861.50/956: Telegram

The Ambassador in the Soviet Union (Standley) to the Secretary of State

296. Krasnaya Zvezda of April 1, which has recently been received, contains a long article outlining the reasons which have enabled the Soviet national economy successfully to withstand the strain of war.63 This may be summarized as follows:

The main factor has been the Soviet policy of emphasizing heavy industry at the expense of the production of consumer goods.

The second has been the planned distribution of the country’s economy. Heavy industry was built up in the Urals, Siberia, the Volga Basin, and Kazakhstan. Each year the center of Soviet industry has been moved more and more to the east and further from the frontiers. During the 2 five-year plan periods more than 200 large industrial enterprises were installed in the Urals, including such giant plants as the Magnitogorsk Metallurgical Combine. The basic amount of new industrial construction was situated outside the radius of systematic operations of the enemy air force. Thus, even prior to the outbreak of the Soviet-German war more than half of all the steel was produced in the eastern districts. Furthermore, the production areas of such important types of strategic raw materials as copper, zinc, lead, vanadium, molybdenum, arsenic and antimony have been completely or almost completely untouched by military operations.

In respect of agriculture, prior to the war the Urals, Volga Basin, western Siberia, north Caucasus, and north Kazakhstan had become main bases of grain production. During the past few years the role of the Ukraine as an exporter of grain to other regions of the Soviet Union has considerably decreased and the part played by the eastern producing districts has risen sharply. At present the main grain [Page 435] regions of the R. S. F. S. R.64 can satisfy the demands of the country and of the army in grain.

Other factors appeared after the start of the Soviet-German war. The entire Soviet economy was placed on a war footing in a very short time, with industrial enterprises immediately converting their type of production if necessary. All main industrial enterprises were evacuated eastward in good time from enemy-occupied territories and frontal regions, and were as a rule again in production within 2 or 3 months. The smaller industrial enterprises left in enemy-occupied regions were in general put out of commission. Another factor has been that no country in the world has such possibilities as the Soviet Union for utilizing women in productive work. Moreover, the Soviet Union is receiving rubber, aluminum, tin, nickel and other materials from England and the United States.

As a result, Soviet defence industry is now producing considerably more than it was before the outbreak of the war and the Red Army has more cannon than the Germans. The German numerical superiority in tanks and airplanes is being reduced. The number of trench mortars and automatic weapons in the Red Army is rapidly increasing. At present the Red Army is armed much better than was the case at the commencement of the Soviet-German war.

  1. In his preceding telegram (No. 295, April 9, 3 p.m.), Ambassador Standley cautioned that this article, while substantially true, was “believed to be somewhat optimistic in its analysis of both the agricultural and the industrial situation.” (861.50/957)
  2. Russian Socialist Federated Soviet Republic.