After 1927 Soviet military intelligence began to blossom. This was the year in which the first five-year plan was drawn up, which aimed (as all subsequent five-year plans have) exclusively at the growth of the military potential of the country. The plan stipulated the creation and speedy growth of the tank, ship-building, aviation and artillery industries. The Soviet Union set itself the target of creating the most powerful army in the world. The Soviet leadership made haste and demanded from its designers not only the creation of new kinds of weaponry and military technology, but also that Soviet armaments must be the best in the world. Monumental sums of money were spent to attain this aim: prac-tically the whole of Russia's gold reserves was thrown into the task. At Western auctions the Soviet authorities sold off Russian corn and wood, pictures by Rembrandt and Nicholas II's stamp collection. A tidy sum of money was realised.
All GRU residents received book-length lists of foreign military technology which they would have to steal in the near future. The lists included equipment for bombers and fighters, anti-aircraft and anti-tank guns, howitzers and mortars, submarines and torpedo boats, radio valves and tank engines, the technology for the production of aluminium and equipment for boring out gun barrels. Yet another GRU tradition first saw the light of day in this period: that of stealing analogous kinds of armaments at the same time in different countries and then studying them to select the best. Thus, at the beginning of the 1930s, Soviet military intelligence succeeded in stealing samples or plans of torpedoes in Italy, France, the United States, Germany and Great Britain. It was hardly surprising that the Soviet torpedo, manufactured in the shortest possible time, conformed to the highest international standards. Sometimes Soviet copiers selected the best assemblies and components and constructed out of them a new type which often turned out to be the very best in the world. Luck too was on the side of Soviet military intelligence. Nobody took very seriously the efforts of the Soviet Union in the military sphere, and few countries went to great pains to hide their secrets from it. Communists the world over were obsessed by the idea of helping Soviet intelligence, Soviet residents were able to throw their money round, and finally the great depression threw into the arms or Soviet intelligence thousands of opportunists who feared losing their factories, workshops or offices. Soviet intelligence, by the beginning of the 1930s, had attained unprecedented heights of power. Within Soviet territory the GRU had practically no political influence. In the international sphere it did not very much seek to enter into the political life of parties and states, but in the field of clean espionage the GRU already clearly occupied the leading position in the world, having by far overtaken the political intelligence work of the OGPU. At the beginning of the 1930s the GRU budget was several times larger than the overseas budget of the OGPU. This situation remains true today.
The system in use today of recruitment and running of agents had already fully developed by the end of the 1920s. In agent organisations directly subordinated to the GRU the recruitment and running of agents was in the hands of 'illegals', that is, GRU officers posted abroad undercover with forged documents and offices, posing as Soviet diplomats, consuls, trade representatives, correspondents and so on. In agent organisations subordinated to military districts and fleets the recruitments of agents was carried out from the territory of the Soviet Union. Only rarely did certain officers of the intelligence directorates of districts travel abroad with forged documents for short periods. Before diplomatic recognition of the Soviet Union, emphasis was concentrated on the activities of illegals, but after its recognition, undercover residencies were added to the numerous illegal residencies. The GRU illegals and undercover residencies acted independently from each other but in the pre-war period the communications of illegals from GRU residencies with the Centre were frequently accomplished through the Soviet embassies. This was a very serious mistake. With the beginning of the war when the embassies were closed or blockaded, the communication with illegals was disrupted. The mistake was subsequently rectified. Military district intelligence always operated independently of the GRU illegals and Soviet embassies, and for this reason at the beginning of the war it was practically unharmed. Gradually a tendency became noticeable in the operations of military district intelligence services to limit the use of Soviet officers even for short trips abroad. Faced with wartime conditions the military district intelligence services began to recruit and run their agents only from Soviet territory. The recruitment of new agents was carried out either on Soviet territory or on the territory of neighbouring countries by means of agents who had been recruited earlier.
There is an interesting story to be told about the recruitment of agents at this time, whose moral holds as true today. In the pre-war period, recruitment took up little time. The Comintern simply made a decision and immediately scores, sometimes hundreds of communists became Soviet secret agents. In the interests of successful agent work, the GRU always demanded from them that they should publicly resign from the communist party. The vast majority accepted this without demur. After all, it was only a camouflage, a Bolshevik manoeuvre to help defeat the lass enemy. Sometimes however, there were communists who were unwilling. In Germany, one group agreed to the GRU's demands only on condition that it was accepted into the Communist Party of the Soviet Union. The demand was a simple one, for it is not difficult for the GRU to write out a dozen new party cards, and as the new agent group was working so successfully, the GRU did not want to refuse. At a routine meeting the GRU case officer, an employee of the Soviet embassy in Berlin, informed the group's leader that their demands had been met. He congratulated the group on becoming members of the CPSU and informed them, in conclusion, that the General Secretary of the Party himself, comrade Stalin, had written out the party cards. As an exceptional case, the German communists had been accepted without going through the candidacy stage. Their party cards were naturally to be kept in the Central Committee.
At this news the group's productivity redoubled. It was supposed to receive a certain sum of money for its work, but the group members refused to accept the money. More than that, they began to hand over to their case officers sums of their own money, in order to pay their membership fees to the Soviet communist party. Punctually they handed over to their case officers all documents and payslips concerning their earnings together with their party subscriptions. This took up a great deal of time during the agent meetings, but the Germans were working very productively and nobody wanted to offend them.
Some time later, the Gestapo got on their trail, but all the members of the group managed to escape into Austria, then to Switzerland and finally through France to Spain where the civil war was going on. From Spain they were brought to Moscow, Terrible disappointments awaited them in the capital of the Proletariat of all the world, the chief of which was that nobody into at any time written out their party cards, or accepted them into the Soviet communist party. The GRU officials had of course assumed that the agents would never set foot in the Soviet Union on that therefore it would be very easy to dupe them. However, on their arrival in Moscow, the first thing the agents did was to declare a hunger strike and demand a meeting with the higher leadership of the GRU. The meeting took place and the GRU leadership did all in its power to help the Germans join the party, after going through the candidate stage, naturally. But foreigners can only be accepted in the CPSU through the Central Committee, and the natural questions arose: 'Were you ever members of the communist party? Why did you leave it?' The fanatics told exactly what had really happened but were damned out of their own mouths. To burn one's party card is a cardinal sin - and the Central Committee threw out their application. The Germans again declared a hunger strike and demanded a meeting with Stalin in person. At this point the NKVD offered its help to the Central Committee, but the GRU intervened, being in no way desirous that its agents should fall into the hands of the NKVD. So the ex-agents ended up in the GRU cellars.