V.M. Molotov
Introduction
The last phase of the socialist Soviet Union under Stalin was marked by the programme of gradual transition to communism over three five-year plans. In this situation after the 19th Congress of the CPSU of 1952, Mikoyan and Molotov both came under a political cloud. As is evident in his memoirs Mikoyan confronted Stalin in his opposition to the gradual transition of Soviet trade to direct products exchange between Soviet industrial enterprises and the collective farms. Molotov, in a Plenum, was charged by Stalin of ‘Rykovism’ for his commitment to the application of commodity-money relations in questions of agriculture in the transitional phase to communism. It is also clear, too, from his interviews with Feliks Chuyev, that Molotov was not in agreement with the programme of communism articulated by Stalin.
Between 1953 and 1958 generalised capitalist commodity production was constructed in the Soviet Union as is evident from the archives of the Gosplan. Centralised directive planning under Gosplan was decisively terminated between 1953 and 1955 and replaced by a system of decentralised ‘co-ordinated planning’ of the Central Ministries and the Union Republics. The directors of state enterprises were given greater powers at the expense of centralised planning. They gradually were to be transformed into independent private producers. The new criterion of efficiency of the industrial enterprises and the state farms was their profitability. This ended the earlier understanding of the Stalin period that sought profitability of the enterprises in the country as a whole but not necessarily of individual enterprises. In later years after the 20th Congress, and after the removal of Molotov and Kaganovich, the products of Soviet industry in 1958 were categorised as commodities circulating within the state sector. A series of organisations were established under Gosplan for the sale of the products of Soviet industry. While genuflection was exhibited to the transition to communism, as in the 1961 party programme, effectively the underlying notions of a ‘market communism’The speech by Molotov of September 1953 is in consonance with the turn to the commodification of the Soviet economy. It implicitly negates Stalin’s views of a non-commodity-money approach to industry and agriculture which stressed the need for gradually transforming the relations of production of the Soviet Union in the transition to communist society. Molotov lambasted the soi disant one-sided ‘superindustrialisation’ of the Stalin period in the Soviet Union and the People’s Democracies of Central and Eastern Europe which, allegedly, neglected agriculture. Molotov approved of the ‘amendments’ to the Soviet economy in the first few months after Stalin which terminated the ‘grandiose plans’ for hydropower plants and the plans for extending the irrigated area (and indeed many of the other major late Stalin-period projects). Essential to socialist extended reproduction was the primacy given to investment in Department ‘A’ of the economy which was the basis for increased development of light industry before 1953. The increase of investment in Department ‘B’ and agriculture after March 1953 was bound to have the effect of a long term decline in the rate of growth of the economy such as indeed happened in the Khrushchev years. Molotov argued that there was ‘an abnormal situation’ in the Soviet Union in which there was a lack of correspondence between procurement prices and retail prices. Under Stalin the cost of production was taken into account in formulating pricing but it did not determine them. Pricing was planned according to the requirements of building socialism and communism. Thus the price of steel was fixed below value as was the price of children’s clothing. Other items such as alcohol and luxury goods were priced above value. Implicit in the views of Molotov was the need to apply greater value relations in the Soviet economy. Those who tolerated the existing ‘abnormal’ understanding said Molotov needed to be given ‘special awards’. From this it was implied that Stalin deserved an award for his ‘abnormal’ views on political economy. Molotov considered that the CPSU had tolerated this situation, which allegedly ignored the lack of material benefits for the Soviet peasantry, for long. Greater investment was required in agriculture and higher procurement prices were needed to increase milk and meat production and lead to an upsurge in Soviet agriculture. Such measures should have been implemented much earlier. Molotov here defended the very views which Stalin had criticised as ‘Rykovism’. The new measures initiated at the September 1953 Plenum led to a temporary rise in the rate of growth in agriculture but only for a limited period. The transition to a market economy after March 1953 reflected the changing character of the economic relations.
The observations of the second edition of the Textbook of Political Economy published in the Soviet Union exactly two years after the September Plenum of 1953 are instructive. (The Textbook of Political Economy, Lawrence and Wishart, London, 1957, pp. 653-655). The textbook criticised the earlier practice of exaggerated deliveries of compulsory quotas from the more advanced collective farms which were alleged to have reduced the material interest of the collective farmers to increase output. Instead, quotas of compulsory deliveries were reduced for a number of agricultural products and procurement prices were considerably raised for the voluntary sales of agricultural goods to the state, and, the agricultural tax on the personal subsidiary holdings of the collective farmers was reduced. All this led to a considerable increase in the money incomes of the collective farms and farmers, to an increase of 12 milliard roubles in 1953 and 25 milliard roubles more in 1954 than in 1952.
The Textbook frankly accepted that these changes in agricultural prices were in keeping with the requirements of the law of value. It did not refer, of course, to these as being the implementation of the political economy of Rykovism.
The increasing application of the law of value in the economy not only led to the loss of the relations of socialism by the end of the 1950s but also led to a drastic drop in the yearly rates of growth of all major sectors of the Soviet economy.
Vijay Singh
MOLOTOV. Comrades! The comprehensive report of Comrade Khrushchev gave a broad picture of the state of our agriculture; a picture of its growth and, at the same time, the shortcomings that still exist in this area. No one at the Plenum disputed that Comrade Khrushchev’s report gave the correct picture of the current situation in our agriculture. It should not be said, however, that no one has disputed that the planned measures and measures already taken recently to ensure a new upsurge in agriculture are in the interests of the present subject and will yield positive results.
It must also be said that the discussion that is being held at the Plenum on a heard report is of professional nature and introduces a number of new points that give an even more complete picture of what we have in the countryside, in agriculture, and on collective and state farms.Nevertheless, it must be admitted that, in addition to production issues, which was the focus of the majority of people, there is another side to the issue under discussion. The Central Committee of the Party should not limit or reduce the matter to simply production issues that we are now considering in connection with the new tasks in agriculture. It is also necessary to give a political assessment of the state of affairs in agriculture and the measures that are currently outlined by the party.
With regard to the situation of individual agricultural sectors, the report and the speeches available here provided so much material – clear, convincing, and quite versatile, covering various sectors and different stages of development of our agriculture that there is no need to supplement or develop those topics.
From all this we come to the conclusion that, despite the important successes of our collective farms, the situation in our country, and especially in some branches of agriculture, is not favourable. Agriculture far from satisfies the needs of the Soviet people for a number of products, and the measures taken until recently to raise agriculture were clearly insufficient. With this general conclusion, it is necessary to give an appropriate political assessment of the facts about which the Central Committee Plenum spoke in detail and the tasks that the party must set for itself and, above all, all agricultural workers.
We know that there is a considerable difference in the position of individual regions. Here it was said that the agricultural territory of one region sometimes noticeably differs from the territory of another region. For example, they said with bitterness that “here are the weeds, it means that this is the territory of our region!” Or, comparing to neighbouring regions: “the streak of weak collective farms begins – which means that this region begins.” And at the same time, there are regions and republics that have achieved great results and achieved important successes against the average level that is most common.
In particular, there is a big difference between the individual agricultural areas. The difference is even greater between individual collective farms. There is also a difference over time: everything would go well for several years, then it would get worse.
It is clear that it is impossible to reduce all these facts to some basic economic, technical or even personnel issues. Here the issues of leadership are of great importance: who is leading, how they are leading, how experienced, suitable, and prepared a person is for this business.On the other hand, another one-sidedness should be avoided.
Of course, we well know that our present agriculture is at an immeasurably higher level than it was in pre-revolutionary times. We well know that during the years of Soviet power, our agriculture has risen to a whole new, higher stage of development, which could not have been dreamed of before the creation of the Soviet state. But this does not give us any reason to gloss over those shortcomings, to pass by the serious drawbacks that we have in agriculture.
Take an issue of grain, which is crucial for agriculture.
Compare the period of 1930, when the turn of the mass collective farm movement was still taking place, and the present period, when the collective farms have already gained strength, and it will become clear how far we have stepped forward.
In 1930, the 16th Congress of our party took place. Even then, in the report to the Congress, J.V. Stalin said that we “have almost resolved the grain problem.” Then, in 1930, the gross yield, as you know, was estimated at 5.1 billion puds. Before the last war, in 1940, the gross yield in our country was estimated at 7.3 billion puds. Last year, it was estimated at 8 billion puds.
So, if we had reason to say – and we had such reason – that in 1930 we had basically solved the problem of grain farming under the conditions then, we all the more had the right to say so at the next party congress in 1934. We emphasized the importance of this victory of ours before the Great Patriotic War. With that great reason, we should have said this at the party congress last year, when the gross yield reached 8 billion pounds. As you know, the Central Committee’s report to the 19th Party Congress stated: “The grain problem, which was previously considered the most acute and serious problem, has been successfully resolved, finally and irrevocably resolved.”
But, comrades, we must not forget the following. Now, we are talking about the fact that the grain problem has been solved, yet we do not sell flour in all cities yet, and where we sell it – not in all varieties. Although we have made tremendous successes in grain farming since 1930, we still haven’t solved this problem as fully as we need, for example, so that we can sell flour in all cities and those varieties which there is a demand among the population. So, we have to work very hard in this matter.
Take the second example that has been talked about a lot here – potatoes. Everyone knows that we lack potatoes and vegetables. So much so that we do not provide potatoes and vegetables even to Moscow – throughout both last and this year.
And at the same time, the fact that Comrade Patolichev pointed out is noteworthy. In Belarus, this potato republic, peasants sometimes plant potatoes, and then forget where they planted them. Maybe they only talk about potatoes like that, but this indicates that they are not very interested in this matter. Such facts can hardly be considered random.
But if we look at the economic conditions in which potato production takes place and how little attention was paid to mechanization issues in this matter, then it seems to me that we will understand better why we have such an unsatisfactory situation with potatoes and vegetables.
In fact, until recently, we had a procurement price per kilogram of potatoes of about 4 kopecks, more precisely 3.8 kopecks. Along with this, even before the spring of this year, the retail price for potatoes was 90 kopecks per kilogram. Now, after April 1, 1953, state retail prices were set at 50 percent and the current price is 45 kopecks per kilogram. But if someone proves that it is economically correct to keep the procurement price for potatoes at 4 kopecks, and the retail price at 90 kopecks, or, conversely, with a retail price of 90 kopecks and even 45 kopecks, the procurement price should be 4 kopecks, then such a person could be given a special “award”. However, until recently, we all put up with such an abnormal situation.
We have a better situation with cotton. In this regard, we have significant achievements compared to 1940. I will not dwell on the numbers here. You know these figures from the report and from the materials that you have on hand. It is an indisputable fact that the positive economic measures that we carried out earlier gave positive results, but we did not conduct enough in relation to other sectors of agriculture.
Take a position with sugar beets. We now produce more sugar beets than we did in 1940, but only a little more. This is far from enough to meet the increased needs of our population.
MIKOYAN. Many plants are not staffed, dozens of plants are not staffed.
MOLOTOV. This suggests that we are unsuccessful in this regard.
But livestock faces especially unfavourable conditions. Therefore, it is clear that the party and the government are paying special attention to the issues of livestock farming. Is this a new question for our party? No, not new.
In this connection, I will have to give the corresponding statement of J.V Stalin at the 16th Party Congress in 1930, when he said:
“Now that we have mainly resolved the grain problem, we can begin to simultaneously solve both the livestock problem, which is currently a burning problem, and the problems of industrial crops. To solve these problems, we need to follow the same path that went towards resolving the grain problem.” At the next party congress, in 1934, the Central Committee report again said on this issue:
“The livestock problem is now as big as the grain problem, which was already successfully resolved.”
It seems that we had a lot of time and prerequisites to really take up the resolution of this more complex and more difficult problem – the problem of livestock. But we have not yet achieved the desired results here. Let me remind you the numbers given in the report of Comrade Khrushchev. Here are some comparative data relating, on the one hand, to 1928, that is, to the period before mass collectivization, and, on the other hand, to the present moment – the beginning of 1953. Then, in 1928, there were 67 million heads of cattle (I quote the figures with rounding), and by the beginning of 1953 – 57 million heads, that is, 10 million heads less. There were 33 million cows then, and now 24 million; then there were 28 million pigs, and now 28.5 million, then sheep and goats were 114.5 million, now about 110 million, horses were 36 million, and now 15 million.
From these figures it can be seen that the problem of livestock has not been solved, that this task is not really accomplished.
At one time, we explained the slowness of the rise and the lag in the development of our livestock production by the fact that it happened during the first period of reorganization in collective farm construction, when serious difficulties in solving the problem of livestock production were inevitable. Back then we talked about how this reorganization period ended in 1932. But reorganization period ended and the prewar years passed – until the summer of 1941, and our livestock breeding did not rise to a level that satisfies the needs of the country’s population, at a level worthy of a strengthenedcollective farm system.Now, after a difficult war, we can’t forget that the Nazi occupation of the most important agricultural areas of the country caused enormous damage to our livestock production. The consequences of the war were highly negative for cattle breeding, severely so. But eight years have passed since the war. This is something to be reckoned with as well.
Indeed, if we take what has been done in the industry in the post-war period and recall the basic data from the Central Committee’s same report at the 19th Party Congress, it turns out that our industry has grown, compared to 1940, already in 1952 by more than 2 times a year. The production of means of production rose 2.7 times, the production of means of consumption rose 1.6 times. As for livestock, we certainly can’t say the same.
You have heard a general assessment of livestock production provided in the report of Comrade Khrushchev and in the draft resolution that has been distributed to you. In order not to repeat ourselves and only pay attention to those issues in livestock production that require urgent solutions, I will cite an excerpt from a note by the Minister of Agriculture and the procurement of Comrade Kozlov sent from the Council of Ministers of the USSR on June 31, 1953. Here is what Comrade Kozlov wrote about this:
“The main reason for the difficult situation with livestock breeding is the insufficient material interest of collective farms and farmers in the development of livestock production: cash incomes in a significant part of collective farms do not cover the costs of production in this sector of the economy. In addition to the large losses from mortality and low livestock productivity, this is also because collective farms donate 65-70% of meat and 70-75% of milk to the state at low procurement prices (on average, meat for 24 kopecks per 1 kg of live weight, milk from 25 to 30 kopecks per litre).
The standards for compulsory deliveries of livestock products have been rising almost annually lately. In this connection, in 1953, according to the collective farm plan, they must donate to the state meat by 75.6% more than in 1940, milk by 77.6%, wool by 4.2 times, and eggs by 5.6 times more comrades to 1941.
Due to the poor development of animal husbandry, there is barely enough milk for settlement with the state and for the feeding of calves in many collective farms; in some cases, collective farms spend the main breeding stock to deliver meat to the state, and in order to fulfill the plan, farmers purchase calves, spending a lot of money on it.”
Here, it seems to me, are depicted important points in the position of livestock production, showing how unsatisfactory it is. At the same time, it is clear that in this case, that correcting the existing situation depends on us, on our state leadership, on our economic policy.
In connection with this provision, serious new measures have now been taken and are still being taken to improve the situation in agriculture.
I will not repeat the large amount of data that are at our disposal here, but I will give the general financial results of those state measures that I have in mind to carry out in order to eliminate the noted shortcomings and ensure a new upsurge in agriculture.
These are the data on the finances of the Soviet state, which are additionally anticipated in the second half of 1953 and during 1954 in order to promote a serious upsurge in agriculture.
1953, second half of (in millions of Roubles) | 1954 | |
1. To improve the work of the MTS | 1,477 | 5,459 |
2. To improve the agrotechnical services of collective farms, including agricultural propaganda | 50 | 759 |
3. For the further development of livestock, including changes in the conditions for the production and procurement of animal products | 6,147 | 12,012 |
4. To increase the production and procurement of vegetables and potatoes, including increasing procurement prices and purchases | 1,220 | 1,417 |
5. Agricultural tax reduction | 4,137 | 6,000 |
6. Additional investment, including building machine and tractor plants; additional acquisition of agricultural machinery | 461 | 10,379 |
Total: | 13,492 | 36,026 |
7. Further, additional credit investments, including loans from the agricultural bank for individual housing construction for tractor factory workers | 350 |
1,080 |
Total: |
13,842 |
37,106 |