Stalin, Volume 1

by Stephen Kotkin

  FOREIGN “ECONOMIC” INTERVENTION

  Five German engineers, four of whom were employees of AEG who installed turbines and mining machines, had been arrested in connection with Shakhty. (The politburo had decided English specialists were to be interrogated but released.) Soviet accounts explained that the European working class, impressed by Soviet achievements, held bourgeois warmongers back from a military invasion, but the imperialists had turned to invisible war—economic counterrevolution or “wrecking” (vreditel’stvo), a new method of anti-Soviet struggle.175 On March 10, the chairman of AEG’s board telegraphed Ambassador Brockdorff-Rantzau in Moscow from the foreign ministry in Berlin asking him to convey that AEG would cease all operations and withdraw all personnel unless their people were released; the next day the ambassador read the telegram to Chicherin. On March 12, Deputy Foreign Affairs Commissar Litvinov telegrammed Stalin and Chicherin from Berlin regarding the terrible impact on Soviet-German relations of the German arrests.176 Chicherin had tried to limit the damage by giving the German ambassador in Moscow advance warning about an imminent disagreeable event, which, he hoped, could be jointly managed.177 But for Germany, the timing was surreal. Just one month before the announcement of the “plot,” the Soviets had opened new bilateral trade negotiations in Berlin, promising firm orders of 600 million marks, among other inducements, in exchange for a 600-million-mark credit as well as long-term loans. The Soviets were also requesting that German financial markets handle Soviet government bonds.178 German industrialists and financiers had their own list of demands, but now, all that seemed for naught. Stalin had lost the French credits in the fiasco over Soviet envoy Cristian Rakovski’s behavior, but now he was deliberately poking the Germans in the eye. In the March 2, 1928, note to the rest of the politburo, Stalin, along with Molotov, wrote that “the case might take the most interesting turn if a corresponding trial were organized at the moment of elections in Germany.”179

  Germany, on March 15, 1928, indefinitely suspended bilateral trade and credit talks, blaming the provocative arrests of its five nationals.180 TASS blamed Berlin for the breakdown in negotiations, and the Soviet press, goaded by Stalin’s apparatus, had a field day spewing broadsides against German perfidy. Nikolai Krestinsky, Soviet envoy to Germany, sent Stalin a letter from Berlin on March 17 (copy to Chicherin) asking for the release of one of the arrested German nationals, Franz Goldstein. An infuriated Stalin responded four days later, with copy to Chicherin, accusing Krestinsky of disgracefully abetting the German efforts to use the arrests “to pin the blame on us for the breakdown in negotiations.” The dictator added: “The representative of a sovereign state cannot conduct negotiations in such a tone as you consider it necessary to do. Is it difficult to understand that the Germans in the most insolent manner are interfering in our internal affairs, and you, instead of breaking off talks with the Germans, continue to make nice with them? The matter has gone so far that the Frankfurter Zeitung has published your disagreements with Moscow on the question of the arrested Germans. There’s no further to go than that. With Communist greetings. Stalin.”181

  Suddenly, however, Goldstein as well as Heinrich Wagner, both of whom worked for AEG, were released. Goldstein, according to a note counterintelligence specialist Artur Artuzov wrote for Mezynski, had ingratiatingly told his OGPU interrogators that he knew of three White Guard emigres who worked for AEG in Germany in the Russian department and were extremely anti-Soviet and that he had seen them with a large sum of money. In a further attempt at ingratiation, he indicated his willingness to return to work in the USSR.182 Debriefed back in Berlin by the foreign ministry, however, Goldstein dismissed the Soviet claims of sabotage, attributing the breakdown of equipment to worker disinterest, non-party specialists’ fear of arrest, inept party overseers, and general disorganization. Publicly, he voiced anger at having been arrested on trumped-up charges while trying to rescue Soviet industry, warned other Germans not to make available “their knowledge and ability” to the Soviet regime, and detailed the horrid initial conditions of his confinement in a provincial Soviet prison (Stalino), creating an uproar.183 Meanwhile, three Germans who had not been released—Max Maier, Ernst Otto, and Wilhem Badstieber (who worked for the mining company Knapp)—were being held incommunicado, in violation of bilateral treaties specifying that German consular officials had a right to see them. That was not all: Chicherin had passed a note from Yagoda to Brockdorff-Rantzau detailing the alleged crimes of a German national whose name matched no one who was in the Soviet Union; someone whose name was close to that of the accused had last been in the USSR in 1927, which reinforced German doubts about the OGPU’s “case.”184

  The arrest of German nationals redounded onto Franco-Soviet relations as well, confirming many there, too, in their view that Moscow was not a place to do business. Like France, Germany stopped short of severing diplomatic relations, but some German companies began to pull the rest of their engineers.185 Stalin continued to hunger for German specialists, German technology, German capital—but on his terms. AEG decided on March 22 to continue its multiple construction projects in the Soviet Union. A week later, twenty-two days after the arrests, the Soviet regime informed the German embassy that the consul in Kharkov could see the German nationals (confined in Rostov); the German ambassador insisted that someone from the Moscow embassy be allowed to visit them, which was granted. The audiences, on April 2, lasted ten minutes per prisoner, in the presence of three OGPU operatives.186 Five days later the three Germans were relocated to the Butyrka prison in Moscow in preparation for trial.

  INCITING CLASS WARFARE

  Stalin was playing with fire. The entire Soviet coal mining industry had perhaps 1,100 educated engineers, and putting 50 of them on trial in just one case was economically perilous, especially as it frightened many others into inactivity and incited workers to verbal and physical attacks.187 “I know that if there’s a desire, one can accuse the innocent, such are the times,” read the note of one engineer with no connection to the Shakhty case who committed suicide after being called a “Shakhtyite” and threatened with arrest. “I do not want defamation, I do not want to suffer while innocent and have to justify myself, I prefer death to defamation and suffering.”188 All industry in Leningrad had just 11 engineers per 1,000 workers; Moscow 9, the Urals 4.189 With the exception of Molotov, the hard-core Stalin loyalists who supported coercion against the peasantry worked to rein in the hysteria Stalin was stirring over Shakhty.190 Orjonikidze, head of the Central Control Commission workers’ and peasants’ inspectorate, told a group of recent graduates on March 26 that the Shakhty engineers were atypical, that engineers were vital to Soviet industry, that foreign specialists should be allowed to work in Soviet industry, and that Soviet specialists should go abroad.191 Kuibyshev, who had been a Left Communist in the civil war opposed to employing tsarist “military specialists,” now, as chairman of the Supreme Council of the Economy, told a gathering of industrial managers, in a speech published in the Trade-Industrial Gazette, the newspaper of his agency, that “every wrong assertion, every unjust accusation that has been exaggerated out of proportion creates a very difficult atmosphere for work, and such criticism already ceases to be constructive.”192 On March 28, he assured a group of Moscow engineers and scientists that the Shakhty case did not herald a new policy vis-à-vis technical specialists, and that “the government will take all measures to ensure in connection with the Shakhty case that not a single innocent engineer will suffer.”193

  While Stalin’s faction opposed Shakhty, his politburo opponents opposed to his coercive peasant policy supported the wrecking accusations. Voroshilov wrote (March 29) to Mikhail Tomsky, head of trade unions, who had just returned from the coal region, expressing alarm: “Misha, tell me candidly, are we not walking right into a board with the opening of the trial in the Shakhty case? Is there not excess in this affair on the part of local officials, including the regional OGPU?” Tomsky, a former lithographer, sho
rt and stocky, with horrendous teeth, deaf in one ear, a man who drank to excess and suffered depression, but was also gruffly charming and caustically witty, was the sole pure worker in the politburo (the peasant Kalinin had also worked at factories) and genuinely popular among workers, far more than Stalin.194 Tomsky had long been gung ho for “workerification” of the apparatus to combat bureaucratism and a regime summons to worker activism was grist for his mill.195 Tomsky informed Voroshilov that the bourgeois specialists “are running rings around us!” Soviet mining construction plans were being “approved by the French,” as a result of the engineers’ foreign ties. “The picture’s clear,” he reassured Voroshilov. “The main personages have confessed. My view is that it would not be so bad if half a dozen Communists were imprisoned.”196 Bukharin, in a speech to the Leningrad party organization (April 13, 1928), not only endorsed the Stalin line on widespread wrecking in the coal industry, but also the likelihood of finding similar “organizations” sabotaging other industries, and seconded the need for “proletarian democracy” in the form of production meetings. Bukharin underscored the correctness of Soviet vigilance by the fact that after the Germans’ arrests, a vociferous anti-Soviet campaign had broken out in Western Europe and relations with Germany had deteriorated sharply.197 Bukharin, as he had written with his coauthor Preobrazhensky in The ABC of Communism, was long predisposed to view “bourgeois engineers” as traitors. Bukharin was also looking to avoid giving Stalin a pretext to accuse him of schism and factionalism. But Shakhty was less about a political attack on the party’s defenders of the NEP than about Stalin’s outflanking his own loyal faction.

  Stalin was also appealing directly to the workers, seeking to win them back and mobilize them for industrialization and collectivization. Wage earners in industry, who were spread over nearly 2,000 nationalized factories, reached 2.7 million in 1928, finally edging past the 1913 total (2.6 million).198 (Another half million workers were employed in construction.) But proletarians were still stuck in cramped dormitories and barracks, and not a few were homeless. Daily life necessities (food, clothes, shelter) consumed three quarters of a worker’s paycheck, when he or she had a paycheck: unemployment had never fallen below 1 million during the NEP, and approached 20 percent of the able-bodied working age population. One in four industrial workers even in the capital was unemployed, a shameful circumstance that cried out for explanation or scapegoats.199 An expensive whoring nightlife, meanwhile, took place right in front of workers’ eyes—who was that for, in the land of the proletariat?200 What had happened to the revolution? Had the civil war been fought and won to hand power over to NEPmen and speculators? History’s “universal class” went hungry while kulaks could hoard immense stores of grain with impunity? Workers were sent into mines that collapsed on them—and it was all just accident? “Bourgeois specialists” and factory bosses lived luxuriously in five or more rooms, with running water and electricity, servants and drivers?201 What was the self-proclaimed workers’ state doing for workers? Doubts about the proletariat’s steadfastness had induced party officials to look to themselves, the apparatchiks, as the social base of the regime, an awkward circumstance even without the Trotskyite critique of “bureaucracy.” Moreover, a vicious public campaign had been depicting workers as shirkers and self-seekers, drunkards and deserters, while “production meetings” with workers organized by trade unions were actually serving as a way to impose higher output quotas. In 1928, however, party committees seized control of these meetings, which now became opportunities for workers from the shop floor to expose mismanagement, waste, and self-dealing.202

  Shakhty case materials effectively announced that bosses might be traitors.203 Pravda’s revelations also asserted wrecking had been going on for years “under the very noses of ‘Communist leaders.’” Thus prodded, younger party members seized the opportunity to harness the pent-up class resentments and class ambitions of young proletarians, not to mention their own. According to police mood summaries, workers following the Shakhty case often pointed to similar phenomena at their places of work. “At our factory there is enormous economic mismanagement, good machines are thrown into a barn,” a worker at the Leningrad factory Bolshevik was overheard to say, according to a report dated March 24, 1928. “This is a second [Shakhty].”204 Such sentiments reached into the countryside. “Where were the party, the trade union forces, and the OGPU such that for ten years they allowed us to be led by the nose?” one village correspondent wrote in a letter to Peasant Newspaper, appending complaints about local investigating organs similarly failing to punish “red tapists” and “alien elements” who persecuted peasants.205

  Worker efforts to form independent organizations continued to be ruthlessly suppressed, but worker resentments would now be stoked, and not just occasionally but in a clamorous campaign against enemies both abroad and at home.206 Meeting after meeting was convened to “discuss” wrecking in the coal industry and beyond, and some workers at the events demanded the “wreckers” be put to death; engineers and managers who called Shakhty a cynical manufacture of scapegoats reinforced suspicions that the specialists who had not yet been accused might be guilty, too.207 In places where no scientific-technical intelligentsia existed, such as the backward Mari Autonomous Province on the Volga, the OGPU targeted the humanist intelligentsia (mostly of peasant origin) for the crime of studying and teaching the history of their region and people.208 Class warfare was back. Forget about Lenin’s wager on poor peasants, let alone Stolypin’s wager on prosperous peasants, Stalin was going to wager on young, male strivers from the urban lower orders to spearhead a socialist remake of the village many of them had only recently left behind. Here was a manifold technique of rule: a “struggle” not only against grain-hoarding kulaks in the village, but also against the class-alien “bourgeois” specialists in the cities, and against the party officials who willingly colluded with enemies or were complacent, which amounted to collusion. It was a mass mobilization whose message was seductive: the regime would not allow worker dreams to be surrendered, lost in a lack of vigilance, sold for Judas coins. But the campaign risked immense disruption, for an uncertain outcome.209

  TACTICAL RETREAT (APRIL 1928)

  Stalin was no more worried about the ill effects of coercion against peasants than he was about the ill effects of arrests and suicides among engineers in industry. He had written to Kaganovich in Ukraine on the day before he had departed Moscow for Siberia warning that no one should be afraid of using the stick. “Many Communists think they cannot touch the reseller or the kulak, since this could scare the middle peasants away from us,” he explained. “This is the most rotten idea of all the rotten ideas that exist in the minds of some Communists. The situation is just the opposite.” Coercion promised to drive a wedge between kulaks and middle peasants, Stalin argued: “Only under such a policy will the middle peasant realize that the prospect of raising grain prices is an invention of speculators, . . . that it is dangerous to tie one’s fate to the fate of speculators and kulaks and that he, the middle peasant, must fulfill his duty as an ally to the working class.”210 But even by the OGPU’s own statistics, actual kulaks were a minority of those who were arrested, and arrests of non-kulaks generated significant pressures against the coercive policy.211 Justice Commissar Nikolai Yanson had issued a circular categorizing the extraordinary measures as “temporary,” indicating they would expire at the end of the current agricultural year (June 1928).212 But many officials, not just Rykov, wanted the “emergency-ism” terminated immediately. Such was the background to a joint plenum of the Central Committee and the Central Control Commission held between April 6 and 11. On the opening day, the regime announced the “Sochi affair”: for three years, party and soviet leaders in the Black Sea resort town were said to have been embezzling state property, wielding official positions for personal gain, and engaging in drunkenness and moral debauchery. The investigation led to a startling 700 expulsions, nearly 12 percent of the Black Sea
party organization. Some of the expelled were civil war heroes.213 Peasants were not the only target of Stalin’s intimidation.

  On the plenum’s agenda were reports on grain procurement (Mikoyan) and the Shakhty case (Rykov), and the combination of these two subjects testified to Stalin’s sly strategy. Rykov, on April 9, sought to allay doubts about Shakhty, pointing out, for example, that Nikolai Krylenko of the procuracy had checked into the work of the OGPU (the organizations were rivals) and that Tomsky, Molotov, and Yaroslavsky had gone to the Donbass to check in person. “The main conclusion consists in the fact that the case is not only not overblown, but larger and more serious than could have been anticipated when first uncovered,” Rykov noted, adding that some defendants had already confessed: after fighting for Denikin, they had worked for Soviet power, but two-facedly, while enjoying enormous privileges. Whether he believed in Shakhty or merely thought it had use value is unknown, but he was trying to manage it. “We cannot achieve industrialization of the country without specialists,” he added. “Here we are unusually behind, and our attention to this question is unusually weak.”214 Sixty people signed up for the discussion during which Kuibyshev spoke against the specialist baiting and Molotov answered with Stalin’s hard line.215