Now we have 6,158 machine tractor stations, in vehicles, and 104,323 modern threshing-machines, including the latest types. Some 500,000 tractors are working on our Soviet fields.

We now have in our villages our own Soviet skilled workers. We have in the villages of the U.S.S.R. 734,000 tractor drivers, 165,000 combine operators, 124,000 truck drivers, etc.

The peasant from time immemorial dreamed about the land, but he could receive that land only after the victory of the Socialist Revolution. Prior to the Revolution the greatest part of the land belonged to the landlords, monasteries, kulaks, and other exploiters. . . . About two-thirds of the peasants had less than three dessiatines each.

Of the total peasant farms in Tsarist Russia, 30 per cent. had no horses, 34 per cent. had practically no agricultural implements, 15 per cent. cultivated no land.

Now we have in the Soviet Union 243,000 collective farms, uniting over 18,000,000 peasant households (93 per cent. of the total) and embracing 99 per cent. of the total area cultivated by peasant farms.

Prior to the Revolution the landlords and kulaks had 72 per cent. of all the marketable grain. To-day 97 per cent. of the marketable grain is produced by the State and collective farms.

Tsarist Russia harvested annually, on an average, between 4,000 and 5,000 million poods of grain. Our Socialist agriculture already in 1937 produced 7,000 million poods of grain. The number of cattle is increasing year by year in our country. The well-being and culture of the collective farmers are steadily rising.”

The various figures of output, etc., must be considered in relation to Russia’s huge population, of about 170 million people, and in relation to the quality of the products.

Russia claims to occupy second place in world industrial output, U.S.A. holding first place, but the population of the U.S.A. is about 30 million less than that of Russia and it is not seriously disputed that the average quality of American industrial products is higher than that of Russia’s industries, many of which are relatively in their infancy.

The claim regarding the number of students in higher educational establishments is much more impressive because Russia’s population is about 130 million less than the total population of the countries with which comparison is made.

The final test of production is, of course, the standard of living of the mass of the population, and in spite of the rising level, no responsible authority in Russia, as far as we know, claims that it is high by comparison with, say, the standard of living in England or U.S.A. An example is the production of boots and shoes. The U.S.S.R. Handbook (1936) states that in 1934 Russia produced 69 million pairs of leather boots and shoes, and 65 million pairs of rubber boots and shoes. This means that it takes Russia about 2½ years to produce enough leather boots and shoes to provide one pair per head of the population. Production and sales of boots and shoes in Great Britain are about double the 1934 production in Russia, yet the population is only about one-quarter as large. Russian production will have increased considerably since 1934, though it may be mentioned that the production of leather boots and shoes in that year represented a big decline on 1933.

The statements about the progress of Russian agriculture must also be set against the admitted enormous decline in the number of horses, cattle and sheep that took place after 1929, due to deliberate slaughter by rich peasants who were opposed to the collective farms policy. This loss has not been made good.

Avowed opponents of the Russian Government, such as The Times, various oppositionists living in Russia, some visitors to Russia and former Communists who have become disillusioned, allege that the increased quantity of industrial products has been obtained at the cost of quality, for example, by using lower-grade coal and iron ore, poorer quality textiles, etc. Such allegations must be viewed in the light of the source from which they come, but so must the claims of the Russian dictatorship. Until such time as it is made possible for Russian workers freely to organise and to publish their own criticisms of the acts of the Government, the claims of that Government will be open to the charge that they are coloured to suit the interests of the governing clique. Indeed the authorities themselves have publicly admitted that their statistics have been faked by those responsible for compiling them, this being one of the charges against persons tried for alleged “Trotskyism.” A census of the population has just had to be taken again because the first lot of figures were found to be totally unreliable.

On the other hand, reliable testimony about the quality of some Russian factory products is provided by Mr. J. C. Little, President of the A.E.U., and a delegation of working engineers who visited Russia early in 1937. They say that in works they visited the work “equalled in skill and excellence the engineering products of heavy engineering in this country.” (The Times, November 10th, 1938.) It is probable that visitors are shown the more up-to-date works rather than an average selection, a practice not confined to Russia.

One last point is that no defender of the Russian system has been able to explain away the enormous and growing disparity of income between the mass of workers and the favoured group of specialists, officials, writers, bondholders, etc.

Ed. Comm.

The Socialist Forum: Ourselves and the Russian Five-Year Plan. (1931)

Letter to the Editors from the December 1931 issue of the Socialist Standard

Ourselves and the Russian Five-Year Plan.

Mr. W. Langham (W. Ealing) writes as follows :—

“You often condemn the Russian Five-Year Plan as not being Socialism, and being apparently a wrong method of attaining Socialism, but according to the ideas of the S.P.G.B. Socialism must come through Capitalism, it could not come through any other economic system, and as Russia under the Czars had been kept industrially backward for many years, it follows that the Five Year Plan is a necessary step towards Socialism. At least State Capitalism will make the change over much easier than from the Individualistic Capitalism which exists in other European countries.

You also condemn the I.L.P. for advocating Nationalisation, but this if brought about would tend to put the whole control of industry into the hands of Parliament, and production and distribution would at last become subject to the direct will of the people. Surely the fact that such services as the Post Office being of no advantage to the workers at present, only proves the necessity for taking over all services of production and distribution, and not make one pay for the inefficiency of private enterprise. It seems to me that this must be the way Socialism will at last come.”

Reply:

Our correspondent is in error. We do not “condemn the Russian Five-Year Plan” ; what we do is to condemn the Communists here and in Russia for propagating the falsehood that it is Socialism.

The further question about the technical development of Russia is answered by the condition of things in Great Britain, Germany, the U.S.A. and elsewhere. It is true, as Marx pointed out, that a country cannot jump from a backward, pre-capitalist, stage of development straight into Socialism; and we condemned the Bolsheviks for attempting to do this. But it is also true that something more than mere industrial efficiency is required in order to establish Socialism. Otherwise we would have had Socialism in the advanced capitalist countries decades ago.

State capitalism may, in certain circumstances, bring about the development of industry more rapidly than if it were left to private capitalist enterprise. It is, however, useful to remember that State capitalism has been little resorted to in the U.S.A.—a country which the Bolsheviks are taking as their model for industrial efficiency. There are, too, many observers who doubt whether State capitalism in Russia has achieved this end more quickly or more efficiently than would have been the case if private capitalism had been given greater freedom.

The more important point is, however, the argument that State capitalism “will make the change-over much easier.” It is an old argument, but is there any foundation for it? Germany and Australia are two countries in which vast experiments in State capitalism have been tried out over a long period. Have they in consequence made greater strides towards Socialism? We know of no evidence whatever to that eflect. We challenge our correspondent to prove this assertion.

May we also point out that the question of nationalising industries is one which the capitalists themselves will continue to decide so long as they remain in power, and they will decide it in their interests, not in ours. During the past ten years the process all over Europe has been in the direction of handing over State capitalist concerns to private corporations. Almost the first action of the late “Labour” Government was to ratify the agreement transferring State cables and wireless services to Imperial and International Communications, Ltd.

We certainly do condemn the I.L.P. for pretending that nationalisation and public utility corporations are Socialism, or are steps to Socialism; and our correspondent admits that we are justified in so doing, when he confesses that State ownership as in the Post Office is “of no advantage to the workers at present.” Socialism can only come when the workers have become Socialists. The I.L.P. and the Labour Party have made the work of propagating Socialism infinitely harder by pointing to nationalised industries as instances of Socialism. The worker who believes the Post Office to be a Socialist institution and who observes, like our correspondent, that it is “of no advantage to the workers,” quite naturally looks without enthusiasm at Socialist propaganda. Before we can get the workers to listen to our propaganda for Socialism, we have to undo the harm wrought by the I.L.P. and Labour Party.

To talk about putting industry under the “direct will of the people” by nationalising it is absurd. Is the Post Office under the direct will of the people? It is one of the most bureaucratic and hidebound bodies in existence. The unfortunate postman is hedged about with ancient and stupid regulations which most private capitalists have abandoned long ago. He may not even unfasten his collar in a heat wave ! Is this the will of the people?

Parliament is the dominating factor in the situation for all industries, not only nationalised ones. When the workers determine to do so they can control Parliament and, consequently, control the whole situation. The need is to get the workers to have the will to establish Socialism, not to interest them in minor questions about the form of capitalist control. Converting the workers to Socialism is still in its infancy in Russia as in other countries.

Ed. Comm.

50 Years Ago: The Reason for the Show Trials in Russia (1987)

The 50 Years Ago column from the June 1987 issue of the Socialist Standard

The Moscow correspondent of the Economist (February 27th, 1937) provides the answer to the question why did the Russian Government need the recent trials? It had to explain the breakdown of the grandiose five-year plans. This breakdown made it necessary to fend scapegoats, since no dictatorship ever dare let the population know that the dictator and his advisers may themselves have pushed their plans to a point where they became top-heavy and unworkable. Only, now that scapegoats have been found, is the population being told how badly some of the plans have worked:

Now that veteran Bolsheviks have confessed to deliberate sabotage in several major industries, the Government permits its people to learn of distressing conditions hitherto kept From them. Sabotage explains everything; revelation of gross inefficiency need not cast discredit upon central planning, which without some such explanation, might come into disrepute.

Official newspapers now reveal that conditions are most unsatisfactory on the railways. and in the non ferrous metal and chemical industries. Plants were designed hastily without an adequate knowledge of raw material resources. Capital was invested in the "least advantageous fields and those which presented the greatest difficulties for exploitation." For example, where lead and zinc ores were found together, only one or the other was utilised, Plans for new factories were altered locally, which resulted, according to one official newspaper, "in complete irresponsibility and confusion."

[From an article, The Reason for the Russian Trial, in the Socialist Standard June 1937.]

Notes by the Way: Tall Stories from Russia (1932)

The Notes by the Way Column from the November 1932 issue of the Socialist Standard

Tall Stories from Russia

Owing to technical deficiencies and the repercussions of the world crisis, the industrial development of Russia is failing to come up to expectations, and many exaggerated claims are now being written down. Information is not easy to obtain. For example, as soon as the monthly output figures in various branches of production began to fail below the figures for the preceding month and the corresponding month of the previous year, the monthly journal of the Soviet Bank in London conveniently ceased to publish the figures at all, although hitherto they had appeared regularly.

Much has been written of the enormous motor works built on “Ford” lines at Nijni Novgorod. It was declared open on November 1st, 1931, but it was soon apparent that it was beyond the present capacity of the Russian workers to operate this up-to-date mass production, plant. Mr. Emrys Hughes (Forward, September 17th) writes of these difficulties, and then says : —

“From nothing the output had reached 30 cars a day, and then 40. Order was slowly emerging from the chaos. Every day brought more experience: in 1933 Nijni would turn out 70,000 cars.”

Mr. Hughes is, we believe, mistaken, his figures refer to “trucks” not passenger cars, although the works are equipped for both. The claim for 30 or 40 a day is far below the promised 70,000 a year, and a very sorry output in comparison with what was promised in January, 1932.

The Moscow Daily News Weekly Edition, (August 15th) publishes an article by Victor Vacsov dealing with the car output of the Nijni Novgorod works. In it Vacsov admits that “the automobile industry of the U.S.S.R,, which is only one year old, has not as yet produced any passenger cars. The first cars of a Ford Model-A type are now being produced.”

He says that research is still going on to decide “What type of car is best suited to Soviet conditions.”

The failure of the Nijni Novgorod works up to the present, incidentally, shows up many visitors in Russia who came back and reported that all was well. For example, there is the dramatic critic, Mr. Herbert Griffiths, who, in his “Seeing Soviet Russia,” reported—on the strength of second hand accounts from expert eye witnesses–that it was a “star-turn” !

The Communists get very angry when doubt is cast on their figures and claims, but they should remember that they have themselves to blame. A Party which for years has preached the doctrine of “lying and subterfuge” (Lenin’s words) as a method of gaining control of the workers’ trade union organisations, can hardly complain if the world occasionally doubts their veracity.

The Means Test and the Labour Party

The agitation for the removal of the “Means Test” is instructive from several points of view. The unemployed man or woman ceases after 20 weeks in a year to be entitled to unemployment insurance pay on the ordinary conditions. He or she then has to apply for transitional benefit, which is granted in whole or in part according to the means of the applicant and his or her family. The decision is made by the Public Assistance Committee and is based on a minute inquiry into the savings, earnings, pension, etc., of all the members of the family. In short, it is the application of the years old Poor Law system to unemployment insurance pay—which has not prevented the Labour Party (which administered the system for Poor Law purposes when in office) from protesting indignantly at its use for unemployment insurance purposes.

One for the Currency Cranks

The sectional interests of manufacturing, land owning and financial capitalists have always puzzled and misled the Labour Party and its satellites making them easy victims for the quacks who believe that the ills of capitalism can be cured by land tax or by currency juggling. Yet the situation is not difficult to grasp. The workers produce the wealth, the capitalists own it. Out of the mass of wealth they produce the workers receive wages based on their cost of living. Out of the remainder the capitalists must meet all the expenses of production, and the costs of government, etc. Then they divide up the balance on terms which are the subject, of contract between themselves. In a time of expansion, when prices are rising, the capitalist who has goods to sell is improving his position. At such a time—for example, during the War—the Labourites howl loudly about the “profiteer” and the “hard-faced business man.” During the next phase of the normal cycle of capitalism, when prices are falling, it is the turn of the money-lending capitalist to prosper, the man who has contracted to receive a fixed money return on a certain sum lent or invested. Now it is he who is getting a larger and larger relative share of the total wealth of the capitalist class. Then the Labourite turns soft on his poor, dear friend, the manufacturing capitalist, and joins with him in denouncing the wicked bankers who “grow rich on adversity.” What is overlooked all the time is that the workers, as a class, do not alter their general position whatever happens. The ups and downs of prices and interest rates are only a matter between the groups of capitalists themselves, and the changes that take place are not the work of conspiring individuals but are governed by the forces inherent in the capitalist system itself. It is not the “greed of the profiteer” which sends prices up at times of expansion—for, obviously, if it were he would never permit them to fall again. Nor is it the plotting of the bankers which sends prices down during a depression—for if bankers had much control over prices they would never suffer them to rise again.

At the moment the currency cranks are gaining widespread acceptance for their claim that the bankers can and do control prices and interest rates, and that the bankers have it in their power (by increasing or decreasing the supply of credit) to increase or decrease the volume of trade and the amount of money on deposit in the banks, and, in short, to make “prosperity” or “depression” as they choose.

A glance at a few facts will show the absurdity of this. If the banks have such power, why have they allowed the bank rate to fall from five-and-a-half per cent. in 1926 and six per cent. in 1931 to two per cent. now? Why have they allowed the rate of interest paid by the Government on Treasury Bills to fall to the extraordinarily low level of three-quarters of one per cent. And why, after making a concerted move to force the rate up in the week ended October 15th, 1932, were they compelled to take actually less than the week before, i.e., 15s,. per £100 instead of 16s. l1d. (See Daily Telegraph, October 15th, 1932.) The fact is that bankers, just as much as any other section of the capitalist class, have to work within the limits set by the economic forces of capitalism. They can take advantage of, but cannot control, those forces. A glut of money seeking investment in gilt-edged securities (because of the declining profits and insecurity of industrial investments) will force the interest rates down in spite of all the bankers can do.

Similarly, with the stupid notion that bankers can “create credit” at will, and that bank deposits are the result of banks deciding to increase their loans to industry. This theory ignores the fact that banks want security for their loans and that money lent to produce more goods for an already glutted market would be money thrown away. The theory assumes that bank loans and bank deposits rise and fall simultaneously, the former being the cause of the latter. Actually, during the past year bank deposits have increased by over £100 million, while bank loans have not risen but have fallen by over £90 millions. (See Evening Standard, September 9th, 1932.) What has actually happened is what an understanding of capitalism leads us to expect. In times of depression, with production in excess of the demands of the market, the banks lend less because security is lacking; and investors seek safety in gilt-edged securities or by increasing their deposits with the banks. The theories of the currency cranks are in flat contradiction with the facts, but thousands of observers continue to be taken in by them, including many of the so-called labour leaders and representatives of labour colleges.

Edgar Hardcastle

Russia: Land of High Profits. (1930)

Book Review from the September 1930 issue of the Socialist Standard

“The Soviet Union Year-Book, 1930.” Publishers: George Allen & Unwin, Ltd. 7s. 6d.

The Soviet Union Year-Book, compiled and edited by A. A. Santalov and Louis Segal, Ph.D., M.A., is published “to provide business and public men with a reliable information on the economic and political life of the U.S.S.R.” It contains in its 670 pages accurate and detailed information from official sources on all the chief aspects of Russian economic and political life. For business men seeking trade connections, and for those who wish to combat the double campaign of misrepresentation which is carried on by the ignorant and prejudiced in the ranks of capitalist parties on the one hand and the ranks of the communist party on the other it is an indispensable work of reference.

It is not possible here to describe fully the range which is covered. It must suffice to indicate some of the facts and figures which will be useful to the Socialist student of Soviet affairs.

Production and foreign trade.

Much space is devoted to the growth of trade and production. Agricultural production in 1928-29 was 4 per cent. above that in 1913, and in 1932-33 it is planned to reach 59 per cent. above the 1913 level (page 92). Industrial production in 1928-29 was 73 per cent. above 1913 level, and in 1931-32 will reach 166 per cent. above that level (page 94).

Exports in 1928-29 were valued at 877 million roubles, as compared with 1,520 million in 1913. Imports in 1928-29 were valued at 836 million roubles, as compared with 1,374 million in 1913 (page 289). It is planned to increase exports to over 2,000 million roubles in 1932-33, and imports to over 1,705 million. In 1909-13 agricultural exports represented 70 per cent. of the total exports, and industrial exports 30 per cent. In 1932-33 the proportions will be equal, if the plan matures (page 291).

High Rates of interest and profit.

The Concession Companies make staggering profits out of the exploitation of the Russian workers. In 1926-27 the average profit was 81 per cent. on the capital invested by them.

In 1927-28 it was 96 per cent. (see page 208). What a harsh reality after the dreams of the visionaries for whom Russia was to serve as a model to the Western world. One of the Bolshevik slogans of 1917 was “Down with the foreign bondholders.” They were duly “downed” and the National Debts repudiated. The Soviet Government has just repeated its willingness to resume part of the old National Debt obligations, but in the meantime the foreign bondholders have given place to “home” bondholders – a distinction without a difference from the stand point of the Russian workers.

A rapidly increasing percentage of the total revenue of the Government is raised by means of additions to the new National Debt. In 1927-28 the percentage was 0.5; in 1928-29 it was 8.6 per cent., and in 1929-30 it will be 11.5 per cent. (page 397).

On October 1st, 1925, the new National Debt stood at 367 million roubles (£36 million). On October 1st, 1929, it was 2,595 million roubles (£259 million) (see page 398). It is at the present moment nearly 3,000 million (£300 million), and it is planned to increase it to £500 or £600 million in the next year or two.

The amount raised by means of loans during the one year 1929-30 reached the total of 1,335 million roubles (page 391). In the same year the Government spent 450 million roubles on payments to the new investing class who have invested their money in Russian industry through the Russian Central Government. Interest rates are very high; up to 12 per cent.

Other avenues of investment for Russia’s propertied class are the co-operatives. Hundreds of millions of roubles are invested in that way (see pages 226 and 621).

All these forms of investment, in the National Debt, in the co-operatives, and in the trading concerns, etc., are forms of exploitation of the Russian workers They, like the workers everywhere, carry on their backs a class of property owners, receiving incomes from property ownership.

The very high rate of interest which rules in Russia owing to slowness with which foreign investors enter the Russian money markets, may serve to explain why the Russian Government, or certain influential groups behind it, continues without any tangible result to finance Communist parties abroad. Investors inside Russia would naturally not want the interest rates to fall from 10 per cent. or 12 per cent. to 4 per cent. or 5 per cent., and an obvious method of preventing this would be to play upon the fears of foreign Governments and investors, and thus save themselves from unwelcome competitors.

Excess profits tax.

As in this country, the income tax in Russia is a graduated one, there being five categories. In each of them provision is made for different rates of tax on ranges of income from under 1,000 roubles a year up to 24,000 roubles and over (page 402).

The fifth grade applies to those whose incomes are derived from “ownership of industrial and trading enterprises, from money investments, dividends on shares, etc.” (page 402), also incomes from “rent” (page 401).

Then, in addition to the income tax, there is an excess profits tax for those companies whose yearly profits exceed a standard which is described as the “normal profits” (page 405).

It is this economic organisation, possessing all the usual features of exploitation (rent, interest, and profit, a working class, and a property owning class, a stock exchange, etc.), which the Communist parties describe as “Socialism”!

Wages and unemployment. 

The average money wages in 1928-29 was 892 roubles (£89, or about 34s. 6d. a week(page 453).

The worker’s output is increasing at a greater rate than his wages. Under the five-year plan the “productivity of labour in the end of the five-year period will be doubled and real wages are to show an increase of 70 per cent.” (p. 97)

(Information about the inequalities of wages and salaries was given on The Socialist Standard for December, 1929)

The number of unemployed in 1924-25 was 848,000; in 1926-27, 1,353,000; and on January 1st 1930, 1,310,000 (page 454).

The amount paid out in unemployment insurance in 1928-29 was 111,500,000 roubles. This works at about 80 to 90 roubles a year for each unemployed person (on the basis of 1,300,000 unemployed). This, in English coinage, is about £8 10s. a year, or 3s. 3d. a week. The trade unions also pay unemployment benefit to their members from 3 to 18 roubles a month, say from 1s. 6d. to 9s. a week. Although the unemployed are exempt from the obligation to pay rent, or charges for lighting, water and transport, it would seem that they do not have a very pleasant time. Is this what our communists have in mind when they ask the Government here to give the unemployed “full maintenance”?

Inheritance.

As in other capitalist countries inheritance of property is recognised in Russia. “Soviet law recognises the right of inheritance, irrespective of the amount involved” (page 498).

As in this country, it is subject to an inheritance tax (page 405). The tax rises from 5 per cent. on the first 2,000 roubles (£200) up to 90 per cent. on that part between 200,000 and 500,000 roubles (£20,000 to £50,000).

The Communist Party. 

The membership of the Communist Party on July 1st, 1922, was 1,554,012 which represented 184 in every 10,000 of the adult population, or 1 in 54 (page 565).

The number of new members enrolled in 5½ years from 1924 to June, 1929, was 1,408,742. The number expelled in the same period were 128,460.

On July 1st, 1929, the party was composed as follows: – workers, 724,115; peasants, 200,452; employees, etc., 629,327. Women form 13.5 per cent. of the whole membership (page 566).

Education.

In December, 1926 (the last available figures) illiterates had been reduced considerably, but still represented 433 per 1,000 of the whole population (page 462)

The expenditure on education by the Central Government is under 3 per cent. of its total expenditure (page 462).

It is less than the amount spent on army and navy (page 389).

Hopes and facts.

In the first section of the “Constitution of the U.S.S.R.,” passed in 1923, Russia is depicted in the following rosy terms: –

“Here – in the camp of Socialism –are mutual confidence and peace, national freedom and equality, and dwelling together in peace and brotherly collaboration of peoples” (see page 1).

The facts given in this Year-Book sufficiently illustrates how illusory the communist dreams have been. Like many pious hopes embodied in the official documents and constitutions of the rest of the capitalist world these phrases have no relation whatever to the actual facts. Russian capitalism, although administered by the Communist Party dictatorship, reproduces almost down to the last detail the paraphernalia of the capitalist world as we know it here.

The lesson of it is the one we have tried to drive home for so many years, that it is not possible for a minority to impose socialism upon a majority who are hostile or indifferent; nor is it possible to remedy backward economic development by means of fine-sounding but ineffective decrees, issued by dictators.

Edgar Hardcastle

Editorial: Russia: A Dangerous Delusion (1929)

Editorial from the December 1929 issue of the Socialist Standard

When in 1921 the Bolsheviks introduced their ”New Economic Policy,” they stated plainly what they were doing and why they had no alternative. Their early hopes of the immediate establishment of socialism in the advanced capitalist countries had been shown to be illusory, and it was necessary for Russia to develop on capitalist lines. The Bolsheviks consciously adopted the policy described by the late Leonid Krassin as “nationalisation,” or ”state capitalism.” (See report of lecture by Krassin reproduced in “Labour Monthly,” January 16th, 1922.)

They saw that Russian industry could be developed on no other basis than a capitalist basis, and in respect of a large area of industry and transport they preferred state capitalism to private capitalism.

The Socialist Party does not support nationalisation or state capitalism in this country, because that policy is contrary to working-class interests, and is not in this country a step towards Socialism. Russian conditions are different. Russia was, and is, very backward industrially, and the problems there are not those which face the workers in the more advanced countries. We have therefore no criticism to offer of the general policy of hastening capitalist development in Russia. No other policy is practicable. What criticisms we offer relate to methods of applying that policy and to the policy of suppression.

We do, however, strongly protest against the attempts to misrepresent Russia as being run on socialist lines. It is untrue, and such misrepresentation makes more difficult the work of preaching Socialism. Russia presents, and will continue to present, in spite of any good intentions of its rulers, the conflicts and evils normal to the capitalist system. Nothing but harm to the Socialist movement can come from propaganda which misrepresents the very real achievements of the Bolsheviks by calling them the building up of Socialism. Socialism—the common ownership of the means of production and distribution—is not to be found in Russia any more than in Great Britain or the U.S.A.

Sometimes this misleading propaganda is the work of persons who have never troubled to understand what capitalism is. Calling themselves Communists, they merely apply to Russia the confusing propaganda used by the Labour Party in this country. They support State capitalism and call it Socialism because they know no better and really believe that the change from private capitalism to State control of capitalist industry represents a fundamental change. Others who associate themselves with this confusion do know better and are guilty of deliberate falsehood.

We find Scott Nearing, a prominent American Communist, writing in the “New Masses” (October), about Russia, and saying : “Profiteering has been largely eliminated. Exploitation has been wiped out.”

It will be noticed that Scott Nearing uses the loose and undefined term “profiteering” instead of “profit making,” and implies that the “profiteering” which has not yet been eliminated is not “exploitation.” We say that such misleading statements from Scott Nearing can only result from a deliberate intention to deceive.

The “Trade Union Bulletin” (August-September, 1929) issued by the U.S.S.R. Central Council of Trade Unions, Labour Palace, Solianka 12, Moscow, describes the plans for large State farms under the title “Socialistic Reconstruction of Rural Economy.” In fact this is simply an application of State capitalism to Russian agriculture.

The “Sunday Worker” on September 15th made the deliberately false statement that “All the products of (Russian) industry go to the workers and peasants,” and asked, “What do they want parasites for?”

When it was pointed out to the editor that the State industries are largely financed by means of loans and that the receivers of interest are “parasites,” the editor replied with the evasive and untrue statements, which follow :—

“The loans which are being raised to finance the Five-Year Plan are largely subscribed by Russian workers and peasants. These, using their own money to build their own Socialist state, can hardly be parasites—unless they are to be regarded as parasites upon themselves. There are also non-working-class investors, who would be glad to live on the interest from these loans, and become parasites. But the laws of the Soviet Union prevent that. These people cannot acquire land or any of the means of production which would enable them to exploit workers. They are not allowed to be parasites.” (Sunday Worker, Sept. 22nd.)

Such arguments from a so-called Socialist paper are pitiful. To suggest that Russians calling themselves ”workers and peasants” cannot be “parasites on themselves,” is equivalent to saying that there cannot be parasites in England because persons calling themselves “English” cannot be parasites on themselves. The simple truth is that a minority of persons in England have large investments and draw incomes from them; the majority do not possess such investments. So also in Russia, a wealthy minority having relatively large incomes from various sources, from salaries, from legal and illegal trading, from farming, and from investments, are able to accumulate capital for further use in legitimate and illegitimate business, or for investment in State loans. They draw property incomes from these investments and are “parasites.”

To say that those who receive incomes from investment in Russia cannot “become parasites” (they are that already) because they are prevented from acquiring land or other means of production, is like saying that those English capitalists who invest in Government loans and live on the proceeds without buying land or other means of production are not “parasites,” but that their fellow investors who derive similar property incomes from investment in farming or other productive concerns, are “parasites.”

Inequality of incomes and of property in Russia is great and growing, although less than in this country. According to figures from official Russian sources given in his book, “Three Months in Russia,” by W. J. Brown, M.P., the pay in the Russian Civil Service rises, according to grade, from less than £5 a month up to £45 a month (see pages 113 & 114). Mr. Brown, it may be remarked, is more than sympathetic to the Bolsheviks, and is in fact highly gratified because the inequality of pay in Russia is less than elsewhere.

A correspondent of the “Manchester Guardian” (Oct. 21st) states that the pay of engineering experts is as high as £1,750, £2,500 and even £3,500 a year. The average wage of manual workers, on the other hand, is 73 roubles a month, or less than £90 a year. (See “Ministry of Labour Gazette,” October, for figures from Russian official sources.)

According to the Soviet Union Year Book, 1929, out of a population of 140 millions, the number of persons with deposits in the Savings Banks on October 1st, 1928, was only 3,825,900, the average deposit being 82 roubles (see page 449). (A rouble is worth about 2s.)

The loans being issued at high rates of interest in connection with the Five Year Economic Plan are comparable in amount and in kind with the annual investments of capital in the rest of the capitalist countries.

The Russian State Debt stands now at about 2,100 million roubles (about £210 million). Interest ranges up to as much as 12 per cent. on some of the issues. It is planned to increase the debt under the Five Year Economic Plan by borrowing another 6,000 million roubles (£600 million) in five years (see Bank for Russian Trade Review, June, 1929). Other fields of capital investment are the co-operatives and the concession companies. The profits on the concessions are extraordinarily high.

The existence of a class of large investors is clearly shown by the relative amounts of State lottery loans and non-lottery loans. On page 406 of the “Soviet Union Year Book,” it is stated that “Soviet State loans that are intended to be placed among small investors are lottery loans, since these are more attractive to the small subscribers.”

On pages 408 and 409 are details of the various loans. It will be seen that the total of non-lottery issues is more than four times as great as the lottery loans— i.e., the small investors’ loans.

From these particulars it will be seen that Russia is making encouraging progress along the road of capitalist industry. It is impossible for Russia yet to progress on any other basis than capitalism.

But Communists who pretend that it is socialism are deliberately or unknowingly propagating a falsehood and hindering the work for socialism.

Soviet Capitalism: Bonds (1967)

From the May 1967 issue of the Socialist Standard

State bonds are a feature of capitalism which the Bolsheviks inherited from the Tsarist regime. A few details show to what an extent the Imperial government relied on this method for obtaining revenue. For example, in just five years (between 1909-1913) 4,100 million roubles were raised by issuing these stocks and, during the same period, 4,040 million roubles were needed for interest and redemption payments on loans which had been floated previously. When the Bolsheviks seized power they took advantage of the change in government and refused to recognise the pre-revolutionary foreign and internal loans. This was a logical step because by then many of the rich bond-holders were living abroad, exiled enemies of Russian state capitalism.

As soon as the chaotic conditions of the Civil War started to settle, the Bolsheviks set about floating new loans. Thus, between 1922-25 bonds were issued which brought 396 million roubles into the state budget — this being 7.5 per cent of all government revenue. This was followed, in the years of forced industrialisation under Stalin, by a succession of state loans. The bonds carried interest rates which the wealthy found it difficult to resist and Russia was dubbed, by the Socialist Party of Gt. Britain, the “land of high profits”.

By the time of the Third Five-Year Plan, the capital being invested in the loans was dwarfing the figures of Tsarist days. Thus, between 1938-41, four state loans were floated, bringing in a total of about 3,400 million roubles. In the war years revenue from the sale of state bonds was as follows:

Investment came from three principal sources. First, there were the state industries — the banks, insurance companies and so on —which made use of their vast reserves. Thus, figures in the government budgets for 1941-44 show that more than 580 million roubles were obtained from the insurance business, a large percentage in the form of subscriptions to state loans. Secondly, individuals from the ruling class were eager to sink their capital in state bonds, which guaranteed a steady return in interest payments. As a random example, we can mention Vladimir Stefanov — a priest of the Moscow Church of the Assumption — who, recognising that war is good business, invested 73,000 roubles in the Defence Fund during World War II. That this was no exceptional case was made clear by R. Bishop in his pamphlet Soviet Millionaires, issued by the Russia Today Society in 1943. He presented figures which showed that in one state of the USSR alone (Kazakstan) at least eighteen individuals had invested a million roubles or more. Bishop attempted to justify this with the incredibly weak comment that “in the Soviet Union the millionaire has acquired his roubles by his own toil and by service to the Soviet State and people.” A few years later T. Cliff was very neatly to smash that lame argument, as follows.

If we examine this statement we find that, as late as 1940, the average annual income of workers and employees being only 4.000 roubles, to collect a million roubles would have taken an average worker 250 years — provided he spent no money on himself at all. The Soviet millionaire gets, in interest alone, 50,000 roubles for every million, which is many times more than the income of any worker. (Russia: A Marxist Analysis—T. Cliff).

The third source was from the working class. There were mass-subscription loans, described as “semi-voluntary” — which meant that workers “bought” their bonds by means of compulsory stoppages from their wages. In the factories and offices, it was the branches of the state-controlled trade unions which were responsible for seeing that their members contributed. These loans were organised on a lottery basis — something like British premium bonds — and the prizes represented at first 4 per cent then 3 per cent and finally 2 per cent of the total sum subscribed. This compared unfavourably with the interest-bearing loans which at times carried rates of up to 11 per cent.

In the decade following the Second World War the issue of bonds went on unabated. During the Fourth Five-Year Plan the state loans brought in almost 11,700 million roubles and the comparable figure for the Fifth Five-Year Plan was 13,600 million roubles. As Khrushchev explained, at several public meetings in early 1957, the state debt had reached 26,000 million roubles, while interest and redemption payments were in the region of 2,900 million roubles annually. This situation led to a drastic reversal of government policy. The central committee of the Communist Party decided to discontinue, from 1958 onwards, the floating of further compulsory loans aimed at the working class. At the same time it suspended lottery-prize drawings on the already existing, mass-subscription bonds and, in addition,, repayment on these was postponed for a period of twenty years or more. It should be emphasized, however, that the sale of bonds to wealthy individuals on a voluntary basis was not discontinued; neither were the interest payments on these stocks defaulted on. (See The Soviet Economy— A. Nove. 1965. p. 107).

The latest figures available show that the issue of state bonds is still running at well over a thousand million roubles each year.

Investment today comes mainly from the banks — as before — and also from members of the ruling class, who can die with the comfortable assurance that their bonds are free from inheritance tax. On the other hand, the individual Russian worker, like wage-earners everywhere, is not in a position to invest. His wages are barely sufficient to keep him in working order from week to week, and from generation to generation. The most he can aspire to is buying a few premium bonds and then hoping against hope that he will land one of the big prizes. It is his function to produce the surplus value from which interest is derived, not to share its distribution.

It was Professor Allakhverdyan of the Moscow Financial Institute who was responsible for the pathetic remark that “the loans floated by socialist states express the new economic relationships . . " Any thinking worker can see that the very fact that interest-bearing bonds exist in Soviet Russia is plain evidence of capitalism in that country. They are one of the mechanisms by which the ruling class gets its hands on the surplus value extracted from working men and women.

John Crump

What Stalin Forgot To Mention (1933)

From the May 1933 issue of the Socialist Standard

Joseph Stalin delivered a report on the Russian Five-Year Plan to a meeting of the Russian Communist Party in January, 1933, and Modern Books, Ltd., have published it in an attractively got-up 2d. pamphlet. Stalin (or more probably some member of his staff) had the ingenious idea of quoting the leading capitalist newspapers and outstanding figures in the world of capitalist finance and industry as testimony to the success of the plans for industrialising Russia. Looked at from the point of view of publicity the idea was a clever one, but what does it mean when the capitalist chorus sings the praises of Russia? Does a socialist and working-class movement ever expect or receive commendation from the mouthpieces of capitalism? In short, Stalin over-reached himself, and showed up in a clear light the position the Russian Bolshevik politicians have come to occupy, in their own minds, in relation to the capitalists outside Russia. One of the passages of praise for Russia reproduced in the pamphlet is a speech by a prominent banker, Mr. J. Gibson Jarvie, chairman of United Dominions Trust, Ltd., delivered at the City Business Club in Glasgow on October 20th, 1932. Stalin quotes extensively from the speech those passages in which Mr. Jarvie said what an amazing success the Five-Year Plan has been.

Now read the passage that Stalin carefully omitted to quote :

  While Russia might be officially described as the Union of Socialist Soviet Republics, and might claim to be a Communist State, nevertheless that country to-day was, unquestionably, practising state capitalism, incorporating a modified form of private capitalism. He felt that as Russia advanced from one Five-Year Plan to another, private capitalism in some form or another would become increasingly strong, but – and this was the point capitalist countries must bear in mind – if she advanced according to plan she must, as a nation, become invulnerable.” (The Times, October 21st, 1932.

In other words, Mr. Jarvie gives a fairly good description of Russia’s social system and the direction in which it is tending, and his fears are the ordinary ones of the capitalist in one country threatened by the competition of another capitalist country. In one thing, however, he is wrong. Capitalism in Russia is no more invulnerable than it is anywhere else. It will produce the same evils and call for the same remedy as capitalism elsewhere, i.e., the organisation of a Socialist movement.

Stalin should take more care how he selects his quotations.

Edgar Hardcastle

50 Years Ago: Russian Illusions (1981)

The 50 Years Ago column from the July 1981 issue of the Socialist Standard

It is claimed by many that the Russian Government has discovered a means of developing Russian industry on Socialist lines and free from the disturbing effects of the world trading conditions that affect the other capitalist countries. Actually, the more Russian industry enters into the world market as importer and exporter, the more Russian industrial conditions will be affected by conditions outside.

For example, the world slump in prices has hit Russian industry as badly as any, and has necessitated hasty and difficult modifications of the so-called Five-Year Plan. Estimates were based upon the exporting of certain quantities of goods at certain prices, the yield from which was to be used for machinery and other imports. Owing to the unforeseen slump, Russian exports in January and February of 1931 decreased in value by nearly one-fifth as compared with the corresponding period of 1930, and this in spite of a big increase in the quantities of goods exported. The output of the exporting industries had to be increased above the planned amount owing to the fall in the prices obtained for the exported goods in the world market, and in order to pay for the imports. The machinery and other imports either have not fallen in price at all, have not fallen as heavily, or have been contracted for at a stated price. The final result has been that imports have had to be curtailed. The imports for January and February, 1931, were one-third below those for January and February, 1930. Thus does capitalism frustrate attempts at planning.

Mr. Fenner Brockway, the new Chairman of the I.L.P., writing in the New Leader (April 17th), assumes that Russian industry is being run on a “ Socialist basis.” This is quite incorrect and indicates either a misreading of the Russian industrial system or—more probably—a failure to grasp what constitutes Socialism. In Russia, as elsewhere, goods are produced, not for use, but for sale. The producers are a wage-earning class with no effective control over the machinery of production. There is great inequality, as in other capitalist countries. The first charge on industry is the payment of interest to the investors in the State loans. The way in which inequality of wealth is growing is shown by the increasing yield from the graduated income tax. Already the yield is over £60 millions a year. The Government is now itself catering for the wants of monied people by opening shops at which goods are sold at rates far above the official prices.

(Editorial from the July 1931 issue of the Socialist Standard)

The Reason for the Russian Trial (1937)

From the June 1937 issue of the Socialist Standard

The Moscow correspondent of the Economist (February 27th, 1937) provides the answer to the question why did the Russian Government need the recent trials? It had to explain the breakdown of the grandiose five-year plans. This breakdown made it necessary to find scapegoats, since no dictatorship ever dare let the population know that the dictator and his advisers may themselves have pushed their plans to a point where they became top-heavy and unworkable. Only, now that scapegoats have been found, is the population being told how badly some of the plans have worked : —

    Now that veteran Bolsheviks have confessed to deliberate sabotage. in several major industries, the Government permits its people to learn of distressing conditions hitherto kept from them. Sabotage explains everything; revelation of gross inefficiency need not cast discredit upon central planning, which, without some such explanation, might come into disrepute.
   Official newspapers now reveal that conditions are most unsatisfactory on the railways, and in the non-ferous metal and chemical industries. Plants were designed hastily without an adequate knowledge of raw material resources. Capital was invested in the “least advantageous fields and those which presented the greatest difficulties for exploitation." For example, where lead and zinc ores were found together, only one or the other was utilised. Plans for new factories were altered locally, which resulted, according to one official newspaper, “ in complete irresponsibility and confusion."
    In the chemical industry “plants frequently were designed with too large or too small capacities, in unsuitable places, for the production of an unnecessary assortment of goods, etc. Often plants were built at places where there was little ore." Funds were withheld from plants under construction, which often resulted in the suspension of building operations. Designs were altered after much of the construction work had been completed, which necessitated the demolition of finished buildings and their reconstruction. At the Krasno-Uralsk Combinat the metallurgical section was built with no provision for the use of bye-products.
    All this, and much more, is now recorded in the official newspapers, and charged to Trotskyism. Whatever the cause may be, it is obvious that there has been terrific waste of capital funds and effort, and that thorough reorganisation of whole industries will be necessary. The official view is that reorganisation will be easy now that the wreckers in high places have been removed.

Now what becomes of the everlasting boasting by the British Communists of the marvellous success of the five-year plans? Whatever explanation they choose to offer for the breakdown, it now becomes obvious that their former boastings of success were not based on fact, but on the propaganda of the Russian Government, which excluded the truth about industrial inefficiency.

P. S.

Russian Illusions (1931)

Editorial from the July 1931 issue of the Socialist Standard

It is claimed by many that the Russian Government has discovered a means of developing Russian industry on Socialist lines and free from the disturbing effects of the world trading conditions that affect the other capitalist countries. Actually, the more Russian industry enters into the world market as importer and exporter, the more Russian industrial conditions will be affected by conditions outside.

For example, the world slump in prices has hit Russian industry as badly as any, and has necessitated hasty and difficult modifications of the so-called Five-Year Plan. Estimates were based upon the exporting of certain quantities of goods at certain prices, the yield from which was to be used for machinery and other imports. Owing to the unforeseen slump, Russian exports in January and February of 1931 decreased in value by nearly one-fifth as compared with the corresponding period of 1930, and this in spite of a big increase in the quantities of goods exported. The output of the exporting industries had to be increased above the planned amount owing to the fall in the prices obtained for the exported goods in the world market, and in order to pay for the imports. The machinery and other imports either have not fallen in price at all, have not fallen as heavily, or have been contracted for at a stated price. The final result has been that imports have had to be curtailed. The imports for January and February, 1931, were one-third below those for January and February, 1930. Thus does capitalism frustrate attempts at planning.

Mr. Fenner Brockway, the new Chairman of the I.L.P., writing in the New Leader (April 17th), assumes that Russian industry is being run on a “ Socialist basis.” This is quite incorrect and indicates either a misreading of the Russian industrial system or—more probably—a failure to grasp what constitutes Socialism. In Russia, as elsewhere, goods are produced, not for use, but for sale. The producers are a wage-earning class with no effective control over the machinery of production. There is great inequality, as in other capitalist countries. The first charge on industry is the payment of interest to the investors in the State loans. The way in which inequality of wealth is growing is shown by the increasing yield from the graduated income tax. Already the yield is over £60 millions a year. The Government is now itself catering for the wants of monied people by opening shops at which goods are sold at rates far above the official prices.

Mr. Walter Duranty, of the New York Times, telegraphing from Moscow, says: 

  In the large cities, industrial centres and construction camps the food ration of the masses is adequate for health and can readily be supplemented by anyone with money . . .     In the larger centres the authorities are attempting to meet the situation by opening a kind of “ State NEP” stores, where food and commodities are sold well above ration prices but below the rates of the “free markets" which the “State NEP ” stores are intended to replace.

(New York Times, April 3.) 

The Moscow Correspondent of the News-Chronicle (April 13th) gives further information about these stores :—

   New State-owned profiteering stores—selling to anybody with no questions asked about your ration book or whether, you are an “economic outlaw” — went on charging 8s. a pound for frozen chickens; 25s. a pound for an inferior sort of cheese; and 6s. a pound for poor salt herrings.

Mr. Albert Coates, the musical conductor, who recently returned from Russia, gives information about the prices a section of the population are able to pay for seats at the opera. Speaking to a Daily Telegraph representative, he said:—

    Many people still have a great deal of money in Russia, but they have to be careful. There is little or no actual starvation, but there is a system of food rationing.
    The price of seats in the.theatre ranged from 24s. downwards. At every performance—and there is one every night and two on Sundays for nine months in the year—the opera theatres are packed, although the majority of the populace are said to be penniless . . .
    Beautifully gowned women and well-dressed men still continue to adorn the front rows of the Grand Theatre, Moscow, every night.

(Daily Telegraph, April 1.)

While the Russian workers are told that they must pull in their belts and reap their reward later on when the Five-War later on when the Five-Year Plan (or the second Five-Year Plan) is completed, the highly paid administrative and technical officials and the investors in State loans get their benefit now.

These are not the features of Socialism, but of capitalism. Before they get Socialism, the Russian workers will have to tread the same path of disillusionment leading to knowledge that is being trodden by the workers in other countries.