The facts were indisputable, but their interpretations differed. The Left Communists and other advocates of immediate socialization, standing in the midst of the wreckage they had wrought, facing the prospect of imminent famine, refused to concede failure. In a treatise published in 1920 Bukharin spoke glowingly of the collapse of the Soviet economy. In his view, it was the legacy of “capitalism” that was being destroyed: “such a grand debacle had never happened before,” he boasted. It was all “historically inevitable and historically necessary.” His book, filled with Marxist clichés, contained no facts, statistical or other, on the actual condition of Soviet Russia’s economy: facts that would have demonstrated that the culprit was not “capitalism” but Bolshevism.*
Other Communists found the cause of the economy’s calamitous condition in the survival of the private sector. They had always insisted that socialism could not succeed under conditions of partial nationalization and now felt vindicated: the trouble lay not in the government’s pressing socialism too hard, but in not pressing it hard enough. A typical defense of War Communism in this spirit appeared in Pravda in early 1921, just as it was being abandoned. The author, V. Frumkin, ascribed the shortcomings of Soviet Russia’s economy to the fact that its “entire apparatus lies in the hands of bourgeois and petty bourgeois elements, our class enemies.” This could be overcome only by the formation of “sufficiently large cadres of Red commanders of the economic front,” a task which he perceived as lying in the “more or less distant future.”153
More sober heads realized that, far from being responsible for the failure of socialist experiments of 1918–20, “capitalism” had made such experiments possible in the first place. Essentially, under War Communism the Bolsheviks had been living off the human and material resources accumulated by bourgeois Russia. But there was a limit to those. An analysis published in the summer of 1920 in the leading Soviet economic newspaper concluded: “We have completely exhausted the supplies of the more important resources and raw materials bequeathed to us by capitalist Russia. Henceforth, all economic gains will have to be made from our own current production.”154
This agenda would be adopted in the spring of 1921 under the New Economic Policy: a transitional period of indeterminate duration, modeled on Lenin’s original concept of “state capitalism,” during which the government would retain a monopoly on political power but allow private enterprise a limited role in restoring the country’s productive forces. During this period, it would ready cadres of “Red commanders of the economic front.” Once productivity had been sufficiently improved and the personnel stood available, a fresh offensive would be launched to exterminate the “bourgeois” and “petty bourgeois” class enemy for good and then to proceed in earnest with the construction of socialism.
*L. N. Iurovskii, Denezhnaia politika sovetskoi vlasti (1917–1927) (Moscow, 1928), 51. Another contemporary expert who concurs is the Left Communist L. Kritsman (Geroicheskii period Velikoi Russkoi Revoliutsii, 2nd ed., Moscow-Leningrad, 1926): he calls “so-called War Communism the first grandiose attempt at a proletarian-natural economy, the attempt [to take] the first steps of transition to socialism” (p. 77).
*Meshcherskii in NS, No. 33 (May 26, 1918), 7; M. Vindelbot in NKh, No. 6 (1919), 24–32. According to NV, No. 101/125 (June 26, 1918), 3, Meshcherskii was arrested in June. He later emigrated to the West.
*Vechernaia zvezda, April 19, 1918, in Peter Scheibert, Lenin an der Macht (Weinheim, 1984), 219. The reference, of course, is to the unpopular “breathing spell” which the Bolsheviks claimed to have secured with the Brest-Litovsk Treaty.
†On him: Granat, XLI, Pt. 2, 89–98. He was given a mock trial (along with Bukharin) in 1938 and presumably shot soon afterward for an alleged plot to assassinate Lenin: Robert Conquest, The Great Terror (New York, 1968), 398–400.
*According to Hilferding, in 1910 six of the largest Berlin banks controlled most of German industry: S. Malle, The Economic Organization of War Communism, 1918–21 (Cambridge, 1985), 154.
†Russian banks, like those of Germany, participated directly in industrial and commercial ventures, and owned sizable portfolios of securities and debentures issued by these enterprises, which lent these notions the semblance of credibility.
*E. H. Carr, The Bolshevik Revolution, 1917–1923, II (New York, 1952), 145. Carr says that “it is difficult to regard any of these figures as anything but guesses.” Indeed, the state budget approved by the Sovnarkom in July 1918 retroactively for the preceding six months fixed expenditures at 17.6 billion and revenues at 2.85 billion: NV, No. 117/141 (July 14, 1918), 1. Another contemporary estimate placed expenditures for the first six months of 1918 at 20.5 billion and revenues at 3.3 billion: Lenin, Sochineniia, XXIII, 537–38.
†Piatyi Sozyv VTsIK: Stenograficheskii Otchët (Moscow, 1919), 289–92. It appears, however, that only a fraction of the desired sums was actually collected.
*A survey of the theoretical foundations of the projected moneyless economy can be found in Iurovskii’s Denezhnaia politika, 88–125. A dominant influence on Bolshevik thinking on this subject was the German sociologist Otto Neurath.
†S. S. Katzenellenbaum, Russian Currency and Banking, 1914–24 (London, 1925), 98n. In view of this evidence it is not possible to agree with Carr (Revolution, II, 246–47, 261) that Bolshevik fiscal policies which led to the total depreciation of Russian currency were the result not of plan or policy but of responses to desperate needs.
*It is surprising how little note financial markets took of this irresponsible fiscal policy and, indeed, how readily they accommodated themselves to Bolshevism. According to contemporary newspapers (NV, No. 102/126, June 27, 1918, 3), in June 1918 one could buy U.S. currency in Russia at the rate of 12.80 rubles for one dollar, which was the same rate as in early November 1917.
† Reproductions of Russian currency for the revolutionary period can be found in N. D. Mets’s Nash rubV (Moscow, 1960). According to Katzenellenbaum, the earliest Soviet currency came out in mid-1918 in Penza (Russian Currency, 81).
*In fact, prices increased 100 million times.
*M. Weber, Wirtschaft und Gesellschaft, I (Tübingen, 1947), Pt. 1, Chap. 2, 12. These strictures were directed at Otto Neurath, who believed he had worked out a system of keeping accounts without reference to money.
*Lenin, Khronika, VIII, 243, 267. While most of the economic planners of this period fell afoul of Stalin and were shot, Larin, a victim of childhood polio, had the good fortune in 1932 to die a natural death.
*The organization of defense industries is not clear. In August 1918, the Supreme Economic Council set up a Commission for the Production of Articles of Military Ordnance under the direction of Krasin. This commission received and passed on to industrial enterprises orders from the military which were mandatory. In time, responsibility for supplying the armed forces came under the Council of Defense (Sovet Oborony).