STATE OWNERSHIP IN RUSSIA

Dominion, Volume 12, Issue 228, 20 June 1919, Page 3

STATE OWNERSHIP IN RUSSIA

A COSTLY FAILURE BOLSHEVIST ADMISSIONS (From a Correspondent of tho "Morning • -i Post.") On. February 2' a very prominent Bolshevik, Tchudskayeff, the inventor among other economic expedients of the famous tax which is to be ,paid in breadstufl's, meat, eggs,, and butter by the peasantry, hrid the daring to declare in the Moscow Council that he feared State ownership, which is the very essence of Bolshevism, would provo to be "nonsense." He used 8/n exprossive Russian word, tchepukhs. The incident, though' it provoked soma ongry comment, is wholly insignificant in itself; but it coincides with criticism of some unpleasant rovelations as to the ineffectiveness of State trading and industry. These revelations are instructive now that Germany, and apparently after her, the rest of Europe, aro to bo pushed on the same slippery path. Of course, one eannot comparo Europe with anarchical Russia. But anarchical Russia in some respects started with advantages which Europe will not enjoy; it had tabula rasa and no obstruction; and its nationalised undertakings started entirely without debt, whereas the Europe States which nationalise will have to take on their shoulders the initial heavy burden of compensation for the present private owners. The event which aroused JI. Tchudskayeff's wrath was th 9 discovery that of nationalised before Juno 1, 1918, 270 had entirely ceased work. As "about a good many others one cannot even find out what is happening," it follows that very few were at work. The excuse was mado that these undertakings hod not been Tegalarly nationalised. They had, simply been seized by individual local Soviets, or La'bour Unions, or by their own employees; and the Central Government, finding itself powerless to nationalise them according to elaborate plans drawn up for such a process, had nt first left .most of them clone. The reBult, as the Pravda, tho official organ of the :Soviets, admits, was "in all cases lamentable,'wasteful, and unproductive." To save its face, the helple?s Moscow Government 'now proclaimed that all the 456 undertakings were nationalised in form; and it sent inspectors to see what orcV could be made out of the chaos,. Tho inspectors' Teports have not been publisher!: but judging .from comments'in the "Izvestiya" and the "Scvernaya Kommuno," the havoc was po great that it was decided to leave most of these undertakings njone, and not waste tho Central Government money on thein. Soviet Leaders at Variance. On June 28 the first fully authorised mass nationalisation took placo. In preparing for it two tendencies among Soviet leaderti came into conflict. Experts who thought" first of Soviet finances, recommended the nationalising of only going concerns the geographical position of which in regard to fuel,' raw materials, and reserve of skilled labour indicated that they could be worked without loss; but the majority, and with it both Lenin and Trotsky, decided for the nationalisation of whole branches of industry. Thereupon was issued a nationalisation decree declaring that all industrial works of certain branohes belonged to the State. The undertakings numbered over a thousand, and their capital, totalled over 3,000,000,000 roubles. They included all minis, mnchine-works,* electro-technical works, ironworks, sawmills, wood manufactures of different kinds, cable factories, soap and candle factories, tho capital of which exceeded 1,000,000 roubles; and all tobacco, rubber,* glass, china, boot, leather factories, also local monopolies such as gas and trams, the capital of which exceeded 500,000 roubles. The great majority of these undertakings were at a standstill when the Soviets, professed to take them over; and, according to the "Izvestiya," tho taking over...in.jinany, i cases, was fictitious; the _industries wore simply'entered in a-list. As a result, it was stated officially before Christmas last that only 500 odd undertakings had been nationalised; but, in addition, there were railways, steamship companies, including all river and lako lines, and arms factories. No other jneasuro of Socialisation was taken until near the end of 1918, when life, fire, and burglary insurance was entirely nationalised. After that followed a decree _of December 31 .nationalising the advertisement business (newspaper advertisements were already a Bolshevik newspaper monopoly); and lastly was published a decree making the holding of exhibitions ft State concern.

Yield Half Expenditure. " The Bolsheviki, have never published accounts of the result of nationalisation; tilt there are _ a great many isolated figures indicating, heavy losses and an official statement by ,a Soviet functionary named MucEanofE that tho yields in goods-is'only equal to about half the expenditure. Muchanoff recommended , thnt private industry, should bo reintroduced, at least in part; and his recommendation led the Soviets in September last to resolve that concessions should ■be given to foreigners for certain industries. In particular, this concerned railways and mining in remote districts; but the "Izvestiya" declared that foreigners would probably be invited to manage tho iron and machine-buildinij industry. The Commissary of Finances, Krestinsky, estimates the whole' production of nationalised in JulyDecember last year as worth 3,000,000,000 roubles; but as a fact, up to December last the Soviets had received only 800,000,000 roubles' worth of goods,'' a. wholly insignificant quantity at a time .when, as Krestinsky declares, the rouble is worth only about' 6 kopecks gold. In nationalising the industries, i.e., capital expenditure on their reorganisation for State conduct, no fewer than 2,800,000,000 roubles were spent in 1918. This- sum, as the "Izvestiya" admits, was so carelessly spent that half of tho nationalised industries, after an average expenditure on them of 6,000,000 roubles, could not be carried on. As result, the Soviets have of late been cutting down heavily their outlay on nationalisation and trying to run only tho better equipped works—tho policy recommended to them from the first. Th» chief plague of nationalisation. the "Izyestiya" says, is bureaucracy. The Supreme College of National Industry, which,sits in Petrogrnd in ths Ministry of Trade, has in"its emnloymcnl no fewer than 40,000 officials. When the Soviets nationalised an industry—often on paper—they increased their clerical and control staff; and when the factory or workshop ceased operations owmg to want of fuel or raw material the increased clerical staff remained. The decree of June 28 created a highly complicated bureaucratic system. First, every branch of industry has a commissary, and in addition a ' central directorate , which appoints the administrative) and expert staffs of each individual undertaking. These institutions are central. Next is an economical and administrative council. In theory this council is not bureaucratic but elective—its members are chosen by the facton- .workmen and officials, by the local Council of Workmen, and by tho local Foo;f Council, co-operative organisations, and peasants; but in nractice tho council is entirely bound by'instructions from Moscow, and it is hampered by bnrdes of inspectors and other officials. Tho duty of tho council, put shortly, is to seo that the workmen's conditions of employment and life are bearable. In fact, according to complaints mnde to the Supreme Col,We. the council muddles in technical questions, and "makes it just as impossiM» to pflWnHv n<s fli*l n workmen's council which interfered in the .technical nw.nagement of a private factory." Hinhlv-paid Officials. The Soviets bare, further, an enormous staff of "social" officials, who are supposed to 'look after the State workers' material and moral comfort, n.nd whose functions overlap those of tho "economical and administrative- council." And, finally, each fqciory has an "executive cnunciU' All thee officials, including the elective, nre highly paid—tho minimum wage of a skilled workman in Moscow province is now 1450 rnuKes a -month. The result upon nationalisation finances may be guessed. In the numerous Staff ready-made clothing factories the cost of the non-producin" offici.il staff is reckoned ot 27 per cent, of {he whole 'cost of production. A non-Bolshevik critic. M. Vaftlieff, of Moscow, states that "the

whole nationalisation organisation is merely a mechanism for grinding out salaries for men ami women who have no real functions."- This is unfriendly criticism; but thorough-going Bolshoviki admit the samo thing. They declare that all estimates of tho production of State factories have proved illusory;' when the Soviets last summer launched their scheme for inducing tho peasants to sell grain by offering them in oxchango tobacco, matches, tea, china, and glass, it was announced that 1,162,000,000 roubles worth of these goods would bo supplied within three months. Of this 000,000,000 roubles worth were to be turned out in tho first month. In reality.the output was 75,C00,0C0 roubles worth. As a result the whole scheme broko down, and the Soviets did not get more than a fraction of their grain.

_ Naturally tho Soviets have- no pleasant timo with" their nationalised workmen. Having entirely alienated the peasantry, Bolshevism must keep the good graces of the city workmen, and the city workman exploits this obvious fact in order to hotter his by no means enviable position. Demand* for higher wages are unceasing. The Stato ready-made clothing factories had three wage strikes.in four months. When factories close for want of materials or fuel the workmen claim, and usually obtain, full wages. At Christmas in the provinces of Tula and Vladimir (respectively metal and textiles) unemployed Stato workmen had been drawing full wages for seven weeks. They are probably drawing thera still. Oil this.point the Soviet last aiiti?m?i entered into o formal conflict with its workmen; but tho employees, arguing that in a "proletarian State" a manual worker has quite as good ft right to permanency of employmont as a genteel clerk, gained their point. The Soviet ruled in October that a person offered work of any kind for which he is physically fitted must accept it; but tho first result of this ruling was that two hundred workmen who. were ordorcd to go from Moscow to Kaluga province refused to go; and tho Soviets, threatened with a hunger riot, had to grant thenv their pay. '