Funding Loyalty

Funding Loyalty: The Economics of the Communist Party

Copyright Date: 2012
Published by: Yale University Press
Pages: 224
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  • Book Info
    Funding Loyalty
    Book Description:

    The flow of money to national, regional, and local Soviet communist party organizations, the manner in which money was collected, and how their financial discipline was enforced all yield deep insights into the party's role in the Soviet institutional design.Funding Loyaltyexamines the Soviet communist party's financial operations and its budget from the 1930s through 1960s, providing a fresh look at the evolution of the party and its role in the Soviet economy and society as a whole.

    eISBN: 978-0-300-16590-6
    Subjects: History, Economics

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. Preface
    (pp. ix-xii)
  4. Introduction
    (pp. 1-22)

    “Follow the money.” This saying in its modern sense applies to untangling criminal conspiracies or to understanding the dynamics of elections. The same principle can be applied to understanding the workings of the Communist Party of the Soviet Union, although theoretically actors in the Soviet system were supposed to be largely indifferent to money. Goods, services, and privileges were supposed to go to the system’s directors and their loyal subjects, not to the highest bidder. A party driven by ideological motives as the “guiding force” should have been least of all interested in cash or anything associated with monetary transactions....

  5. 1 The Budget of the Soviet Communist Party
    (pp. 23-35)

    Bud gets tend to be regarded as tedious documents that show how a business, nonprofit organization, or government intends to use its income over a period of time. Yet behind the bland numbers themselves, bud gets tell us a great deal about an organization by revealing its sources of revenue and priorities, as it will inevitably allocate more resources to the tasks considered more important.

    In this chapter we describe the bud gets of the Soviet Communist Party by showing how the CPSU raised its revenues, spent the proceeds, and whether it had to rely on others to cover its...

  6. 2 Trends in Party Finance, 1939–1965
    (pp. 36-44)

    Party leaders announced priorities of the state—“the party line”—in frequent speeches and newspaper articles. Party budgets, although less eloquent than speeches, also reveal priorities. Moreover, they expose changes in priorities that the leaders chose not to broadcast. Clearly, in the late 1930s, as reflected in the most significant single expenditure item, the party’s focus was on ideology. Some three years later, when World War II broke out, other activities had become more important, and party spending on ideology shrank. At the end of the war, spending on ideology increased briefly but soon began declining again.

    Party bud gets...

  7. 3 The Special Budget of 1948
    (pp. 45-55)

    The transcripts of a UD meeting that took place in late April 1948 capture the turning point in party finance—the abrupt decline in federal subsidies—observed in the data. After a discussion of the previous year’s financial reports, the Central Committee’s financier, UD chairman Dmitrii Krupin, broke the bad news to the regional participants: the 1948 bud get was going to be “special,” with the party having to depend on its own revenues. Federal funding in the current and following years was to be significantly reduced—no more than 25 percent of expenditures. The propaganda and training of party...

  8. 4 “Impossible Structures”: Resource Allocation and Party Donors
    (pp. 56-73)

    Maurice Escher, one of the world’s most acclaimed graphic artists, owes his fame to his images of impossible structures, which break the laws of perspective. They combine graphic elements such as staircases or flowing water that cannot coexist in a real 3-D world. Escher chose graphic art over architecture to engage in “irrational” modeling. If we found ourselves in an Escher structure, we would be ascending and descending simultaneously or ascending all the time, only to find that we have remained at the same level.

    In the 1920s and 1930s, when Maurice Escher began his explorations in graphics, Soviet leaders...

  9. 5 Funding Loyalty with Promises
    (pp. 74-94)

    A single mass party as a central element of the political system is a characteristic feature of the Soviet Union and many other similar regimes. The party ranks consisted overwhelmingly of ordinary members who did not hold any official paid positions. This was true throughout the history of the Soviet Union: in the years of the civil war, when party membership was only a few hundred thousand people; in the Stalin period, when a much larger party still comprised no more than 3 percent of the total population; and at the peak of the party’s numeric strength in 1989, when...

  10. 6 The Party and Its Overseers
    (pp. 95-109)

    Communism was supposed to breed a “new socialist man” to replace the self-interestedHomo economicus. Indeed, would it not be reasonable to expect party members, as the avant-garde of the socialist state, to place the interests of the state above their own narrow interests? If this were the case, however, there would be no need for the party to supervise its members as they could be counted on to serve the higher interests of the party and state. That there were shady characters in the party should come as no surprise, but the fact that the party had to create...

  11. 7 Selective Justice: Party Control under Stalin
    (pp. 110-129)

    The Soviet justice system was clearly biased toward party and state elites, who often enjoyed selective justice, while most jurists were controlled by the Communist Party.¹ A number of studies describe how Soviet justice was administered to citizens but shed little light on how it was administered to its members within the Communist Party system. From the literature we know more about periods of sudden and sweeping party purges (the 1932–1933 and 1935–1938 purges, the Great Terror, and the 1948 Leningrad Affair) than about routine mechanisms of party justice.² Was party justice different from justice for others? Did...

  12. 8 How Much? The Cost of Party and the Determinants of Party Expenditures
    (pp. 130-140)

    Over its decades in power, the Communist Party accumulated substantial resources that the party leadership considered as party property. According to an inventory of January 1, 1990, the party’s assets were worth nearly 5 billion rubles.¹ This included 1.6 billion rubles from the publishing business; almost 2.5 billion rubles in property owned by local party organizations; 133,000,000 rubles in property owned by central party organs; and some 760,000,000 rubles in buildings, resorts, summer houses, and means of transportation owned by the UD itself.² In 1990, facing reforms of state property and a very credible threat that the party’s resources would...

  13. Conclusions
    (pp. 141-154)

    In the spring of 1990, one year before the demise of the Soviet Union, the Communist Party Department of International Affairs prepared a memo for a Politburo discussion of the party’s future relationship with communist parties in Eastern Europe.¹ The memo summarized the political mistakes made by the leaders of the Soviet East European satellites—primarily their attempts to extend the existence of political structures based on the “Stalinist matrix,” which undermined the reputation of communist parties among the masses. The East European comrades had failed to foresee that state subsidies would dry up quickly and had not made the...

  14. Appendix of Figures and Tables
    (pp. 155-184)
  15. Notes
    (pp. 185-202)
  16. Index
    (pp. 203-209)