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The Problem of Market Relations and the State in Revolutionary Russia

Published online by Cambridge University Press:  03 June 2009

William G. Rosenberg
Affiliation:
University of Michigan

Extract

If the market has emerged in current Soviet and Western discourse as a notional Rosetta stone capable of deciphering the coded blueprints of post-Soviet reconstruction, its apparent destruction by the Bolsheviks during the Civil War and subsequent resurrection under the New Economic Policy (NEP) is often seen as a similarly defining element of the whole early Soviet project. As many would have it, the party's initial urge to control entirely the whole complex of economic exchange relations firmly situates Soviet totalitarianism in a Leninist political economy. The brutal repression of free traders and the mindless nationalization of production clearly evidences the calamitous utopianism of Bolshevik class-based ideology, while the reemergence after 1921 of limited market mechanisms, even if only a reluctant concession to political weakness and economic devastation, opened alternative paths to a non-Stalinist Soviet modernity involving elements of a civil social order. In a phrase, reified conceptions of the market broadly shape historical constructions of a unique and problematic Soviet past, just as they purportedly demonstrate what is peculiar about the post-Soviet present and necessary for the future.

Type
Markets and the State
Copyright
Copyright © Society for the Comparative Study of Society and History 1994

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14 See especially Keith Hart's suggestive essay “Heads or Tails,” which shows the multiple functions of coins in joining symbols of state order (heads) with codifications of value (tails) and argues persuasively that, in addition to its function as a medium of equivalent exchange, money forms represent social and political organization. An open display of money (or the wearing of money equivalents like gold necklaces or bracelets) signifies cultural acceptance of economic inequalities in some highly commercialized societies in the same way that paunches might represent wealth in a pre-commercial village; the failure of a debased currency to lubricate commodity exchange relations is likely to produce a shift in attitudes about legitimacy, authority, and the state.

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16 See the careful discussion in Diakin, V. S., et al., Krizis samoderzhaviia v Rossii, 1895–1917 (Leningrad, 1984), especially 358–9.Google Scholar

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22 Rieber, Alfred J., Merchants and Entrepreneurs in Imperial Russia (Chapel Hill, 1982), 415.Google Scholar Russian industrialists themselves were sharply divided. Strong monopolistic interests in Petrograd with close ties to foreign banking interests and the state, and dedicated after 1905 to rationalizing production, controlling labor, and modernizing their plants along Western European lines, worked at a considerable distance from many of their colleagues in Moscow, who maintained a much greater distance from the state, fought the industrial trusts, were more liberal politically, and continued to reflect in various ways the independence and autonomy of that city's traditional Old Believer merchant and manufacturing community. See the discussion in Rieber, and in Owen, Thomas, Capitalism and Politics in Russia: A Social History of the Moscow Merchants, 1855–1905 (Cambridge, England), 1981.Google Scholar

23 This does not mean that communal villages necessarily resisted innovation nor that Russian peasants were not self-interested producers. Entrepreneurial activities flourished in many rural areas, especially those dependent on handicraft production. See Kingston-Mann, E. and Mixter, T., eds., Peasant Economy, Culture, and Politics of European Russia, 1800–1921 (Princeton, 1991), especially chs. 1, 3, and 4.CrossRefGoogle Scholar

24 See Skinner, , “Marketing and Social Structure in Rural China,” passim.,Google Scholar as well as his “Rural Marketing in China: Revival and Reappraisal,” in Plattner, , Markets and Marketing, 89.Google Scholar

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26 Promyshlennost' i Torgovlia 10 (1915), 497–8.Google Scholar

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28 In the fall of 1914, for example, contracts worth some 66 million rubles for shells and shrapnel were placed with only sixteen plants, most prominently the Putilov, Baltic shipbuilding, Obukhov, Nevskii and Petrograd metal works in Petrograd. Some 60 million rubles were advanced in 1914 alone to enterprises in Petrograd. See Sidorov, , Ekonomicheskoe polozhenie, 29.Google Scholar

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31 From a total of some 17,877 industrial firms listed in Russia's principal commercial registry in 1913, only 12,492 were still in business by 1916. See Sidorov, , Ekonomicheskoe polozhenie, 347–8.Google Scholar

32 Gatrell, , The Tsarist Economy, 185.Google Scholar While estimates of total industrial production for the 58 provinces of European Russia (excluding Poland), the Caucasus, Sibeia, and Turkestan, made in the early 1920s, show a growth of some 1,211 million rubles between 1913 and 1916, or 21.5 percent, this was almost entirely the result of increased output in only two sectors, metals and chemicals. Metalworking plants alone accounted for an increase of 1,260 million rubles; chemicals, for 541 million. Of the other major industries, only leather, linen, hemp and jute, and various clothing plants (including shoes) showed any increase whatsoever, and accounted for only 8.3 percent of new output. Mineral extraction and processing (including cement production, ceramics, and glassmaking) fell into some 53 percent between 1913 and 1916, from an annual gross output of 154 million rubles to less than 90 million. Wood products declined 38 percent; the production of silk and paper, some 20 percent. Most dramatic and significant were the declines in Russia's two largest industrial branches, food processing and cotton textiles. In the food sector, output fell from 1,516 million rubles in 1913 to 1,176 million in 1916, or 22 percent. Cotton textiles fell from 1,091 million rubles to some 893 million, or a little more than 18 percent. By 1916, more than 30 percent of all industrial output went directly toward the war effort; and in the all-important metals and machine-construction sector, the figure was closer to two-thirds. See Tsentr.Stat.Upravlenie (TsSU), Trudy, vol. 26, “Fabrichno-zavodskaia promyshlennost' v period 1913–1918 gg.,” vyp. 2 (Moscow, 1926), 162–63;Google ScholarVorob'ev, N. Ia, “Izmeneniia v russkoi promyshlennosti v period voiny i revoliutsii,” Vestnik Statistiki, 14 (1923), especially 150–3;Google ScholarSidorov, , Ekonomicheskoe polozhenie, 333ff,;Google Scholar and the discussion in Koenker, D. and Rosenberg, Wm. G., Strikes and Revolution in Russia, 1917 (Princeton, 1989), ch. 1.Google Scholar

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34 The number of workers employed in the metals industry, for example, declined by some 40,000 between 1914 and 1916; in chemicals, from 82,000 to approximately 65,000 in 1916, despite increased output in the industry as a whole. In South Russia, 25 percent of the blast furnaces operating in the metallurgical industry in 1915 had shut down in 1916, despite increased demand for iron and steel; and of the 223 metallurgical plants operating in 1915 (excluding Poland), only 145 remained open on the eve of the revolution. According to statistics compiled by N. Vorob'ev for the Central Statistical Administration in 1926, some 356 major enterprises closed in 1914, 573 in 1915 and almost 300 in 1916. See TsSU, Trudy, vol. 26, vyp. 1, 3436.Google Scholar

35 See the discussion in Koenker and Rosenberg, , Strikes and Revolution, 5356.Google Scholar

36 According to the data of the 1917 agrarian census, some 10,932,600 persons were drafted into the army from 47 European provinces between 1914 and January 1917, a figure that may have represented 45 percent or more of the most able-bodied men in the countryside. See Rossiia v mirovoi voine, 1914–1918 gg. (v tsifrakh) (Moscow, 1925), 17.Google Scholar

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42 Socialist economists like Vladimir Groman and Nikolai Kondratiev worried that the intervention of “politically reactionary forces” into the market could greatly exacerbate the growing cost of living crisis. Groman argued with the support of the military that the state should intervene to force prices lower, especially for foodstuffs. See, for example, Kondratiev, N., Rynok khlebov (Moscow, 1922), 8687.Google Scholar

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44 Vestnik vremennago pravitel'stva, March 7, 1917.Google Scholar

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46 See the discussion in Lih, , Bread and Authority, ch. 3.Google Scholar

47 Vestnik vremennago pravitel'stva, March 28, 1917.Google Scholar

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51 Karrik, V. V., O khlebnoi monopolii (Petrograd, 1917), 1016. Indeed, state procurement prices for a whole range of commodities, including grain, were soon increased.Google Scholar

52 Russian State Historical Archive (RGIA) f.23, op.17, ed.khr. 505, 606.

53 Journal of the Executive Committee of the Sovet S'ezdov Predstavitel'ei Promyshlennosti i Torgovli, May 17, 1917, RGIA, f.32, op.1, de1.37, 1.117.

54 RGIA f.23, op.17, ed.khr.609, 1.143.

55 In Shingarev's analysis, authorized increases in the price of grain made state procurement obligations “impossible” to meet. Salary needs for the army (500 million rubles before the end of the year), the post and telegraph (150 million rubles), pensions (80 million), state employee cost of living bonus obligations (150 million), the financing of state debt, and a host of other urgent needs had brought state outlays to a staggering 1.5 billion rubles a month, most of which was now being financed by the printing press. Shingarev, A. I., Finansovoe polozhenie Rossii (Petrograd, 1917), 1011.Google Scholar

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64 “Banks are now so tightly bound up with trade (in grain and everything else) and with industry,” Lenin wrote in “The Impending Catastrophe and How to Combat It” in October, “that without ‘laying hands’ on the banks nothing of any value, nothing ‘revolutionary-democratic’ can be accomplished.” This essay is in Polnoe sobranie sochineniia, 5th ed. (Moscow, 1959), v. 25, 329–30.Google Scholar

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66 The State Bank was seized on November 20, and major commercial banks on December 27. See Malle, S., The Economic Organization of War Communism, 1918–1921 (Cambridge, England, 1985), 153–60.CrossRefGoogle Scholar

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70 The 324,000 persons registered as unemployed in April 1918, 1.5 million for 1918 as a whole, put a tremendous strain on local governments as well as the new regime. See Anikst, A., Organizatsiia raspredeleniia rabochei sily (Moscow, 1920 [1921]), 4647.Google Scholar

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76 Dekrety sovetskoi vlasti, (Moscow, 1959), II, 2324.Google Scholar

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85 Ibid., 543–44.

86 Ibid., 543.

87 Ibid., 553.

88 On this question see especially LeGrand, Julian and Estrin, Saul, eds., Market Socialism (Oxford, 1989), 124.Google Scholar

89 Sokolnikov, G. Ia, et al., Sovet Policy in Public Finance (Stanford, 1931), 142.Google Scholar

91 In 1922, less than 3 percent of total revenues came from taxation; and only 15 percent of the total state budget for 1922 could be financed by money receipts. The remaining 85 percent—needed for wages, the reconstruction of industry and transport, housing, the army, and so forth—came from the issue of new paper money, just as it had in 1917. Ibid., 145–6.

92 Ibid., 148; Nove, , Economic History, 9192. The ratio makes the near hyperinflation of 1992–93 pale by comparison. In the spring of 1993, 130 rubles equaled 1 Soviet kopeck.Google Scholar

93 Ibid., 147.

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