TRADING IN RUSSIA

Shannon News, 5 February 1926, Page 4

TRADING IN RUSSIA

UNDER SOVIET CONTROL. GREAT CAPITALIST CONCERN. An interesting picture of trading: and commercial conditions in Russia is given in a travel book just issued, N "Beyond the Baltic," by A. MacCallum Scott.

"In yn*iting of Russia the author nays:—ln the first flush of enthusiasm the wage system was abolished, all workers were put on equal rations, the factories -were put under the direct control of committees of the workers in them, and private trading for profit was prohibited. The result was an immediate, and progressive, decrease in production. Not merely was the factory control inefficient and wasteful, but the workers would not put forth their full energy. Bolshevism was threatened with disastrous bankruptcy. But all that Communist control and rationing has now been scrapped. The factories are under the control ,of specialist boards. The payment of wages has been established on a, stimulating piece-work basis. And instead of drawing a ration the worker spends his wages in a shop much as he did before the Revolution. In nothing did Lenin show his genius more than in this rapid strategic retreat, and in his introduction of the so-called hew economic policy, familiarly known by its initials as "Nep," according to the fashion of the new verbal currency. Under the new economic policy,, private capitalist trade was allowed to return ana establish itself as best it could, in the internal market, in competitions with communal trading of various degrees. The result, of "Nep" has been that in the course of three years 90 per cent of the retail trade, especially in the villages, has come to be in private hands. In the wholesale tradp, however, the proportion was almost exactly the reverse —about 10 per cent only remained in private hands. The private trader allowed to make what profits he could .though, of course, he was heavily taxed both before and after. There was much speculation. Big profits were earned by some of the "Nepmen," as they Hslerej jpalled, jand those who made money spent it lavishly. Their motto was to spend as they got, for they had no security that they would, be able to keep it. Squeezing the Tradter. Since the death of Lenin, there has been a renewal of the campaign against private trade in a more subtle form. It is not by prohibition, or by 'direct confiscation ,as at first, that the private trader is being eliminated, but by economic pressure. He has to pay a much higher rent, and much higher taxes than the co-operative societies or the trusts, or other semicommunalised organisations. The Government banks (there are no , others) refuse him credit, Moreover, the trusts, which are semi-Govern-ment organisations, and which are the manufacturers and wholesalers, handicap him in many ways, by restricting the supply of goods. The result is that private traders .after having flourished for three years, are having to close down right and left. Nevertheless, the Bolshevik leaders believe that the process of exterminating private trade will be a lengthy one ,extending over generations. On the other hand ,the external trade, both export and import, is a strict Government monopoly. No trade can be done with Russia ex-cept.-through the Government or through some organisation licensed by it: "Vnieshtorg,' 'a barbarous word

composed of syllables of other words, meaning "external trade,' 'is the Government Department which controls all this trade. It has formed in England a limited liability- company, named "Arcos'," which is simply the trading branch of the »Russian Government in Britain. For the ordinary British manufacturer who wishes to do an export business with Russia it is no use going to Russia in search of customers. He will have to return to London and call at the office of "Arcos." In Leningrad I met a man of wide experience in Russian trade who was trying to establish a business in a,certain article of British manufacture, He rustled round and found a likely customer. Then his work was finished. All he could say was "Order the article from 'Arcos/ and specify our make." "Arcos' 'then carried out the transaction, and charged 15 per cent for doing so. A Great Monopolist.

Besides 'Arcos' 'there are a certain number of limited companies which have concessions for specific branches of trade, such as timber, wheat and shipping. They are called "Mixed Companies," because, though they are established with private capital, a certain proportion of shares must be allotted to the Soviet Government in return for the concession. The exact proportion of shares, the nature ofthe concession, and <jthe guarantees for security, are matters for bargain in each case. Money has very small value in Russia under present conditions, prices having risen so enormously, and it requires a huge capital to make anything move. The small man is 'being frozen out of the Russian trade, and business is coming more and more into the liands of' big international capitalists. There are also a few institutions in Russia, solialised, of course, such as the railways, and the Naphtha Syndicate, which have the right to purchase material abroad direct, under license from " Vnieshtorg." The cooperative societies have also the right, through their central organisation, "Centre Soyus," lo trade abroad, and they maintain an office in London. They sell co-operative produce, and I buy for their own requirements. ! The thing, therefore, which is growing up and developing in Russia, which exists in an inchoate form, Is very different from the conception of communism which prevails among us. It is not anarchy. It is hot democracy. It is not mob rule. It is not the extreme of popular control. It is not a universal share-out. What is now definitely taking shape is the government of Russia by chartered company The Soviet/ Government :s a great capitalist trading organisation which monopolizes fthe w'hole of thq export and import trade of the country, and at the same time constitutes the Government. In this respect it resembles the old East India Company, "John Company," which used to govern India. It is not subject to popular election or popular control. Its shareholders are not the Russian people, but a small minority called the Communist Party, entrance to which is jealously guarded.