Stalin, Volume 1

by Stephen Kotkin

  Stalin applied pressure on the foreign affairs commissariat to look after foreign grain purchases, and took part in instituting surveillance of foreign aid workers.182 He also proposed that the ARA be charged for the cost of transporting its emergency food supplies on Soviet territory.183 Thanks to the foreign donations and the purchases abroad of seed grain, as well as a return of favorable weather and peasant survival instincts, the 1922 harvest turned out to be robust. Additional alleviation was provided by the belated effects of the New Economic Policy’s incentives for peasants, so that from 1923 a recovery commenced.184 The regime, grudgingly, played a part, too. It passed the Land Code, which forbade the sale and purchase of land and restricted the legality, and to an extent the reality, of land leasing and the hiring of non-family farm labor, but it allowed peasants legally to grow any types of crops, raise any type of livestock, and build any type of structures on the land; women were recognized as equal members of the peasant household. Above all, the Land Code allowed peasant households to exercise real choice in legal land tenure: communal-repartitional, collective farm, even consolidated homesteading (i.e., Stolypinism).185 The Land Code did not use the term “commune,” substituting instead “land society,” but the regime was compelled to acknowledge that the commune had self-governing authority.186 The regime also found itself compelled to drastically reduce financial support for collective farms, which shrank to an even smaller part of the arable land (under 1 percent). The turnabout was stunning: peasants, whether communal-repartitional or homesteader, obtained far-reaching economic freedom.

  The size and timely collection of the harvest remained the key determinant of the country’s well-being, and the peasant revolution that paralleled the Bolshevik seizure of power was strong enough to reshape the Soviet state. The civil war commissariat of food supply, the “requisitioning commissariat,” yielded its predominant position to the agriculture commissariat, a kind of “peasants’ commissariat” inside the proletarian dictatorship. Punctuating the shift, Alexander Smirnov (b. 1898), a party loyalist with a practical bent, was shifted from deputy food supply commissar to deputy agriculture commissar, on his way to assuming the top position in 1923. The “requisitioning commissariat” had been located at the Upper Trading Rows right on Red Square; the “peasants’ commissariat” was located, of all places, at Old Square—N. 8, just down from Communist party HQ—in the former Boyarsky Dvor Hotel and business complex built in 1901–3 in art nouveau style.187 In the famine, agricultural commissariat personnel found a raison d’être, concluding that peasant farming was perpetually on the edge of the abyss because peasants were ignorant of modern farming’s best practices. Therefore, peasants needed to be educated by agronomists and other specialists.188 The agriculture commissariat would grow into the regime’s largest, with more than 30,000 staff in central and regional offices, plus another 40,000 working on forestry. This eclipsed in size even the internal affairs commissariat, that is, the combined regular police-GPU, as well as the second biggest—the finance commissariat.189

  ILINKA, 9

  That a finance commissariat existed under a Communist regime was a surprise. During the civil war the regime had collected no taxes, funding itself by confiscating grain and other goods and printing paper money.190 Confusion enveloped the country’s monetary base. The populace still used nikolaevki (rubles under Nicholas II), dumskie (rubles associated with the Duma period), and kerenki (rubles under Kerensky and the Provisional Government), which the Soviet regime itself printed for a time without the crown on the double-headed eagle, as well as foreign currency, which circulated illegally and at ever steeper exchange rates.191 The Whites in territories they controlled had accepted Soviet-printed kerenki, but not Soviet rubles (sovznaki) on which the Whites stamped “money for idiots.”192 The resulting runaway inflation made vodka a major means of exchange and store of value, as barter took over the economy. Things were not as bad as Weimar Germany’s hyperinflation, where the Mark went from 60 to $1 in 1921 to 4.2 trillion to $1 two years later, but a top tsarist-era economist estimated that between 1914 and 1923 the ruble depreciated by 50 million times.193 Some Bolshevik fanatics asserted that the hyperinflation constituted a form of class war, and one called the printing presses the “machine-gun of the finance commissariat.” Ideologues also asserted that the “end of money” marked an advance in the stages of civilization, toward Communism.194 But by 1924, the Soviet currency would be stabilized and the economy remonetized, a stunning turn of events achieved by a rebuilt finance commissariat.

  The finance commissariat had seized the grand premises of the Moscow offices of the expropriated St. Petersburg International Bank, at Ilinka, 9. The street’s name derived from an ancient monastery named for Ilya (Elijah) the Prophet, but Ilinka was jammed with enclosed trading rows, banks, and exchanges, and had served as prerevolutionary Moscow’s financial hub inside the walled commercial quarter known as Kitaigorod. Also situated on Ilinka were the foreign trade commissariat (N. 14) and the workers’ and peasants’ inspectorate, which Stalin had merged with the party’s Central Control Commission (N. 21), where many a Communist was summoned to be disciplined. The Red Army, besides its main complex at Znamenka, had seized a second structure for the army political administration, Ilinka, 2, the former wholesale Middle Trading Rows, right near Red Square, where it would publish its newspaper Red Star. Ilinka connected Old Square and Red Square, and was the street Stalin walked down every day to and from work with his party comrades who also lived in Kremlin apartments. Without the macroeconomic achievements of Ilinka, 9, Stalin would not have enjoyed the stability that rescued the Soviet regime and enabled him to concentrate on building his personal dictatorship. The finance commissar was Grigory Sokolnikov (b. 1888), who had replaced the hapless Nikolai Krestinsky in 1922, not long after Stalin had filled Krestinsky’s former position atop the party apparatus.

  Sokolnikov had a spectacular revolutionary biography.195 He grew up in bourgeois privilege in a Moscow Jewish family: his father, a physician, owned a building where the family occupied eight rooms on the upper floor and operated a lucrative pharmacy on the ground floor. Grigory, their eldest son, had German and French governesses, attended a classical gymnasium in the Arbat neighborhood (with Nikolai Bukharin and Boris Pasternak), and joined the Moscow Bolsheviks in 1905 (he may have derived his nom de revolution from the city’s Sokolniki ward). He ended up in Siberia, then in foreign exile, where he completed a doctorate in economics at the Sorbonne. Sokolnikov returned to Russia on the sealed train with Lenin and in July 1917 was elected to the small Bolshevik Central Committee, working closely with Stalin as one of the key editors of the party press and taking part in the key votes in favor of a coup, which he helped carry out.196 Afterward, Sokolnikov oversaw bank nationalization.197 He replaced Trotsky as head of the Brest-Litovsk delegation, at age twenty-nine, and signed the treaty.198 During the civil war, despite lacking formal military training, Sokolnikov served not as a political commissar but as a commander, earning an Order of the Red Banner.199 In 1920, Stalin requested that Sokolnikov be dispatched to him on the southern front against the Poles.200 Instead, Sokolnikov was given charge of reconquered Turkestan, where, as we saw, he organized a counterinsurgency and introduced the NEP tax in kind earlier than would be done in the country as a whole, legalized private markets, and carried out a monetary reform.201 In Moscow, following surgery in Germany (he had a liver condition, among other ailments), Sokolnikov relied on a team of prerevolutionary financial professionals, forced through a restoration of the State Bank, and prevented the deportation of Professor Leonid Yurovsky, who spearheaded the creation of a new currency called the chervonets, a “hard” ruble to be limited in the scale of issue and backed by gold bullion and foreign reserves.202 Sokolnikov supplemented the chervonets with gold coins issued with a portrait of the murdered Nicholas II.

  Sokolnikov achieved his macroeconomic reforms in the face of widespread resistance and incomprehension in the party.203
Hard currency and gold reserves had essentially been depleted to finance emergency grain imports, but the good harvest of 1922 allowed renewed exports, which delivered a shock windfall that rebuilt gold reserves from 15 million gold rubles in January 1923 to 150 million a year later, and enabled the takeoff of the chervonets.204 Regular Soviet rubles (sovznaki) underwent three bouts of replacement at severely depreciated levels, while the chervonets grew to around 80 percent of the currency in circulation.205 Sokolnikov enforced balance of payments discipline as well, and by 1924 the Soviets would manage a trade surplus.206 Sokolnikov oversaw introduction of a regular budgetary system, with revenues from customs duties, transport, and especially direct taxation (the agricultural tax in kind, an income tax), but also new excise taxes on common items such as matches, candles, tobacco, wines, coffee, sugar, and salt. Taxing salt had been abolished as far back as 1881, making its revival by Sokolnikov extraordinary. The regime, in 1923, also reintroduced the monopoly on vodka sales (the tsars’ derided “drunken budget”), bringing in significant revenues.207 The GPU undercut Sokolnikov’s work—the politburo approved Dzierzynski’s proposal to expel all “speculators,” including currency dealers, from Moscow and other big cities—but Sokolnikov fought back.208 “The more financing your operatives receive,” Sokolnikov is said to have told Dzierzynski, “the more manufactured cases there will be.”209 The industrial lobby, too, battled Sokolnikov tooth and claw, claiming that his tight money was strangling Soviet industry.210 But Sokolnikov gave no quarter, taunting them by declaring, “Money-printing is the opium of the economy.”211 Mikhail Lurye, known as Yuri Larin, a pundit, charged in 1924 that the finance commissariat was imposing its own “dictatorship.”212 In effect, Sokolnikov helped teach Stalin macroeconomics, the relationship between the money supply, inflation, balance of payments, and exchange rates. Stalin backed him.213

  “UNDER STALIN’S WING”

  Stalin’s power flowed from attention to detail but also to people—and not just any people, but often to the new people. The Society of Old Bolsheviks came into being on January 28, 1922, and Stalin spoke at their inaugural meeting.214 Members had to have joined the party before 1905 and expected recognition of their hard labor stints and exile under tsarism and their seniority. But though the regime resolved to reserve the position of provincial party secretaries for party members who had joined at least before the February Revolution, in practice the guideline was violated. Old Bolsheviks were proportionally overrepresented in administration, but in a preponderance of lower-level posts, the politburo excepted.215 The Old Bolsheviks, especially those who had lived in European emigration, often looked askance at the newcomers as crude simpletons, but the latter viewed the Old Bolsheviks as suspiciously bourgeois. Each group had gone through the same civil war experience and the younger ones came out confident they did not need to know multiple foreign languages or be university educated to get things done. Stalin, although of course an Old Bolshevik himself, favored the upstarts. Many came from the workers and the peasants, but far from all.216 Fully one quarter of party members as of 1921 admitted to white-collar origins. These were not, however, predominantly figures who had served in tsarist institutions; many were products of the February Revolution, having joined various bodies of the Provisional Government. After October, they grafted themselves onto the new regime.217 “The new political elite was not predominantly proletarian in origin,” one scholar has written. “It was, however, predominantly plebeian.”218 The revolution was carried by the partially educated who often continued to study at night after long hours on the job.219 Stalin identified with them; they were younger versions of himself. Still, the people closest to him presented an eclectic mix.

  The most important was Vyacheslav Skryabin (b. 1890), better known as Molotov (“the Hammer”), perhaps the regime’s first pure apparatchik (Krestinsky had concurrently been party secretary and finance commissar). The son of a shop clerk, he had managed to enroll in the St. Petersburg Polytechnique Institute, but joined the party and became an editor of Pravda after it was briefly legalized. In 1915, he adopted his party pseudonym, later explaining that “Molotov” was easier to pronounce than “Skr-ya-bin” for someone who stuttered, as he did, and that “Hammer” sounded proletarian, industrial, and could impress workers, who did not overly love party members of the intelligentsia.220 (Molotov, like Lenin, preferred a bourgeois suit and tie.) Like Stalin, Molotov had spent some time in prerevolutionary exile in Vologda, where he earned his keep by playing violin in a restaurant to entertain drunken merchants. He and Stalin may have first met in St. Petersburg, in 1912, at a dentist’s quarters that doubled as a safe house.221 Elbowed from the top position by Stalin twice (in 1917 at Pravda and in 1922 at the party secretariat), Molotov could have nursed a grudge and connived to undercut Stalin. Instead, he hitched his wagon to the Georgian, acceding to Lenin’s wishes and Stalin’s eleven-year seniority. Trotsky mocked Molotov as “mediocrity personified,” but Lenin, intending a compliment, called his protégé “the best filing clerk in Russia.”222 Boris Bazhanov, who worked in the apparatus in the early 1920s, also came away impressed. “He is a very conscientious, not brilliant but extremely industrious bureaucrat,” he wrote of Molotov. “He is calm, reserved. . . . With everyone who approaches him he is correct, a person utterly approachable, no rudeness, no arrogance, no bloodthirstiness, no striving to humiliate or crush someone.”223 Bazhanov’s words said as much about Bolshevik political culture as about Molotov.

  Valerian Kuibyshev (b. 1888), an ethnic Russian and native Siberian, was from a hereditary military family. He studied at the Omsk Cadet School, then moved to the capital to enter the Military Medical Academy, but in 1906 was expelled for political activity and fled likely arrest. He managed to enter the Tomsk University Law Faculty but left after a year, went into the Bolshevik underground, and was arrested and exiled numerous times, including to Narym (from 1910) and Turukhansk (from 1915), places where Stalin had been exiled. Kuibyshev was a practiced musician like Molotov and a poet like Stalin. He took part in the 1917 Bolshevik coup in the Volga city of Samara and during the civil war served on the southern front, and then had a commanding role in the reconquest of Turkestan. Precisely when he first caught Stalin’s eye remains unclear. Stalin made him a full member of the Central Committee and a Central Committee secretary in 1922. In late 1923, Stalin named him the head of the party’s Central Control Commission, which had been established as a neutral court of appeal, but under Stalin became a bludgeon to punish party members.224 Kuibyshev viciously went after local resistance, perceived and real, to central directives and lined up officials behind Stalin in the regions and the center.225 Trotsky dubbed Kuibyshev “the foremost violator and corruptor of party statutes and morals.”226 Kuibyshev’s loyalty to Stalin was absolute.227 He also appears to have played a role in bringing to Moscow yet another indispensable functionary in Stalin’s faction—Lazar Kaganovich.

  Kaganovich (b. 1893) hailed from a village in the tsarist Pale of Settlement near the small town of Chernobyl, and embodied the rough plebeian cohort. His father was an uneducated farm and factory laborer; his mother gave birth to thirteen children, six of whom survived. Lazar spoke Russian and Ukrainian, with a smattering of Yiddish, and he briefly attended a heder attached to a synagogue. But his family could not afford to educate him and he apprenticed to a local blacksmith, then moved to Kiev and joined one of his brothers at a scrapyard. At age fourteen, Kaganovich started laboring at a shoe factory—what Stalin might have become, had he had fewer options in Gori and Tiflis—joined the party in 1912 in Kiev, fought in the Great War, and, following the Bolshevik coup, in January 1918, as a twenty-four-year-old went to Petrograd as a Bolshevik delegate to the Constituent Assembly.228 During the civil war, he served in Nizhny Novgorod and Voronezh, where Trotsky’s people predominated. But during the controversy over trade unions, Kaganovich, then a trade unionist, sided with Lenin against Trotsky. Just two months after Stalin became general secretary, K
aganovich was hired in the central apparatus and put in charge of the Organization and Instruction Department, which soon absorbed the Records and Assignment Department—and would oversee the nomenklatura system. Kaganovich’s attachment to the charismatic Trotsky may have extended beyond the civil war (according to an aide in the apparatus, Kaganovich “for a rather long time tried to look like Trotsky. Later everyone wanted to copy Stalin”).229 But soon he would infuriate Trotsky with slashing ad hominem attacks. He was indisputably proletarian and, like Stalin, distrusted intellectuals and “bourgeois specialists.”230 Kaganovich was a fine speaker and natural leader, with immense energy and organizational muscle. “He is a lively fellow, no fool, young and energetic,” wrote Bazhanov.231 In 1924, Stalin made Kaganovich a Central Committee secretary.232

  Stalin’s faction had tentacles around the country. He picked up a number of loyalists united by their common service, whether former or current, in Ukraine, the key republic after Russia. Other figures around him hailed from the Caucasus: the Georgian Orjonikidze (b. 1886), party boss in Georgia; the Russian Sergei Kirov (b. 1886), party boss in Azerbaijan; and the Armenian Anatas Mikoyan (b. 1895), party boss in the North Caucasus. Another figure who ended up close to the dictator was Mikhail Kalinin (b. 1875), three years Stalin’s senior, who had similarly spent time in the Caucasus during the underground years.233 Stalin got his civil war loyalist Klim Voroshilov named head of the North Caucasus military district (1921–24); he turned out to be the only loyalist from the Tsaritsyn “clan” who remained close to Stalin.234 Other figures from the civil war–era southern front—above all, those associated with the First Cavalry Army—would see their fortunes rise with Stalin, including the First Cavalry commander Semyon Budyonny as well as Alexander Yegorov. Still, in the early 1920s, Molotov, Kuibyshev, and Kaganovich constituted the innermost core of Stalin’s political clan. Observers began to say these men walked “under Stalin’s wing” (khodit’ pod Stalinym).235