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Chapter 4 - -The Road to Industrialization-

--The Russian military is changing.

 Anyone who knew the Russian army before the war would have felt that way. For better or worse, the Russian army was a backward military force, and while it had the tenacity to continue to resist stubbornly even in difficult situations, the majority of its soldiers had received little education and were governed by anachronistic customs.

 This backwardness is also strongly reflected in the Russian army's traditional hand-to-hand combat doctrine, which places the greatest importance on victory in a bayonet charge that relies on superior spiritual strength rather than material firepower. One emerging Eastern nation that actually confronted the Russian army was so impressed by the Russian army's spiritualism and hand-to-hand combat doctrine that it adopted it in its own country.

 However, Stalin's harsh experiences during the Russian Civil War and the Great Patriotic War transformed him into a realistic rationalist who could be described as a believer in materialism.

 What Stalin learned from the two wars was that "modern warfare is a battle of firepower" and that "to support firepower, industrial power as an underlying foundation is essential."

 In fact, the Soviet Union's advantage over Nazi Germany in the Great Patriotic War was not so much in numbers as in firepower: at most, the Soviet Union had only two to one troop strength, but four to ten to one tanks and artillery.

And if firepower is emphasized, it is inevitable that logistics - material aspects such as ammunition and fuel supplies - must be emphasized. In the Soviet military, which emphasized a scientific approach based on materialism, there was no room for a "spiritual theory" based on humanism. What should be supported is the simple and realistic laws of physics... the truth that even an excellent commander cannot achieve results without the necessary supplies.

"Industrialization is the key. Heavy industry must be the focus."

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 Stalin, who felt the need for industrialization, immediatelyNational Planning CommissionGosplan" He aimed to reform the military and promote industrialization, which would serve as the foundation for that reform.

 But perhaps it was to be expected.National DietDumaThis resulted in a strong backlash from the nobles.

 This is because the "industrialization" policy advocated by the Emperor, roughly speaking, was "collecting taxes, accumulating capital, and investing it in industry."

 The people who would suffer most from this policy would be the nobility, who owned most of Russia's wealth, as it was in direct conflict with the interests of the conservative peasants and nobles, who were united in their refusal to allow the Tsar's rule to penetrate into their lands.

 On the other hand, Stalin was supported by military personnel and bureaucrats who feared Russia's backwardness and lagging industrial base.

"If we go into war without industrialization, the results will be disastrous."

Based on their experience in the Russo-Japanese War, Kuropatkin and other military men correctly predicted that the coming war would be a disastrous war of attrition.

 In the next generation of wars, nations would need to use all of their resources efficiently, and to do so, the development of industry was an urgent task.

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 However, the nobles were one of the few highly educated elites in Russia, and they were not opposed to industrialization without any justification.

"Russia's strength lies not in industry, but in agriculture. If Russia focuses on uncompetitive industry, it will lose to Western countries with high quality and it will be a pointless waste of national energy. Instead, shouldn't our country focus on agriculture, which is internationally competitive, and import industrial products, so as to achieve a coexistence of the two countries?"

 This is a perfectly reasonable opinion based on David Ricardo's theory of comparative advantage. It is not necessarily true that blindly striving for domestic production and self-sufficiency will lead to a "great leap forward."

 Even at the time, South American countries such as Argentina and Mexico were trying to industrialize ahead of Asian countries, but in the end it did not work out. Why was that?

 --The bottom line is, there's no demand.

 If there are no buyers, no matter how much goods are produced, they will just pile up. In fact, one of the main reasons why South American countries failed to industrialize was that their citizens did not have the purchasing power to buy the goods. In addition, if foreign products can be imported cheaply, only the most patriotic people will choose to buy them.

Ironically, the Russian Empire, which had formed the Triple Entente, was able to import high-quality industrial products from Britain and France at low prices, which actually hindered the development of domestic industry.

"But now we are in wartime. With imports from the UK and France cut off, shouldn't we turn our attention to domestic production?"

 Following the outbreak of World War I, many reformist politicians, including Sergei Witte, called for promoting industrialization.

 However, the majority in parliament, led by Prime Minister Ivan Goremykin, a known ultra-conservative, took the position that "the war is temporary, and there is no need for sudden structural reforms."

 However, the main point of Goremykin's argument is that he is conservatism in the true sense of the word, rather than restorationism, in the sense that he is opposed to "sudden" reforms, although he does acknowledge the need for gradual reforms.

"Most of our people are poor farmers. In order to increase their purchasing power, we must first develop agriculture. The wealth gained through agricultural development will then become the capital accumulation necessary for industrialization."

 The basic conservative idea is to first invest in agriculture, develop surplus grain for export, and then use foreign currency to purchase the production equipment needed for industrial development.

 There is ample justification for this. Russia, which has an immature industrial base, relies on imports for most of its production equipment. Before industrializing and mass-producing industrial products domestically, the first problem was how to raise funds to import production equipment from abroad.

"Japan's industry is inefficient and uncompetitive. In contrast, agriculture, which accounts for 90% of the population, has an abundant labor supply and allows relative production costs to be kept low, so Japan's cheap agricultural products have the potential to be internationally competitive. Given that budgets and resources are limited, wouldn't it be more efficient to invest in agriculture, which has a comparative advantage over industry and can be expected to see a higher rate of growth?"

They then use the foreign currency earned by exporting the agricultural products they produce to import production equipment and invest in industry. After that, they produce industrial products, which are then purchased by the people, whose purchasing power has increased sufficiently through agricultural exports... The largest consumers in Russia are farmers, and if they become wealthy, they will buy industrial products. This will then allow funds to flow to industrial producers, who will then be able to import production equipment from abroad and increase their production capacity.

 In other words, Goremykin and other conservatives aim for what could be called bottom-up growth, and believe that "governments should develop national strategies in line with the situation of their own economies."

 In fact, advanced industrial countries such as Britain and the United States achieved industrialization by following this moderate pattern, so this was a perfectly reasonable argument.