In article
<ddfr-3E286F.20170011082008@[EMAIL PROTECTED]
>, David
Friedman <ddfr@[EMAIL PROTECTED]
> wrote:
> In article <g7pvq7$9p9$1@[EMAIL PROTECTED]
>,
> Anton <anton.usenet@[EMAIL PROTECTED]
> wrote:
<deletions>
> >
> > This view is generally regarded as the correct one by most scholars.
Had
> > the relation****p been "extortion and tribute" as this Donald guy is
> > suggesting GDP and other figures would not had looked the way they
did...
>
> You may well be correct that the trade was profitable for the Finns
Of that there is no doubt. It was not only profitable, it was profitable
beyond human comprehension. A country with a population of 5,000,000 being
in the privileged position of supplying a virtually insatiable and
non-discriminating market of 300,000,000 with everything from nylon
stockings to an entire city and industrial infrastructure key-in-hand at a
price set by the seller and paid for in raw materials significantly below
world market prices.
> --on
> the evidence of this thread, one plausible explanation is that the
> Soviets were bribing the Finns to sup****t them in various political
> ways.
That is partially true. But there is a simpler reason. The Soviets did not
want to consign their industrial capacity to the production of what they
considered to be frivolous and ideologically suspect light industrial
products such as nylon stockings, macaroni, and galoshes. On the other
hand, their population craved these products. Allowing the capitalist
Finns free access to the consumer goods sector of the economy kept the
Soviet population happy, the Finns employed, content, and prospering as
they managed the heavy industrial infrstructure that the Soviets had
forced them to build to pay the war reparations, and showed the world that
the peaceful coexistence of capitalism and communism could be mutually
beneficial to both parties. It also allowed the Soviets to focus on what
they did best: munitions manufacture, raw materials extraction, heavy
industry, and space technology.
The Finns only sup****ted the Soviets politically when it was in their own
national interests, as the 1975 CSCE in Helsinki was, in many people's
opinion. It finalized the results of WW II at the price of
internationalizing human rights abuses. The Finns vigorously protested the
worst Soviet abuses there was a massive demonstration lasting for days
outside the Soviet embassy in August 1968 protesting the invasion of
Czechoslovakia, in addition to which Finland took in hundreds of
Czechoslovak defetors and did not automatically repatriate defectors
from the USSR, but they tended to be prudent and maintain a low profile
when it came to criticism of day-to-day Soviet abuses and policies. When
the Soviets proposed to the Finns such projects as joint miltary
exercises, the Finns told them to shove their proposal where the sun
doesn't ****ne.
> But your argument doesn't work. If the Finns had a much more
> productive economy, as they did, they could have been paying tribute to
> the Russians and still ended up richer than the Russians.
The Finns had a much more productive economy than the Soviets, they
arguably paid tribute to the tune of $300,000,000 in the form of war
reparations to the USSR between 1948 and 1952, but after that they had
free access to one of the largest and most insatiable markets in the world
on exceedingly, almost insanely, preferential terms. When this
asymmetrical system eventually came to an end after almost forty years,
the Finns wound up with a bloated but easily downsized, retooled, and
redirected industrial
infrastructure, while the Soviets wound up with warehouses full of nylon
stockings, cheese, and baggy men's suits.
After 1952 the Finns were no longer paying tribute to the Soviets, but
rather using their privileged access to the Soviet market to earn back
many times what they had paid in tribute. In the end, Finland ended up so
much richer than Russia that between the collapse of the USSR and the
spectacular growth of the Russian economy after the 1998 ruble collapse
and Putin's accession to power, the gulf in living standards at the
Finnish-Russian border was said to be the greatest in the world.
In 1994 I worked in Kiev, not Russia, but Ukraine, which was arguably even
worse off than Russia. Salaries averaged $15 (fifteen) to $20 (twenty)
dollars a month, and they were paid in scrip: Ukraine did not have a
functioning currency at the time and the rate, if I remember, was 4,000 to
4,500 'coupons' to the dollar. I exchanged $20 on arrival and received a
shopping bag full of 'coupons'. In Finland people were making more than a
hundred times that much. In Russia, salaries were at the Ukrainian level,
but rubles were in short supply, so many people were being paid, if at
all, quite concretely in the products of their labor, such as T-****rts,
sausages, or brassieres.
Regards,
Eugene Holman
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