The Soviets Take Stock

The Seventh All-Union Congress is in session. Chairman Molotov, of the People’s Commissars, is winding up a two-hour report: “…we can say to our friends that the Soviet Union is now greater than ever in its economic might and in the solidarity of the toiling masses around the Soviet power…. Our Stalin is leading the million-strong masses and we firmly know that this is the road to our complete victory.” Thunderous applause bursts forth in the great hall of the Kremlin. It turns into an ovation as two thousand delegates stand and shout: “Long live the great Stalin! Long live Comrade Molotov!”

It is four years since the last general stock-taking, four difficult, crucial years. The Sixth Congress, too, reported progress, was wildly enthusiastic and proclaimed the triumph of socialism. But then the mood was one of feverish excitement, of ardor and determination. It was the mood of the First Five Year Plan, half-completed, with its short rations and heroism, with the future hanging in the balance. In 1935 confidence and security pervade the atmosphere. Not that the Seventh Congress fails to recognize that much still remains to be done; but the delegates who cheer Molotov know that a decisive battle has been won, that the foundations of the Soviet Union are now solidly established. The rest of the world, hostile or friendly, knows this too and must take it into account. At any rate, the facts are there for all who care to look.

All the concrete accomplishments—and the failures—of the Soviets during the last four years are linked with the closing period of the First Five Year Plan and the first two years of the Second. While there has been no real break or dividing line between the two plans, the Second called for special emphasis on light industry, that is, consumers’ products. Here, however, the Soviets admit only a partial success. The last four years show an increase of 150 percent in consumers' goods, on the whole a gratifying gain, but not up to demand. Last year production in light industries was up 5.2 percent and in the food industry over 21 percent, but both figures failed to fulfill the Plan. For 1935 the Commissariat for Light Industry must increase output by almost 12 percent and the Commissariat for Food Industry is ordered to step up production by nearly 15 percent. In both of these branches, the government complains, quality as well as quantity is considerably behind schedule.

There are many reasons, including incompetence and bureaucracy, why the Second Five Year Plan lags in those very departments the Plan had stressed. However, the chief cause probably lies in the fact that heavy industry still absorbs the principal energies of the nation. This is far from saying that the second Five Year Plan, in terms of the Soviet Union’s general economy, has thus far been a failure. What it reveals is that general world conditions have stimulated greater activity than had been anticipated in those industries which produce the means of supplying submarines, artillery, airplanes, tanks, munitions, etc. What it further reveals is an almost foolhardy confidence in the loyalty and endurance of the masses, whose legitimate wants and needs remain only partially satisfied because of this diversion of energy.

The necessity for that shift of emphasis, endangering as it did the chief objectives of the Plan, is not questioned very seriously. After all, the “contradictions” of the capitalist world, which the Bolsheviks are fond of pointing out, affect the destinies of the Soviet Union in no small degree. The fact remains, however, that the growth of Russia’s heavy industry during the last four years, and particularly during 1934, is the principal reason for the air of optimism that brightened the Seventh Congress.

In the words of Molotov, the “victory in the iron and steel industry,” especially during 1934, must be considered as the Soviet’s most important economic—and political—success. The production of iron during the past four years increased 110 percent and reached the enormous figure of 10,500,000 tons; of this, last year accounted for more than a third of the total gain. Russia now ranks second only to the United States in world production of iron. Steel output increased 66 percent, reaching 9,600,000 tons, while the production of rolled steel went up 49 percent with a total of 6,700,000 tons; in both cases the past year was responsible for about a third of the sum.

In more general terms, the whole level of Soviet industrial production has increased 77 percent since 1931 and 139 percent since 1929; this in the face of only a 2-percent gain for the rest of the world since 1931 and a 24-percent loss since 1929. The comparison is of course not entirely relevant. Apart from questions of basic stimuli and incentives to produce, conditions quite unrelated to the nature of the two opposing systems of economy must be considered. In 1929, at the brink of the depression, industrial expansion and the exploitation of natural resources in the chief capitalist countries reached the apex of a hundred-year period of intense development. Russia, embarking on its First Five Year Plan in 1929, was a backward country, starting almost at scratch. Besides, we have seen similar industrial progress, on a smaller and less spectacular scale, to be sure, in backward Turkey and Palestine.

All these figures, however, do reveal the amazing speed of Soviet development and stress the fact that the fundamental strength ofthe Soviet industrial system lies in its rapidly expanding heavy branches. Weak units, nevertheless, exist and are freely admitted—for example, oil, copper, tin and lumber. The weakest link is undoubtedly the transport system, and in case of war this might cause serious embarrassment. Commissar Ordjonikidze, of the division of Heavy Industry, reported to the Soviet Congress that 450,000 carloads of manufactured goods were congesting warehouses.

During the past four years, freight turnover increased only 32 percent, obviously lagging far behind the vast increase in the load to be carried. Worse still, the percentage of the run of empty cars in relation to the total movement of cars actually grew larger in 1934. One bright spot in the transportation picture is the Far Eastern Territory, where strategic reasons urgently demanded action. Here the completion of the unfinished second track of the Trans-Siberian road and the beginning of a new Baikal-Amur line accompanied the most intensive military preparations. The appointment of Lazar Kaganovich, one of the “strong men” of the Soviet regime, as the new Commissar for Transportation, is the signal for a desperate campaign to raise the efficiency of the railroad system this year. Kaganovich will have a budget of 4,000,000,000 rubles (about 20 rubles per gold dollar) at his disposal.

Whatever the future has in store for Russia, its transformation into an industrial power is already an accomplished fact. What it cost the great masses of the country in terms of want, hardship, sacrifice and loss of life can probably never be adequately described. Yet the role of industrialization in converting feudal Russia into a new modern Westernized Soviet state cannot be overestimated. Externally, industrialized Russia deeply affects the economic and political balance of the whole world. Internally its influence is even more profound. An extraordinarily concise and complete account—more eloquent than a dozen books—of what has taken place in Russia since the Tsar’s time was made public at the Seventh All-Union Congress. It is a table of statistics recording the class composition of the country's population at three well chosen intervals. We reproduce the table below:

If we compare the figures for the agricultural population in 1913 and in 1928, we see that little real change took place. The kulaks were reduced from 12.3 percent to 3.7 percent, but a corresponding gain, from 65.1 percent to 72.9 percent, took place for the rest of the individual peasantry. Along with this nearly static condition we notice even less change in the relative proportions of the proletariat.

But in 1934, after a six-year period of industrialization, the whole complexion of the population had undergone radical change. A rise in the industrial population from 17.3 percent to 28.1 percent, apparently not a tremendous shift in relation to the entire mass, reveals its true significance in the completely altered aspect of the agricultural workers, who in both periods represent approximately 70 percent of the entire population. By the end of 1934 some four-fifths of the peasantry had been collectivized and—what the table does not indicate—nine-tenths of the cultivated area of the Soviet Union had become collective and state farms.

The collectivization of Soviet agriculture, which is bound to be total in a short time, is one of the major results of the industrial program. Collectivization, under the conditions the Soviets faced, would have been a complete failure unless accompanied by mechanization. It was heavy industry that built and supplied the tractor plants that in turn furnished collective farms with over 100,000 tractors and other machines during the past four years. For 1935 the program calls for 65,000tractors, 10,000 motor vehicles and 14,000 combines.

As for practical results in terms of crops, the following item will serve to illustrate how Russia’s modernized agriculture works. In 1933, the first year of relative stabilization under the new scheme, the total grain harvest exceeded that of 1913 (in the same territory within the borders of the present U.S.S.R.) by 590,000,000 poods (a pood is approximately 36 pounds). And 1913 was considered an exceptionally good harvest year! Again, in 1913, over 600,000,000 poods of grain were exported, while in 1934, with a net increase over the previous year of nearly 300,000,000 poods (and this in spite of a serious drought in the Ukraine), only 60,000,000 poods left the country. This made possible the recent abolition of the bread card, one of the notable improvements in the Soviet standard of living.

Soviet agriculture is definitely on its feet, in spite of weak points which the government is prompt to recognize. Technical and organizational incompetence are still not uncommon. The cotton, flax, beet and other less important crops are still far from satisfactory. The Seventh Congress emphasized very clearly the immediate importance of increasing livestock breeding. Here only some timid signs of improvement appeared during the past year. For 1935 the Second Five Year Plan calls for a gross agricultural increase of 16.4 percent over the preceding year, perhaps the most ambitious task of the Plan.

Returning to our table of population statistics, we can see that the thoroughgoing transformation of the Soviet economy in an incredibly short period of time is matched by a simultaneous—and no less rapid or radical—shift in the social status of the Russian people. Up to 1929 and after more than a decade of Bolshevik rule, 75 percent of the population still functioned as individualists and capitalists. This figure differs very little from that of 1913. It is true that one important change had taken place by 1928 without which the initial survival of the Soviet regime would have been impossible: the reduction of those groups listed under “Bourgeoisie” from almost 16 percent to less than 5 percent of the total population. Yet this “revolutionary” shift was almost counterbalanced by the increase of individual peasants, a Pyrrhic victory for the Bolsheviks, since a large individualistic peasantry would have been a permanent obstacle barring the way to communism.

Here the fundamental social significance of the First and Second Five Year Plans is revealed. Industrialization and its adjunct, the mechanization of agriculture, not only built up national power, but opened the way for Communism. The year 1935 finds three-quarters of the Russian people living collectivized, socialized lives. Socialism in the daily life of the people is no longer a theory, but a concrete reality. It is difficult to visualize what this means in terms of altered habits of living and thinking, of new social relationships, of individual and mass psychologies. It is quite useless any longer to speak of the impossibility of changing human nature. Russia’s new class distribution must be counted as one of the most important sources of strength of the present government. It is on this basis that the Seventh Congress altered the Constitution to provide for the secret ballot, the direct vote and equal representation for collective farmers and factory workers.

The figures on Russia’s military establishment presented at the Seventh Congress are impressive. An increase in the air force of 330 percent, of 200 percent in heavy artillery, over 2,000 percent in baby tanks and more than 700 percent in large tanks, 535 percent in submarines, 470 percent in torpedo boats, the completion of heavy fortifications on the Eastern and Western frontiers, the establishment of a huge munitions industry and a standing army of 940,000 men—these are the quantitative measurements. Of equal importance, however, in judging the potential strength of Russia's armed forces is the fact that foreign military observers are unanimous in their opinion that improvement in quality has matched that of size. In other words, the Soviet military machine is not only one of the largest and most highly mechanized in the world, but it is one of the most efficient.

In spite of its formidable power to wage war, it is generally admitted that Russia today is one of the largest single factors in preserving the peace of Europe. Soviet foreign policy since 1927, that is, since the banishment of Trotsky, has definitely been based on the propositions that: (a) there is no immediate prospect of worldwide communist revolution; (b) one or more of the capitalist powers are likely sooner or later to attack the Soviet Union; (c) Russia must have peace as long as possible in order to build up her defenses and develop her natural and human resources.

As a matter of fact, the last thing that can be said of Russian policy is that it is sentimental or idealistic. True, the Soviet Union still insists that it is the “fatherland” of the world’s proletariat. In one of his speeches to the Seventh Congress, Molotov spoke of expecting to “see in the camp of our friends a flow of new energy and faith in the cause of communism” (stormy applause). But for all practical purposes Russia is no more concerned with active participation in the world communist movement than is J. P. Morgan. Though the headquarters of the Third International remain in Moscow, the Soviet government has gone to great pains to dissociate itself from all such activity in order not to jeopardize relations with capitalist countries. Russia leaves the world revolution for the outside world to take care of, justifying herself by saying that any other course would endanger the Soviet Union and that the Soviet Union must be preserved as the world's first and foremost stronghold of communism.

What it all comes down to is that the Soviet Union has “come of age.” With industrialism as its magic formula, it has transformed itself a remarkably short time into a first-class power. Internally this has meant the possibility of establishing a new social order. Externally, it means that it has joined the family of nations, not only as the exponent of a social theory, but as a nation, far more coherent than old imperial Russia, far more vital, the nation that Alexis de Tocqueville envisaged over a hundred years ago when his visit to the United States led him to predict that some day Europe would find itself squeezed between the jaws of a mighty vise: America on the West and Russia on the East.

This article originally ran in the July 17, 1935, issue of the magazine.