Private Capital in the USSR -1927

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  Private Capital in the USSR -1927
State publishing house

Translated from the Original- no omissions

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(A unique book, recommended at one time by I.V. Stalin, which shows the dialectic of the NEP, how in practice the socialist way of economy destroyed the economically private-proprietary, capitalist way. In the post-Stalin USSR, it was kept in special depository, there was no free access to it. All the schemes that were then widely used by the new bourgeoisie during the period of Perestroika are described). 


The objective of the work – P5

Initial formation of bourgeois capital in the USSR -P7

Agents & accomplices of private capital in the state apparatus-P13

Pseudo-state form of activity of private capital-P21

Malicious contractors-P24

Illiquid Funds. Road and water transport-P32

Predatory rent- P38

Repurchase System- P41

Smuggling- P46

State monetary credit- P54

Government loans- P62

Foreign exchange transactions- P69

Private capital in agriculture- P77

Farming with hired workers- P83

Capitalist surrender of livestock and implements-P104

False collective farms- P111

Entrepreneurial organization of waste. Construction- P119

Overgrowth and ideology- P132

Four types of capitalist industry- P140

Gross production. Industrial pseudo-cooperatives. Distribution offices.-P143

Private capital in the production of consumer goods- P154

Employed persons- P157

Capital and accumulation- P162

Dynamics and activities. Workers in capitalist industry. From the hidden to the obvious -P176

Private Capital in Trade, Production, and credit base-P209

Capitals and the social structure of private trade- P212

Wholesale and retail. City and village. -P228

The rising cost of private trade. Economic and social

significance of the problem of retail prices- P244

Private Capital in the credit and money market.

The amount of credit capital. -P293

Size and net accumulation of private capital in general- P299

Private capital and taxation

Private capital in national property & annual accumulation. - P318

Classes, incomes, taxation. -P325

Taxation and opposition. -P347

Evolution of private capital- P370

The transitional period to socialism and the sprouts of capitalism. -P386

Features of the USSR and the opposition. -P387

The results of six years of experience- P389

Practical setting for the coming years- P393

I. The objective of the work
There is no disagreement that the study of one's enemies is no less necessary than the study of one's own creative activity. There is no disagreement that the role of the bourgeoisie in the national economy is one of the essential obstacles in the matter of our internal construction, in the matter of preparing for the full development of the socialist system. This role is much greater than it might seem at first glance when looking at our state factories, mills, and railways alone. If we take, for example, the totality of wage labor in our country, then, according to recently made calculations in the "Control Figures" of the State Planning Commission, of all wage workers and employees in our country, 28% are employed by private individuals, and these calculations are still underestimated. Taken there, for example, the number of agricultural workers is much smaller than according to the data of Vserabotzemles, so this is the minimum that can be discussed. Of all the hired workers and employees in our country, up to 30% still work in private households and enterprises. Already by this figure alone, one can judge the significance of the phenomenon in question.

It must be emphasized that we will be talking specifically about the role of private capital, and by no means about the private economy in general. In our country, quite often people speak completely uncritically, for example, about private industry in general. Meanwhile, there is private capitalist industry, organized by bourgeois capital, which is a form of bourgeois accumulation and based on the exploitation by bourgeois capital of the labor power it employs. And there is private labor industry, which is simple commodity production without the exploitation of other people's labor, based solely on the expenditure of the small handicraftsman's and craftsman's own labor power without hired workers. Both of these forms are different socio-economic categories, different social and economic strata, and it is wrong to confuse them together when judging private capital. The same is true in other branches of the economy; everywhere it is necessary to single out the capitalist part of the private economy as a whole in order to judge the relative weight of the capitalist bourgeoisie in our economy.

There is an enormous amount of material on the question of private capital—there is hardly anything we write and talk about more than this—but this material is not systematized, not brought together into a single whole, not sufficiently generalized. First, to bring together the material that is available on the origin of bourgeois capital in the Soviet country, to classify the several types and types of primitive bourgeois accumulation in the period 1921-1924. (partly in a weakened form preserved to this day). Secondly, to give, without any glossing over and exaggeration (such as the substitution of private capital by private economy in general), a picture of its current role in industry, agriculture, trade, and the money market, taking into account, if possible, also the disguised forms of its activity. Thirdly, our task is to make those generalizations that can be made on the basis of an analysis of the development of private capital in recent years.

The work is based on three reports read by me at the Communist Academy on March 19 - April 16, 1927.

The materials that are used in this are mainly as follows.
Under various people's commissariats and institutions, commissions were formed to study private capital in our country, collecting information about its activities in various sectors. The relevant reports and data were then submitted to the commission on private capital, which worked under the chairmanship of Comrade Ordzhonikidze with my participation from December 1926 to May 1927. These are the materials I use in the first place. The second, source of this kind.

I asked in 1926; assistant prosecutor of the USSR comrade Kondurushkin to develop materials of larger court cases that have been brought before the courts of the republic in cases of economic crimes over the past six to seven years. These materials provide many interesting comparisons. Comrade Kondurushkin's work has now been completed and will soon be published by Gosizdat. Thirdly, and finally, information kindly communicated to me officially by various government agencies on special requests.

Initial formation of bourgeois capital in the USSR

The Bourgeois capital did not completely disappear and did not stop its activity even at the height of war communism. But the absolute value of the funds at his disposal was comparatively small - the confiscation of capitalist property, carried out by us in 1917-1919, was still too fresh and sufficiently thorough. Of course, there was a certain amount of gold coins, precious stones, etc. hidden away. But since they were in the hands of the capitalists, they were largely lying at that time in anticipation of a better future, while spending on the purchase of food for their owners, etc. The entrepreneurial activity of pre-revolutionary capitalists in the era of war communism was reduced only to speculation in depreciating pieces of paper of various denominations (tsarist, Duma, Kerensky, canceled loans and shares, Soviet signs, etc. ) and foreign exchange (the influx of which could not then be particularly large, which narrowed the scope of speculation) and to the partial financing of bagging. Basically, the bagging of the Civil War period was reduced to the trips of workers and peasants for food for their own families. In an entrepreneurial way, with a network of agents, etc. bagging began to be put more towards the end of this period. Judging by estimates of the present cash flow of private capital in the country and by tentative data on the rate of its accumulation, it is difficult to think that the real entrepreneurial accumulation (on bagging, hard currency, etc.) of the pre-revolutionary and newly created bourgeoisie together amounted to the beginning of the new economic policy (1921) more than one hundred and fifty million rubles. Rather, less. Moreover, including already here all the reserves of cash gold that have survived from the bourgeoisie. A significant part of the gold coins, rings, etc., left by the population. was hidden in general by "little people" who were not engaged in any trade or other business.

The history of the accumulation of bourgeois capital in such proportions that it acquires some, albeit secondary, significance in the national economy of the country, begins with us, therefore, only with the New Economic Policy, since 1921. Then, firstly, state bodies received the right to economic connection with private entrepreneurs, and secondly, private individuals received the right of economic entrepreneurship. At the same time, under the New Economic Policy, a legal opportunity arose for those individual successful handicraftsmen, small traders or peasants who had previously been prevented by the conditions of war communism from developing into entrepreneurs of the exploiting type.

We created NEP, as you know, for both external and internal reasons. True, external ones (the possibilities of an influx of foreign capital to improve our economy) have so far not yielded much (although the results are gradually increasing). But on the other hand, the internal ones have already fully justified themselves. The economy of the country, which was resting after a long war, began to rise rapidly in the commodity-market forms familiar to the petty-bourgeois majority of the population. As the state economy strengthened by virtue of this, we were able to invest increasingly socialist content in commodity-market forms (the growth of state industry, industrialization in the hands of the proletariat). But along the way, by virtue of the very restoration of commodity-market forms, bourgeois entrepreneurship was also restored.

"We didn't learn how to trade," said Comrade Semkov at the Moscow Provincial Party Conference in 1921 to Comrade Lenin. The bourgeoisie has brought neither large fresh funds of its own nor new commodity funds to revive the economy. Commodity funds were in our hands, and the size of the bourgeois funds, as indicated, were small. But the bourgeoisie brought with them the ability to move in the conditions of commodity-market relations, and we were compelled to give them our commodity funds and our means. Production (industrial) remained in our hands (and agricultural production in the hands of the peasants), but the market connection between different parts of the economy (and often even between different state enterprises) fell into the hands of the bourgeoisie. For this, of course, she generously rewarded herself, but for us it was "payment for science". Only as this “payment” accumulates among the bourgeoisie does it begin to take some roots, firstly, in production, secondly, in organizing trade at its own expense (and not only through the legal and illegal use of state funds and state credit), in- the third - in the money market.

Since in the first period of this activity the bourgeoisie had no means of its own to advance the commodity funds of the state, or there were too few of them, the very nature of the use of its "skill" must have very often been illegal or semi-legal, and bourgeois accumulation must have been typically predatory accumulation, i.e., e. in no way proportional (even according to the bourgeois assessment) of the services it provides. The history of the Soviet bourgeoisie is thus quite simple. Her ability to rotate in market conditions was needed, especially for the first period, while we were almost completely unable to do this; she thus obtained the opportunity to act and, having no means of her own, took advantage of the opportunity to steal them from us, from the state; and nakravshi - then created independent trade at its own expense and capitalist industrial entrepreneurship. The history of bourgeois accumulation in the USSR in its first period is, therefore, first and foremost the history of bourgeois theft in various shapes and forms. And then it starts bourgeois accumulation of the usual type.

In parallel, a narrow circle of small capitalist entrepreneurs was growing out of simple commodity production in the countryside.

In turn, the Soviet state, as it masters the art of maneuvering in the conditions of commodity forms of economy, naturally begins to change its practical line regarding private capital. Instead of the practice of "squandering" 1921-1923. the practice of "pushing aside" private capital from its positions begins, primarily in the area of ​​turnover with products of state industry (1924-1926).

The entire period of the New Economic Policy in relation to the history of private capital must therefore be divided into three parts.

The first period is from 1921 to 1923. This is the period of the creation of modern private capital in our country, plus the involvement in the life of some remnants of the pre-revolutionary past that had not been in an active state until then.

The second period is the next three years, from 1924 to 1926. This is the time of the so-called "normal" operation of private capital. Of course, in this second period there were still many remnants (there are still to this day) of the former illegal methods of making money, but those forms of his activity that are based not on abuses, but on commercial transactions of a legal type are already beginning to prevail.

And the third period is the one that begins in 1927 and whose essence on the part of the state is characterized by the current planned approach to the question of private capital as a whole, and not only to individual manifestations of its activity, such as trade in state products, etc. What tendencies it is characterized by on the part of private capital - we will dwell on this below.

The first period is the period 1921-1923. - characterized mainly by the fact that at that time private capital arose by transferring state funds into private hands in a variety of ways and methods. It can be said that the bourgeoisie that acted in the first period of NEP entered this NEP almost bare-handed, very little, often with almost nothing in their souls, except their enterprise, except for connections in various Soviet institutions, except for their readiness to any crime for the sake of enrichment. The circumstance that it was able to achieve rather great success along these paths, as we shall see, is, of course, due in no small measure to the well-known defect in our state apparatus. In other words, by those bureaucratic perversions the availability of which made it possible, and sometimes still makes it possible, on the economic front, for the private businessman to turn government agencies into instruments and means of his own enrichment. The more the work of the state apparatus of our country improves, the less this opportunity becomes, the more the circle of illegal profit of private capital narrows, the more legal profit comes to the fore.

Classifying the methods of primitive bourgeois accumulation of this period, some of which have survived to this day, I list 12 main types of predatory and illegal emergence and accumulation of private capital. They gave him the opportunity by the end of this period, approximately by 1923/24, to collect in his hands already the sum of several hundred million rubles, with which he then began to operate "normally" (having gradually added the remnants hidden and partly accumulated in period of war communism).

Hidden from pre-revolutionary times, the remnants, and accumulations of the period of war communism from currency transactions and bagging can be counted, as I have already indicated, in the hands of the bourgeoisie about 150 million. g., i.e. about 350 million - all this was accumulated by private capitalists during the first years of NEP as a result of their illegal activities.

The main twelve types of this activity are as follows:

1) agents and accomplices of private capital in the state apparatus,

2) pseudo-state form of activity of private capital,

3) malicious counterparty,

4) illiquid funds,

5) predatory rent,

6) illegal repurchase,

7) smuggling,

8) state money credit,

9) state loans,

10) foreign exchange transactions,

11) tax evasion and

12) pseudo-cooperatives.