the bourgeoisie and official social
democracy, ... is on the contrary necessary."

VI

THE FAILURE OF RUSSIAN INDUSTRY

At first sight it is surprising that Russian industry should have
collapsed as badly as it has done, and still more surprising that the
efforts of the Communists have not been more successful in reviving
it. As I believe that the continued efficiency of industry is the main
condition for success in the transition to a Communist State, I shall
endeavour to analyse the causes of the collapse, with a view to the
discovery of ways by which it can be avoided elsewhere.

Of the fact of the collapse there can be no doubt. The Ninth Congress
of the Communist Party (March-April, 1920) speaks of "the incredible
catastrophes of public economy," and in connection with transport,
which is one of the vital elements of the problem, it acknowledges
"the terrible collapse of the transport and the railway system," and
urges the introduction of "measures which cannot be delayed and which
are to obviate the complete paralysis of the railway system and,
together with this, the ruin of the Soviet Republic." Almost all those
who have visited Russia would confirm this view of the gravity of the
situation. In the factories, in great works like those of Putilov and
Sornovo, very little except war work is being done; machinery stands
idle and plant is becoming unusable. One sees hardly any new
manufactured articles in Russia, beyond a certain very inadequate
quantity of clothes and boots--always excepting what is needed for the
army. And the difficulty of obtaining food is conclusive evidence of
the absence of goods such as are needed by the peasants.

How has this state of affairs arisen? And why does it continue?

A great deal of disorganization occurred before the first revolution
and under Kerensky. Russian industry was partly dependent on Poland;
the war was conducted by methods of reckless extravagance, especially
as regards rolling-stock; under Kerensky there was a tendency to
universal holiday, under the impression that freedom had removed the
necessity for work. But when all this is admitted to the full, it
remains true that the state of industry under the Bolsheviks is much
worse than even under Kerensky.

The first and most obvious reason for this is that Russia was quite
unusually dependent upon foreign assistance. Not only did the
machinery in the factories and the locomotives on the railways come
f