Lecture 3: The Soviet Union
State, Government and Economy
Topics
•
The “state”
consisted of legislatures at every administrative level called Sovety (“Councils”) that were chosen in uncontested
elections and obeyed Party guidance
•
The “government”
consisted of ministries mostly administering specialized industries
•
The “economy” was
owned by the state, operated by the government except in most farming, and
produced according to central directives called “Five-Year Plans” which were
however not plans but commands
The State
•
National
legislature was called the Supreme Soviet of the USSR
– Verkhovnyi Sovet, literally “Upper Council”: vverkh
means “upward”
•
Each Union Republic also had a Supreme Soviet
•
Every lower
ranking entity – province, city, district – also had a soviet
Uncontested Elections
•
Party officials
working for the first secretary ruling each territorial subdivisions picked a
slate of candidates to represent the “indestructible bloc of communists and
non-party persons” (bespartiinii,
“without-party-ish”)
•
Each candidate
was elected by a simple majority from a single-member district
•
Each won with
nearly unanimous support
Voting procedure
•
All adults were
eligible to vote
•
Persons wanting
to vote for the candidate showed their identification (known as a “passport,”
but for movement within the country only), picked up a paper ballot, and
dropped it into an urn
•
Anyone wanting to
vote against showed identification, took the ballot into a screened area,
crossed out the candidate’s name, and dropped the marked ballot into the urn
•
“No” voters were
instantly identifiable
Turnout
•
Turnout was
always recorded as near universal
•
No procedure for
absentee voting
•
Persons absent
from their place of residence could not vote and were not counted
•
Almost a third of
Soviet citizens routinely left town on election day in
order to avoid voting
•
Actual turnout
was about 70 percent
Motivation to Vote
•
If everyone knew
the vote was a pre-determined charade, why did anyone vote?
•
One of the chores
of party membership was collecting people to go to the polls
•
This provided an
opportunity for Soviet subjects to draw official attention to unresolved
problems such as the need for repairs to streets or apartment buildings
•
More important,
after casting ballots voters had the opportunity to buy otherwise scarce
foodstuffs and consumer goods delivered to the polling place
•
Motivation to
vote depended on the state’s near monopoly of the economy
Motivation to Serve
•
Election to a
Soviet only from the “indestructible bloc” made all Soviets strictly obedient
to Party guidance
•
The Politburo was
the only true legislature
•
Why serve without
any discretion?
•
Deputies to
Soviets received privileged access to housing and shops operated by the
Soviets, as well as free travel
•
Opportunity to perform “case work” for constituents also probably
mattered to some
•
Government
officials were required to answer questions sent by deputies
Government
•
Union government
was headed by a Council of Ministers with a Chairman (Russian predsedatel’, “foresitter”)
invariably a member of the Politburo
•
This was the only
title born by (Lenin 1917-22), coupled with the title of General Secretary by
Stalin (1929-1953), and added to the title of First Secretary by Khrushchev
(57-64)
•
Brezhnev
(1964-1982) was the first General Secretary not to assume the post of Chairman
of the Council of Ministers
•
None of the three
later General Secretaries took this post, whose occupant therefore acquired a
degree of independence from the General Secretary
•
A Soviet predsedatel’ is a hierarchical superior able to give orders, not
merely the person recognizing speakers at a meeting
Council of Ministers
•
Most ministers
headed bureaucracies controlling industries generally specialized by category
of product
•
Ministry of
Agriculture both operated some farms (so-called “state farms”) and bought
product from so-called “collective farms” whose chairmen were chosen by
territorial party officials; purchasing was later separated into a specialized
Ministry of Procurements
•
Normal
set of other ministries: foreign, defense, interior (police and prisons), a
“state committee” called the KGB that operated the political police, justice
running criminal courts, education running schools
•
From the
Khrushchev years onward, the “power ministries” reported directly to a tiny
group of the most important Politburo members called under Brezhnev the “Defense
Council,” not through the Chairman
Appointment of Ministers and Officials
•
Ministers were on
the nomenklatura of the Politburo, as were
subordinates heading the very largest factories and certain key research
laboratories
•
Secretariat
maintained a huge filing system containing records on all persons holding
appointments or eligible for appointment in the future
•
Party guidance
took the form of “recommendations” that were invariably enacted by the
ministers who technically made the appointments
•
Together with
holders of party offices and deputies to the Soviets and their staffs,
government appointees composed the ruling group called nomenklatura
after the name of the process used to select them
Gosplan
•
A first deputy
chairman of the Council of Ministers headed the State Planning Committee Gosplan
•
Despite its name Gosplan did no planning
•
It issued
production quotas summarized in the Five-Year Plan but revised yearly in the
annual plan
•
Production quotas
were set for each ministry
Ministries
•
Each ministry
took the production quotas delivered by Gosplan and
allocated them among the production units subordinate to the ministry
•
Production units
might consist of factories, research labs, storehouse, railroad or shipping or
trucking organizations, farms, warehouses, retail stores, or any others
Gossnab
•
A second central
office, called the State Supply Committee or Gossnab
(originally a subdivision of Gosplan), issued
directives to the ministries telling them where to deliver the product ordered
by Gosplan
•
Ministries
subdivided Gossnab directives among their production
units
Money and Finance
•
Finances play
almost no role in transactions among production units: no buying or selling
•
All transactions
occur by a combination of production orders and delivery orders
•
Another state
committee called Goskomtsen issued directives
to ministries with guidance concerning the assignment of prices to products
•
A Ministry of
Finances (Minfin) kept track of the price of
goods delivered to and from each production unit and of the bank balance for
the unit
•
But if a
production unit went into the red, Minfin simply
increased its bank balance
•
The production
unit director might get reprimanded or even reassigned for failing to stay in
the black
Employment and Consumption
•
Both males and
females were employed almost uniformly in production units of various kinds or
were full-time students or military and administrative personnel
•
They were paid in
cash wages that could be spent in retail stores
•
Because wages
were regularly increased while prices were deliberately set low and never
increased except when new products replaced old, retail shelves were ordinarily
empty
•
Most purchases
were made through the buyer’s production unit
Housing
•
Housing consisted
of apartment blocks built according to production quotas set by Gosplan for construction ministries
•
Once complete,
the construction ministries delivered the apartment buildings to local soviets
•
Local soviets
then assigned the apartments to individuals and families who had applied for
new housing
•
Shortages meant
that large employers often built housing for their employees
•
In the Brezhnev
era, some apartment blocks were sold to cooperatives that local officials were
authorized to organize and that sold membership to individuals who purchased
the right to occupy an apartment
•
Private housing
was otherwise non-existent
Origins of the Command Economy
•
When Lenin’s
movement seized power in a few Russian cities, its members felt a generalized
aversion to private ownership
•
Need to mobilize
for the ensuing civil war led to confiscation of privately owned factories and
to rationing of all goods
•
At end of civil
war, while retaining ownership of large industry, the Russian communist party
also encouraged private enterprise
Composition of the Soviet Population
•
Industrial
workers whom the communists felt were their natural supporters comprised only
3% of the population
•
Upwards of 85
percent were subsistence agriculturalists, or peasants, raising barely enough
food to feed their families and to surrender a small surplus
•
While Marx and
Lenin regarded peasants as potential allies for the working class, they also
perceived a political danger
Stalin’s Transformation
•
Stalin used this
doctrinal ambivalence about peasants to assemble a following of civil war
veterans who resented the higher incomes accumulated by the private
entrepreneurs or Nepmeny
•
Their support
enabled him to win a dispute within the Party leadership over economic policy
in favor of a new confiscation coupled with dramatic increases in industrial
employment
•
His decisive
victory in 1929 triggered the transformation of Gosplan
from a planning to a command agency and the beginning of collectivization
Collectivization
•
Land had been
nationalized but peasant villages had been encouraged to seize land and decide
how to allocate it among their members
•
Stalin now
ordered all peasants to join collective farms and to surrender their tools,
livestock and grains
•
Rather than turn
over food, they predictably chose to eat it instead
•
Lacking horses to
pull plows and any incentive to produce a crop that would be confiscated
anyway, peasants who had produced barely at the margin of subsistence now found
themselves starving instead
Urbanization
•
Famine in the
countryside gradually drove the peasant population into the cities where they
necessarily sought employment first as the construction force and then as the
work force in the new factories
•
Also, peasants
labeled “kulaks” (Russ. kulak, “fist,” slang for a village moneylender)
were deported to construction sites in Siberia and the Far North to take advantage of mineral deposits
•
Between 1930 and
1985 a population that had been about 85 percent rural became about 70 percent
urban
An “Economy”?
•
An economy
converts raw materials into finished products
•
Vast expansion
over time in the quantity of finished products of various types
•
An economy
performs conversion by buying and selling
•
In principle, no
buying or selling among production units
•
Buying and
selling were confined to the marginal retail interactions between consumers and
the state and even more marginal sales of private production, primarily food
•
It hardly matters
whether the Soviet system is called an economy
•
It is important not
to allow the term “economy” to confuse
Economic Growth?
•
In a market
economy, economic growth occurs when the value of production increases
•
Production has
value when it is sold
•
Additions to
unsold inventory reduce economic growth by adding to warehousing costs
•
Since the
majority of Soviet product was unsold, was its expansion growth?
Drawbacks of Command Production
•
Gosplan needed to balance quotas for raw materials and semifabricates and quotas for transportation against quotas
for finished product
•
As quantity and
assortment of finished product increased, balancing became more difficult
•
Imbalances were
resolved by development of technically illegal barter among production units
encouraged by Party administrators for leverage
•
Bigger problem is
perverse effects of measurement units
Perverse Consequences of Quotas
•
Quotas must be
expressed in some units
•
Suppose a factory
making windows is told to produce a certain number of square meters of glass
•
Then it is
easiest to produce the quota by making very thin glass, but the resulting
windows break
•
Gosplan shifted to ordering the factories to produce a
certain weight of glass
•
Then it is
easiest to produce the weight by making very thick windows
•
They were too
thick to fit the frames produced by a woodworking factory
•
All over old
Soviet buildings, window glass is puttied into wood frames with slots that have
been broken out to make the window fit
•
Specifying the
units as both weight and thickness doesn’t resolve the problem either because
the number of instructions becomes too large for the central office to
formulate in time
Perverse Consequences of Universal
Employment
•
All persons were
required to be employed or to be studying
•
Unemployment was
a crime known as “parasitism”
•
Being a crime,
loss of employment was ordinarily imposed only for political dissent as a
preliminary to charges of parasitism, often accompanied by accusations of rape
•
Since one could
not lose one’s job and since promotions were a reward for political loyalty,
what was the incentive for most people to work hard?
•
Work effort was
low and much product was deficient to the point of being inoperable