From New Times (Moscow), No. 18, April 29, 1953
The deliverance of the peoples of Central and Southeast Europe from fascist slavery and capitalist oppression led to the establishment of a new and advanced social and political system in these countries. The problem then faced the working class of the People’s Democracies, in all its magnitude, of promoting the all-round development of their productive forces, without which the building of socialism is impossible. The chief task is to lay the production and technical base for socialism through industrialization. This involves putting an end to the technical and economic backwardness inherited from the bourgeois system, creating a modern industry, mechanizing agriculture and transport, and reconstructing the entire national economy on a new technical basis. Only through the continuous expansion and perfection of production on the basis of higher techniques is it possible to ensure the maximum satisfaction of the constantly rising material and cultural requirements of the whole of society.
Having reformed agrarian relations, nationalized industry, the banks and transport and repaired the ravages caused to the national economy by war and fascist occupation, the working class of the People’s Democracies, led by the Communist and Workers’ Parties, commenced the socialist industrialization, the reconstruction and development of industry where it existed, and the creation of industry where it did not exist.
The Socialist Method of Industrialization. Specific Features of Industrial Development in the People's Democracies
The work of building a production and technical base for socialism in the European People’s Democracies is making successful headway. The theory of socialist industrialization developed by Lenin and Stalin is their theoretical and practical guide. As in the Soviet Union, the first step towards industrialization was the socialization of the instruments and means of production, which makes it possible to plan economic development in accordance with the law of balanced (proportionate) development of the national economy. As in the Soviet Union, priority in the People’s Democracies is given to the development of industry, principally heavy industry, which produces the means of production.
The conditions for economic development in the People’s Democracies are most favourable, because they are able to draw upon the Soviet Union’s vast experience in the building of socialism, and because of the fraternal practical assistance the Soviet Union is rendering them.
Industrialization in these countries is proceeding at a very high speed, with annual output increases amounting to several tens of per cent, in contrast to the capitalist countries, where increase of production is not continuous, is marked by alternating booms and crises and amounts to only a few per cent in the very best years.
The long-term plans of economic development provide for an average annual increase of industrial output of over 26 per cent in Poland, nearly 20 per cent in Czechoslovakia, 42 per cent in Hungary, 29 per cent in Rumania, 24 per cent in Bulgaria, and 49 per cent in Albania.
Like the Soviet Union, the People’s Democracies are building chiefly big industrial plants, often of the combined type, equipped with up-to-date machinery ensuring high productivity of labour and low cost of production. Technical progress in the People’s Democracies is swift, there being nothing to hinder it because of the prevalence of the socialist ownership of the means of production. Technical progress and production are not retarded here by obsolete equipment, as is the case under capitalism. The People’s Democracies stand for continuous and unlimited technical development, because only higher techniques can ensure the continuous expansion and perfection of production needed for satisfying the rising material and cultural requirements of society.
The territorial distribution of industry in the People’s Democracies is determined by the principles of socialism. Plants are located rationally, where the sources of raw material are in close proximity and where the least expenditure of labour is involved in converting the raw material into the finished product. In deciding on the location of industries, consideration is also given to the national problem, to the task of promoting the economic and cultural advancement of backward national-minority areas. A graphic illustration of this is the industrialization of Slovakia which until very recently was the underdeveloped agrarian part of Czechoslovakia.
In developing their industries, the People’s Democracies rely chiefly on their internal resources as well as on the fraternal aid of the Soviet Union and the mutual assistance they render one another.
They are creating an industrial base far superior technically to that of the capitalist countries, and at a speed unparalleled under capitalism. The fact that technical development in the principal capitalist countries today is in advance of that of the majority of the People’s Democracies is no deterrent to this. When its first five-year plan was launched, the Soviet Union’s technical development likewise lagged behind that of the leading capitalist countries. But only thirteen years later, on the eve of the Great Patriotic War, nearly all the old machinery had already been replaced by the most efficient machinery in the world. By that time the Soviet Union had already outstripped the foremost capitalist countries in technical development and rate of increase of production. This will most certainly happen in the very near future in the case of the European People’s Democracies too. Not only are they building new and perfected industrial plants; the old plants are being reconstructed and re-equipped in a way that ranks them technically with the newly-built plants. Old machinery is being replaced everywhere, so that in time producing facilities will have been rejuvenated in all branches of the national economy. In the capitalist countries, on the other hand, only individual plants are built or reconstructed, which cannot result in any substantial technical improvement of the bigger branches of industry, to say nothing of the national economy as a whole.
The industrial base being created in the People’s Democracies has features in common with that of the Soviet Union. This is due to the operation of the basic economic law of socialism, to the common class character of their social and political system, and to the similarity in methods of socialist industrialization.
At the same time, the process of industrialization in each of the People’s Democracies has its own specific features, due to the historical conditions of the country’s development and the new international conditions of today, arising from the fundamental change that has taken place since the second world war in the relative strength of socialism and capitalism in favour of the former.
The features marking this new international situation are: firstly, that the Soviet Union – the first socialist power – has become a mighty international force possessing the most advanced technical equipment, which is being widely drawn upon for the industrialization of the People’s Democracies; secondly, that there is now a single and powerful socialist camp confronting the camp of capitalism; thirdly, that the countries constituting the socialist camp, the Soviet Union and the People’s Democracies, have joined together economically and have established economic cooperation and mutual assistance based upon a sincere desire to help one another and to promote the economic progress of all. A new world market has arisen, the market of the democratic countries. Their relations are of a new type, which not only permit, but make it necessary for each of them to regard the development of the others as a component part of the common interests.
When the Soviet Union began its industrialization, its level of technical development was extremely low, while the hostile capitalist countries surrounding it, on the other hand, were the foremost in technical development. The People’s Democracies have begun their industrialization at a time when the technical development of the Soviet Union is the most advanced and is superior to that of any capitalist country, and when they are able to benefit from its achievements and experience, which it unselfishly places at their disposal. Industrialization in the Soviet Union was carried out at a time when the country was isolated internationally. The People’s Democracies, on the other hand, are tackling this problem with the economic cooperation and mutual assistance of the countries of the socialist camp, numbering eleven in all.
Thanks to the Soviet Union, with its powerful industrial technique, and also to the fact that Czechoslovakia and the German Democratic Republic are industrially developed, the People’s Democracies are in a position to create an industrial base for the reconstruction of their national economies much more effectively and in a shorter period. There is no chance of the capitalists stifling the People’s Democracies by taking advantage of their technical backwardness. The existence of the socialist camp, headed by the Soviet Union, precludes that likelihood and makes it possible for them to effect their industrialization in an historically brief period.
A common feature of the long-term economic plans of all the European People’s Democracies is that they pursue one and the same aim of laying the foundations of socialism. This requires:
Firstly, a substantial rise in the level of their productive forces, especially in the production of means of production;
Secondly, bridling and restriction of the capitalist elements in those branches of the economy where they still exist, with a view to their gradual total elimination;
Thirdly, the conversion, on voluntary lines of a considerable proportion of the small and medium peasant farms into collective farms – agricultural producing cooperatives – thereby eliminating the sources from which capitalism springs;
Fourthly, extension and consolidation, on the principles of socialist solidarity and mutual assistance, of economic relations and cooperation between the Soviet Union and the People’s Democracies through coordinated economic plans making for a powerful development of productive forces;
Fifthly, a substantial advance in the material welfare, the living and cultural standards, and the activity of the working masses.
It is thus that the tasks involved in laying the foundations of socialism are defined in Poland’s six-year plan and in the five-year plans of the other People’s Democracies.
This is not the only feature of the economic plans of the People’s Democracies. They all provide that these basic objects are to be attained by a high rate of development of socialist industry, in the first place of heavy industry, which produces the means of production, by a considerable expansion of production of raw materials, by proper allocation of capital investments, and so on.
Nevertheless, each of the People’s Democracies has its specific features, since each of them develops principally those heavy industries for which the conditions at home are most favourable. Together, the Soviet Union and the People’s Democracies now constitute a force so powerful that it is not essential for each of the People’s Democracies to have the whole gamut of heavy industries. They can, on the basis of socialist division of labour, develop principally those heavy industries for which the conditions are most favourable in the given country.
In Poland, for instance, conditions are conducive for the development of the coal, nonferrous metals and chemical industries. Abundant resources of the appropriate raw materials make it necessary and expedient to develop principally these heavy industries, parallel, of course, with the engineering and ferrous-metal industries, which constitute the basis of industrialization.
The national feature of Rumania’s economy is the development of the oil industry, for which there is a solid raw-material base in the rich oil deposits that country possesses. Rumania’s five-year plan therefore states that oil is the country’s major industry, and that its output is to be raised to ten million tons in 1955. At the same time, those branches without which the oil industry cannot be effectively developed are also to be rapidly expanded. This involves, in particular, the production in Rumania of pipes and oil equipment. The Soviet Union is supplying Rumania with a powerful tube-rolling mill of 300,000 tons annual capacity, which is to be installed in an iron and steel plant now under construction. Rumania will then be the second largest pipe producer among the People’s Democracies, being exceeded only by Czechoslovakia. The engineering and ferrous-metal industries will also, of course, figure largely in Rumania’s industrialization.
The specific feature of the development of Hungary’s heavy industry is that machine- building is to be expanded so as to be able not only fully to satisfy home requirements, but also to permit the export of Hungarian machinery and machine tools to other countries. Such is the target of the five-year plan; before the war Hungary had practically no machine-tool industry. The plan provides for the extensive development of the ore-mining industry, notably the production of bauxite, which will serve as the basis for an aluminium industry. Hungary possesses vast deposits of bauxite with a high aluminium content, and all the conditions therefore exist for the creation of a large-scale aluminium industry. This was not possible before the war because the deposits were a monopoly of a German firm and all the bauxite produced was exported to Germany. The international aluminium monopolies prevented Hungary from building its own aluminium industry. These obstacles, of course, no longer exist.
Bulgaria is building up a ferrous-metal industry. With the help of the Soviet Union, it is now erecting its first iron and steel works, named after V. I. Lenin. With a ferrous-metal industry of its own, Bulgaria will be in a better position to accomplish another major task of its five-year plan, namely, the creation of an agricultural machinery industry and a chemical industry. This will make it possible to raise Bulgaria’s agriculture to a high technical level and definitely to put an end to its “historical” backwardness.
The national feature of Albania’s industrialization is that its five-year plan does not provide for the building of an engineering industry, but rather for the broad expansion of those industries for which conditions in the country are favourable: oil, minerals (chromium, copper, coal, bitumen), power and building materials. In 1950, Albania produced over three times the quantity of oil, four and a half times the quantity of minerals, more than five times the quantity of power, and eight and a half times the quantity of building materials it produced in 1938. The five-year plan envisages the further development of these key industries.
Czechoslovakia’s five-year plan provides for priority development of heavy engineering and iron and steel. An over-all 133 per cent increase of industrial output is to be attained in 1953 compared with 1948; the increase in heavy machine-building will be 248 per cent, precision machinery – 185 per cent, general machinery – 118 per cent, chemicals – 110 per cent, metals – 78 per cent. Czechoslovakia will supply large quantities of machinery, particularly heavy machinery, to the other People’s Democracies.
The specific feature of the industrial development of the German Democratic Republic is a fast rate of expansion of the machine-building, metallurgical, precision instrument and optical industries. According to plan, the increase of output of major industrial items in 1955, compared with 1950, will be as follows: machinery – 114.8 per cent, metals – 153.6 per cent, precision and optical instruments – 138.9 per cent, power – 82.7 per cent.
Like Czechoslovakia, the German Democratic Republic will supply the People’s Democracies with major heavy industry products with a view to strengthening the industrial potential of the socialist camp as a whole.
Fraternal Aid of the Soviet Union
What is the secret of the striking economic achievements of the People’s Democracies? In his masterly work, “Economic Problems of Socialism in the U.S.S.R.,” J. V. Stalin points out that the fundamental thing is that the countries of the socialist camp have joined together economically and established economic cooperation and mutual assistance, and that at the bottom of this cooperation lies a sincere desire to help one another and to promote the economic progress of all.
Stalin also stresses that a big part in this is played by the assistance the Soviet Union is rendering the People’s Democracies, assistance that is the cheapest possible and technically superb, and such as no capitalist country could render them. The Soviet Union supplies the People’s Democracies with a very wide range of products, from major industrial raw materials to equipment for whole plants and power stations. Of particular importance is the supply of full equipment for machine-building, metallurgical, chemical, mining, power and other key industries. In 1952, the Soviet Union supplied the People’s Democracies ten times more up-to-date machinery and equipment than in 1948.
Soviet plants produce first-class equipment – the last word in technical achievement – for the industrial giants now being built in the People’s Democracies, such as the big Nowa Huta Iron and Steel Works and a high-grade steel plant in Poland; the Stalin Iron and Steel Works in Hungary; a big iron and steel works in Rumania; a textile plant, a sugar refinery and hydroelectric stations in Albania. One might also mention a blooming mill for the Polish Bobrek Works, equipment for Polish automobile plants and for a Bulgarian chemical works, among others.
The Soviet Union supplies machinery and equipment to the People’s Democracies on credit. It also grants them loans at a minimum interest, and renders them technical assistance free of charge. Soviet aid is therefore the cheapest – cheaper than any the capitalist countries could render, because they are all out for the maximum capitalist profit.
The Soviet Union’s assistance to the People’s Democracies is the cheapest because it is rendered not for the sake of profit or for any other selfish advantage, but in the general interest of the entire camp of socialism. Its purpose is to help develop and strengthen the economies of friendly countries, to satisfy the rising material and cultural requirements of the peoples of the democratic camp, and to ensure the triumph of socialism.
The fact that the Soviet Union’s industrial assistance to the People’s Democracies is also in its own interest does not make that assistance any less unselfish, but is only indicative of the grandeur and international character of its historic mission, and of the community of its interests with those of all countries that have set foot on the road of socialism.
The following explains why the assistance given by the Soviet Union to the People’s Democracies is technically superb. The Soviet Union holds first place in the world as regards the ratio of machinery output to total industrial output. Its machine-tool industry is the largest in scale and the most technically perfect. It has acquired vast technical experience. Its producing facilities have been entirely renewed, its industries are equipped with highly productive machinery, and at the same time it has made great advances in technology and in the organization of industry on the basis of higher techniques.
One of the major features of technical progress in the Soviet Union is the mechanization and automatic control of production processes, resulting in an enormous increase of labour productivity. The advances made by the Soviet Union in this respect may be illustrated by the following facts:
The production of one million tons of pig iron with the non-mechanized, hand-operated blast furnaces of pre-revolutionary Russia absorbed seven million man-hours; today, with the blast furnaces mechanized, less than 700,000 man-hours are required – a tenfold increase in labour productivity.
The Soviet Union has plants where all processes are done automatically. A Soviet automatic plant for the production of automobile pistons, the first of its kind in the world, requires one fifth of the operatives and one third of the floor space ordinarily required. It has raised labour productivity and lowered production costs considerably.
Passed on to the People’s Democracies, these technical achievements of the Soviet Union help them to overtake and outstrip the capitalist countries in technical development. The fact that the Soviet Union is the pacemaker in technical progress and shares its experience with the People’s Democracies, and also supplies them with the most up-to-date machinery, is of immense value and helps them to speed their industrial development.
There are several reasons why no capitalist country could render the People’s Democracies such highly qualified assistance:
First, because the level of capitalist technology is lower than that of Soviet technology.
Second, because the capitalist countries prefer not to supply machinery to countries needing it, or to supply obsolete patterns, their aim being to extract the maximum profit without promoting the rapid development of the productive forces of these countries, whose status as providers solely of raw materials they would like to perpetuate.
Third, because all the Soviet Union’s achievements in science and technology, all the achievements of its finest research institutes and industrial plants are the common property of the whole country. The Soviet Union is therefore able to pass on all its technical advances to the People’s Democracies, and it does so.
In the capitalist world, on the other hand, with its anarchy of production and frantic competition, the monopolies keep their discoveries and inventions a careful secret, so that an individual firm is able to impart, or, rather, to sell, only those patents which it happens to possess, and which relate only to the narrow sphere of activity in which it is engaged. The discoveries and inventions of other firms are not available to it, and are, therefore, beyond its power to impart.
Here is a striking illustration of the fundamental difference between the effective aid rendered by the Soviet Union and the spurious “aid” which is the boast of certain capitalist countries.
Until 1948, the Soviet Union contributed largely to the economic development of Yugoslavia, thanks to which the latter’s industry at first made rapid headway. When the treachery of the Tito clique was exposed, the Soviet Union naturally discontinued its assistance to that country. Instead, fascist Yugoslavia began to receive so-called “aid” from the United States, aid which was actually a disguise for robbing the Yugoslav people and pilfering their natural resources. The results of this soon became evident. In the People’s Democracies, which enjoy the disinterested aid of the U.S.S.R., the iron and steel industry, for instance, is rapidly expanding; in Yugoslavia, it is either making no progress or actually retrogressing.
Tito and his clique are no longer able to hide the fact that Yugoslavia’s industrial development has ceased, and that the country is being more and more turned into a raw- material adjunct of American industry. A report in the British Metal Bulletin stated that the Yugoslav government had decided not to accelerate the industrialization of the country, supposedly because intensive industrialization was a Russian method and not necessary in Yugoslavia. It is easy to see that renouncement of the “Russian method” of industrialization means renouncement of industrialization altogether and deliberate perpetuation of Yugoslavia’s economic backwardness. The British journal states that appropriations for Yugoslavia’s industrial development have been sharply curtailed. This is undoubtedly due to the pressure of the American monopolies, who always try to hinder the economic development of dependent countries and to keep them as sources of raw material and as markets for their own products.
(To be concluded)
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