Knowledge that Transforms

A. David Redding, Comparison of Volume and Distribution of Non-Agricultural Employment in the U.S.S.R., 1928-1955, with the U.S., 1870-1952, The Review of Economics and Statistics, Vol. 36, No. 4 (Nov., 1954), pp. 444-450

THE investigation reported here was a part of a survey of consumer use and purchase of furniture in Flint, Michigan, spring, I95I.1 The annual nationwide Surveys of Consumer Finances 2 have reported consumers' economic expectations and buying plans, but these have been more narrowly defined than in the Flint Study. In the Surveys the head of the spending unit I is asked about his income outlook, what he thinks will happen to prices, and his buying plans for a home, an automobile, and for selected durable goods. The Flint sample was drawn from a city of 48,I59 households (in I950) with one dominant industry automotive manufacturing. It included only primary spending units keeping house and using (or having definite plans for using) their own furniture. From the original stratified random sample, 8 per cent were excluded because they were renters of furnished quarters with no definite plans for using their own furniture, and I3 per cent could not be interviewed. It was judged satisfactory to treat the final sample (428 spending units) as a random one in the analysis. Spending units including husband and wife (called normalfamily units) made up 84 per cent of the survey sample (2I9 with children and I39 without), i i per cent were single-person units, and 5 per cent were broken-family units (with children). Economic expectations. After the homemaker had stated the previous year's income, she was asked (i) Do you expect to have more to this year (I95I) than you had in I950? Less? About the same? and (2 ) Why do you say so? The reasons given were chiefly in relation to income expected. However, a number of the replies indicated that money to spend was thought of as left after taxes and fixed or routine expenses (including debt payments and common necessities) were accounted for. The percentage distribution of reasons given for specific expectations is shown below. Percentages are not additive because some respondents gave more than one reason.

THE pattern of Soviet participation in foreign trade since World War II has been radically altered as a result of the farreaching changes wrought by the war in the international relations of the U.S.S.R. Unfortunately, firm and direct information on Russia's annual transactions in international trade is unavailable inasmuch as the Soviet Government has continued to maintain a blackout of information, introduced at the end of I938, on this vital subject. Hence the magnitude and geographic direction of Soviet foreign trade can only be determined approximately and indirectly by the use of the statistical returns of the countries trading with the U.S.S.R. A composite estimate of the dollar value of Soviet foreign trade for the five-year period I947 to I95I discloses that the effort which the U.S.S.R. has exerted in recent years to mobilize and direct the resources of the areas in Europe and Asia that have come under its control has resulted in two conspicuous changes in the character of Russia's international exchange of commodities. One distinctive feature of postwar Soviet foreign trade has been a strong upward trend in its total annual value. In this respect, Soviet trade has witnessed a reversal of the trend it displayed during the prewar period, I930 to 1938, when the annual value of Russia's foreign trade had tended downward steadily.

Philip J. Bourque, The Domestic Importance of Foreign Trade of the United States, by Producing Regions, Manufacturing Sector, 1947, The Review of Economics and Statistics, Vol. 36, No. 4 (Nov., 1954), pp. 401-408

THERE have now been two post-Stalin budgets, which in structure and presentation differ so appreciably from their predecessors as to cause acute confusion in the minds of many commentators. The differences have not been explicitly stated in Soviet sources, but can be deduced from them, though the evidence is insufficient for an arithmetically precise account of what has occurred. The objects of the present paper are, first, to examine the budgets for the light they shed on the development of the Soviet economy in the last two years, and, second, to explain as far as possible the changes since Stalin's death in the structure of the budget itself. Obviously, these two aims overlap, since a change in the definition of a budgetary heading affects any conclusions one can draw about or from its magnitude. The I953, and still more the I954, budget sessions of the Supreme Soviet are simultaneously informative and acutely frustrating; there is a substantial volume of new data, but some information is missing, and comparison with previous years is rendered difficult by complex and inadequately explained changes in structure and definition. One new feature is that the Soviet leaders have spoken in the budget debates and in the course of their speeches have given useful economic, political, and information. Under Stalin, the speech of the unchanging Minister of Finance, Zverev, was followed by routine speeches of little interest by persons of medium or lowly rank, while the top party leadership remained in the special seats reserved for them on the platform and said nothing. Malenkov broke with precedent when he addressed the I953 budget session; he spoke again in I954, as did such major personalities as Khrushchev, Kaganovich, and Mikoyan. Since men of this stature, whose speeches were to be reprinted in millions of copies, could not confine themselves merely to repeating the points already made by the relatively less important Zverev, this in itself ensured that the session would be more informative than had been the case under Stalin. Unfortunately, the increasing political importance of the budget session has led to a noticeable decline in what might perhaps be called statistical integrity; before I953, while certain data were from time to time suppressed, the budget figures always appeared to be reasonably reliable; it will be shown that in I953-54 there has been a marked increase in propaganda-statistics. Table i compares the results of the I952 budget, the last of the Stalin era, with the original estimates and provisional results for I953, and with the estimates for I954. Unfortunately, a complete set of comparable figures for all items cannot be reconstructed from official sources, and in certain cases it has been necessary to make deductions from indirect data, of varying degrees of accuracy; these are explained in the notes to the table. One is immediately struck by the very large increase in the unspecified items of both revenue and expenditure from their I952 levels. This reflects the changes in presentation to which reference has already been made; the analysis of the details of these changes will be left to one side for the present, though it must be stressed that they are of quite vital importance to a proper understanding of the budget as a whole. Revenue from turnover tax shows a downward trend, although both the production of taxable commodities and retail trade turnover are rapidly rising. The volume of turnover of state and cooperative trade in I953 was stated to be 2I per cent above that of I952; it is planned to rise by I5 per cent in I954 and reach a level 75 per cent above that of I950. The fall in turnover tax yield is, of course, due to the cuts in retail prices and increases in prices paid by the state to agricultural producers. The I954 estimated yield is below that of I950. Retail prices, according to Mikoyan, are only 25 per cent below I950 levels. In comparing the relative changes in trade turnover and prices, some commentators find it hard to see why turnover tax revenue should be fall-

THE United States, through her policy of economic assistance, first in the form of the Marshall Plan and since I952 in the form of Mutual Aid, has helped many friendly countries to recover from the ravages of war without any appreciable reduction in living standards. Had the United States not come to the rescue, a highly developed area like Western Europe would have been forced to adjust herself in one way or another to hard economic circumstances. In the process she would surely have had to suffer a decline in living standards productive of social unrest and possibly of communal strife sufficiently violent to have brought into power in some countries political parties of extreme doctrines and hostile toward the United States. If that danger has been avoided, it is by no means over. Though production in the rest of the world, and in Western Europe in particular, has recovered and advanced beyond its prewar standards, there is still some evidence of a dollar shortage suggestive of a structural disequilibrium which is unlikely to be solved with the mere passage of time. The question naturally arises what further measures might be undertaken by the interested countries to promote the expansion of world trade on a multilateral basis. If we agree that in the immediate future the prospects of a substantial contribution to this end by West European countries are rather poor, our main concern will be to reconsider the efficacy of those policies by which, it is frequently alleged, the United States might further contribute toward its realization. First, however, let us appraise briefly the existing imbalance. From June I95I to June I952 the United States current account had a surplus of $4,I00 million.' From June I952 to June I953 the current account surplus was roughly $68 million. One concludes the United States surplus on current account is tending to disappear completely, a conclusion which has promoted some cautious optimism. But optimism is warranted only if the situation has been brought about without further trade restrictions; in the present situation, that would be largely by an expansion of the value of to the United States in a way which would be unlikely to prove merely temporary. Glancing at the figures we discover that, of the reduction in the surplus from $4,I00 million to the present insignificant figure, the in to the United States accounted for less than $I,400 million. Of this increase in exports to the United States, about $500 million was an in United States government expenditure on purchases by its personnel abroad, and an estimated $250 million was on offshore purchases. Of the reduction in from the United States of close to $2.6 billion, a small part was accounted for by an in the output of coal in Western Europe and by better harvests abroad. The remainder is attributable largely to the effects of a further of import restrictions abroad in late I95 i and in I952. If these import restrictions are considered temporary, then the potential deficit is still very large. It would be larger still if the political situation were other than it is. For then the United States item imports of government services, which provided some $I,900 million in the period I952-53, would be reduced to a fraction of this sum. As a final damper to the optimism, it may be pointed out that should the high level of economic activity in the United States recede, even slightly as in I949, to the United States would fall off rapidly. At any event it must not be assumed that as soon as the surplus in the United States balance This figure results when we include government of services (largely on its military personnel abroad), offshore purchases both for the United States forces stationed abroad and NATO forces, and private remittances, and when we exclude all military-aid (in the form of goods and services).

BY way of summary let it be said that for seven years up to and including I960 which are considered here, net farm output per capita of total population may possibly increase, perhaps by as much as I5 per cent or even 20 per cent. This conclusion is arrived at on basis of policies laid down in Malenkov's speech in August I953,' Khrushchev's speech in September I953,2 Party decision on Measures of Further Development of Agriculture of U.S.S.R., 3 and three further decrees of government and Party.4 But if government takes seriously its promises, demands, or both, of fulfilling the task to create an abundance of food for population and raw materials for light industry within next 2-3 years, 5 it is heading toward a great disappointment. With considerably more attention than formerly given to labor-saving devices, enlarged farm output might possibly be produced with a moderately smaller labor force than that currently available. To be on safe side, roughly stable labor requirements in agriculture are best assumption in calculating reserves of labor which may be available for nonagricultural pursuits. The total supply of labor newly available each year for all requirements will be large in I954-57 but will drop to almost zero in subsequent several years. On basis of present policies it may be anticipated that amount of labor in agriculture will be increasing in first four years of period under review, but part of additionally accumulated farm labor will have to be released in last three years of period. This would leave some labor reserves to be drawn from agriculture after I960 (the lean years for agricultural labor supply would not end at this arbitrarily selected date). The change from years with rising labor force in agriculture to years with declining labor force is likely to affect farm output, but it would be difficult to estimate intensity of this effect.