Moissaye J. Olgin spent much of 1921 in Soviet Russia and provides this sober summary of that momentous year which saw the Kronstadt Rising, the debate on trade unions, costly victory in the Civil War, famine, and the New Economic Policy.

‘The Work of the Fourth Year’ by Moissaye J. Olgin from Soviet Russia (New York). Vol. 5 No. 5. November, 1921.

On November 7 the Soviet Republic begins its fifth year. The accomplishments of its fourth year are here reviewed by one who recently returned from Russia, and who has done much to familiarize American readers with conditions under the Proletarian Dictatorship. Ed.

WHEN the third anniversary of the October Revolution was celebrated throughout the vast extent of revolutionary Russia, the guns were still thundering in the South, and Wrangel was retreating towards the Crimean Peninsula. The entire nation stood breathless, watching the final struggle against the last White General. Victory seemed near at hand; the White forces were in themselves insignificant when compared with the armies of the Red Republic, yet peace with Poland had not been concluded, the Rumanian frontier was not secure, and behind General Wrangel were imperialistic France and her Allies. The uncertainty cast a black shadow over the anniversary celebration. Only several weeks later could the country heave a sigh of relief. The enemy was beaten, the South was cleared of White bands, and the spectacular flight of the White officers ensued. To accentuate the difference of purpose between the defensive war that was waged by the Republic, and the aggressive encroachments of the reactionary forces, the Russian Government declared the Crimean Peninsula, with its balmy air and beautiful scenery, to be henceforth a sanitarium of the nation. All former palaces, villas, resorts of the Russian imperial family and of the bourgeoisie were to be used as rest-homes for fatigued and exhausted women, soldiers and peasants.

The country was safe, Prospects were brightening. Peace, unknown to Russia for six long years, was again restored. But the wounds of the economic organism, little tended, or even deepened in the fierce revolutionary struggles, were now felt more keenly. There was, first of all, the frightful deterioration of the transportation system. Trotsky, the rail dictator, had done wonders in increasing the carrying capacity of the railways. In 1920, the war emergency was successfully met; there was little delay in the transportation of troops, munitions, and war-materials to the front. Yet all this was accomplished at the expense of the reserves. The industrial establishments had worked feverishly and with great waste in certain directions, while in the others there was a decline if not an actual stoppage. State monopoly, which had been imperative in the course of war, when all national resources had to be concentrated in the hands of the Federal Government, began to show its seamy side. The salient problem in the economic field, however. was the problem of the land. The peasantry had shown ardent devotion to the Revolution because their own land was at stake. “Beware of the White Generals who will bring back the noble landlord”, was a slogan powerful enough to arouse the villager and keep him at the front in the most crucial moments. Yet, while he was ready to defend the agrarian achievements of the October Revolution with all his might, he was not altogether ready to follow the leadership of the industrial proletariat in the direction of communist economy.

Changes Required in Agrarian Policy

It must be stated that in the first three years of the Revolution the agrarian policy of the Soviet Government had not assumed a definite shape. On the one hand, the Sovokhozy ‘(Government farms), similar in management and aims to the State owned industrial establishments, were greatly encouraged; on the other hand, the Government was now proclaiming its readiness to support the “middle” peasant, as distinct from both the village proletariat and the remnants of the village bourgeoisie. Neither was there a clear-cut policy in the practice of collecting foodstuffs from the village population. It was recognized that the peasant was a worker for the State, obliged to yield to the Republic all the produce of his labor above a necessary minimum of subsistence. Still, the richer agricultural districts remained in possession of foodstuffs far above their immediate need, whereas the peasants of the poor soil regions were left with hardly enough to maintain a meager existence.

This policy of haphazard assessment and still more haphazard levying of food duties in the rural districts displease the peasantry in various districts, and sometimes led to actual clashes between the village and the food administration. The peasant sentiment was clearly voiced at a conference of the representatives of Uyezd, Volost and village Soviets, called in Moscow for October 15, 1920, at which the writer of these lines was present. This conference, consisting of nearly three thousand peasant representatives, made a profound impression in Soviet circles, showing that there was no actual peace in the village. “We want to know what we are expected to do, we want our duties defined. We know that, from the communist standpoint, we are petty bourgeois, yet we are the backbone of Russia and only from us can the Social Revolution derive its strength and resisting power.” It was plainly evident that something had to be done to improve relationship between village and town. More imperative, — than this political task was the necessity of increasing the agricultural output. Keen as was the desire of the peasants to defend their land against the Whites, eager as they were to cooperate with the Soviet Government in a time of national crisis, they could not be induced, individually or collectively, to increase the productivity of the land, of which all the surplus, they knew, would be requisitioned by the State. The outcome, inevitable under such conditions, was a decrease both of the area of arable land and of the crop per acre, notwithstanding the unusually good crops of 1918 and 1919. The low yield of the fields in 1920 was a warning to the Soviet administration. Something had to be done to increase the production of food.

The Eighth Congress of Soviets

The problem of industrial reconstruction and the problem of the land loomed up before the Eighth All-Russian Congress of the Soviets, which convened before the end of December. The Congress, however, did not relinquish the Government monopoly on production and distribution, and in general it was very cautious in dealing with vital problems. it emphasized, however, the necessity of a political and economic demobilization, which meant an increase of the power of the local Soviets and more independence for the Soviets in conducting industrial work. In the agricultural field, the Congress introduced the planting committees (Posevkomy), composed of peasants and representatives of the administration—to see to it that the output of the land in 1921 should be larger.

That these palliatives did not satisfy the crying need of the country for vigorous steps towards reconstruction, was evident from the discussion on the role of the labor unions in industrial management, which between December, 1920, and March, 1921, occupied the foreground of Russian thought and at one time seemed even to threaten the Communist Party with disruption. Several elements combined to make this discussion both timely and urgent. In the first place, the Spetz—the bourgeois specialist, the intellectual administrator,—had become too dominant a figure in industrial management, and by his lack of sympathy for the Soviet system and lack of responsibility for the progress of the new economic policies, seemed to be largely instrumental in creating the tangle of red tape which threatened to cripple the Russian industrial system. Animosity between the rank and file of labor on the one hand, and the Spetz on the other, had become quite acute. Dissatisfaction felt by the rank and file with the policy of the labor unions, which were looked upon as an integral part of the administration, and with the imposition of strenuous working conditions upon labor, was also manifest here and there. The food shortage, the diminished vitality of the workers, the craving for immediate improvement of living conditions after the cessation of hostilities, increased the general unrest. The paramount issue, however, was the problem of straightening out the machinery of production and setting the wheels of the Russian industrial system running.

Labor Union Primacy Suggested

It was this state of affairs which dictated to one group of Communists, headed by Trotsky, the idea of labor unions taking over the management of industries and thus eliminating both the Spetz and the red tape. “To make the labor unions the sole factor in the management of industrial affairs”, was the underlying principle of this group, which it was ready to defend at the March Convention of the Communist Party. Opposed to it was the current headed by Lenin, which considered the time inopportune for rash experiments and would have the labor unions gradually acquire the necessary experience and knowledge, in order that they might become, perhaps in the remote future, the real owners and masters of their respective industries. In the March, 1921, Convention of the Communist Party, the Trotsky faction was defeated by an overwhelming majority and took its defeat with stoic resignation. The convention was not ready to recommend new experiments at a time when all the power of the country needed to be used for immediate improvement of the economic conditions.

While the Communist Convention was “conservative” in its handling of the problem of the labor unions, it showed unusual determination in inaugurating what has since been known as the new economic policy of the Soviets. in the first place, it introduced the agrarian “tax in kind”. The peasants were thus assured that each year only a certain fixed percentage of their crops would be taken in the form of taxes, and the rest left for the producer to dispose of in the open market in exchange for other commodities. This one measure necessitated the abolition of the State monopoly on internal commerce. Trade in the open market was declared free, and exchange between village and town was henceforward to be carried on both by private individuals and, preferably, by cooperative organizations.

Similarly, private initiative in the industrial field was promised an opportunity by the convention. A survey of the economic situation of Russia showed a lamentable decrease of industrial output. The amount of coal produced in 1920 was 20 per cent, the output of oil 41 per cent, of that of 1913. The output of peat and wood increased, but could hardly fill the gap created by the diminution of the output of oil and coal. Still worse results were manifest in the output of metals. Here, the production of 1920 amounted to hardly more than 5 per cent of the output of 1913. The production of agricultural implements varied in 1920 between 14% per cent and 17 per cent of the prewar output, the construction of machines for the railroad system and for military purposes was a little over 25 per cent of the pre-war level. The textile industries showed an output of between 4 and 6 per cent, and only the production of linen amounted to 25 per cent of the pre-war production. The production of rubber was something like 20 per cent, that of paper 21 per cent to 22 per cent, sugar 6 per cent, tobacco 28 per cent to 37 per cent, printing products 15 per cent, joinery 15 per cent, salt 15 per cent, and so on.

Kronstadt Delays the Convention

It is characteristic of the Russian political morale, that one third of the delegates to the Communist Convention, picked men of the new Russian intelligentsia, each an important functionary in local or national affairs, went to Kronstadt to defend the Revolution. The Kronstadt upheaval was soon quelled, the future was secure. Yet, it was quite evident that decisive steps had to be taken to increase the productivity of the Russian factories and plants. A series of decrees inaugurating the new economic policy was soon issued by the government. Private production was introduced, the Kustar—small producer of the artisan type—was allowed to work for the open market. The co-operatives were given free hand to run and own industrial establishments. Larger factories were to be leased to private business men, to be operated on the basis of private enterprise.

This set of measures was a strong contradiction to the policy hitherto pursued by the Soviet administration. It looked like an abolition of the principles cherished by the Revolution in the course of three years.

Special Conference Called

An unusually heated discussion followed throughout the country. Many were shocked, many were in despair. The controversy was so passionate that two months after the March Convention, the calling of a special conference became necessary. This latter clearly showed that the large masses of the supporters of the present system, Soviet functionaries, leaders of labor unions, representatives of the Red Army, Communist workers, had grown to realize the pressing need of the new policy. A resolution adopted by the conference confirming all the decrees that had been issued between March and May, has the following wording:

1. The fundamental political task of the present moment consists in a complete assimilation and a punctual execution by the Party and Soviet workers of the new economic pa which is to be established for a long period to come. This policy is to be pursued with absolute firmness and good faith.

2. The fundamental lever is recognized to be the exchange of goods, which can be realized and partly stimulated by increased planting and the improvement of agriculture.

3. The transfer by the Provisions Commissariat of its stocks of tradable goods to the cooperative organizations is recognized as correct, since it enables those organizations to provide for the necessary supplies.

4. Aid to small and medium-sized enterprises should be given; if necessary, they may be leased.

5. The production programs of the large industries should be revised and corrected in the direction of increasing the output of staple goods and commodities necessary for the peasants.

6. The development of the system of bonuses in kind for the workers. the introduction of the principle of individual and collective participation of the workers in their output. the increase of punitive measures for waste or irrational use of Iabor is approved.

7. The apparatus of the Provisions Commissariat is to be maintained and reinforced in order to enable it quickly and thoroughly to collect the agricultural tax.

8. The urgent tack of the present year is considered to be the collection, in the form of the tax in kind, and through exchange, of four hundred million poods of grain.

Economic Conferences

The Communist Convention was not the only one to consent to the new economic policy. All the following gatherings, conventions, and conferences gave their approval to the new system. The Congress of the Councils of National Economy, the special convention on the Tax in Kind, the National Convention of the Labor Unions, gave their unanimous endorsement to these fundamental changes.

The general sentiment was vigorously expressed by Rykov, the former President of the Supreme Council of National Economy, at the Economic Convention. “There are many among us,” he said, “who look upon the new tax in kind, which is to take the place of the former assessment, as an exclusively political measure, as a pact between the proletariat and the petty owners, the petty bourgeois element. It seems to me that the roots of the change in our food supply system lie much deeper. In the course of four years we were in a position to observe the progressive decrease of the planted area, the decrease of crops per acre, and an almost total disappearance of some plants most precious for industry, for national economy, and for export, such as flax, hemp, oil seeds, etc. The reason is that under the conditions of food requisitions, under the former assessment methods, the small owners were not interested in enlarging their farms. This made the shrinking of the peasant economy inevitable. Radical measures were necessary in order to cure this evil. A way out was found in the substitution of a tax in kind, for the former assessment methods. The tax in kind means extracting from the peasant only a part, possibly a very small part, of his products, to go to the State, and a free hand to do with the rest as with bourgeois property, which he may dispose of according to his wish. This means a reestablishment of the institution of petty ownership in the bourgeois sense of the word, and it inevitably leads to the development of the rural bourgeoisie on the economic basis.”

Denationalizing Industry

As to the question of denationalizing industry, Rykov said: “If any factory can be run by a private owner, whereas under our management it does not run—it would be a crime not to give it over to the private owner, when we are not in a position to put it into operation. The fundamental task consists in solving the commodity crisis as quickly as possible, and at any price. … There is no rule, custom, law or decree which should not be annulled if, as a result, we shall receive better commodities, a larger amount of commodities, if competition means improvement, then introduce exchange with the village and let us develop our industries. Up to the present we have been suppressing everything. Now it is the time for us to study carefully the local customs and habits, and to individualize our work. The abolition of our former methods, and the greater flexibility, in accordance with the new conditions, are imperative, if we wish to gain by our new policy. The Soviet Government has taken into account the colossal changes in the social environment in which we live, the mood of the masses of peasants and small producers, and a whole series of economic factors. This change in the economic environment and in the general domestic and international conditions dictated the change in our economic policy-

Has Communism Been Abolished?

The series of measures introduced in April, May and June, forming in their totality the new economic policy of the Soviets, has aroused an enormous volume of discussion both in Russia and abroad. It is very significant to note that those who saw in them a renunciation of all the basic ideas of the Soviet system and an unconditional surrender to capitalism, were the sharpest opponents of the Soviet system, who had critisized it for forcing communism on Russia, which, in their opinion, was not ripe for experiments of this nature. One would have been inclined to think that the new set of measures would meet the approval of all these elements. If, however, they preferred to continue their venomous attacks on the Soviet system, and even increased their campaign of misrepresentation, it was obvious that there still remained in Russia a number of potent factors which were unacceptable to the Capitalist world. Indeed, within the ranks of the active Russian workers, who were fully alive to the demands of the moment, there was no marked consternation over the inaugurated concessions.

It may be well to quote an excerpt from an address delivered by Lenin at the Communist Conference in Moscow. With the sober vision and practical good sense that characterize all his utterances, he admitted that the new policy was a concession to the spirit of small ownership within Russia; he did not, however, consider the principles of the Revolution abandoned. The fight, in his opinion, was transferred from the political field into the realm of economic reconstruction. “Russia,” he said, “is now attracting the attention of the workers of all countries, without exception. This is no exaggeration. This is one positive result of the revolution. The capitalists will not be able to pass it by in silence. Therefore, they try to point at its economic errors and weakness. Here is where the fight now rages on a world-wide scale. If we solve this problem of economic reconstruction, we shall have won a world battle, decisively and completely. This is why the problems of economic reconstruction acquire an exceptional significance for us. We must win the fight on this front by slow and gradual but inflexible rise and progress.”

In the opinion of the leaders of Soviet Russia, the new economic policy is only a series of temporary concessions — temporary from a historic viewpoint—though they may last a number of years, made in order to lead the country out of the present economic chaos without giving up the main force which will be able in the course of time to steer Russia toward a complete abolition of private ownership and private gain. What remains in the hands of the nation are the largest and best equipped factories, the basic establishments of the key industries, the transportation system, and foreign trade. The Government remains the supreme power in the economic realm, directing all economic activities, stimulating those which are least dangerous for the social welfare of the masses, and checking those which may become a menace to the existing system. What is most significant in all the startling changes is the fact that the political system has remained almost intact. The proletariat, headed by the Communist Party, is still in control of all the affairs of the State. The peasantry, having realized its major demand, is not likely to strive for political domination in the near future.

True, it is conceded by the Russian authorities that a new battlefront is developing within the country—the battle front of the Soviet system against the new forces of private gain. The future may witness two camps: one composed of the proletariat and the more revolutionary portion of the peasants; the other embracing the peasant bourgeoisie, the industrial bourgeoisie, the foreign capitalists who will receive concessions in Russia, and a part of the intelligentsia, which will align itself with the bourgeois forces. The Russian leaders are fully aware of the gravity of this future struggle. They place their hopes, however, in the organized activities of the proletariat, which will increase in number and vitality as the economic system will improve, and in the cooperative organizations which may compete successfully with private enterprise and become one of the great aids to labor on its internal front. The future will witness a curious condition of affairs, in which a labor-controlled State will allow capitalism to develop with the avowed purpose of putting it out of operation as soon as the economic organism has reached a healthier state.

The Cooperative Organization

The most active factors in the situation at present seem to be the cooperative organizations on the one hand, the small producer and trader on the other. Reports reaching this country show a remarkable growth of the cooperative organizations, whose progress may be partly due to the fact that they had only been dormant in 1919 and 1920, their apparatus remaining in existence even in the times of the most rigorous State trade monopoly.

The cooperative organizations of consumers, notably workmen’s cooperatives, are doing a large volume of business. Cooperative organizations of small independent producers, as well as cooperatives of peasants, both for the sale of products and for the buying of manufactured articles, also show rapid development. All the activities of the cooperatives are directed by the Central Bureau of the Cooperatives in Moscow. Plants are being leased both to cooperatives and private business men. In the latter case, the typical stipulations are: Government control of production and labor conditions; a short term lease, not exceeding ten years; a tax for the Government amounting to 4 to 10 per cent of the gross income of the enterprise. The lessees are obliged to increase the production of the enterprise to a certain point and to comply with all rules and regulations.

As to the plants that remain in the hands of the Government, they are now operated on a totally new basis. The Supreme Council of National Economy remains the head of all the Government-owned industries. However, the local plants receive a large measure of independence. Individual plants are being pooled together into groups or “trusts” under responsible management, which is to conduct their operations on a strictly business basis. Preliminary control by the central economic bodies has been abolished. Raw materials, fuel and other supplies are to be independently acquired by the enterprises or groups of enterprises through their own agencies, both at home and abroad. The output must cover all the expenses and leave for the Government a margin of profit. It is supposed that the State-owned large enterprises with good machinery and good equipment, enjoying, moreover, the support of the Government, will be in a position to compete successfully with private enterprise, either of a medium or small size.

Transportation and Famine

The process of reorganizing the Government owned industries is now in full swing. All activities, however, are greatly impeded by the impoverishment of the country, by the lack of the most elementary necessities, and mainly, by the deterioration of the transportation system. The crisis has become more acute through the famine in the Volga districts. Relief, however, is coming through foreign trade, which is increasing in volume month by month. Thus, the volume of imports amounted in January, 1921, to 737,000 poods; in February, 1,632,000; in March, 2,024,000; in April, 2,114,000; in May, 2,840,000; in July, 5,434,000; while the total imports for 1920 amounted only to a little over 5 million poods,

Petrograd has become one of the main ports of entry; quantities of goods are coming in also through Reval, Riga, and Odessa. Russia imports rails, locomotives, coal, agricultural implements, chemicals, and foodstuffs. Its exports consist of hemp, flax, lumber, hides, tobacco.

Socialism in Russia?

It is significant to note that the Russian administration seems to be much more concerned with straightening out the economic tangle, with increasing the productivity of its industrial establishments, with improving the conditions of life, than with the name that might be given to the prevailing economic system or with the possible disappointment of many who saw the realization of Socialism in Russia near at hand. The country as a whole has not lost faith in the regeneration of Russia. Its faith has not been shaken even by the terrible new calamity of the famine. In this connection it must be stated that in spite of its extent and in spite of the sufferings it inflicts on millions, the famine has not shaken the existing system. “Hunger is no less a danger than war” was the slogan, and all the feverish activities, all the self-sacrifice, all the sentiment of generosity which mark a country at war against foreign invasion, was thrown to the famine front.

Fighting the Famine

The first task was to collect the grain tax from those provinces which suffered less from drought. The second task was to distribute the grain among the famine-stricken peasants, so as to enable them to sow their fields. The third task, to take care of those who were running away blindly from their villages and provinces in quest of food. With almost superhuman effort, al! these tasks have been accomplished as far as that is possible among the ruins of the Russian economic life. Thousands of workers were thrown into the famine districts to stop the disorderly flight, to return the able-bodied villagers to their homes, in order that they might not lose an opportunity to plant their fields, to remove the children, the sick and the invalids from the hunger areas into safer districts, and in general to bring relief and comfort to stricken millions. Thousands of other workers were sent out to supervise and facilitate the collection of the grain tax. Repair work on the transportation system was hurriedly resumed in order to hasten the delivery of grain, both domestic and imported, to the famine districts.

Early in September the Government felt it could proclaim its first success on the famine front. By that time, ten million poods of seed grain had been delivered in the hunger districts. The amount is pitifully small, the sufferings of the rest of the population are intense. Yet, there is hope that, with the foreign aid coming in, the famine will be conquered.

Striking a Balance

If, at the end of the fourth year of Soviet rule, we ask what Russia has lost and what it has gained in these four years of unparalleled struggle, the mere enumeration of the various facts would require a special essay. We can here point out only the most significant aspects. Russia has secured her frontiers against enemy invasion from without, her internal peace against counter-revolution from within. Russia has crested a political system— that of the Soviets—combining the forces of the peasantry and the industrial workers under the spiritual guidance and political hegemony of the working-class. Russia has created a totally new administration, recruited, in its overwhelming majority, from the ranks of labor. Russia has created a new army on the basis of a new discipline and imbued with a revolutionary spirit. Russia has called forth a new intelligentsia from the masses, largely replacing the old intelligentsia of the bourgeoisie. Russia has created a network of cultural institutions destined to mould the masses into an enlightened participation in the workers’ state. Russia has offered powerful resistance to assaults from all sides and even to elemental disasters of the most horrifying nature. Russia has developed the political understanding of the masses to a degree that makes all efforts at counter-revolution appear futile. Russia has attempted to do away with private property and in a large measure has succeeded.

For these accomplishments Russia has paid with a ruined industrial system, with years of war under the most trying conditions, with diminished vitality of the population, with numerous epidemics, with this year’s famine. Idle speculators or embittered enemies may sit in judgment over the revolution and declare that the game was not worth the candle. Surely, those most concerned, the enlightened Russian masses, are not inclined to regret the revolution. Whatever other complaints the present, writer may have heard among the Russian workers and peasants, he never heard them complaining over the fact of the October Revolution. They knew why they had made the Revolution, and they were ready to take the consequences.

Transition from War to Peace

The fourth year of the Soviet revolution will go down into history as the year of transition from a war to a peace footing. The nation settles down for the peaceful pursuit of life. Periods of transition are painful even in countries with greater economic power. In Russia, every adaptation is made more harrowing by the exhaustion of the economic reserves and by the fierce civil war that ravaged the country for years. If adaptation to changed conditions be considered progress, then the change in the economic policy, the most significant event of this year, must be set to the credit of the revolution. The fourth year saw the disappearance of many phenomena connected with the conduct of war, chief among which was extreme centralization, political and economic, a wasteful spending of national energy, and a one-sided concentration of activities to the neglect of many others. The second half of this year, notwithstanding the famine, has witnessed a broadening of national activities, a freeing of energy, a stimulation of initiative, a linking together of the various parts of the country in the exchange of goods. It has once more shown the ability of the Soviet administration to cope with a national crisis, and, above all, it has shown the ability of the system, commonly considered to be in the grip of dogmatists and dreamers, to yield to the demands of time and to adapt itself to changed conditions without a change in the personnel of the administration and without renouncing the ultimate goal.

Soviet Russia began in the summer of 1919, published by the Bureau of Information of Soviet Russia and replaced The Weekly Bulletin of the Bureau of Information of Soviet Russia. In lieu of an Embassy the Russian Soviet Government Bureau was the official voice of the Soviets in the US. Soviet Russia was published as the official organ of the RSGB until February 1922 when Soviet Russia became to the official organ of The Friends of Soviet Russia, becoming Soviet Russia Pictorial in 1923. There is no better US-published source for information on the Soviet state at this time, and includes official statements, articles by prominent Bolsheviks, data on the Soviet economy, weekly reports on the wars for survival the Soviets were engaged in, as well as efforts to in the US to lift the blockade and begin trade with the emerging Soviet Union.

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