SECOND VERSION (UNFINISHED)
In reply to your questions:
1. I think that the "Nepman", i.e., the representative of the trading system developing under the "New Economic Policy", would like to become a political force, but shows no signs of this, or shows them in such a way as to conceal his aspirations. He is compelled to conceal his aspirations, for otherwise he would run the risk of meeting with the stern opposition of our state authorities, or perhaps even worse than opposition, i.e., downright hostility.
I am of the opinion that with the concentration of the bulk of the means of production in the hands of our state what the petty bourgeoisie actually needs, economically is freedom to buy and sell consumer goods. Our laws grant the petty bourgeoisie this freedom.
The term "Nepman" that you use leads to some misunderstanding. This word is made up of the abbreviation NEP, which stands for "New Economic Policy", and the word "man". Together it means "a man, or representative, of this New Economic Policy". This term first arose as a journalese nickname for the small huckster, or individual who took advantage of the free market for all sorts of abuses.
Outwardly, what strikes the eye most in the New Economic Policy is that people like the "Nepmen", that is, people of all sorts who "buy and sell", as you say, come to the fore.
But the actual economic activities of the actual majority of the population by no means consist in this. For example, it is sufficient to point to the activities of the vast masses of the peasantry who, precisely at the present time, are
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displaying tremendous energy and self-sacrifice in restoring their tillage, their agricultural implements, their houses, farm buildings, etc. On the other hand, at this very moment the industrial workers are displaying equal energy in improving their tools, in replacing worn out tools by new ones, in restoring wrecked, dilapidated or damaged buildings, etc.
The "Nepmen", if we are to employ this term, which belongs rather to the realm of journalese than to the realm of serious political economy, make more noise than their economic power warrants. I am therefore afraid that anybody who in a vulgarised way applied to our "Nepmen" the proposition of historical materialism that economic power must be followed by political power, is in danger of falling into serious error, and even of becoming the victim of a series of ridiculous misunderstandings.
The real nature of the New Economic Policy is this -- firstly, the proletarian state has given small producers freedom to trade ; and secondly, in respect of the means of production in large-scale industry, the proletarian state is applying a number of the principles of what in capitalist economics is called "state capitalism ".
I think that the "Nepmen" who draw from this the conclusion that they should aspire to become a political force are in danger not only of falling into error, but also of becoming a butt for newspaper quips about their vulgar conception of Marxism.
2. It seems to me that your impression that in Russia today buying and selling are highly profitable, "whereas production is possible only in very rare cases" is likely to call forth well-deserved ridicule over Mister Nepman's political economy.
If I am not mistaken, the overwhelming majority of the population of Russia are small peasants, who have now thrown themselves into production with extraordinary zeal, and have achieved (partly due to the assistance the government has given them by way of seed, etc.) enormous, almost incredible success, particularly if we bear in mind the unprecedented devastation caused by the Civil War, the famine, and so forth. The small peasants have been so successful that they delivered the state tax amounting to
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hundreds of millions of poods of grain with extraordinary ease, and almost without any coercion.
I therefore think that it would be more true to say that the overwhelming majority of the population, whose production is conducted on a very small scale and is concentrated in private hands, obtains very large profits. This applies to peasant farming as a whole. The same, or slightly smaller, profits are obtained from industrial production -- part of which is in private hands and part in the hands of lessees from the state or state factories producing consumer goods for the rural population.
The only really unprofitable production in the hands of the state is that part which, to employ the scientific terminology of political economy, should be called the production of means of production (ores, metals, etc.), or the production of fixed capital. Under capitalist economy the renewal of this form of capital usually requires government loans, which at one stroke provide extremely large sums (hundreds of millions of rubles, or even dollars) for the reorganisation of a number of enterprises capable of restoring damaged means of production.
In our case, the restoration of the damaged means of production promises no profit whatever for a long time to come, and is "unprofitable", as you express it. For a long time we shall have to resort to revenues obtained from concessions, or state subsidies, for the purpose of restoring our fixed capital.
Such is the actual economic situation at present. As you see, my view of this situation is quite different from yours. I am afraid that your opinion that in this country there is a "continuous increase in the economic power of the Nepmen" and a "continuous diminution of the power of the state" would probably have prompted Marx to make some caustic remarks about vulgar political economy.
I still stick to my old idea that after Marx you can drag in non-Marxian political economy only for the purpose of fooling philistines, even if they are "highly civilised" philistines.
I am rounding off on the question of "political power". The basis of political power in Russia is the workers and peasants. In all capitalist countries the peasants are robbed
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by the landowners and capitalists. As the peasants become more politically educated they understand this better. That is why the bulk of the population will not follow the lead of the "buying and selling" Nepmen.
3. Will not the tax on the "Nepmen" merely result in increased wages and prices, instead of providing funds for production?
No, because prices will be based on grain. A certain part of this grain is in the hands of the state, collected in the form of a tax. The Nepmen cannot directly influence prices because they are not producers. The foreign trade monopoly, I must say in passing, will help us to keep the Nepmen in hand, for, without consulting them, prices will be determined by the price of production abroad plus the extra charge imposed by the state for the purpose of subsidising production.
I am afraid that you sometimes imagine that the Nepmen are forcing up prices although the rise in prices is actually due to the depreciation of our paper currency, caused by increased issues. That would be a mistake.