previous chapter
1 Beginning of Troubled Times
next chapter

Beginning of Troubled Times

No one supposed at that time that the war would drag on and turn itself into a frightful war of peoples. No one supposed at that time that those tasks which were given to us at the beginning would become so complicated and become more and more difficult at each step.
A food-supply commissioner, August 1916

When war broke out in the summer of 1914, the Russian government did not feel that providing the army with food was a pressing priority: Russia was after all a major exporter of grain. Germany might have to worry about obtaining enough food to sustain its war effort, but not Russia. Indeed, the extra purchases required by the army might prove to be a boon since they would help avert a depression in agricultural prices that might be caused by the cutoff of Russian exports.

Before the war, grain for the army had been purchased directly by the army purchasing agency (Intendantsvo). It was an easygoing process, and any controversy surrounding it had more to do with the distribution of economic plums than with efficient ways of supplying the army. A few days after the beginning of the war the task of making purchases was suddenly given to the Ministry of Agriculture, which had no previous experience in army purchasing.[1] The motive for this decision had little to do with strictly military considerations and much more to do with longcontemplated reforms of the grain trade, where the position of the middleman was strongly resented. The Ministry of Agriculture was given a mandate to purchase grain from the immediate producers-the landowner and the peasant. To help achieve this goal, it would call on the zemstvos


(local self-government organs) as well as a more recent arrival on the scene, the cooperatives. These organizations were regarded as associations of the immediate producers and not as middlemen.[2]

The casualness of the government approach was not justified. Although first regarded as an opportunity, food supply soon came to be seen as a problem, then as a crisis, and finally as a catastrophe. Instead of falling because of a glut on the internal market, agricultural prices steadily climbed until efforts to control them became one of the central questions of domestic politics. Not only was the army poorly supplied, but the cities and the grain deficit provinces (located for the most part in the north of Russia) began to feel the pinch and to fear for the future. In the last months before the revolution food-supply policy became the center of a pitched bureaucratic and political battle that led to drastic shifts of policy but not to alleviation of the people's hardships and insecurity. When the tsarist government fell in the depths of the winter of 1916-1917, it was the Petrograd crowds calling for bread that delivered the final blow.

What went wrong? The explanation must begin with the disruption of normal life caused by the outbreak of war. This disruption first expressed itself in the physical relocation of millions of men taken from productive activity at home and sent to the front. In early 1915 there was an answering movement in the opposite direction when millions of refugees from the war zones were uprooted and sent to the interior provinces, bringing disorder and uncertainty. "The elements have risen. Where they will stop, how they will settle down, what events will accompany them-all this is an equation with many unknowns. Neither governmental, public, nor charitable organizations have the forces to bring the elements into their proper course."[3]

Alongside this physical relocation came a massive redirection of productive activity. The scale can be shown by the example of food supply: almost


half of marketable grain went to the army in 1916.[4] The necessary reorganization of the national economy was made even more difficult by a sudden isolation from the world economy. Losing Germany as a trading partner was a severe blow, soon compounded by the closing of the Straits and the consequent difficulty of maintaining economic ties even with allies.

This redirection of economic activity meant that the previous network of "paths of communication" (puti soobshcheniia , the transport system) was no longer adequate. The strain on the transportation network resulted from the attempt to supply the front in the far west of the country and the swollen capital city of Petrograd in the far northwest. The new demands on the transportation network were almost the reverse of the usual market pattern of peacetime transportation when grain was shipped to southern ports for export. The rail system matched the river system by having a north-south emphasis; it was simply not set up for east-west traffic. Difficulties were compounded by the enormous length of the front line, and when large-scale troop movements took place, the transport system failed to cope.[5]

In the long run the war would first remove the economic stimulus for productive activity, because of a lack of goods for civilian use, and then even the possibility of productive activity, because of a lack of raw materials and equipment. But in the first two years of the war these dangers were hardly thought of. The challenge facing society seemed straightforward enough: emergency mobilization for a short war. Proceeding from this diagnosis, state authorities reacted in a way that, far from lessening the disruption caused by the outbreak of the war, served to amplify it.

Supplying the Army: Embargoes and Requisitions

None of the belligerent powers of 1914 realized that they were in for a protracted war that would call on all of society's resources-material, administrative, political, and social. The war could not be fought with stocks on hand, whether of ammunition, clothing, transportation, or patriotic support; government and society had to be transformed in order to manufacture all of these items in ever-increasing quantity. The warring powers recognized only slowly that business as usual and ad hoc intervention were insufficient and even dangerous.


On the surface, the minister of agriculture could look back at the end of the first year of the war with a sense of a mission accomplished. That was the claim of Aleksandr Krivoshein, the minister of agriculture who was also at that time the most prominent politician in the tsarist cabinet. The main objective had been accomplished: the army had been provided with the necessary grain. He said in a speech of July 1915 that despite mistakes, the country was ready to sustain "years of struggle without the slightest scarcity." He went on to quote British prime minister David Lloyd George to the effect that victory now went not to the best army but to the most highly developed productive technology; he amended this statement to say that victory went to the country that could feed itself indefinitely, no matter how big its army.[6] Krivoshein was especially proud of the "shining example" that had been given of cooperation between the zemstvos and the central government. The success of provisionment demonstrated the soundness of turning with confidence to local activists (deiateli ) and eliminating the we-versus-they mentality that was so widespread in Russian political life. As his deputy G. V. Glinka put it, "To [our] cause [should] be enlisted all economic, all activist Russia, so that each is given access and means to serve the homeland in this difficult moment."[7]

Krivoshein did not deny that cost-of-living problems had arisen in the consuming centers, especially Moscow and Petrograd: this difficult situation could only be eased by "systematic work [planomernaia rabota ]" of all government departments working together. It was also true that one cause of this situation was trade disruptions due to embargoes, but, concluded Krivoshein, priorities must be kept straight: civilian disruptions, bad as they were, were preferable to any disruption in provisionment of the army.[8]

The disruption of civilian trade had not been caused by the amounts taken by military and civilian purchasing commissioners but by the methods they used. The commissioners shared Krivoshein's sense of priorities, so that the damage done to the civilian economy was undervalued, and their inexperience also helped to magnify inevitable dislocations.

But in the summer of 1914 the job of civilian purchasing commissioner


(upolnomochennyi ) had not seemed a difficult one, and Krivoshein made his appointments mainly among provincial zemstvo chairmen—people he had worked with and knew personally. The new commissioners promptly built up an apparatus of more than two thousand agents.[9] Left to their own devices, the commissioners showed considerable zeal but lamentable ignorance—they would buy a load of grain at what they felt was a bargain price and then discover that it was cheap because it was located far from rail stations and therefore expensive to transport.[10] The original policy of buying directly from the producers could not be sustained, if only because the commissioners did not have storage space for such large purchases. As a result, half of government purchases went through middlemen.[11]

When the commissioners began to experience difficulties in obtaining supplies (especially oats) at what they felt was a reasonable price, they blamed the middlemen. They were aided in their search for ways of dealing with the middlemen by regulations issued by the central government on 17 February 1915. These regulations had been proposed by the army purchasing agency; their effect was to extend powers already held by military authorities at the front to commanders of the military districts in other parts of Russia. These powers included the right to set prices for government purchases and enforce these prices by means of requisitions and embargoes that prevented shipment out of the local area. Although the military commanders issued the necessary orders, decisions were taken jointly with the provincial governor and the local purchasing commissioner.[12]

Neither the frontline military authorities nor the civilian purchasing commissioners actually resorted to requisitions to any great extent; the idea was to use the threat of requisition at a penalty price as an inducement to voluntary sale. But local embargoes were widely applied and by the


summer of 1915 embargoes had been set up in most of the frontline and producing provinces.[13] Embargoes were much more disruptive than requisitions would have been since instead of inconveniencing an individual middleman, an embargo cut long-established links between regions and deprived the deficit regions of their normal sources of supply without warning. It is therefore surprising to discover that the commissioners saw the embargoes as a way of avoiding what they thought was the more drastic step of requisition. They reasoned that since an embargo deprived the grain dealer of alternatives by preventing shipment of grain out of the area, it made the threat of requisition more effective and increased the chance of voluntary sale to the government. An embargo would also disrupt trade within the province less than the use of requisitions would. This blatantly localist perspective meant that an embargo was placed on twenty million poods so that three million poods could be bought for a few kopecks a pood less.[14]

The rhetoric used to justify requisitions and embargoes introduces one of the most important rhetorical terms of the time of troubles, speculation . Speculative middlemen were seen as the cause of the rise in prices, and this view meant that requisition had not only an economic but also a moral rationale, for can a speculator justly complain if his goods are requisitioned? To some extent, then, the charge of speculation was a case of giving a dog a bad name in order to beat it, or rather, to take its bone. The case is precisely that of the term kulak later on. If the authorities were hostile to the grain holder, it was not because he was necessarily a villain but because he held grain. I will examine later the economic impact of speculation, but the impact of speculation as a rhetorical category was fully as important.

The local purchasing commissioners translated their feeling about speculation into hostility toward "specialists in the grain trade" (the euphemistic label given to private grain dealers). Even when the commissioners acknowledged the services and equipment provided by specialist middlemen, they still felt it was worth the trouble and expense to replace or duplicate them at least for government purchases. Local activists were much more confident than the government about their ability to do the job alone—especially since they themselves did not feel the pinch created in the consumer centers by the disruption of civilian trade.


Central officials had a different perspective on the use of specialists. The center had become keenly alive to the scarcity of administrative resources and realized that rejecting experience and talent was a luxury Russia could ill afford. It could also observe the performance of the system as a whole and so was aware of how inadequate that performance was. And as it came closer to dealing with the peasants directly, it began to understand the need for intermediaries. (At this early stage of the war the services asked of the intermediaries were mainly technical: gathering grain from scattered peasant villages as well as cleaning and drying the lower-quality peasant grain.) Of course the specialists had to be carefully watched, and this supervision required an activist state policy: "It is necessary to arrange things so that [the middlemen] do not fleece the people and sell cheaply." This could be done if the government properly used its strategic resources, such as control over rail transport.[15]

Whenever a representative of the War Industries Committees (an association of manufacturers organized to help the war effort) or of the Ministry of Trade and Industry addressed a conference of the purchasing commissioners, he was met with crackling hostility. The tone of Krivoshein or Glinka was defensive when they tried to make the case for using the specialists. They had to emphasize they only wanted to employ "honorable" ones and that the zemstvos themselves were not doing an efficient job of collecting, storing, and shipping grain.[16] This debate over the use of the specialists reveals a characteristic split between the center and the locals that continued throughout the entire time of troubles.

To accuse the speculator was to excuse the immediate producer. The head of the army purchasing agency stated that penalty prices would be a "threat only for speculators; the general mass of the population will not suffer from this since procurement experience has shown that the immediate producer is not only not avoiding [grain] deals but is also actively searching them out."[17] To accept that the population itself was capable of hardheaded and economically rational behavior would have meant facing the moral and practical difficulties of applying coercive measures to everybody. As soon as the government actually began to work directly with a particular group of "immediate producers," it rapidly became disillusioned. This process began with the big landowners. Glinka expressed his exasperation with unscrupulous landowners who sold grain they did not have and then tried to obtain it from the neighboring peasants: "Then the whole operation falls apart and a few noble ladies sustain a financial loss.


They kick up such a fuss in all spheres and departments that all Russia shakes."[18] But even at this time we can see the beginning of a fear that later came to dominate Russian political thinking: the fear of the self-sufficient peasant in a position to cut off economic contact with the towns. At this early stage the reason assigned for peasant self-sufficiency was the vodka prohibition that was announced at the beginning of the war, which eliminated a major item of expenditure.

Bureaucrats and activists were not the only ones searching for explanations. Two commercial agents sent out by the railroads to investigate conditions discovered a wide range of opinions among people concerned with the grain trade. One of these agents felt that southern cities were indeed experiencing difficulties because of the "unbridled speculation" of "grain and flour kings," and he was quite cynical about regulatory attempts made by municipal councils in towns like Rostov and Novocherkassk. But he also reported many other opinions. The main impression from his reported conversations is confusion as people attempted to make sense of an economy that was beginning to go haywire. Everyone convincingly blamed someone else—either inexperienced government purchasers, or transportation delays, or the landowner and peasants who were beginning to get greedy, or of course speculative middlemen. The small-fry grain collectors (ssypshchiki ) who hung around the stations and wharves denied that hoarding was even within their economic powers, for they depended on rapid turnover. They (and other observers such as tax inspectors and agronomists) pointed to the landowners and the well-off peasants. But these in turn claimed they knew of high grain prices only by report; all they could see was climbing prices for consumer items. More objective reasons such as massive army purchases or the difficulty of getting oats from outlying regions to the railroad stations were also mentioned.

The other agent disguised himself as a prospective buyer to get a more straightforward story from the grain merchants. According to these merchants, competition made any large-scale hoarding impossible, and anyway it was impossible to cheat the landowners and peasants because every one of them knew the latest market price and would accept no less. They also declared that all it took was rumors about the possibility of requisition to reduce the likelihood of finding supplies at major collection points: the risk was becoming too great. The landowners and the well-off peasants ran a smaller risk: they undoubtedly had reserves that mysteriously appeared


whenever a local embargo was lifted. The author then stated the necessity of using requisition measures against the actual grain holder—evidently not considering the possibility that requisition would dry up this source as well.[19]

The expectation of a short war gave rise to an attitude that consciously accepted a dualism between the army and the civilian population: government policy concentrated only on the army, and the civilians were left to fend for themselves. The regulations of 17 February 1915 amplified the consequences of this dualism by giving extraordinary powers to purchasing commissioners. But the commissioners' disregard of any interests but the army's or perhaps their own provinces caused enough damage to ensure that pressures to reestablish unity quickly came into being.

Overcoming Dualism: Price Regulation

In March 1915 the grain dealers Kurazhev and Latyshev bought more than eight hundred thousand poods of grain in Ufa province; the grain was intended not for the army but for the industrial city of IvanovoVosnesensk in Vladimir province. The governor of Ufa put pressure on them to sell the grain voluntarily to the army and save him the trouble of requisitioning it. In response, the grain dealers turned to the governors not only of Vladimir province but of Kostroma province, where the flour mills of the area were located. In an effort to pry loose the grain, these officials bombarded with telegrams the Ufa governor as well as the purchasing commissioner and the relevant military authorities. These appeals finally succeeded, but the grain was still far from its final destination—the Kostroma governor now used his embargo powers to keep the flour in his own province, and the authorities in Vladimir had to start sending telegrams again.[20]

This story shows that pressures that had expressed themselves through the market did not go away when embargoes were introduced but instead were transformed into political ones. Defenders of the embargoes argued that the complaints of the consumer centers should not be taken seriously, but this argument did not lessen the intensity of the complaints. The mere existence of these consumer pressures made the embargoes less effective in inducing voluntary sale since the grain dealers now felt that sooner or later the embargoes would have to be lifted.[21] Since anything was preferable to


the free-for-all just described, attempts were made in the spring of 1915 to overcome the army-civilian dualism by means of bureaucratic reorganization.

The first result of this effort was the Main Food-Supply Committee (Glavny Prodovol'stvenny Komitet) set up in May 1915 under the chairmanship of the minister of trade and industry, V. N. Shakhovskoi. Shakhovskoi himself did not want the job and was not completely sure why his ministry had been given this task instead of the Agriculture Ministry. The Main Food-Supply Committee did not exist long enough even to set up any organizational apparatus for grain purchases, but Shakhovskoi did send around a circular lifting all embargoes then in force since his ministry was hostile to disruptions in trade.[22]

By August 1915 the task of overcoming dualism in food supply was given back to the minister of agriculture in his role as the chairman of the newly created Special Conference (Osoboe Soveshchanie) on food-supply matters. Shakhovskoi had lifted the embargoes simply to let normal trade operate more freely, but the political and social forces behind the creation of the Special Conference wanted to replace dualism with a more active regulation of the national economy. One of the slogans of opposition forces had been the need for a centralized ministry of supply, and in this demand they were seconded by the military. The result of all the political infighting over who would control such a ministry was a compromise system of not one but four special conferences with responsibility for food supply, transport, fuel, and the defense effort in general.[23]

The Special Conference on Food Supply tried to establish a new level of coordination in several spheres. In the political sphere it moved to overcome the split within the political class between the government bureaucracy and the public opposition. The partnership/rivalry between these two is the great theme of tsarist politics during the war years; the new forms of cooperation that had been evolving pragmatically during the first year of the war only took concrete institutional form when military defeats temporarily put Tsar Nicholas on the defensive.

The members of the special conferences from the legislature and the public organizations were true representatives since they were selected by


the institutions that sent them. The Special Conference on Food Supply had seven representatives from the Duma, seven representatives from the State Senate, and one representative each from the Union of Towns and Union of Zemstvos. Since there were no representatives from the War Industries Committee, representation of public organizations was much less than on the Special Conference on Defense. Even so, the Special Conference on Food Supply had sixteen representatives from outside the bureaucracy and only nine or ten ministerial representatives.[24]

These numbers in themselves do not give an accurate picture of the actual relative influence of the two sides. The Special Conference on Food Supply was legally only an advisory organ; full decision-making power rested with the minister of agriculture, the ex officio chairman. The Special Conference could be seen as a bulky miniparliament with the expected consequence that most of the real work was done by its secretariat. The representatives of the legislatures decreased their influence by absenteeism, whether or not the Duma was in session. But none of these factors canceled out the significance of the Special Conference. The chairman did not want even the appearance of conflict with public representatives so that at least until mid-1916 the Special Conference was de facto a decisionmaking organ, not just an advisory one. The representatives of the public organizations—Peter Struve from the Union of Zemstvos and especially Vladimir Groman from the Union of Towns—had a disproportionate influence stemming both from their personal activity and from the weight of the social groups in whose name they spoke. The main legislative development of the year—the price-regulation decision of February 1916—was pushed through by a coalition of the chairman, the secretariat, and Struve and Groman.[25]

The Special Conference was also meant to achieve coordination in the administrative sphere by creating a central authority responsible for all food-supply matters. In the spring of 1915 Krivoshein responded to a complaint about fuel for flour mills by saying, "In this connection I'm almost as helpless as you"; the most he could promise was to petition the appropriate authority.[26] The effect of the Special Conference system was to


give this petitioning a more stable institutional form. Results were seen mainly in the area of transport policy. The first aim of the Special Conference was to get a top priority for food shipments for both the military and the civilian population. The transport bottleneck had become so tight that those without top priority simply would not get their shipment on the rails. Many horror stories were told in this regard; a zemstvo noted in August 1916 that they had just received a shipment that had been sent in December. The Special Conference had to petition long and hard just to get an appropriate priority for food shipments. The next step was what was called a transport plan, which simply meant matching available freight car space to available food shipments. Even this amount of regulation was not achieved in the case of the more decentralized river transport system, which was never used to its capacity during the war years. Despite constant squabbles and mutual accusations, some progress was made in the immensely complicated business of meshing food procurement and transport capacity.[27]

But otherwise the Special Conference did not gain full control even in food supply. A list of all the agencies with a role in food-supply policy includes local branches of the army purchasing agency; local towns and rural administrations; the food-supply section of the Ministry of Internal Affairs (whose prewar function had been famine relief); the military, directly intervening on the local level; central transport authorities; and various organizations attending to the needs of refugees.[28] The role of the Special Conference as a coordinating institution at the center was also challenged by various rivals mostly set up on an ad hoc basis as the result of bureaucratic infighting.[29] Even within the Special Conference system the Special Conference on Defense had final say on food-supply matters and used this prerogative in September 1916 on the politically explosive question of the level of fixed prices for grain. The efforts of the Special Conference to coordinate food supply finally ended in failure in late 1916 when it began to lose its political standing and as a result lost most of its administrative usefulness as well.

The main aim of the Special Conference was to achieve coordination in the economic sphere by overcoming the army-society dualism. This mission was reflected in its local organization. The Special Conference (or, to be more precise, its chairman) had a commissioner in each province; the organization below this level was vague and depended a great deal on the initiative of the provincial commissioners. In the surplus provinces the


zemstvo chairmen who had been serving as purchasing commissioners directly under the minister of agriculture often became Special Conference commissioners as well. In other provinces the Special Conference commissioner was usually the governor, the official with traditional responsibilities for public order.

Theoretically the purchasing commissioner was subordinated to the Special Conference commissioner who had the broader mission of alleviating food-supply difficulties as they arose; in practice there was a division of labor between the two kinds of commissioners: the purchasing commissioners took responsibility for procurement, and the Special Conference commissioners for distribution. (It is understandable that there were complaints about "these various commissioners who are propagating these days in such numbers.") Unity at the top was guaranteed by the fact that the minister of agriculture and the chairman of the Special Conference were always the same person.[30]

Merely by virtue of including the situation in the deficit areas within its purview, the Special Conference was led to continue the repudiation of local embargoes that Shakhovskoi had begun. The destructive impact of sudden embargoes was so clear that the Special Conference even got the support of Tsar Nicholas in this effort, and although there were isolated violations, by and large this problem had been overcome by early 1916. But when it abolished the blatant dualism of embargoes and reestablished communication between surplus and deficit regions, the Special Conference took on the imposing challenge of regulating their mutual relations. Krivoshein had preferred the embargo system, which isolated the surplus regions from the competitive bids of the deficit regions, because he felt it economized on administrative resources: "I can compel someone to sell, but it is hardly possible to compel a buyer not to offer a price higher than the established one."[31] Not until Krivoshein was replaced as minister of agriculture in October 1915 by A. N. Naumov were embargoes definitely abandoned. Naumov also gave much attention to ending direct purchases by the military behind the front.[32]

Dualism still existed in the price structure. The basic dualism between


regulated prices and market prices at first existed in two forms: regulated government versus unregulated civilian purchases, and regulated retail versus unregulated wholesale prices. The logic of events drove the Special Conference to overcome this dualism and replace it with one regulated price for all grain transactions. Yet, as we shall see, the Special Conference only undertook the task of overall price regulation with great foreboding.

Dualism is created when a powerful actor protects its own interests by self-help actions that disrupt the normal activities of everybody else. When the government and its local agents used their power to set fixed prices for army food-supply purchases, a dualism was created between the government price and the unregulated market price. The market price was soon considerably higher than the fixed government price, partly because government purchases took a significant percentage of total supply—or, as it was usually put at the time, because the producers and the millers made up for losses on government purchases by overcharging the civilians. This dualism irritated both the government and the civilians. The civilians were irritated because they felt an undue share of wartime strain was being shifted to them, and the government was irritated because the seller much preferred the unregulated market and so began to flee when he saw the government purchaser approach.

A dualism of a different kind was created when municipal authorities tried to protect local interests by establishing a regulated price (taksa ) for bread and other foodstuffs to keep the cost of living down—a dualism between regulated retail prices and unregulated wholesale prices. The cities were much less powerful than the central government, and their self-help actions failed to achieve the intended purpose. If the regulated price was simply based on the existing wholesale price, with the aim of controlling the profits of local tradesmen, it had little impact on the cost of living. If the cities tried to set a regulated wholesale price, they merely succeeded in drying up supply as wholesalers diverted their shipments elsewhere. When economic competition was transmuted into political competition, disruption was only amplified, as in the case of the meat war between Moscow and Petrograd: "When the regulated price was higher in Moscow, livestock was brought only there. Petrograd suffered from lack of meat and in its turn raised its regulated price, so Moscow was left without meat, and all the livestock went to Petrograd. Thus Moscow could do nothing but raise its regulated price in turn. She once more raised her price, and again Petrograd sat without meat."[33]

During the second year of the war both of these price dualisms were


overcome. The process began late in 1915 when the Special Conference imposed central control on fixed prices for government purchases. Empirewide prices for the various grain products were decreed and backed up with requisition powers. Price setting started with oats and ended with wheat flour, that is, it went from the grain product whose production was the least market-oriented and therefore hardest to procure to the one whose production was the most market-oriented. The government originally set the fixed prices on the basis of market prices, but dualism returned when the fixed prices stayed constant and the market price continued to rise.[34]

The next major decision of the Special Conference was to tie the many regulated prices set by local civilian authorities to the empirewide fixed price used for government purchases. The Special Conference undertook to review the civilian prices so as to coordinate them with each other and with the fixed prices offered by the government to sellers in the surplus regions. These prices were enforced through de facto government control over the transport bottleneck. In February 1916 rules were issued that instructed Special Conference commissioners to grant access to priority shipping (which in practice meant the opportunity to ship anything at all) only to those dealers who would promise to sell at regulated prices.

There was now one national price dualism: a government price system that tied together prices for both the army and the urban population coexisted uneasily with the prices created by the unregulated market. Despite their control over the transport system, political authorities still found this dualism a hindrance. Municipal authorities could now make sure that grain was sold at a reasonable price—but only if they succeeded in obtaining actual supplies at that price. In frustration they turned more and more to the central purchasing authorities to get these supplies. The central authorities, faced with an ever-increasing procurement target, were also frustrated. To be sure, the fixed government prices were backed up with requisition powers, but these could only be used with "visible supplies," that is, supplies already concentrated at transportation points, flour mills, and other places of storage. These supplies were noticeably drying up already in the summer of 1915, and by the end of the year the use of requisition had made dealers so cautious that all grain supplies were rapidly becoming invisible.[35]

These difficulties led to the final overcoming of dualism by making state grain prices mandatory for all transactions, public and private. Just as the


transport bottleneck had forced an increase in the scope of government regulation in February 1916, the bottleneck of the flour mills forced this final step. The millers were afraid of paying the market price for their grain since they could easily be compelled to sell their highly visible supplies at the lower government price. But they were unable to obtain supplies if they restricted themselves to the government price. In June 1916 the Special Conference decided that fixed prices should be extended to all supplies obtained by the mills and that the government "must create conditions which will assure the millers a sufficient supply of the grain they need, at fixed prices." Since the millers were the main buyers of commercial grain, there was little difference between extending fixed prices to their transactions alone and extending them to all grain transactions. The government had now undertaken to do what Krivoshein warned was not possible: to keep the buyer from offering more.

There was a certain logic to the steadily increasing government intervention. But there was also an alternative method of overcoming dualism, and that was the removal of regulated prices altogether. The government rejected this path only after much wavering and conflict. The reason for this ambivalence was that it was both necessary and impossible to regulate prices, and since the bureaucrats were experienced and clearheaded enough to see both the necessity and the impossibility, they could not be expected to be cheerful about their decision. They were forced to do what opponents of regulation had warned against: to take on the job of an "adequate and equitable provision of the population with food, while having a complete lack of confidence in the possibility of executing . . . these responsibilities."[36]

The crucial choice had been made in February 1916 when the Special Conference decided to tie civilian regulated prices to the fixed prices for government purchases. In the debate within the Special Conference that preceded this decision, both sides agreed on two things: the transport bottleneck was the "center of gravity of the whole food-supply question" (Struve, who supported regulation), and setting price rates could be effective only as a "component . . . of a whole system of measures" (the Pokrovskii committee, made up of opponents of regulation).[37] But the conclusions drawn by the opposing parties differed radically.

The debate in the Special Conference grew out of a report in late 1915 by the secretariat of the Special Conference on the chaos created by ad hoc price regulation by local authorities. This report (written by K. I. Zaitsev) had made a convincing case for the necessity of going further than simply


regulating prices at the local level: "On the state authority that regulates prices lies the responsibility either of ensuring that a sufficient quantity of the affected product appears on the relevant market or of regulating demand, since as soon as the prices are regulated, prices lose the ability to regulate supply and demand." It was the authorities who now had the job of "drawing out goods hidden from observation and getting them to the consumer." Not that the difficulties of further regulation were ignored: Zaitsev spoke at length about the difficulties of setting prices properly in a situation where production costs fluctuated because of inflation and wartime shortages. It had been difficult enough to determine a fair price for the middlemen: how much more difficult "to go deep into the hidden side of economic life and determine production costs."[38]

The Pokrovskii committee was a nonofficial grouping of Special Conference members headed by N. N. Pokrovskii, a member of the State Council. Though it agreed that uncoordinated local regulation was destructive, it recoiled from the prospect of "state monopolization" and "statization." It noted that the government was having difficulties coping just with the regulation of sugar production and distribution it had already undertaken: how could it possibly hope to take on economic life as a whole? Since transport was the origin of the difficulties, the committee advised concentrating on making improvements there; as for price-setting measures, they should all be rescinded (except perhaps for the capitals).

It was this last suggestion that moved Struve to make his one major intervention in food-supply policy making. Struve saw in the removal of local regulated prices a "purely negative measure" that would only discredit the state authority: "If it is possible to see danger in the sketching of theoretical schemes of state intervention and [in] the announcement of such broad tasks by the state authority [this is probably a reference to proposals advanced by Vladimir Groman], still it would be not less but perhaps even more dangerous in the present crucial moment for the state authority, consciously and on principled grounds, to remove itself from intervention in economic life, based on lack of confidence in its own powers." The breakdown in transport had to be taken as an inevitable feature of wartime, along with the "severe militarization of all of national life" that made free trade impossible.[39]

Struve's argument pointed to the consideration that finally led the


majority to accept the necessity of price regulation. It was unwise to rely on any substantial improvement in the transport situation, especially since transport was outside the mandate of the Special Conference on Food Supply. The Special Conference had fought hard to get access to priority transport: how could it avoid using this power to influence economic life? It was also clear that it would be impossible to get the cities to remove their price rates; but if price rates there must be, reasoned the Special Conference, they should be at least effective ones that did not damage national economic life. The hand of the Special Conference was thus forced by decisions taken earlier at all levels of government.

In response to the argument that the government was taking on a task that would be "impossible for any government on earth to carry out," Struve made a distinction between free trade and private trade. Free trade was dead, but the private trade apparatus would still be able to act as specialists in "concentrating and distributing goods." (There was never a whisper in these debates about any rights of the capitalists; the bureaucrats who opposed price regulation saw the capitalists purely as an apparatus that it would be inexpedient to destroy.)

Despite these arguments, the original decision of the Special Conference was to reject regulation. Only after the chairman of the Special Conference, Agriculture Minister Naumov, made his preferences known did the Special Conference reverse itself (thus sparing him the necessity of overriding its decision). When Naumov had taken over the ministry from Krivoshein in October 1915, he was appalled at the "chaos of decisions, opinions, and intentions" and at Krivoshein's casual attitude toward coordination and control.[40] Naumov heavily stressed the necessity for unity of action and for a planned approach to policy. Furthermore, he had political reasons for wanting to be able to point to a coherent program: criticism of the Special Conference's lack of system in food-supply policy was beginning to be heard not only from the Duma but also from the Ministry of Internal Affairs. Naumov himself was scheduled to meet the Duma on 18 February 1916. The decision to use control over access to transport as a means of regulation was made 16 February; hence Naumov was able to refer to it in his well-received Duma speech.

The Battle Over Prices

After the decision to overcome dualism in grain prices by establishing a fixed price for all transactions, political battle began over the level of those


prices. This struggle went on throughout the summer of 1916 and was a much more passionate affair than the debate that had preceded the more fundamental decision to impose fixed prices. Naumov started the process of price formation by asking local commissioners of the surplus regions to consult local agricultural producers and set prices based on local conditions. Not surprisingly, these prices were placed rather high, and the officials of the Special Conference secretariat worked over them and reduced them noticeably. Meanwhile, a challenge to these prices was also being mounted by the commissioners of the deficit regions of the Moscow area. The prices finally approved by the Special Conference were between the high level proposed by the producers and the low level proposed by the consumers. But at this point the consumer interest gained a powerful ally: the army. Owing to the army's challenge, a unique meeting of all four Special Conferences took place in September, and prices were lowered still further. The Council of Ministers then made one final adjustment upwards.[41]

In this conflict over the level of fixed prices we can see the outlines of an alignment of social forces that lasted throughout the time of troubles. Leading the fight for low prices was Vladimir Groman. Groman was a Menshevik economist and statistician whose previous experience had been in the local zemstvos. He was a fascinatingly typical member of his generation of the Russian intelligentsia, a generation whose enthusiasm had been excited by the opportunities for reform first of the war period and then of the revolutionary period but which was disillusioned by Lenin and destroyed by Stalin.

Even before the beginning of the Special Conference Groman had been a powerful voice pushing for further regulation. In spring 1915 he presided over a multivolume study of the rise of the cost of living in which he called for the "self-organization of the nation" as an answer to growing economic dislocation. When the Special Conference was formed in August and the public organizations were asked to send representatives, "The Union [of Towns] happened to choose Groman, or vice versa."[42] The archives of the Special Conference are littered with his passionate and polemical memoranda, characterized by insightful rebuttals of his opponents and a visionary faith in economic regulation based on statistical data. The course of food-supply policy during the time of troubles cannot be understood without recalling this visionary faith, which did not wait for the revolutions of 1917 to make its influence felt. Naum Jasny, who at that time had


just joined Groman's staff, later described Groman in action at one of the conferences of the summer of 1916:

The commissioners consisted mostly of wealthy landlords, with "your excellencies" and even princes richly strewn among them. It was fascinating to observe how Groman, in a suit which had never been pressed since he bought it off the rack, made himself heard. In spite of his immense drive, however, the commissioners decided on prices which he believed too high. Groman's continued pressure brought the Army's interference in favor of his proposals.[43]

It may seem astonishing that Groman, the revolutionary statistician with a visionary dream of a planned economy, should have a major impact on the tsarist economic policy. Indeed it is astonishing, and for an explanation we must look at Groman's allies in forcing a lower price. First we see the Union of Towns, which hired Groman and put him on the Special Conference. Then there are several of the central ministries, including the Ministry of War, whose protest brought about the joint session, as well as the ministries of Finance and State Audit. A partial ally was liberal landlords and merchants who "considered it their political duty to separate themselves from the narrow group interest in higher prices" and therefore voted for low prices or abstained.[44] Another ally was the specialists, both in the public organizations and in the Special Conference secretariat, who had their own ambitious dreams of economic reform. For example, Ia. M. Bukshpan of the Special Conference secretariat wrote in August 1916:

The war has moved the state into center stage in social life, and made it the dominant principle, in relation to which all other manifestations of public endeavor [obshchestvennost' ] are auxiliaries. . . . Industrial mobilization, regulated prices and requisitions, syndicates and monopolies, all of this has created a new current in the national economy and points to unheardof possibilities for economic creativity. [The new organizations at the center and in the localities are] all cells of our nationaleconomic organized nature and are a yet unappreciated foundation for the systematic [planomernyi ] construction of our future external and internal commercial policy.[45]


On one side of the battle over prices was a coalition based on the consumer interest of the deficit regions, the mobilization needs of the military, and the dreams of ambitious specialists. On the other side were the landowners, who had not previously had much impact on the course of wartime economic regulation but were galvanized into action by the threat of low fixed prices.[46] The landowners believed intensely that the city was robbing the countryside and that, in the words of a landowner from Kursk, "when the town loots the village, when it demands this sacrifice, then I count this as a crying injustice." Under these circumstances, it was claimed, the landowners had a common interest with the mass of the peasantry. The Kursk landowner stated that he was the one and only representative of the rural producers at the provincial price-setting conference; all other participants were either bureaucrats or factory owners, whose only aim was to set prices as low as possible.[47]

The landowners argued that the consumer representatives had no conception of agricultural costs. A writer from Viatka named I. Sigov granted that in some cases gentry-dominated local conferences had exaggerated production costs, but he gave the following counterexample from Viatka: local residents calculated the average cost of producing a pood of grain to be two rubles and twelve kopecks at the place of production (that is, without including transport costs). It was probably an underestimation since weather conditions were worse than expected. Meanwhile the fixed price was set at one ruble and twelve kopecks—with no extra premium for the cost of transport.[48]

The fight over prices was thinly veiled by the pretense that it was a debate over the method of price calculation.[49] Some of the features of the "Moscow method" associated with Groman's name will give an idea of his style. The Moscow method was intended to correct for wartime speculative influences by a complicated system of proportions between production costs before the war and production costs in 1916. Groman had great confidence that his method would allow the central government to establish fair and efficient prices for the localities. As a pamphlet by one of his disciples stated, it was a "scientific method, with scientific positions, scientific premises and arguments of scientific value."[50] It was precisely this


"theoreticalness" to which his opponents objected. A speaker at one of the Special Conference debates scoffed at the statistics on which Groman's calculations were based: "What are statistics worth at present? An absolute farthing—just as they are never worth anything. Statistical data are gathered by village elders and scribes, and these do as they wish."[51]

Groman also contended that the countryside would not gain anything from higher prices for what it sold since they would be matched by higher prices for what it bought. He stated that "there can only be one basic criterion: the equilibrium of the national economy"; high prices for grain would threaten this equilibrium since they would push wages up and thus increase the cost of all industrial products. This speech is one of the first appearances of the concept of equilibrium for which Groman became notorious in the late 1920s. It reflects well on Groman's integrity that the emphasis on equilibrium, seen as soft on peasants in the late 1920s, should make its first appearance as a defense of the urban consumer against high grain prices.[52]

Besides challenging Groman's arguments about the level of prices, the landowners also insisted that it was unfair to impose fixed prices on agricultural products but not on manufactured goods bought by the countryside.[53] This argument was seen as a conservative one in 1916, although it was later taken up by peasant spokesmen and supported by the left-wing parties. Even in 1916 the justice of the complaint was not denied by the opposing coalition, both because it was politically dangerous to raise up the countryside against the towns through one-sided regulation of agricultural products and because fixed prices for industrial items broadened the scope of government economic regulation. A conference of local commissioners in August 1916 went on record as favoring price regulation of industrial items so that there would be an equitable distribution of wartime burdens between town and country; this demand was supported by a Duma resolution in December.[54] The commitment to provide industrial items at fixed prices was also taken up as official policy by the Provisional Government and the Bolsheviks.

This commitment to further regulation revealed a feeling shared by both sides that the overcoming of dualism by means of fixed prices was incomplete and therefore unstable. Vladimir Gurko (an opponent of fixed


prices) felt that the extension of fixed prices to all transactions would have the same effect as local regulation—a drying-up of supply, only now the supply of the entire empire would be affected. He believed that the government should allow complete free trade (with occasional use of requisition powers) or institute a state monopoly: "there is no third solution."[55] Support for a full-fledged state monopoly was in fact gaining in strength. The first suggestions had been made by purchasing commissioners facing difficulties in the procurement of oats. By August 1916, partly at the instigation of Special Conference specialists such as Bukshpan, there was a widespread discussion in the press of the possibility of a state monopoly of the grain trade. At the September meeting of all four Special Conferences the prominent Kadet spokesman Andrei Shingarev argued that "the most correct and radical solution of the problem would be to establish a state grain monopoly." Shingarev meant what he said: six months later he was instrumental in setting up the grain monopoly of the Provisional Government.[56]

Behind the struggle over the level of prices was a more ominous debate on the efficacy of economic incentives in general. The Special Conference representatives of the Union of Zemstvos and the Union of Towns parted ways on this issue. Struve took a lonely position since he strongly supported the extension of fixed prices to all transactions but strongly opposed setting the level of prices too low: "If we have to choose between a high, even excessive, level of fixed prices and the mobilization of an enormous requisitioning organization directed against the mass of agricultural producers who hold a surplus of grain, it stands to reason that what we should fear most is the fixing of too low, or even merely inadequate, prices."[57] Groman objected that since peasants had only a limited need for money, higher prices might even decrease the amount of grain offered. He mentioned that soldiers often wrote home to their families saying, "Watch out, don't sell your bread, who knows what may happen!" and commented that this motive was not affected by high prices.[58] This reasoning came perilously close to arguing the necessity of force.

Decreeing a single price for all transactions was an attempt to overcome the disruption caused by dualism. But the very process by which grain prices were fixed had the unfortunate effect of increasing political and social disruption. Naumov's original reason for allowing the prices to be set through a broad open process was so that they would be perceived as fair to


all parties. The result was just the opposite, for the prices were now viewed as the result of a power struggle between groups. Even though the public consultation with local assemblies about price levels was a concession to the demands of the landowners, Naumov himself left office in the summer of 1916, partly because of unpopularity earned by association with the whole policy of fixed prices.[59]

The delay caused by the price-setting process had a paralyzing effect on the market. As producers waited for the price to be set, they stopped seiling. Not only government purchases but also the market as a whole were at a standstill. Local buyers had asked that prices be announced by July, yet they were not set until the middle of September. By September the Special Conference was inundated with frantic telegrams from purchasing commissioners asking for a definite price so that they could start buying.[60] This tardiness in the start of government purchasing operations was extremely harmful since supplies had to arrive in the north before the end of river navigation in the middle of October.

The economic standstill was easily perceived as deliberate blackmail. Local grain dealers had been listening to the local price-setting conferences, and they had concluded that the fixed price was going to be immense. Acting on this assumption, they bought grain from the peasants at fairly high prices and were shocked when the final fixed price was considerably below their expectations. They could not believe gentry opinion could be so easily flouted, so they waited for a change and in the meantime held on to their grain.[61]

To disabuse grain holders of the hope of any change, a telegram was sent out to local officials in late September over the signatures of Boris Sturmer (chairman of the Council of Ministers), Aleksei Bobrinskii (the new minister of agriculture), and Aleksei Protopopov (minister of internal affairs), saying that success now depended on convincing people of the fixity (tverdost' ) of the fixed prices. Protopopov's signature was important since he was known to be an advocate of free trade as an answer to food-supply difficulties. The commissioners were to inform the population that under no circumstances would the prices be raised and were to induce them to cooperate by "knowing how to use the uplift of its patriotic feeling"; but they were also to remind them that the requisition power stood at the ready. This volley in the war of nerves between government and grain holders was not successful since the political challenge in high government


circles to the policies of the Special Conference was hardly secret. The governor of Ekaterinoslav reported that the appeal to patriotism-cum-force struck many people as revealing not determination but rather the lack of it.[62] Earlier the embargoes and requisitions that created economic dualism had brought forth political counterpressures; now the politics of overcoming dualism in turn had economic consequences, which unfortunately only intensified disruption.

Although the breakdown of political authority was still in the future, the first two years of the war reveal the logic of a time of troubles almost as much as do the more dramatic events to come. The time of troubles first showed itself in small things—a shipment that failed to arrive because of a local embargo, a regulated price that made bread affordable and unavailable—but the logic was similar to that of the larger crisis ahead that indeed grew out of these small disruptions.

The expectation of a short war had led authorities to be casual about the costs of disruption so that they consciously created a dualism by which civilian society was to bear the entire burden of dislocation and readjustment. This policy could not be sustained indefinitely, and the second year of the war was spent in trying to overcome the dualism created during the first year. But the process of overcoming dualism itself created further uncertainty.

People had difficulty accounting for these unexpected developments. Why were there shortages and high prices in a country where there should have been a glut? In efforts to explain this puzzling state of affairs everybody blamed everybody else. Society was now forced to make conscious choices about what had previously been done routinely, but the knowledge to support these newly conscious choices was not forthcoming. To use the poignant commercial metaphor, visible supplies were quickly exhausted, and the government was forced to feel its way around on the hidden side of economic life.

Uncertainty gave rise to conflict, and conflict gave rise to uncertainty. The battle over fixed prices led to bitter disunity between the coalition of forces that wanted a cheap and reliable supply of grain and the rural producers who felt they were being exploited. The political struggle did not end with the final establishment of fixed prices in September 1916 but merely entered a new phase—and until the smoke had cleared and the outcome of the battle was known, the fixity of the prices and of everything else about food-supply policy was in doubt.


previous chapter
1 Beginning of Troubled Times
next chapter