Still deluded about the Soviet system

Seriously, does anyone at all still believe this?

In October 1984, six months into the dispute, the National Union of Mineworkers was desperate for cash to fund the strike, because a judge had ordered the confiscation of the union\’s entire assets. The NUM leader, Arthur Scargill, had stepped up efforts to raise cash from the USSR; Soviet miners had responded by donating more than $1m from their wages.

Come on, it\’s one of the marks of a totalitarian state that there is no such thing as an independent union (or independent anything else for that matter).

Thatcher wanted to know whether Gorbachev had approved the donation, since the Soviet miners would have needed government permission to convert roubles into foreign currency.

Yes, that\’s certainly true. But the original \”donation\” would have been at least approved, if not actually instigated, by the government itself anyway.

Viktor Popov, appeared unmoved. \”The ambassador simply maintained that Soviet trade unions were independent and democratic and that the Soviet government was not answerable for their exercise of their rights\” to donate to their British comrades.

Simply untrue. Such ability to make independent decisions just did not exist.

The following day, a senior Soviet official returned to the Foreign Office with a message stating that \”any form of aid that might be given to the British miners would be undertaken independently by the Soviet miners without the slightest participation of the Soviet government or its departments\”.

Just nonsense.

It was a foreign state intervening in Britain\’s domestic affairs.

Whether you think it was a justified attempt or not is entirely another matter, but in the Soviet system there was just no way at all that anything as large and national as a miner\’s trade union had any independence from government or party.

16 comments on “Still deluded about the Soviet system

  1. The selective memory of the professional lefty never ceases to amaze me. No matter how powerful the evidence, it seems to be mandatory to pretend that the USSR was not a violent, coercive blunt instrument run by gangsters and completely hostile to our interests. But you could say the same about the NUM, so at least there was some moral equivalence there…

  2. To be fair, the article does make it clear that the Soviets were lying:

    “It later transpired that a month before the Chequers meeting, Gorbachev had himself signed the papers authorising the donation.”

    I’m not sure reporting the Soviets’ official version of events is the same as believing it.

  3. This is from the same idiots who believe the figures published by the Castro regime in Cuba. And a good few of these idiots reckon the likes of Russia can be trusted to accurately report its CO2 emissions.

  4. We should be grateful to the Soviets (Gorbachev?)for doing their bit to keep a major
    British industry going, at a time when the chinless wonders in the City were saying that Britain should say goodbye to what they called” old-fashioned metal bashing” because the future lay in sooper-dooper financial services fuelled by the entire population sending mortgage repayments to the banks.Oh happy days…Crash. ..Where have all our industries gone?

    Tim adds: Well, given that manufacturing output is higher now than it was in 1980, I strongly suspect that we’ve still got lots of manufacturing industry really.

  5. My Russian wife was at school at the time. Everyone in her school was required to make a mandatory voluntary donation to help the miners, who were suffering unbelievable poverty at the hands of their capitalist oppressors. On the other hand, thanks to the munificence of the Soviet state, her family were living quite comfortably in 8 sq. m of temporary housing while they waited 12 years for an apartment.

  6. And, as anyone who has experienced Russia first-hand would know, if the route of $1m has to go from a miner to somebody else via a bureaucrat, a hefty chunk of the cash is going to end up in the bureaucrat’s pocket. So the very fact that $1m got handed over is evidence enough that the miners had little to do with it.

    Well, given that manufacturing output is higher now than it was in 1980, I strongly suspect that we’ve still got lots of manufacturing industry really.

    Indeed, only this time we’re making stuff we’re quite good at making.

  7. “the future lay in sooper-dooper financial services fuelled by the entire population sending mortgage repayments to the banks”

    Those foolish bankers. We shut down the mining industry and suddenly 24 years later there was a financial crisis.

    All that wealth created in the intervening years has proved to be illusory and we are actually poorer than we were in 1984. Only we haven’t realised it yet.

  8. @Tim
    As has been established somewhat tediously before, production and productivity may have increased but the wage share has not. So its sucks boo to the Fotherington Thomas view that market forces are the friends of man .
    @Kay Tie
    The Public School /City/Tory subversion of British industry has been going on for a long time .As well as clubbing coal miners on the head, “business opinion” favoured asset stripping by the likes of Slater/ Walker (the latter a Tory Cabinet Minister)by which factories were closed down at a profit with the
    assets generally land being sold off.Remember Centre Point?.Harry Hyams wa not the villain he’s been made out to be ,but then( and now )it was possible to sit on property and derive an income ,without actually producing anything.

  9. DBC – what’s wrong with asset-striping? If the parts of something are more valulable separately than together, they should be broken up into the parts, otherwise you’re just destroying value.

    Of course, there might be foolish laws that artificially make it more valuable to break things up, or keep things together, eg tax incentives, in defiance of the underlying economics. But in that case the solution is to change the laws.

  10. DBC Reed has forgotten how the economy worked back in the 70s

    1) The coal mining industry was inefficient, so the taxpayer had to subsidise it, and its customers were not allowed access to cheaper foriegn coal
    2) The steel industry was inefficient, and it had to buy expensive British Coal so the taxpayer had to subsidise it, and its customers were not allowed access to cheaper steel.
    3) The automotive industry was inefficient, and it had to buy expensive British Steel so the taxpayer had to subsidise it, and its customers were not allowed access to cheaper & better vehicles.

    It wasn’t really a sustainable model was it? The longer it stayed in place, the more expensive was its downfall going to be.

    The modern equivalent is the unneccessary regulatory burdens that governments place on companies. I suspect that they have driven many a marginal company over the edge.

  11. What is wrong with asset stripping is that it destroys jobs and so decreases dispersed purchasing-power.These geezers took on Mittelschaft companies that had big turn-overs but small profits and concentrated on selling the assets for as much as possible.Since land was untaxed,they could make a lot of money: without producing anything.
    @Serf
    What is the problem with subsidising people to work? It is surely better to push money their way in wages than to ensure house prices keep on rising with no effort from the homeowner at all.These are both in effect subsidies.It is ludicrous for people whose houses have appreciated by thousands of percent to accuse workers of getting something for nothing.

  12. DBC Reed, this depends on the motives for the asset striping. If the parts of an asset are genuinely worth more separately than together, then asset striping means producing wealth and it, of course, increases dispersed purchasing power. (Before we only had one owner, who wasn’t getting that much, once you’ve stripped the assets, we have multiple owners, and overall they’re earning more as the parts are more profitable than the whole).

    These geezers took on Mittelschaft companies that had big turn-overs but small profits

    So companies that were taking valuable resources, such as expensive machinery, land, etc, and not making much money from it compared with potential alternative users. For the public good, assets should be used in the most valuable way, so by taking assets away from those managers who were wasting them, compariatively, the geezers were acting in the public good. (Excluding of course those cases where the laws of the land make it profitable to make investments which the underlying value does not support, in those cases the laws of the land should be changed).

    and concentrated on selling the assets for as much as possible.

    In other words, they were finding the seller who thought they had the most use for the assets, as opposed to giving them away to any random idiot. Again, these geezers are acting in the public good (assuming that the assets really are more valuable separate than joined together, if not then the laws should be changed to align monetary profits with the public good).

    Since land was untaxed,they could make a lot of money: without producing anything.

    Of course as any environmentalist can tell you, you can’t eat money. So once these geezers earn money for their services to the public good, as we have already established, they then will go out and either spend that money, or invest it.
    – If they spend it, then that money was taxed, in VAT, and in income tax on whomever provided the goods and services purchased.
    – If they invest it, then the money was taxed, in capital gains tax, or in the income and profits of the companies that were invested in (eg if the investment went into R&D then the researchers’ salaries are taxed).
    – If they spent it buying more land, then someone must have sold the land, and thus has money available in their turn to either spend or invest, thus attracting taxes (the lander seller of course could have turned around and bought land elsewhere, but then the person they bought from would have the extra cash to do something with, at some point something different winds up being down with the money).

    In other words, taxes got paid, sooner or later, even without land being taxed. Perhaps land should be taxed more, but still asset striping, when it is naturally profitable, is a darn good thing.

    What is the problem with subsidising people to work?

    Because the money that is spent subsidising people to work means that money has to be taken from someone else. Whomever it is taken from therefore has less money to spend, putting other people elsewhere out of work. Add in the deadweight costs of the taxes and the admin costs and we’re all worse off in the end.

    It is surely better to push money their way in wages than to ensure house prices keep on rising with no effort from the homeowner at all.

    This is a false dichotomy. It is entirely possible not to subsidise people in working and also, simultaneously, not to subsidise higher house prices. And it’s a lot cheaper too.

    It is ludicrous for people whose houses have appreciated by thousands of percent to accuse workers of getting something for nothing.

    Perhaps, perhaps not, but this assertion has nothing to do with Serf’s arugments.

  13. Tracey,
    It is very kind of you to spend so much time answering my answer to Serf.
    The nub of the problem lies in your assertion that selling an unwieldy Mittelschaft company (something which the Germans are naturlich loth to do) yields multiple owners.There may be
    more owners,but there are fewer wage earners.
    Mass production cannot function with the purchases of a few owners: they can only buy a few loaves of bread where the employees of factory can buy many and help to keep a fair number of their fellow workers in work (Dispersed purchasing power).
    I am as you may have gathered very, very old.I cannot recollect the most hard-faced Tories in the 8o’s having much good to say about asset stripping.
    I do recollect a Board of Trade spokesman enthusing about the takeover of the Northampton shoe trade by Charles Clore in the 1950′s on the grounds that he was proposing to maximise the slumbering assets.Clore was no asset stripper and did his best to keep the British Shoe Corporation going,but the fact remains that the boot and shoe factories eventually disappeared and the dedicated shoe shops in every high street that went with them went also. If the most valuable asset is the land the factory stands on,where is the long-lasting source of wages once the factory is closed?

  14. The nub of the problem lies in your assertion that selling an unwieldy Mittelschaft company (something which the Germans are naturlich loth to do) yields multiple owners

    Before we go any further, I’ll specify that I am talking about asset striping, in those cases where an assets’ parts are worth more than its whole, not any sale of an unwieldy company. Obviously if an unwieldy company is sold to a single owner, rather than being broken up for its parts, then that transaction does not yield multiple owners.

    Mass production cannot function with the purchases of a few owners: they can only buy a few loaves of bread where the employees of factory can buy many and help to keep a fair number of their fellow workers in work

    However in that case non-mass production can function with the purchase of a few owners, they can buy multiple pieces of individually hand-crafted restaurant meals and keep a fair number of their fellow citizens in work. And, with the money those citizens get, they can buy loaves of bread and keep the mass production going too.

    I cannot recollect the most hard-faced Tories in the 8o’s having much good to say about asset stripping.

    To the extent that this assertion of yours is true, it lowers my opinion of hard-faced 80′s Tories. That many people believe a faulty argument does not make the argument any less faulty.

    Clore was no asset stripper and did his best to keep the British Shoe Corporation going,…

    So Clore was a destroyer of valuable assets and diminished the public good, hiss, boo, boo (this may be unfair, Clore could have honestly believed that the British Shoe Corporation could be more profitable than the sum of its parts, and I don’t think someone should be counted as a villain just because they made some decisions in conditions of uncertainty that turned out to be wrong.)

    If the most valuable asset is the land the factory stands on,where is the long-lasting source of wages once the factory is closed?

    If the most valuable asset is the land the factory stands on, where is the long-lasting source of wages if the factory stays open? A society can subsidise some forms of economic activity indefinitely. It can subsidise all forms for a short period of time. But it can’t subsidise all forms of economic activity all the time.

  15. Tracey
    I did n’t say Clore was a villain. I t was despite his best efforts that shoe factories and their associated shoe shops (most high streets had four or five) disappeared. I made this quite clear in the above from which you have derived a perverse interpretation.
    I am no longer willing to continue this exchange
    for this reason.

  16. I didn’t say Clore was a villain.

    And I never thought you did. I said Clore was a villain (although I then partially retracted it, on the basis that Clore could have been honestly mistaken). My apologies for my poor writing skills.

    My argument is that the people who asset strip a company, where the parts separately are naturally worth more than the whole, are acting for the social good, and people who keep a company together that’s wasting resources are acting against the social good. I am well aware that many people, including you, disagree with me on that matter, and while I hope to persuade you to my opinion, I am clear on the difference.

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