Stalin

Stalin had been preoccupied with a possible French-led collective boycott that could cut the Soviets off from all advanced technology, and Orjonikidze had bent over backward to a delegation of German industrial luminaries, while Stalin restrained the insurrectionist impulses of the German Communists.¹²⁵ Berlin, for its part, faced shrinking foreign markets and rising unemployment—and was coming around to the idea that Stalin’s crazy building of socialism might work. A bilateral trade agreement had been signed that extended German government-guaranteed credits to the USSR for a period of twenty-eight months, longer than the usual. The Soviets were to use the funds to purchase an additional 300 million marks’ worth of German industrial goods, at favorable prices.¹²⁶ The deal was supposed to underwrite the wild industrial leap of 1931 and put to rest, for now, the feared anti-Soviet boycott. German exports to the USSR would jump to double the level of 1929. But the agreement had not resolved the severe Soviet balance-of-payment problems.¹²⁷ The Soviets even failed to reap the benefits of the pound’s devaluation because of their renewed economic reliance on Germany.

¹²⁸

Soviet reliance on expensive short-term credits—the only kind predominantly available to the Communist regime—imposed relentless pressure to retire maturing debt and obtain new loans. With Soviet foreign debt more than doubling in the period 1929–31 (it would increase 50 percent in 1931 alone), rumors of a pending default spread in the Western press. (Turkey and much of Latin America defaulted at this time.)¹²⁹ On October 6, 1931, the British chargé d’affaires in Moscow wrote to London that the severe Soviet balance-of-payments crisis, on top of the failures to meet 1931 output targets, would even compel Moscow to break off rapid industrialization and collectivization.¹³⁰ Wishful thinking aside, the worsening terms of trade and tariffs did force the Soviets to curtail imports of consumer and even capital goods.¹³¹

But the Soviets meticulously paid their debts. The pressure to do so partly explains the regime’s continued export of grain despite fears for the harvest and low global prices.¹³² Only state-imposed deprivation allowed the USSR to avoid external default.

THE STRUGGLE AGAINST KULAK SABOTAGE

Compared with the robust 1930 harvest—officially estimated at 83.5 million tons, but closer to 73–77 million—the 1931 harvest would come in somewhere between 57 million and 65 million tons. A cutback in grain exports loomed, but Stalin stalled the reckoning, continuing to lash out at the “liberalism” of rural officialdom for failing to extirpate “the kulak.”¹³³ He also countenanced intensified religious persecution and ruination of churches.

¹³⁴ Still, he had grudgingly allowed a slight reduction in procurement targets for the Volga, the Urals, Siberia, and Kazakhstan, the most drought-stricken regions, while holding the line on Ukraine’s targets and raising the quotas for the North Caucasus (which had largely escaped the drought).¹³⁵ Mikoyan, on October 31, 1931, told a Central Committee plenum that on the eve of the harvest, “we had awaited the season of the grain collections with rainbow perspectives.”¹³⁶ Regional party bosses, given the floor, uttered the truth: drought and a poor harvest had rendered even the reduced quotas impossible. Stalin—who got his back up when officials cited natural causes as excuses—exploded, sarcastically mocking one speaker’s “exactitude” in adducing data on lower crop yields.¹³⁷

And yet, the dictator agreed to gather separately with plenum delegates from the grain-growing regions, which resulted in additional procurement reductions.¹³⁸

Growers were reluctant to sell even what they had at the regime’s punishingly low prices: in 1931, the market price per tsentner of rye was 61.53 rubles, versus the state price of 5.50; for wheat, the disparity was greater still.¹³⁹ But now, procurement agents grabbed even the food for minimal consumption. State collections in fall 1931 (and into early 1932) would leave farmers with less grain, meat, and dairy than in any year since the mid-1920s. “Comrade Stalin, I ask you to look into how collective farmers live on the collective farms,” urged one of the countless letters pouring in about the starvation. “At the meetings it is impossible to speak up; if you do speak up, then they say you are an opportunist.”¹⁴⁰