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1

THE HOME AND FOREIGN POLICY
OF THE REPUBLIC

REPORT OF THE ALL-RUSSIA CENTRAL EXECUTIVE COMMITTEE
AND THE COUNCIL OF PEOPLE'S COMMISSARS
DECEMBER 23

 
    (Stormy applause. Cries of "Hurrah!", "Long live our leader, Comrade Lenin!", "Long live the leader of the world proletariat, Comrade Lenin! " Prolonged applause.) Comrades, I have to make a report on the foreign and home situation of the Republic. This is the first time I have been able to make such a report when a whole year has passed without one, at any rate large-scale, attack against our Soviet power by Russian or foreign capitalists. This is the first year that we have been able to enjoy a relative respite from attacks, even if for a limited period, and have been able in some measure to apply our energies to our chief and fundamental tasks, namely, the rehabilitation of our war-ravaged economy, healing the wounds inflicted on Russia by the exploiting classes that had been in power, and laying the foundations for socialist construction.

    First and foremost, in dealing with the question of the international position of our Republic, I must repeat what I have already said, namely, that a certain equilibrium, though a highly unstable one, has been created in international relations. This is now evident. It is very strange for those of us who have lived through the revolution from its inception, who have experienced and observed our incredible difficulties in breaching the imperialist fronts, to see how things have now developed. At that time probably none

 
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of us expected or could have expected that things would shape out like this.

    We imagined (and it is perhaps well worth remembering this now because it will help us in our practical conclusions on the main economic problems) that future development would take a more simple, a more direct form than the one it took. We told ourselves and we told the working class and all working people both of Russia and of other countries that there was no way out of the accursed, criminal imperialist slaughter except through revolution, and that by breaking off the imperialist war by revolution we were opening up the only possible way out of this criminal slaughter for all peoples. It seemed to us then, as it was bound to, that this was the obvious, direct and easiest path to take. This direct path, which, in fact, alone had enabled us to break free of imperialist ties, of imperialist crimes and of the imperialist war continuing to threaten the rest of the world, proved to be one which other nations were unable to take -- at any rate not as quickly as we had thought they would. When, nevertheless, we now see what has taken place, when we see that there is only one Socialist Soviet Republic and that it is surrounded by a whole array of frenziedly hostile imperialist powers, we ask ourselves -- how was it possible for this to happen?

    One may reply without any exaggeration that this happened because our understanding of events was basically correct, our appraisal of the imperialist slaughter and the confusion in the relations between the imperialist powers was also basically correct. It is only due to this that such a strange situation, the unstable, inexplicable, and yet to a certain extent indisputable equilibrium that we witness, has arisen. The fact of the matter is that although completely surrounded by countries economically and militarily much more powerful than ourselves, whose open hostility to us quite often borders on frenzy, we nevertheless see that they were unable to destroy Soviet Russia directly and instantly -- something on which they had been spending so much of their resources and their strength for three years When we ask ourselves how this could have happened, how it could be that a state, undoubtedly one of the most backward and weakest, managed to repel the attacks of the openly

 
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hostile, most powerful countries in the world, when we try to examine this question, we see clearly that it was because we proved to be correct on the most fundamental issues. Our forecasts and calculations proved to be correct. It turned out that although we did not receive the swift and direct support of the working people of the world that we had counted on, and which we had regarded as the basis of the whole of our policy, we did receive support of another kind, which was not direct or swift -- the sympathy of the workers and peasants, the farm workers, throughout the world, even in the countries most hostile to us, the sympathy that was great enough to be the final and most decisive source, the decisive reason for the complete failure of all the attacks directed against us. This sympathy consolidated the alliance of the working people of all countries which we had proclaimed and which had been implemented within the borders of our Republic, and which had its effect on all countries. No matter how precarious this support may be, as long as capitalism exists in other countries (this we must of course see clearly and frankly acknowledge), we may say that it is something we can rely on. Because of this sympathy and support, the intervention, which we endured in the course of three years, which caused us incredible destruction and suffering, is, I will not say impossible -- one has to be very cautious and circumspect here -- but, at any rate, has been made far more difficult for our enemies to carry out. And this, in the final analysis, explains the situation now obtaining and which at first glance appears so strange and incomprehensible.

    When we calmly weigh up the sympathy felt for Bolshevism and the socialist revolution, when we survey the international situation from the point of view of the balance of forces, irrespective of whether these forces favour a just or an unjust cause, whether they favour the exploiting class or the working people -- we shall ignore this aspect and attempt an appraisal of the alignment of these forces on an international scale -- then we shall see that they are grouped in a manner that basically confirms our predictions and calculations: that capitalism is disintegrating and that since the war, which ended first with the Treaty of Brest-Litovsk and subsequently with the Treaty of Versailles -- and I don't

 
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know which is worse -- hatred and loathing for the war increase as time passes even in the countries which emerged as victors. And the farther we get from the war the clearer it becomes, not only to the working people, but to an extremely large extent also to the bourgeoisie of the victor countries, that capitalism is disintegrating, that the world economic crisis has created an intolerable situation from which there is no escape, despite all the victories. That is why, while being immeasurably weaker economically, politically and militarily than all the other powers, we are at the same time stronger, because we are aware of and correctly assess all that emerges and must emerge from this imperialist confusion, from this bloody tangle and from those contradictions (to take only the currency contradictions, I will not mention the others) in which they have become entangled and are becoming entangled still more deeply and from which they see no way out.

    Today we see how the representatives of the most moderate bourgeoisie, who are definitely and without doubt far removed from socialist ideas, to say nothing of "that awful Bolshevism", change their tune; this concerns even people like the famous writer Keynes, whose book has been translated into all languages, who took part in the Versailles negotiations, and who devoted himself heart and soul to helping the governments -- even he, subsequently, has had to change his tune, to give it up, although he continues to curse socialism. I repeat, he does not mention, nor does he wish even to think about Bolshevism -- but he tells the capitalist world: "What you are doing will lead you into a hopeless situation", and he even proposes something like the annulment of all debts.

    That is excellent, gentlemen! You should have followed our example long ago.

    Only a few days ago we read a short report in the newspapers to the effect that one of the most experienced, exceedingly skilful and astute leaders of a capitalist government, Lloyd George, is, it appears, beginning to propose a similar step; and that seemingly the U.S.A. wishes to reply by saying: "Sorry, but we want to be repaid in full." That being so, we say to ourselves that things are not going too well in these advanced and mighty states since they are discussing

 
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such a simple measure so many years after the war. This was one of the easiest things we did -- it was nothing to some of the other difficulties we overcame. (Applause.) When we see the growing confusion on this question we say that we are not afraid of their propaganda; although we by no means forget either the dangers surrounding us or our economic and military weakness compared to any one of these states, who, jointly, quite openly and frequently express their hatred for us. Whenever we express somewhat different views as to whether the existence of landowners and capitalists is justified they do not like it, and these views are declared to be criminal propaganda. I simply cannot understand this, for the same sort of propaganda is conducted legally in all states that do not share our economic views and opinions. Propaganda which calls Bolshevism monstrous, criminal, usurpatory -- this monster defies description -- this propaganda is conducted openly in all these countries. Recently I had a meeting with Christensen, who was a candidate for the U.S. Presidency on behalf of the farmers' and workers' party there. Do not be misled by this name, comrades. It does not in the least resemble the workers' and peasants' party in Russia: It is a purely bourgeois party, openly and resolutely hostile to any kind of socialism, and is recognised as being perfectly respectable by all bourgeois parties. This Danish-born American, who received almost a million votes at the presidential elections (and this, after all, is something in the United States), told me how in Denmark, when he tried to say among people "dressed like I am", and he was well dressed, like a bourgeois, that the Bolsheviks were not criminals, "they nearly killed me". They told him that the Bolsheviks were monsters, usurpers, and that they were surprised that anyone could mention such people in decent society. This is the type of propaganda atmosphere surrounding us.

    We see, nevertheless, that a certain equilibrium has been created. This is the objective political situation, quite independent of our victories, which proves that we have fathomed the depth of the contradictions connected with the imperialist war, and that we are gauging them more correctly than ever before and more correctly than other powers, who, despite all their victories, despite all their

 
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strength, have not yet found a way out, nor see any. That is the substance of the international situation which accounts for what we now see. We have before us a highly unstable equilibrium but one that is, nevertheless, certain, obvious, indisputable. I do not know whether this is for long, and I do not think that anyone can know. That is why, for our part, we must display the utmost caution. And the first precept of our policy, the first lesson that emerges from our governmental activities for the past year, the lesson which must be learned by all workers and peasants, is to be on the alert, to remember that we are surrounded by people, classes, governments who openly express the utmost hatred for us. We must remember that we are always a hair's breadth away from invasion. We shall do all in our power to prevent this misfortune. It is doubtful that any nation has experienced such a burden of the imperialist war as we have. Then we bore the burden of the Civil War forced on us by the ruling classes, who fought for the Russia of the emigres, the Russia of the landowners, the Russia of the capitalists. We know, we know only too well, the incredible misfortunes that war brings to the workers and peasants. For that reason our attitude to this question must be most cautious and circumspect. We are ready to make the greatest concessions and sacrifices in order to preserve the peace for which we have paid such a high price. We are ready to make huge concessions and sacrifices, but not any kind and not for ever. Let those, fortunately not numerous, representatives of the war parties and aggressive cliques of Finland, Poland and Rumania who make great play of this -- let them mark it well. (Applause.)

    Anyone who has any political sense or acumen will say that there has not been -- nor can there be -- a government in Russia other than the Soviet Government prepared to make such concessions and sacrifices in relation to nationalities within our state, and also to those which had joined the Russian Empire. There is not, and cannot be, another government which would recognise as clearly as we do and declare so distinctly to one and all that the attitude of old Russia (tsarist Russia, Russia of the war parties) to the nationalities populating Russia was criminal, that this attitude was impermissible, that it aroused the rightful and

 
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indignant protest and discontent of the oppressed nationalities. There is not, and cannot be, another government which would so openly admit this, which would conduct this anti-chauvinist propaganda, a propaganda that recognises the guilt of old Russia, tsarist Russia, Kerensky Russia -- a government which would conduct propaganda against the forcible incorporation of other nationalities into Russia. This is not mere words -- this is an obvious political fact, absolutely indisputable and plain for all to see. As long as no nationalities engage in intrigues against us which bind them to the imperialist oppression, as long as they do not help to crush us, we shall not be deterred by formalities. We shall not forget that we are revolutionaries. (Applause.) But there are facts incontrovertibly and indisputably showing that in Russia, that has defeated the Mensheviks and Socialist-Revolutionaries, the smallest, completely unarmed nationality, however weak it may be, may and must absolutely rest assured that we have nothing but peaceful intentions towards it, that our propaganda about the criminality of the old policy of the old governments is not weakening, and that we are as firm as ever in our desire at all costs, and at the price of enormous sacrifices and concessions, to maintain peace with all nationalities that belonged to the former Russian Empire, but who did not wish to remain with us. We have proved this. And we shall prove this no matter how great the curses rained on us from all sides. It seems to us that we have given excellent proof of it, and we declare to the meeting of representatives of the workers and peasants of Russia, to the many millions of workers and peasants, that we shall do our utmost to preserve peace in the future, that we shall not shrink from great sacrifices and concessions in order to safeguard this peace.

    There are, however, limits beyond which one cannot go. We shall not permit peace treaties to be flouted. We shall not permit attempts to interfere with our peaceful work. On no account shall we permit this, and we shall rise to a man to defend our existence. (Applause.)

    Comrades, what I have just said is perfectly clear and comprehensible to you, and you could not expect anything else from anyone reporting to you on our policy. You know that such, and no other, is our policy. But, unfortunately,

 
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there are now two worlds: the old world of capitalism that is in a state of confusion but which will never surrender voluntarily, and the rising new world, which is still very weak, but which will grow, for it is invincible. This old world has its old diplomacy, which cannot believe that it is possible to speak frankly and forthrightly. This old diplomacy thinks there must be a trap of some sort here. (Applause, laughter.) When this economically and militarily all-powerful old world sent us -- that was some time ago -- Bullitt, a representative of the United States Government, who came to us with the proposal that we should conclude peace with Kolchak and Denikin on terms that were most unfavourable to us -- we said that we held so dear the blood of the workers and peasants shed for so long in Russia that although the terms were extremely unfavourable we were prepared to accept them, because we were convinced that the forces of Kolchak and Denikin would disintegrate from within. We said this quite frankly, with the minimum of diplomatic subtlety, and so they concluded that we must be trying to dupe them. And Bullitt, who had held these friendly, round-table conversations with us, was met with reproach and compelled to resign as soon as he got home. I am surprised that he has not yet been thrown into gaol, in keeping with the imperialist custom, for secretly sympathising with the Bolsheviks. (Laughter, applause.) But the upshot was that we, who at that time had proposed peace to our disadvantage, obtained peace on much more favourable terms. That was something of a lesson. I know that we can no more learn the old diplomacy than we can remould ourselves; but the lessons in diplomacy that we have given since then and that have been learned by the other powers must have had some effect, they must have remained in the memory of some people. (Laughter.) Hence, our straightforward statement that our workers and peasants prized above all the blessings of peace, but that there were limits to the concessions they were prepared to make to preserve it, was taken to mean that they had not for a moment, not for a second, forgotten the hardships they had suffered in the imperialist war and the Civil War. This reminder, which I am sure this Congress, and the whole mass of workers and peasants, all Russia, will endorse and express --

 
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this reminder will surely have some effect and play a certain role, no matter how the powers take it, no matter what diplomatic ruse their old diplomatic habits make them suspect.

    This, comrades, is what I think must be said about our international situation. A certain unstable equilibrium has been reached. Materially -- economically and militarily -- we are extremely weak; but morally -- by which, of course, I mean not abstract morals, but the alignment of the real forces of all classes in all countries -- we are the strongest of all. This has been proved in practice; it has been proved not merely by words but by deeds; it has been proved once and, if history takes a certain turn, it will, perhaps, be proved many times again. That is why we say that having started on our work of peaceful development we shall exert every effort to continue it without interruption. At the same time, comrades, be vigilant, safeguard the defence potential of our country, strengthen our Red Army to the utmost, and remember that we have no right to permit an instant's slackening where our workers and peasants and their gains are concerned. (Applause.)

    Comrades, having thus briefly outlined the most essential features of our international position, I shall now deal with the manner in which economic relations are beginning to shape out in our country and in Western Europe, in the capitalist countries. The greatest difficulty here is that without definite relations between us and the capitalist countries we cannot have stable economic relations. Events very clearly show that neither can the capitalist countries have them. But today we are not in an altruistic mood. We are thinking more of how to continue in existence when other powers are hostile to us.

    But is the existence of a socialist republic in a capitalist environment at all conceivable? It seemed inconceivable from the political and military aspects. That it is possible both politically and militarily has now been proved; it is a fact. But what about trade? What about economic relations? Contacts, assistance, the exchange of services between backward, ruined agricultural Russia and the advanced, industrially-developed group of capitalist countries -- is all this possible? Did they not threaten

 
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to surround us with a barbed wire fence so as to prevent any economic relations with us whatever? "War did not scare them, so we shall reduce them by means of a blockade."

    Comrades, during the past four years we have heard so many threats, and such terrible ones, that none of them can frighten us any more. As for the blockade, experience has shown that it is an open question as to who suffers from it most, the blockaded or the blockaders. Experience has shown beyond doubt that during this first year, on which I am able to report as a period of a relatively elementary respite from direct brute force, we have not been recognised, we have been rejected, and relations with us have been declared non-existent (let them be recognised as non-existent by the bourgeois courts), but they nevertheless exist. I deem it my right to report to you that this is, without the slightest exaggeration, one of the main results achieved in 1921, the year under review.

    I do not know whether the report of the People's Commissariat of Foreign Affairs to the Ninth Congress of Soviets has been, or will be, distributed to you today. In my opinion, the defect in this report is that it is too bulky and is difficult to read right through. But, perhaps, this is my own failing, and I have no doubt that the overwhelming majority of you, as well as all those who are interested in politics, will read it, even if not immediately. Even if you do not read it all, but only glance through its pages, you will see that Russia has sprouted, if one may so express it, a number of fairly regular and permanent commercial relations, missions, treaties, etc. True, we are not yet recognised de jure. This is still important, because the danger of the unstable equilibrium being upset, the danger of new attempts at invasion has, as I have said, increased; the relations, however, are a fact.

    In 1921 -- the first year of trade with foreign countries -- we made considerable progress. This was partly due to the improvement in our transport system, perhaps the most important, or one of the most important sectors of our economy. It is due also to our imports and exports. Permit me to quote very brief figures. All our difficulties, our most incredible difficulties -- the burden of these diffi-

 
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culties, the most crucial feature of them -- lie in fuel and food, in the peasant economy, in the famine and calamities that have afflicted us. We know very well that all this is bound up with the transport problem. We must discuss this, and all comrades from the localities must know and repeat it over and over again to all their comrades there that we must strain every nerve to overcome the food and fuel crisis. It is from this that our transport system suffers, and transport is the material instrument of our relations with foreign countries.

    The organisational improvements in our transport system over the past year are beyond doubt. In 1921 we transported by river much more than in 1920. The average run per vessel in 1921 was 1,000 pood-versts as compared with 800 pood-versts in 1920. We have definitely made some progress in organisation. I must say that for the first time we are beginning to obtain assistance from abroad. We have ordered thousands of locomotives, and we have already received the first thirteen from Sweden and thirty-seven from Germany. It is a very small beginning, but a beginning, nevertheless. We have ordered hundreds of tank cars, about 500 of which arrived here in the course of 1921. We are paying a high, an exorbitant price for these things, but still, it shows that we are receiving the assistance of the large-scale industry of the advanced countries; it shows that the large-scale industry of the capitalist countries is helping us to restore our economy, although all these countries are governed by capitalists who hate us heart and soul. All of these capitalists are united by governments which continue to make statements in their press about how matters stand with the de jure recognition of Soviet Russia, and about whether or not the Bolshevik Government is a legitimate one. Lengthy research revealed that it is a legitimate government, but it cannot be recognised. I have no right to conceal the sad truth that we are not yet recognised, but I must tell you that commercial relations are nevertheless developing.

    All these capitalist countries are in a position to make us pay through the nose; we pay more for the goods than they are worth; but for all that, they are helping our economy. How did that happen? Why are they acting against

 
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their own inclinations and in contradiction to what they are constantly asserting in their press? And this press is more than a match for ours in respect of circulation, and the force and venom with which it attacks us. They call us criminals, and all the same they help us. And so it turns out they are bound up with us economically. It turns out as I have already said, that our calculations, made on a grand scale, are more correct than theirs. This is not because they lack people capable of making correct calculations -- they have far more than we have -- but because it is impossible to calculate properly when one is heading for destruction. That is why I would like to supplement my remarks with a few figures to show how our foreign trade is developing. I shall quote only very brief figures that are easy to remember. In three years -- 1918, 1919 and 1920 -- our total imports amounted to a little over 17,000,000 poods; in 1921 they amounted to 50,000,000 poods, that is to say, three times the total amount imported in the three preceding years. Our exports in the first three years totalled 2,500,000 poods; in 1921 alone, they amounted to 11,500,000 poods. These figures are infinitesimally, miserably, ridiculously small; any well-informed person will at once say that they are indicative of poverty. And that is what they do indicate. But for all that, it is a beginning. And we, who have experienced direct attempts to crush us, who for years have been hearing threats that everything will be done to prevent any relations with us as long as we remain what we are, nevertheless see that something has proved more potent than these threats. We see that their forecast of economic development was wrong and ours was right. We have made a start, and we must now exert all our efforts to continue this development without interruption. We must make it our primary concern, giving it all our attention.

    I shall give you another little illustration of the progress we made in 1921. In the first quarter of 1921 imports amounted to about 3,000,000 poods, in the second quarter to 8,000,000 poods, in the third quarter to 24,000,000 poods. So we are making progress. These figures are infinitesimally small, but they nevertheless show a gradual increase. We see how they grew in 1921, which was a year of unpre-

 
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cedented difficulties. You know what that calamity, the famine, cost us, what incredible difficulties it is still causing on the farms, in industry and in our life generally. But although our country has been devastated by war, has suffered tremendous hardship as a result of all the wars and of the rule of tsars and capitalists, we are now on the road that offers us a prospect of improvement, in spite of the unceasing hostility towards us. That is the main factor. That is why, when we read recently about the Washington Conference,[41] when we heard the news that the countries hostile to us would be obliged to convene a second conference next summer and to invite Germany and Russia to discuss the terms of a genuine peace, we said that our terms are clear and definite; we have formulated them, we have published them. How much hostility shall we encounter? We have no illusions about that; but we know that the economic position of those who blockaded us has proved to be vulnerable. There is a force more powerful than the wishes, the will and the decisions of any of the governments or classes that are hostile to us. That force is world general economic relations, which compel them to make contact with us. The farther they proceed in this direction the more extensive and rapid will be the development of what in today's report for 1921. I have been able to indicate to you only by some scanty figures.

    Now for our domestic economic situation; here, too, the important question that has priority is that of our economic policy. Our main task for 1921, the year under review, was to go over to the New Economic Policy, to take the first steps along this path, to learn how to make them, to adjust our legislation and administrative apparatus to it. The press has given you a lot of facts and information showing how this work has developed. You will not, of course, expect me to quote here additional facts or to give figures. It is only necessary to determine what the main thing was that united us most of all, that is more vital from the point of view of the most important and radical question of our entire revolution and of all future socialist revolutions (if viewed generally on a world scale).

 
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    The most basic, most vital question is that of the attitude of the working class to the peasants; this involves the alliance of the working class and the peasants; the ability of the advanced workers, who have passed through a lengthy, difficult but rewarding school of experience in a large factory, to do things in such a way that they attract to their side the mass of peasants, who were ground down by capitalism, by the landowners and by their old poverty-stricken, petty farms, to prove to them that only in alliance with the workers, no matter what the difficulties to be encountered on this path, and they are many, and we cannot close our eyes to this -- only through this alliance can the peasants abolish the age-old oppression by the landowners and capitalists. Only by consolidating the alliance of the workers and peasants can mankind be saved from events such as the recent imperialist slaughter, from the barbarous contradictions to be seen in the capitalist world today, where a small number, a miserable handful of the richest powers are choking with wealth, while the huge population of the globe suffers privations, being unable to benefit from the culture and rich resources that lie before them but cannot be made use of because of insufficient commerce.

    Unemployment is the chief calamity in the advanced countries. There is no way out of this situation other than through the firm alliance of the peasants with a working class that has passed through the difficult, but one reliable school of importance, the school of factory life, factory exploitation, factory solidarity -- there is no other way out. We have tested this alliance in the political and military fields during our Republic's most difficult years. In 1921, for the first time, we tested this alliance in the economic field. So far we have handled things very, very badly in this field, as we must frankly admit. We must recognise this shortcoming and not gloss over it; we must do everything possible to eliminate it and understand that the foundation of our New Economic Policy lies in this alliance. There are only two ways in which proper relations between the working class and the peasants can be established. If large-scale industry is flourishing, if it can immediately supply the small peasants with a sufficient amount of goods, or more than previously, and in this way establish

 
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proper relations between manufactured goods and the supply of surplus agricultural goods coming from the peasants, then the peasants will be fully satisfied, then the mass of peasants, the non-Party peasants, will acknowledge, by virtue of experience, that this new system is better than the capitalist system. We speak of a flourishing large-scale industry, which is able to supply all the goods the peasants are in urgent need of, and this possibility exists; if we consider the problem on a world scale, we see that a flourishing large-scale industry capable of supplying the world with all kinds of goods exists, only its owners do not know how to use it for anything but the manufacture of guns, shells and other armaments, employed with such success from 1914 to 1918. Then industry was geared to war and supplied mankind with its products so abundantly that no fewer than 10 million people were killed and no fewer than 20 million maimed. This is something we have all seen, and, besides, war in the twentieth century is not like previous wars.

    After this war, even among the victor countries, among those most hostile and alien to any kind of socialism, who ruthlessly oppose the slightest socialist idea, a large number of people have been heard to say quite definitely that even if there were no wicked Bolsheviks in the world, it is hardly likely that another war of this kind could be permitted. This is said by the representatives of the most wealthy countries. This is what this rich, advanced, large-scale industry was used for. It served to maim people, and it had no time to supply the peasants with its goods. All the same we have a right to say that such an industry exists on a world scale. There are countries whose large-scale industry is so advanced that it could instantly satisfy the needs of hundreds of millions of backward peasants. We make this the basis of our calculations. From your daily observations you know better than anyone else what has been left of our large-scale industry, which was weak anyway. In the Donets Basin, the main centre of our large-scale industry, for instance, the Civil War caused so much destruction, and so many imperialist governments established their rule there (how many of them did the Ukraine see!), that it was inevitable that next to nothing should

 
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remain of our large-scale industry. When, added to this, there is the misfortune of the 1921 crop failure, it becomes clear that the attempt to supply the peasants with goods from large-scale industry, which had been placed under state control, was unsuccessful. Once this attempt has failed, the only economic relation possible between the peasants and the workers, that is, between agriculture and industry, is exchange, trade. That is the crux of the matter. The substitution of the tax in kind for requisitioning -- that, very simply, is the substance of our economic policy. When there is no flourishing large-scale industry which can be organised in such a way as to supply the peasants with goods immediately, then the gradual development of a powerful alliance of the workers and peasants is possible only through trade and the gradual advance of agriculture and industry above their present level, under the guidance and control of the workers' state. Sheer necessity has driven us to this path. And this is the sole basis and substance of our New Economic Policy.

    At a time when the main attention and the main forces were diverted to political and military problems, we simply had to press forward with great speed along with the vanguard, knowing that it would have support. The alliance of the peasants and workers in the fight for great political changes, for our great achievements of the past three years, which put us at war with the dominant world powers, was made possible by a simple burst of political and military enthusiasm because every peasant realised, felt and sensed that he was confronted by his age-old enemy, the landowner, who in one way or another was being aided by representatives of other parties. That is why this alliance was so solid and invincible.

    In the economic field the basis of this alliance has to be different. A change in the substance and form of the alliance is essential. If anyone from the Communist Party, from the trade unions, or merely anyone sympathetic to Soviet power has overlooked the need to change the form and substance of this alliance, then so much the worse for him. Such oversights in a revolution are impermissible. The change in the form of the alliance has become necessary because the political and military alliance could not

 
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continue intact in the realm of economics, when we have as yet no large-scale industry, when what we had has been ruined by a war such as no other country has ever experienced. Even in countries infinitely more wealthy than ours, in countries that had gained, not lost from the war, the level of industry has not yet risen. A change in the form and substance of the alliance of the workers and peasants has become essential. We went much further forward in the political and military period than the purely economic aspect of the alliance of the workers and peasants permitted us to do. We had to do this in order to defeat the enemy, and we had the right to do this. We were successful because we defeated our enemies in the field that existed at that time, in the political and military field, but we suffered a series of defeats in the economic field. There is no need to be afraid to admit this; on the contrary, we shall only learn how to win when we do not fear to acknowledge our defeats and shortcomings, when we look truth, even the saddest truth, straight in the face. We have a right to be proud of our achievements in the first field, that is, in the political and military field. They have gone down in history as an epoch-making victory, whose overall influence is yet to be felt. But economically, in the year under review, we only started the New Economic Policy and we are taking a step forward in this regard. At the same time, we are only just beginning to learn and are making very many more mistakes, looking back, being carried away by our past experience -- splendid, lofty, magnificent, of world-wide significance, but which could not solve the economic problems now imposed on us in a country where large-scale industry has been devastated; in conditions which demand that we learn, in the first place, to establish the economic link now necessary and inevitable. That link is trade. This is a very unpleasant discovery for Communists. It is quite likely that this discovery is extremely unpleasant, in fact it is certain that it is unpleasant, but if we are swayed by ideas of pleasantness or unpleasantness we shall fall to the level of those would-be socialists of whom we saw plenty at the time of the Kerensky Provisional Government. It is hardly likely that "socialists" of this type still have any authority in our Republic. And our

 
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strength has always been our ability to take the actual balance of forces into consideration and not to be afraid of it no matter how unpleasant it might be for us.

    Since large-scale industry exists on a world scale, there can be no doubt that a direct transition to socialism is possible -- and nobody will deny this fact, just as nobody will deny that this large-scale industry either comes to a standstill and creates unemployment in the most flourishing and wealthy victor countries, or only manufactures shells for the extermination of people. And if, owing to the backwardness with which we came to the revolution, we have not reached the industrial development we need, are we going to give up, are we going to despair? No. We shall get on with the hard work because the path that we have taken is the right one. There is no doubt that the path of the alliance of the mass of the people is the sole path which will ensure that the workers and peasants work for themselves and not for the exploiters. In order to bring this about in our conditions we must have the only possible economic link, the link through the economy.

    That is why we have retreated, that is why we have had to retreat to state capitalism, retreat to concessions, retreat to trade. Without this, proper relations with the peasants cannot be restored in the conditions of devastation, in which we now find ourselves. Without this, we are threatened with the danger of the revolution's vanguard getting swiftly so far ahead that it would lose touch with the peasants. There would be no contact-between the vanguard and the peasants and that would mean the collapse of the revolution. Our approach to this must be particularly careful, first and foremost, because what we call our New Economic Policy follows from it. That is why we have unanimously declared that we shall carry out this policy in earnest and for a long time, but, of course, as has already been correctly noted, not for ever; it has been made necessary by our poverty and devastation and by the tremendous weakening of our large-scale industry.

    I shall permit myself to quote a few figures in order to prove that despite the difficulties and the many mistakes we have made (and we have made a great number) we are nevertheless moving ahead. Comrades, I have not got the

 
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overall figures on the development of internal trade; I only wish to deal with information on the turnover of the Central Council of Co-operative Societies for three months. For September the turnover of these co-operatives amounted to one million gold rubles, for October three million and for November six million. Again, if taken as absolute, the figures are miserable, small; this must be frankly recognised, because it will be more harmful to harbour any illusions on this score. They are paltry figures, but in these conditions of devastation they undoubtedly show that there is an advance, and that we can fasten on to this economic basis. No matter how numerous the mistakes we make -- the trade unions, the Communist Party and the administrative bodies -- we are becoming convinced that we can rid ourselves of them, and are gradually doing so, and that we are taking the path that is sure to lead to the restoration of relations between agriculture and industry. The growth of the productive forces can and must be achieved even on the level of petty-peasant economy and, for the time being, on the basis of small-scale industry, since it is so difficult to rehabilitate large-scale industry. We must make headway, and we are beginning to, but we need to remember that in this field a different rate and different conditions of work obtain, that here victory will be more difficult. Here we cannot achieve our aims as quickly as we were able to in the political and military fields. Here we cannot proceed by leaps and bounds, and the periods involved are different -- they are reckoned in decades. These are the periods in which we shall have to achieve successes in the economic war, in conditions of hostility instead of assistance from our neighbours.

    This path of ours is the right one, for it is the path which, sooner or later, all other countries must inevitably take. We have begun to follow this right path; we must assess even the smallest step, take into account our slightest mistakes, and then we shall reach our goal by following this path.

    I ought now, comrades, to say a few words about our main preoccupation, farming, but I believe that you are to hear a far more detailed and fuller report on this question than I could make, and also on the famine, to be made by Comrade Kalinin.

 
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    You are fully aware, comrades, of the incredible hardships of the 1921 famine. It was inevitable that the misfortunes of old Russia should have been carried over to our times, because the only way to avoid them is to restore the economy, but not on the old, paltry, petty basis. It must be rehabilitated on a new basis, the basis of large-scale industry and electrification. Only in that way shall we be rid of our poverty and of interminable famines. It can be seen at once that the periods by which we were able to measure our political and military victories do not apply here. Surrounded by hostile countries, we have, nevertheless, pierced the blockade: no matter how meagre the help, we did get something. In all, it amounts to 2,500,000 poods. That is all the help that we have received from abroad, that the foreign countries graciously presented to starving Russia. We were able to collect about 600,000 gold rubles in donations. It is a far too pitiful sum, and shows the mercenary attitude of the European bourgeoisie toward our famine. No doubt you have all read how, at the news of the famine, influential statesmen grandiloquently and solemnly declared that to take advantage of the famine in order to raise the question of old debts would be a devilish thing to do. I am not so sure that the devil is worse than modern imperialism. What I do know is that in actual fact, despite the famine, they did try to recover their old debts on particularly harsh conditions. We do not refuse to pay, and solemnly declare that we are prepared to discuss things in a business-like fashion. But you all understand, and there can be no doubt about this, that we shall never under any circumstances allow ourselves to be tied hand and foot in this matter without considering all its aspects, without taking into account reciprocal claims, without a business-like discussion.

    I have to inform you that during recent days we have had considerable success in the struggle against the famine. You have no doubt read in the newspapers that the U.S.A. has allocated 20 million dollars for the relief of the starving in Russia, probably on the same conditions as A.R.A. -- the American Relief Administration. Krasin sent us a telegram a few days ago saying that the U.S. Government

 
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is formally proposing to guarantee the dispatch to us over a period of three months of foodstuffs and seeds worth 20 million dollars, provided we, on our part, can agree to the expenditure of 10 million dollars (20 million gold rubles) for the same purpose. We immediately agreed to this and have telegraphed accordingly. And I think we may say that, during the first three months, we shall be able to supply the starving with seed and food worth 30 million dollars, that is, 60 million gold rubles. This is, of course, very little; it by no means covers the terrible losses we have suffered. You all understand this perfectly well. But at any rate this is aid which will undoubtedly help to relieve our desperate need and desperate famine. And since in autumn we were able to achieve certain successes in providing the starving areas with seed and in extending the sown areas in general, we now have hopes for far greater success in the spring.

    In the autumn, approximately 75 per cent of the usual area was sown to winter crops in the famine-stricken gubernias, 102 per cent in the gubernias partially hit by the crop failure, 123 per cent in the producing gubernias and 126 per cent in the consuming gubernias. This, at any rate, proves that no matter how fantastically difficult our conditions, we were still able to give the peasants some help in enlarging the area sown to crops and in fighting the famine. Under present conditions we have every right to expect, without any exaggeration or fear of error, that we shall be able to help the peasants substantially with seed for the spring-crop area. This aid, I repeat, is by no means adequate. Under no circumstances shall we have enough for all our needs. This must be stated quite frankly. All the more reason, therefore, to do everything possible to extend this aid.

    In this connection I must give you the final figures on our work to solve the food problem. Generally speaking, the tax in kind made things much easier for the peasants as a whole. This needs no proof. It is not simply a question of how much grain has been taken from the peasants, but that the peasant feels better provided for under the tax in kind, and has a greater interest in improving his farm. With increased productive forces the tax in kind has opened

 
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up wider horizons for an industrious peasant. On the whole, the results of the collection of the tax in kind for the year under review are such that we have to say that we must make every effort to avert failure.

    Here, in brief, are the general results that I can give you based on the latest returns supplied by the People's Commissariat of Food. We need at least 230 million poods. Of these, 12 million are needed for the famine-stricken, 37 million for seed, and 15 million for the reserve fund. We can obtain 109 million through the tax in kind, 15 million from the milling tax, 12,500,000 from the repayment of the seed loan, 13,500,000 from trade, 27 million from the Ukraine and 38 million poods from abroad -- 38 million, reckoning the 30 million from the source I have already mentioned to you, and in addition the eight million poods we plan to buy. This makes a total of 215 million poods. So we still have a deficit, with not a single pood in reserve, nor is it certain that we shall be able to buy more abroad. Our food plan has been calculated to the narrowest margin so that the least possible burden falls on the peasants who have been victims of the famine. In the central Soviet organisations we have for a long time been making every effort to have the plan for food deliveries fulfilled to the maximum. In 1920 we estimated that the state maintained 38 million people; now we have reduced this figure to eight million. Such is the reduction we have made in this respect. This can lead to only one conclusion: there must be 100 per cent collection of the tax in kind, i.e., it must at all costs be collected in full. For the peasants that have suffered so much, this represents a great burden and we do not forget this. I am perfectly well aware that the comrades in the localities, who have themselves experienced all the difficulties of solving the food campaign problem, know better than I do what it means to collect the tax in full at this moment. But, as a result of our work during 1921, I must say on behalf of the government that this task; comrades, has to be carried out; this difficulty will have to be faced, this problem will have to be overcome. Otherwise we cannot meet the most basic, most elementary requirements of our transport and industry, we cannot ensure the very minimum, absolutely essential budget, without

 
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which we cannot exist in our present condition of hostile encirclement and the highly unstable international balance of forces.

    Without the most tremendous efforts, there is and can be no way out of the situation in which we find ourselves after being tortured by the imperialist and civil wars and after being persecuted by the ruling classes of all countries. Therefore, not shunning the bitter truth, we must state quite definitely, and bring this home to the workers in the localities on behalf of the Congress: "Comrades, the entire existence of the Soviet Republic and our very modest plan for rehabilitating transport and industry are based on the assumption that we shall fulfil our general food procurement programme. It is vitally necessary, therefore, to collect the tax in full."

    Speaking of the plan I shall now deal with the present position of the state plan. I shall begin with fuel, which is the food of industry and the basis of all our industrial work. Probably you have already received today, or will do so in a few days, a report on the work of our Gosplan, the State Planning Commission. You will receive a report on the Congress of Electrical Engineers, which made a valuable and important contribution and an examination by Russia's best technical and scientific personnel of the plan providing the only scientific short-cut to the rehabilitation of our large-scale industry, a plan that will take at least ten to fifteen years to fulfil. I have already said, and I shall not tire of repeating, that the periods we have to reckon with in our practical work today are different from those that we saw in the political and military sphere. Very many leading workers of the Communist Party and trade unions have understood this, but it is vital that everyone should do so. Incidentally, in Comrade Krzhizhanovsky's pamphlet -- the report on the work of the State Planning Commission -- which will be distributed to you tomorrow, you will see how the engineers and farming experts together regard the question of the state plan in general. You will see that their approach is not our usual one of viewing things from a general political or economic point of view, but of regarding matters in the light of their joint experience as engineers and farming experts and, incidentally,

 
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showing the limit to our retreat. In the pamphlet you will find an answer to this question from the point of view of the engineers and farming experts; its contents are all the more valuable because you will find there how our general state planning organisation tackles the question of transport and industry as a result of its work during the year under review. Naturally, I cannot outline the contents of this report here.

    I should like to say a few words on the state of the fuel plan, as in this sphere we suffered the gravest setback at the beginning of 1921, the year under review. It was precisely here, basing ourselves on the improved situation at the end of 1920, that we made the serious miscalculation which led to the colossal crisis in transport in the spring of 1921, a crisis caused not only by a shortage of material resources, but by a miscalculation of the rate of development. The mistake of transferring the experience we had gained during the political and war periods to economic problems was already having its effect; it was an important, a fundamental mistake which, comrades, we still repeat at every step. Many mistakes are being made right now, and it must be said that if we do not realise this and rectify them at all costs, there can be no stable economic improvement. After the lesson we have had we have worked out the fuel plan for the second half of 1921 with far greater care, regarding as impermissible the slightest exaggeration, and doing all we can to prevent it. The figures given me by Comrade Smilga, who is in charge of all our fuel collection institutions, for the end of December, although still incomplete, show that there is a deficit, which is now insignificant and indicates an improvement in the internal structure of our fuel budget, or its mineralisation, as the technical experts put it, that is, considerable success in supplying Russia with mineral fuel; after all, a firm foundation for large-scale industry capable of serving as the basis for socialist society can only be built on mineral fuel.

    This is how our fuel plan was calculated at the beginning of the second half of 1921. We hoped to obtain 297 million poods of fuel in firewood, i.e., 2,700,000 cubic sazhens converted into 7,000-calory conventional fuel in the way we usually do and in the way it is done on p. 40 of Krzhi-

 
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zhanovsky's pamphlet, which will be distributed to you. Our figures show that to date we have received nearly 234 million poods. This is an enormous deficiency to which I must draw your attention. During the year under review we have paid very careful attention to the work of our fuel institutions in the matter of firewood. This is the work, however, that is mainly connected with the state of the peasant farms. It is the peasant and his horse that have to bear the burden. The fuel and fodder shortage, etc., greatly affect their work. Hence the shortage. That is why now, when we stand on the threshold of the winter fuel campaign, I must say once again -- comrades, you must take to the localities the slogan that the greatest concentration of effort is needed in this work. Our fuel budget has been based on the absolute minimum required to raise the level of industrial production, but it is vitally necessary that this absolute minimum be achieved, no matter how difficult the conditions.

    Further. We estimated that we would receive 143 million poods of coal; we received 184 million poods. That is progress, progress in increasing the amount of mineral fuel, progress made by the Donets coalfield and other enterprises, where many comrades have worked selflessly and achieved practical results in improving large-scale industry. I shall give you a couple of figures concerning the Donets Basin, because it is the basis, the main centre of all our industry. Oil -- we reckoned on receiving 80 million poods, which if converted into conventional fuel would be 120 million poods. Peat -- we calculated at 40 million (19 million poods of conventional fuel) and we received 50 million. So we had reckoned on obtaining a total of 579 million poods, but apparently we shall not succeed in getting more than 562 million poods. In general, there is a fuel shortage. True, it is not very great, possibly 3-4 per cent short of requirements, but nevertheless it is a shortage. In any case, it has to be admitted that all this constitutes a direct threat to large-scale industry, because some part of the minimum requirements will not be met. I think I have proved to you by this example, firstly, that our planning bodies have not wasted their time, that the moment is approaching when we shall be fulfilling our plans, and, at the same

 
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time, that we are beginning to make just a little progress, and that the hardships and difficulties of our economic situation are still extremely great. Therefore, the main slogan, the main battle-cry, the main appeal with which this Congress must proceed in its work and with which it must conclude its work, which the delegates must carry to the localities is this: an all-out effort is still needed, no matter how difficult it may be, both in the industrial and in the agricultural field. An all-out effort is the only hope for the Republic, the only way in which the rule of the workers and peasants can be maintained, preserved and stabilised. That we have achieved notable successes has been shown particularly in the Donets Basin, where comrades such as Pyatakov in large-scale industry and Rukhimovich in small-scale industry have worked with great devotion and great success, with the result that for the first time the small-scale industry is in a position to produce something. In large-scale industry, output per coal-hewer reached the pre-war level, which had not been the case earlier. The total output of the Donets Basin for 1920 was 272 million poods, and in 1921 it is estimated at 350 million poods. This is a very, very small figure compared to the maximum pre-war figure -- 1,700 million. But still it is something. It proves that there is an important advance. It is, after all, a step forward in the rehabilitation of large-scale industry, and we cannot afford to grudge any sacrifice to this end.

    Now a few words about the iron and steel industry. Here our situation is particularly difficult. We are producing possibly something like six per cent of the pre-war figure. That is the extent of the ruin and poverty to which the imperialist and civil wars have reduced Russia. But we are, of course, making headway. We are building centres like Yugostal,[42]where Comrade Mezhlauk is working with the utmost devotion. Difficult as our position is, we nevertheless can see tremendous successes in this sphere. In the first half of 1921, 70,000 poods of iron were smelted monthly; in October, 130,000; in November, 270,000 or almost four times as much. We can see that there are no grounds for panic. We by no means close our eyes to the fact that the figures I have given represent a miserable, paltry level, but all the same they prove that no matter

 
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how exceptionally grave things were in 1921, no matter what extraordinary burdens have fallen to the lot of the working class and peasants, we are, nonetheless, progressing, we are on the right path, and by straining every nerve we can hope that there will be even greater improvement.

    I should also like to give some figures on our progress in electrification. Unfortunately, so far, we have not been very successful. I counted on being able to congratulate the Ninth Congress on the opening of the second big electric power station built by the Soviet government; the first was Shatura, and the second the Kashira Station, which we had hoped to open in December.[43] It would have generated, and can generate, 6,000 kw at first, which, with the 18,000 kw we have in Moscow, would have been substantial help. But a number of obstacles prevented us from opening the station in December 1921; it will be opened very soon, in a few weeks at the latest. You have probably seen the report published in Ekonomicheskaya Zhizn a few days ago and signed by engineer Levi, one of the leading participants at the Eighth All-Russia Congress of Electrical Engineers and, in general, one of our most important workers. I shall give you a few figures from this report. Taking 1918 and 1919 together, 51 stations with a 3,500 kw capacity were commissioned. If we take 1920 and 1921 together, 221 stations with a 12,000 kw capacity were commissioned. Of course, when these figures are compared with Western Europe they seem extremely small and paltry. But they show that progress can be made even in face of difficulties such as no country has ever experienced. The building of small power stations throughout the countryside played an important role. It must be frankly admitted that they were very often too far apart, although there was some good in that, too. Thanks to these small stations new centres of modern large-scale industry were set up in the countryside. Although they may be of trilling significance, they show the peasants that Russia will not remain a country of manual labour, or of the primitive wooden plough, but will go forward to different times. And the peasant masses-are gradually coming to understand that we must and can put Russia on a different footing. The periods involved, as I have already pointed out, are measured in decades, but the work has already

 
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commenced, and the realisation of this is spreading among the mass of the peasants, partly because the small stations grow faster than the larger ones. But if in 1921 there was a delay in the opening of one large electric power station, at the beginning of 1922 there will be two stations -- at Kashira near Moscow, and at Utkina Zavod near Petrograd.[44] In this respect, at any rate, we have taken the path that ensures progress, provided we approach the fulfilment of our tasks with unrelaxed zeal.

    A few words about yet another achievement -- our success in peat production. Our peat output reached 93 million poods in 1920 and 139 million poods in 1921; this is, possibly, the only sphere in which we have far surpassed the pre-war level. Our peat resources are inexhaustible, greater than those of any other country. But there have always been gigantic difficulties, and to some extent they still remain, in the sense that this work, which is arduous in general, was especially arduous in Russia. The hydraulic method of peat-cutting, recommended by Comrades Radchenko, Menshikov and Morozov of the Central Peat Board, has made the work easier. There have been great achievements in this field. In 1921, we had in operation only two peat pumps, machines for the hydraulic extraction of peat, which relieve the workers of the back-breaking toil still involved in peat-cutting. Twenty of these machines have been ordered from Germany and will be received in 1922. Co-operation with an advanced European country has begun. We cannot ignore the possibilities for the development of peat cutting which now open out before us. There are more bogs and peat deposits in Russia than anywhere else, and it is now possible to transform the back-breaking labour, which only a few workers were prepared to undertake, into more normal work. Practical co-operation with a modern, advanced state -- Germany -- has been achieved because her factories are already working on machines designed to lighten this labour, machines which will most certainly start to operate in 1922. We must take this fact into account. We can do a great deal in this sphere if we all understand and all spread the idea that, given intensified efforts and mechanised labour, we in Russia have a better opportunity to emerge from the economic crisis than any other country.

 
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    I want to emphasise another aspect of our economic policy. In assessing our New Economic Policy it is not enough to pay attention to what may be of particular importance. Of course, the essence of this-policy is the alliance of the proletariat and the peasantry, the union of the vanguard of the proletariat with the broad mass of the peasants. Thanks to the New Economic Policy, the development of the productive forces -- at all costs, and without delay -- has begun. There is another aspect of the New Economic Policy, that of the possibility of learning. The New Economic Policy is a form that will enable us to begin learning how to manage our economy in real earnest; up to now we have been doing this very badly. Of course, it is difficult for a Communist leader, for a trade union leader of the working people to realise that at the moment trade is the touchstone of our economic life, the only possible basis for the alliance of the vanguard of the proletariat with the peasants, the only possible link which will permit us to begin economic development all along the line. If we take any merchant trading under state and legal control (our court is a proletarian one, and it can watch each private businessman in order to see that the laws are not interpreted for them as in bourgeois states; recently there was an example of this in Moscow,[45] and you all know that we shall multiply these examples, severely punishing any attempts by these private businessmen to contravene our laws), we shall see that all the same, this merchant, this private businessman, eager for his 100 per cent profit, will do business -- for example, he will acquire raw material for industry in a way that most Communists or trade union workers would never be able to do. That is the significance of the New Economic Policy. Here is something you can learn. It is a very serious lesson, and we must all learn it. It is an extremely harsh one, not like listening to lectures or passing examinations. We are up against a difficult problem, a stern economic struggle, in circumstances of poverty, in circumstances of unparalleled difficulty, a bread shortage, famine and cold; this is the real school and we must graduate from it. Every attempt to brush this task aside, every attempt to turn a blind eye to it, to disregard it, would be the most criminal and most dangerous

 
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arrogance on the part of Communists and trade unionists. All of us, comrades, who are governing Soviet Russia, are apt to commit this sin, and we must admit it quite frankly in order to rid ourselves of this shortcoming.

    We are undertaking economic development on the basis of yesterday's experience, and it is here that we make our main mistake. I shall quote a French proverb which says that people's faults are usually connected with their merits. A man's faults are, as it were, a continuation of his merits. But if the merits persist longer than they are needed, are displayed when and where they are no longer needed, they become faults. Very likely, almost all of you have observed this in private and public life, and we now note it in the development of our revolution, of our Party and of our trade unions, which are the mainstay of our Party; in the entire government machinery ruling Soviet Russia, we see this fault, which, as it were, is the continuation of our merits. Our great merit was that in the political and military fields we took a step of historic importance, that has gone down in world history as a change of epochs. What we have done cannot be taken from us, no matter what sufferings lie ahead. It was due to the proletarian revolution and to the fact that the Soviet system replaced the old system that we emerged from the imperialist war and got out of our misfortunes. This cannot be taken away from us -- this is the undoubted, unalterable, inalienable merit, which no efforts or onslaughts of our enemies can take away from us, but which if it persists where it is no longer needed becomes a most dangerous fault.

    A burst of enthusiasm on the part of the workers and peasants at their present level of class-consciousness was sufficient to solve political and military problems. They all understood that the imperialist war was crushing them -- to understand this there was no need of a higher level of consciousness, of a new level of organisation. The enthusiasm, drive and heroism, which still remain and which will remain for ever as a monument to what a revolution can do and has done, helped to solve these problems. That is how we achieved our political and military successes, and this merit now becomes our most dangerous fault. We look back and we think that economic problems can be solved in

 
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the same manner. That, however, is the mistake; when the situation has changed and different problems have to be solved, we cannot look back and attempt to solve them by yesterday's methods. Don't try -- you won't succeed! We must realise that this is a mistaken attitude. There are Communist Party and trade union workers who very often turn their backs on and wave aside the humble, many years' difficult work in economic management, which demands forbearance, bitter experiences, long effort, punctuality and perseverance, whether as government workers, or as yesterday's fighters; they excuse themselves with recollections of the great things they did yesterday. These people remind me of the fable of the geese[46] who boasted that they had "saved Rome", but to whom the peasant replied using a long switch, "Leave your ancestors in peace, and what good have you done, geese?" No one will deny that in 1917-18-19-20 we solved our political and military problems with the heroism and success that opened a new epoch in world history. That belongs to us, and there is no one, either in the Party or in the trade unions, who is attempting to take this away from us -- but an entirely different task now faces government and trade union workers.

    At the present moment you are surrounded by capitalist powers who will not help you, but will hamper you; at the present moment you work in conditions of poverty, ruin, famine and calamity. You must either learn to work at a different rate, calculating the work to be done in decades and not months, relying on the worn-out mass of the people who cannot keep pace with the revolutionary-heroic momentum in their daily work; either you learn to do this, or you will deserve to be called geese. When a trade union or a political worker makes the general statement that the trade unions, the Communist Party run things -- that is good. In the political and military sphere we did this splendidly, but in the economic field we do it very badly. We have to admit this and do better. "Stop wagging your tongue" is what I will say to any trade union worker who puts the general question of whether the trade unions should take part in production. (Applause.) It would be better to give me a practical reply to the question and tell me (if you hold a responsible position, are a man in authority,

 
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that you will never come to love this institution. No wonder! It was able to repulse your intrigues and plots better than anyone else, at a time when you throttled us, invaded us from all sides, when you organised internal plots and committed every possible crime in order to frustrate our peaceful work. Our only response is through an institution aware of the plotters' every move and able to retaliate immediately instead of engaging in persuasion. As long as there are exploiters in the world, who have no desire to hand over their landowner and capitalist rights to the workers on a platter, the power of the working people cannot survive without such an institution. We are keenly aware of this, but we also know that a man's merits may become his faults, and we know that prevailing conditions insistently demand that the work of this organisation be limited to the purely political sphere, that it concentrate its efforts on tasks in which it is aided by the situation and the circumstances. If the attempts of the counter-revolution resemble their previous attempts -- and we have no proof that the mentality of our adversaries has altered in this respect, we have no grounds for believing this -- we shall be able to reply in such a way that will make it clear that we are in earnest. The Soviet government grants admission to foreign representatives, who come here under the pretext of giving aid, but these same representatives turn round and help overthrow Soviet rule; there have been cases of this. Our government will not find itself in this position, because we shall value and make use of an institution like the Cheka. This we can guarantee to one and all. But, at the same time, we say categorically that it is essential to reform the Cheka, define its functions and powers, and limit its work to political problems. The task now confronting us is to develop trade, which is required by the New Economic Policy, and this demands greater revolutionary legality. Naturally, if we had made this the all-important task when we were attacked and Soviet power was taken by the throat, we would have been pedants; we would have been playing at revolution, but would not be making the revolution. The closer we approach conditions of unshakable and lasting power and the more trade develops, the more imperative it is to put forward the firm slogan of greater revolutionary legality,

 
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and the narrower becomes the sphere of activity of the institution which matches the plotters blow for blow. This conclusion results from the experience, observation and reflection of the government for the past year.

    I must say in conclusion, comrades, that we have placed on a correct footing the problem we have been handling this year and which up to now we have handled so badly -- that of forming a sound economic alliance of the workers and peasants, even under conditions of extreme poverty and devastation; we have taken the correct line, and there can be no doubt about this. And this is not merely a task for Russia alone, it is a world task. (Stormy, prolonged applause.)

    This task which we are working on now, for the time being on our own, seems to be a purely Russian one, but in reality it is a task which all socialists will face. Capitalism is dying; in its death throes it can still condemn tens and hundreds of millions of people to unparalleled torment, but there is no power that can prevent its collapse. The new society, which will be based on the alliance of the workers and peasants, is inevitable. Sooner or later it will come -- twenty years earlier or twenty years later -- and when we work on the implementation of our New Economic Policy, we are helping to work out for this society the forms of alliance between the workers and peasants. We shall get this done and we shall create an alliance of the workers and peasants that is so sound that no power on earth will break it. (Stormy, prolonged applause.)


 


Pravda No. 292, December 25, 1921

Published according to the verbatim report


 


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2

INSTRUCTIONS BY THE NINTH ALL-RUSSIA CONGRESS
OF SOVIETS ON QUESTIONS OF ECONOMIC ACTIVITIES
DECEMBER 28

 
    The Ninth All-Russia Congress of Soviets, having examined the reports of the People's Commissariats on their economic activities during the year under review, supplements and summarises the decisions of the Congress of Soviets on individual economic questions with the following guiding points, which must be strictly adhered to by all Soviet bodies at the centre and in the localities.

    1. The Congress of Soviets orders that the main and immediate task of all the economic bodies must be to effect, speedily and at all costs, stable practical improvements in supplying the peasantry with large quantities of the goods that are needed to raise the level of agriculture and improve the living conditions of the working peasantry.

    2. This being the main object, it must be kept in mind by all industrial administrative bodies, allowing of course no relaxation in the supply of the Red Army with everything it needs, a task which must remain primary in order to maintain the Soviet Republic's defence potential.

    3. The improvement of the conditions of the workers should also depend on the achievement of this object, which means that it is the duty of all workers' organisations (primarily the trade unions) to see to it that industry is so organised as to be able speedily and fully to satisfy the requirements of the peasantry; wage increases and improvement in the conditions of industrial workers should be directly determined by the degree to which success is achieved in this field.

 
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    4. This object must also be pursued by the People's Commissariat of Finance; and the Ninth Congress of Soviets instructs it to make every effort to secure the speediest reduction of the issue of paper money, eventually put a stop to it and establish a sound currency backed by gold. The substitution of taxes for the issue of paper money must be pursued undeviatingly without any red tape.

    5. The same object must be given priority by all bodies and organisations engaged in home and foreign trade, i.e., the Central Council of Co-operative Societies, the People's Commissariat of Foreign Trade, etc. The Congress of Soviets will judge -- and instructs the leading bodies of the Soviet government to judge -- the success of these organisations only by the rapid and practical results they achieve in developing exchange between agriculture and industry. In particular, the Congress instructs the various organisations to use private enterprises more widely for supplying raw materials, transporting these materials and for promoting trade in every way, while the function of state bodies is to control and direct this exchange, and sternly punish all deadening red tape and bureaucracy.

    6. The Ninth Congress of Soviets calls upon all organisations and departments engaged in economic activities to devote infinitely more attention and energy than hitherto to the task of enlisting the services of all capable non-Party workers and peasants in this field of state activity.

    The Congress declares that in this respect we are a long way behind requirements, that not enough method and perseverance are being displayed in this matter, that it is absolutely and urgently necessary to recruit business and government officials from a wider circle than hitherto; and, in particular, that every success achieved in rebuilding industry and agriculture should be more regularly encouraged by awards of the Order of the Red Banner of Labour, as well as by cash bonuses.

    The Congress of Soviets draws the attention of all economic bodies and all mass organisations of a non-governmental, class character to the fact that it is absolutely essential still more perseveringly to enlist the services of specialists in economic organisation, to employ scientists and technicians, and men who by their practical activities have acquired

 
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experience and knowledge of trade, of organising large enterprises, of supervising business transactions, etc. The improvement of the material position of specialists and the training under their direction of a large number of workers and peasants must receive unflagging attention from the central and local government bodies of the R.S.F.S.R.

    7.  The Ninth Congress of Soviets calls upon the People's Commissariat of Justice to display far more energy than hitherto in two matters:

    first, that the People's Courts of the Republic should keep close watch over the activities of private traders and manufacturers, and, while prohibiting the slightest restriction of their activities, should sternly punish the slightest attempt on their part to evade rigid compliance with the laws of the Republic. The People's Courts should encourage the masses of workers and peasants to take an independent, speedy and practical part in ensuring enforcement of the laws;

    second, that the People's Courts should take more vigorous action against bureaucracy, red tape and mismanagement. Trials of such cases should be held not only for the purpose of increasing responsibility for the evil which it is so difficult to combat under present circumstances, but also for the purpose of focussing the attention of the masses of workers and peasants on this extremely important matter, and of securing a practical object, viz., greater success in the economic field.

    The Ninth Congress is of the opinion that the task of the People's Commissariat of Education in this new period is to train, in the shortest possible period, specialists in all fields from among the peasants and workers; and it orders that school and extra-mural education should be more closely connected with the current economic tasks of the Republic as a whole, as well as of the given region and locality. In particular, the Ninth Congress of Soviets declares that far from enough has been done to fulfil the decision of the Eighth Congress of Soviets on the popularisation of the plan for the electrification of Russia, and requires that every electric power station mobilise all competent forces and arrange regular talks, lectures and practical studies to acquaint the workers and peasants with the importance of electricity

 
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and with the plan for electrification. In those uyezds where no power stations yet exist, at least small power stations should be built as speedily as possible and used as local centres for propaganda, education and the encouragement of every initiative in this field.


 


Written on December 25-27, 1921   Published in Izvestia No. 295, December 30, 1921

Published according to the manuscript


 


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page 513




NOTES



  [40] The Ninth All-Russia Congress of Soviets sat in Moscow on December 23-28, 1921. It was attended by 1,993 delegates, of whom 1,631 had a casting vote and 362 a consultative voice.
    This Congress summed up the first results of activities under the New Economic Policy, fully approving the home and foreign policy of the workers' and peasants' government. In its "Declaration on the International Position of the R.S.F.S.R.", the Congress made the proposal to the governments of neighbouring and all other states to found their foreign policy on the principle of peaceful coexistence, on "peaceful and friendly coexistence with the Soviet republics".
    The Congress devoted its main attention to finding ways of rapidly restoring agriculture as a key condition for the development of the country's entire economy. It also gave much of its attention to famine relief, calling upon workers and peasants to bend every effort to help the people, particularly children, stricken by famine along the Volga. The Congress expressed its "warm appreciation to the workers of all countries who came to the assistance of the famine-stricken gubernias of Soviet Russia".
    The Congress decisions stated that the restoration and development of large-scale industry "is, in addition to the restoration of agriculture, the cardinal task of the Republic".
    Lenin was very active in preparing for the Congress and directed its work.

 
page 514

    He wrote the "Instructions on Questions of Economic Management", which were adopted by the Congress, and also a number of documents on which the Congress decisions were based.
    The Congress elected a new All-Russia Central Executive Committee consisting of 386 members and 127 alternate members.    [p. 141]

  ^[41] This Conference on restricting naval armaments and on Pacific and Far Eastern problems was convened on the initiative of the U.S.A. It sat in Washington from November 12, 1921 to February 6, 1922 and was attended by representatives of the U.S.A. Britain, Japan, France, Italy, China, Belgium, Portugal and the Netherlands. Soviet Russia was not invited, nor was the Far Eastern Republic, which was in existence at the time. Without the Soviet Republic's participation, the Conference examined a number of problems concerning Soviet Russia. In this connection, the People's Commissariat of Foreign Affairs lodged two protests -- on July 19 and November 2, 1921 -- with the governments concerned, stating it would not recognise decisions taken by the Conference without the participation of one of the principal interested parties. On December 8, 1921, the People's Commissariat of Foreign Affairs protested against the discussion at the Washington Conference of the problem of the Chinese-Easter Railway, which solely concerned Russia and China.
    The decisions of the Conference were a supplement to the Versailles Treaty; under pressure brought to bear by the U.S.A. and Britain, Japan was compelled to relinquish some of the positions she had captured in China, but at the same time she consolidated her rule in South Manchuria.    [p. 155]

  ^[42] Yugostal -- a mining metallurgical trust founded in September 1921. It embraced some large iron and steel plants in the Ukraine, the Northern Caucasus and the Crimea and played an important part in rehabilitating the country's iron and steel industry. It existed until 1919.    [p. 168]

  ^[43] The first section (capacity -- 5,000 kw) of the State Shatura District Power Station, a project started in 1918, was commissioned on July 25, 1920. The station was completed in 1925 and was named after Lenin.

    The building of the Kashira Power Station was started in February 1919, and it was expected that it would be completed by the end of 1921, when the Ninth All-Russia Congress of Soviets was due to open. Lenin attached great importance to this station as a power source for some of the largest factories and mills in Moscow and as the first project under the electrification plan. He kept a close watch on the course of the project, directly participating in the solution of many of its problems and checking how it was being supplied with the necessary materials, manpower, fuel and equipment.

 
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    The first section (12,000 kw) of this power station became operational on June 4, 1922.    [p. 169]

  ^[44] The Krasny Oktyabr (formerly Utkina Zavod) Power Station was completed in 1922, its first section (10,000 kw) becoming operational on October 8, 1922.    [p. 170]

  ^[45] This is a reference to the trial of 35 private businessmen -- owners of tea-and-dining rooms, bakeries, shoemaking establishments, etc. -- in Moscow on December 15-18, 1921. They were charged with violating the Labour Code, namely, exploiting the labour of children, juveniles and women, lengthening the working day, and so on. Workers of large enterprises, both members and non-members of the Party, acted as prosecutors. The court sentenced ten of the accused to large fines or to forced labour without imprisonment.    [p. 171]

  ^[46] Lenin has in mind the fable Geese by the well-known Russian writer Ivan Krylov.    [p. 173]