Aggression by Economic Planning

...I asked...

...Roughly speaking, there are only three main channels for the consumption of wealth produced by a modern industrial society: (1) consumption by individuals for material needs...

...The only real military security for the non-Communist world lies in continued and marked scientific-technological superiority over the Soviet Union...

...When," I asked him, "are you going to build six-room private homes and private automobiles in quantity for Soviet citizens like those many Americans have...

...What, then, is the essence of the matter...

...atomic superiority as what it represents: economic, technological and scientific dominance...

...in economic development...

...On the other hand, no U.S...

...How will it be used in the future...

...If started now, such an effort could succeed without impairing political freedoms and still providing a steady and appreciable rise in living standards...

...The present average for city dwellers is a little over a third of this standard...

...It goes without saying that the Party and the Government cannot and will not do this...

...If price cuts will be insignificant, how can the Soviet Government fulfil its promise of a 30-per-cent rise in real wages...

...Tom Whitney studied Russia and Russian before the war and joined the OSS in 1941...

...The latest promises were made by Malenkov in late 1953...

...Soviet efforts in hydroelectric construction are also impressive...

...and new electric power equal to three-quarters of the combined 1955 output of Britain, France and West Germany...

...In view of Soviet behavior in world affairs, people outside Russia are entitled to ask what the Kremlin intends to do with its enormous economic potential in the years to come, particularly after 1960...

...Staring fixedly at his half-empty glass of milk, he finally remarked: "I'm not here to talk about politics...

...Three of these dams one of them complete, another well advanced in construction, the third to be built will be larger than any single hydroelectric installation in the world...

...Who will pay for these increased prices to the collective farms...

...Between 1948 and 1955, there was a steady rise from miserable wartime levels in real wages and consumer income...

...Though military expenditures have been important in the last 15 years, the significant long-term direction has been toward raising living standards...

...It is possible these will mean a reduction in the size of private land plots farmed individually by collective farmers and in their private livestock holdings...

...This is much more dangerous than Americans realize and it will become even more so five years from now unless the U.S...

...The new increase in procurement prices, therefore, means that the Government has abandoned the policy of cutting retail prices a policy introduced in 1947 with derationing and currency reform and implemented annually through 1954, but not in 1955...

...Agriculture, transport and even the living standard (seen merely as a bar to increased productivity) are obvious trouble spots...

...This means that, unless the U.S...

...however, attempting to surpass the U.S...

...A much lesser part is devoted to raising the low living standards of Soviet citizens...

...This means that in just five years the Soviet Union plans to add to its existing steel output a new steel industry as powerful as that of West Germany...

...despite some colossal failures on individual sectors, the Soviet leadership has done on the whole what it set out to do...

...This is apparently an important step in reducing the peasants to landless farm laborers, depriving them of the last vestige of the most basic human freedom the right to have and use land and livestock...

...The U. S. economy is geared to individual consumption...

...For an answer, we turn to the words of Khrushchev in 1953 at a time when procurement prices for potatoes and vegetables had also just been sharply raised...

...While capital-goods and armaments output has rocketed upward, the living standard of Soviet citizens has risen little, if at all...

...By a rise in monetary wages...

...Nevertheless, many consumer-goods goals originally set for 1955 by the Fifth Five Year Plan were attained...

...But standards of public health and technical education have risen greatly...

...Nikita Khrushchev claims that during the first five Five Year Plans, from 1928 through 1955, Soviet industrial output rose more than 20 times...

...The real factor which has led Soviet leaders to avoid war in the last decade is not so much U.S...

...By the end of this year, nearly 75 million acres will be under crops, or about to be, on these farms...

...It would not be surprising if the Soviet Union scored a major triumph by putting its first large atomic-power station into operation before the United States...

...In clothing and footwear, too, the average Russian got considerably more than in 1928...

...And in the crucial machinery industries the U.S...

...rate of increase has been averaging from 3.5 to 5.5 per cent per year recently...

...Meanwhile, the total wage bill of the economy (and, presumably, the average money wage as well) will be swelled by the rise in the number of bureaucrats, technicians and executives who run the Soviet machine and draw down fat pay and bonuses...

...If fully implemented, it would for the first time raise living standards substantially above the 1928 level...

...These are important, to be sure, but to rely primarily on them is a Maginot Line psychology...

...it produced only about 5 per cent less coal, 15 per cent less electric power, 20 per cent less steel than those three great industrial nations (all producing at record levels) combined...

...He does have more electricity and gas, better sanitation and water supply, but this is small compensation for terrible overcrowding...

...Holding back living standards in favor of a grandiose increase in state military-economic might has been a deliberate policy...

...Superficially, the situation might seem comforting...

...Medical care became available to almost everyone...

...He has been an AP foreign-news analyst here since the end of 1953, covered the U.S...

...And 65 new TV stations will be built...

...Certainly the ordinary Soviet city-dweller has considerably less housing floor space today than 27 years ago...

...new petroleum output greater than Saudi Arabia's...

...Housing space on the farms probably has not declined since 1927, and a significant number of peasants now have electric lighting, hut the typical Russian peasant hut remains what it was...

...Germany and France in industrial development...

...In fact, Lazar Kaganovich's I speech indicates that a wage reform and general revision of piece-work norms will be carried out in such a way as to constitute nothing less than a speed-up for all workers...

...superiority to the USSR is still more than 3 to 1 in electric power, more than 2 to 1 in steel, nearly 5 to 1 in petroleum...

...in 1955...

...State military-economic power is also the key to understanding the Sixth Soviet Five Year Plan, recently approved at the 20th Communist Party Congress...

...Some progress is, likely in agriculture, though probably much less than planned...

...Other standard-of-living factors are harder to measure statistically...

...Yezhevsky suddenly remembered he was speaking to an American journalist...

...Cloth production rose more than 80 per cent on a per capita basis...

...Even judged purely as an economic machine, without attention to moral and political factors, the Soviet economy shows many weaknesses...

...He told me that he and a colleague had toured the Minneapolis suburbs the previous day...

...One must, then, regard the latest plan's assurances with skepticism especially since these are closely tied up with a fantastic agricultural plan which continues previous unrealistic Soviet patterns...

...Present predictions for the U.S...

...With a relatively small proportion of national income, as compared with Western countries, going to meet consumer needs, Moscow can direct a much higher percentage of national income and industrial production down lines of state effort...

...Americans have a tendency to rely on the H-bomb and "massive retaliation" to deter would-be aggressors...

...Instead, the new Sixth Five Year Plan follows the old pattern: "heavy industry first.'' Between now and 1960, total industrial production is scheduled to rise by 65 per cent, with heavy industrial production increasing 70 per cent and machinery output (capital goods and weapons) by 80 per cent...

...Ten years' time may be too late...

...Early in 1954, the Soviet Government announced a program for sowing grain in virgin and uncultivated lands in Kazakhstan and other eastern areas of the USSR...

...Petroleum output will increase from 71 million tons to 135 also nearly double...

...maybe more, in 1960...

...On the other hand, the Soviet consumer in l955 had a great deal more of industrial consumer goods, ranging from soap, matches and kerosene to bicycles, watches and radio sets...

...Already some documents have emanated from Moscow which raise serious questions...

...In two short years, over half a million Soviet youths have been mobilized and settled on these plains...

...2) consumption by the state for defense or war...

...Today's average Russian cats considerably less milk, butter, meat and other high-quality foods than in 1928...

...He does get more potatoes, considerably more fish and sugar, more vegetable fats and less animal fats...

...Yezhevsky had seen quite a bit of me as I accompanied his group through Iowa, South Dakota and Minnesota, and it wasn't the first time we had chatted...

...livestock population declined while human population rose and Soviet territory expanded...

...Instead, steel, rubber and other materials, as well as the industrial capacity involved in their production, go to make capital and war goods...

...America's 1955 production was 8 million cars...

...Acute consumer needs are being deliberately suppressed in order to prepare for a future political, economic and perhaps military offensive against other nations primarily the United States...

...American economists familiar with Soviet statistical methods estimate the increase at eight to nine times quite a rise in any case...

...It promises a 30-per-cent rise over 1955 in real wages for workers, and a 40-per-cent increase in farm income...

...is a danger to the free world and a temptation to its power-minded leaders...

...Ex-Premier Malenkov revealed in 1953 that, from 1929 through 1952, the Soviet Government invested nine times as much in heavy industry (basic raw materials, capital and war goods) as in light industry (consumer goods...

...Without intelligent, elastic and imaginative foreign policies, it could easily mean nothing...

...In 1928, the USSR ranked behind Britain...

...Finally, directives have been issued since the Congress which may nullify any living-standard gains Soviet farmers might have expected from the plan...

...Take private automobiles, for example...

...The new plan's goals for living standards are also impressive, on their own relative scale...

...accelerates its growth, the Soviet Union will continue to narrow the gap...

...Industrial leaders announced big programs of capital expansion...

...In both the Fourth and Fifth Five Year Plans, the Soviet Union overfulfilled its targets for these items...

...The simple fact is that the United States is in grave and immediate danger of losing its industrial-technological-scientific leadership in the world and, with this, its political influence...

...The U.S...

...That has not been permitted since 1946...

...Steel output will increase from 45 million metric tons to 68 million over 50 per cent...

...The death rate fell from one of the highest in Europe to one of the lowest...

...are 1 to 2 million kilowatts...

...Electric power production will increase from 170 billion kilowatt hours to 320 billion nearly double...

...In addition, Khrushchev told the Congress that between 1957 and 1960 the work-week will be shortened from its present 48 hours (six eight-hour days) to 41 hours (five seven-hour days, six hours on Saturday) or to 40 hours (five eight-hour days...

...Primary education is universal while higher technical education has greatly expanded...

...One is growth...

...The plan promises new housing for about 20 million persons on the basis of a Soviet "minimum-decency" allotment of 10 square meters (108 square feet) of floor space per person...

...The U.S...

...In the first place, the Soviet Government has made substantial promises to consumers before and failed with a fair degree of uniformity to keep them in full...

...Educational facilities will be expanded to provide universal 10-year schooling, more higher technical education, and at long last tuition-free secondary and higher education...

...Two major facts describe Russia's economy now: 1. Through enormous sacrifice and effort, the Soviet Union has reached industrial maturity...

...The USSR is in the process of transforming the Volga into a long series of big dams...

...This is no small program...

...Russia is maintaining a fairly steady-pace of increasing its industrial output 10 per cent and more per year...

...Then, instead of reducing retail prices for potatoes and vegetables, which the Party and the Government are constantly doing, we would have to raise them, which is not to the people's interest...

...tour of the Soviet farm delegation, and bus also written for the N. Y. Times Magazine...

...Even making the necessary discount for official duplicity toward consumers, the plan will see some improvement in living standards...

...It has achieved that 20th-century industrial-scientific transformation which enables it, like the United States, to produce hard goods in an endless and ever-increasing stream...

...Whether the Soviet citizen now eats more grain and cereal products is problematic...

...in living standards but rather in potential for war...

...This explains the speed of the Soviet atomic effort and the rapid Soviet advances in guided missiles and jet planes...

...If we were to extend this policy, trade in potatoes and vegetables would be unprofitable [for the state T.W...

...The last is, in effect, deferred consumption which ultimately swells consumption through the first two channels...

...Output of industrial consumer goods will be increased anywhere from 23 per cent for cotton textiles to 510 per cent for washing machines 60 per cent overall...

...Nevertheless, the fact remained that the people of the USSR had received only the smallest share of the enormous increase in industrial production and national income...

...One may well question the agricultural wisdom of this program, but one must be impressed by its vastness...

...can go blithely along paying no attention at all to the Soviet economic challenge in which case Russia could well catch up with and overtake us somewhere between 1965 and 1980...

...1955 was a boom year in the U.S...

...The 1955 figures now available contrast poorly with the goals of that widely-publicized Malenkov plan...

...a new coal production roughly equal to Britain's...

...Most important of these is a decree raising the prices which the Government will pay to collective farms for potatoes and vegetables...

...In other words, price cuts, which between 1947 and 1954 affected important commodities, including clothing and food, will now be limited to goods of lesser significance...

...The ultimate goal presumably is to eliminate private livestock and reduce the private land plots to decorative significance...

...On the whole, however, the Soviet did in l955 was inferior in quality to what it had been before the First Five Year Plan, when it was not very good...

...Ho served in Moscow from 1944 through July 1953 first as chief of the U.S...

...The year 1956 is, in a sense, a watershed...

...By 1960, says the Sixth Five Year Plan, the Soviet Union will have nuclear power stations with 2 to 2.5 million kilowatts of capacity...

...In 1960, heavy industry will command an even greater share of total industrial production than its present 70 per cent...

...One cannot dismiss these goals as mere propaganda...

...In other circumstances, he would have given the proper Communist answer: "The essence of the matter is the military-economic strength of the state...

...A further rise in procurement prices for potatoes and vegetables is impossible...

...The Soviet economy may not be irrevocably oriented toward endless state consumption for defense and war, but the direction of Soviet capital investment forces the conclusion that defense and war needs are decisive...

...Potato prices were raised 150 per cent and more, vegetable prices 70 per cent and more...

...In effect, the Soviet Communist leadership is practicing what can be called "aggression by economic planning...

...In his report, Khrushchev admitted that it will not be possible to carry out price decreases on their former scale...

...Hospital space will be expanded nearly 30 per cent, social security appropriations raised nearly one-third...

...But that improvement is nowhere near what could De done if the Soviet Government were willing to divert resources away from the buildup of military-economic potential...

...And here our margin is rapidly being narrowed...

...Twice as many shoes per capita were produced in 1955 though that meant only 1.5 pairs per person per year...

...It has been the key to Soviet planning for 28 years...

...It is now apparent that this program was cut back severely even before the end of 1954...

...They arc not...

...The Soviet Union produced about 100,000 passenger cars in l955...

...If we wait five more years, much greater efforts will be required...

...it plans to increase this to perhaps 200,000 in 1960...

...On the other hand, the Soviet Union has nearly caught up in coal...

...When complete, in 1960, the latter will have a capacity of 3.2 million kilowatts and an annual output of 20 billion kwh nearly half as much as all the electric power stations of France combined...

...Scientific-technological-economic superiority is, of course, no panacea for our world problems...

...It is a year in which the Soviet Government might have decided to shift its emphasis to the citizens' needs...

...Kinbussy's economic section, then as Associated Press correspondent (reporting such events as the birth of the Cominform, Stalin's death and Beria's arrest...

...Said Khrushchev: "We have done as much as we can to raise potato procurement prices...

...The husky, dark-haired Siberian industrial executive was taken aback, but quickly replied: "The essence of the matter isn't six-room homes and automobiles...

...The avowed goal indeed, obsession of the Soviet leaders is to "overtake and surpass" the U.S...

...The U.S...

...Farm homes built by peasants for themselves will supplement this Government-built housing...

...If the Soviets wanted to, they could produce a million autos...

...and (3) capital investment by the state or private enterprises...

...Until Russia decides to compete with us in meeting citizens' needs, the economic power which it is creating...

...wakes up...

...Summing up, the Sixth Five Year Plan will be another big stride in increasing the military-economic might of the Soviet state...

...It has created a complex military-economic machine of great size and striking power...

...The Congress did hear a promise of increased wages for the lowest-paid workers, but not a word about wages generally being permitted to move upward...

...2. The Soviet leadership is devoting most of the great wealth which flows from its mines, mills and factories to increasing the military-economic might of the state...

...However, there appear to be several booby-traps in the plan...

...On the remote and frigid Angara, one large dam is nearing completion, and construction has begun on the biggest of all at Bratsk...

...The ability to concentrate may also mean that, in certain fields of military technology, the USSR is already ahead of the United States...

...The alternative is for the United States to mobilize in a giant effort, not so much military as economic, technological and scientific, with the aim of retaining a constant 2-to-1 margin over the Soviet Union...

...An even shorter work-day is planned for miners and young people...

...The second factor is concentration...

...The consequences of this are incalculable or, rather, they are too easily calculable and too horrible...

...Although this policy poses acute problems for the U.S., our political leaders either are unaware of them or do not dare bring them to the attention of the American people...

...The Sixth Soviet Five Year Plan Aggression by Economic Planning By Tom Whitney One morning last August, Alexander Yezhevsky, Deputy Soviet Minister of the Farm Machinery and Tractor Industry and member of the Soviet agricultural delegation to the United States, sat beside me at breakfast in the coffee shop of the Nicollet Hotel in Minneapolis...

...Nor would it be surprising if the Soviet Union succeeded in shooting into space the first artificial satellite...

...policy, no matter how ingenious, could ever compensate for the loss of that superiority...

...margin is probably not better than 2 to 1. Two factors imply that this margin is now insecure...

...The peak acreage under wheat in the United States in 1949 was only 76 million acres...