March 29, 1927

Comrades, permit me to greet you in the name of the Central Committee of our Party. (Applause.) Permit me to wish you success in your difficult work of organising and politically educating the working-class and peasant youth of our country. The Young Communist League has always marched in the front ranks of our fighters. Let us hope that the Young Communist League will continue to be in the front ranks, bearing aloft and carrying forward the banner of socialism. (Applause.) And now, after these greetings, allow me to pass to two questions about which some of your comrades of the Young Communist League have just spoken to me. The first question is that of our industrial policy. That, so to speak, belongs to our home affairs. The second question is that of the Nanking events.45 That, consequently, is a matter of foreign affairs. Comrades, the basic line which our industry must follow, the basic line which must determine all its subsequent steps, is that of systematically reducing industrial production costs, that of systematically reducing wholesale prices of manufactured goods. That is the high road our industry must take if it is to develop and
grow strong, if it is to give the lead to agriculture, and if it is to strengthen and broaden the foundation of our socialist economy.

What is the origin of this line?

What are the causes that make this line necessary and expedient?

There are, at least, four basic reasons which determine this line. The first reason is that an industry which is based upon high prices is not, and cannot be, a real industry, for it must inevitably degenerate into a hot-house plant that has not and cannot have any vitality. Only an industry that systematically reduces the prices of commodities, only an industry based on systematically reducing the costs of production, hence only an industry that systematically improves its methods of production, technical equipment and organisation of labour and its methods and forms of management—only such an industry do we need, for it alone can go on developing, and it alone can guarantee the proletariat complete victory.

The second reason is that our industry is based on the home market. We cannot, indeed we are unable, to compete with the capitalists in the foreign market. The home market is the basic market for our industry. But it follows from this that our industry can develop and grow strong only to the extent that our home market, its capacity, the mass demand for manufactured goods, develops and expands. And on what does the expansion of our home market, the enlargement of its capacity depend? It depends, among other things, on a systematic reduction of the prices of manufactured goods, that is, on that basic line of development of our industry of which I have already spoken.

The third reason is that unless prices of manufactured goods are reduced, unless manufactured goods are made systematically cheaper, it will be out of the question to preserve those conditions which are indispensable for a further rise of workers’ wages. In the first place, the workers themselves are consumers of manufactured goods, in view of which a reduction of the prices of these goods cannot but be of substantial importance for maintaining and raising real wages. In the second place, on a reduction of the prices of manufactured goods depends the stability of the prices of the agricultural produce consumed in the towns, principally by the workers, which likewise cannot but be of substantial importance for maintaining and raising real wages. Can our socialist state refrain from systematically increasing the wages of the workers? No, it cannot. But it follows from this that a systematic reduction of the prices of manufactured goods is one of the essential prerequisites for a progressive rise in the standard of living of the working class.

The fourth and last reason is that, unless prices of manufactured goods are reduced, we cannot preserve that bond between the proletariat and the peasantry, between industry and peasant economy, which is the basis of the dictatorship of the proletariat in our country. You know that the peasant is paying too much for manufactured goods, for textiles, machines, etc. You know that this is a cause of serious discontent among the peasantry and hinders the progress of agriculture. And what follows from this? The only thing that follows is
that we must pursue a policy of systematically reducing prices of manufactured goods, if we really want to preserve the bond, the alliance between the working class and the peasantry, and to promote the development of agriculture.

But what is required to make the policy of reducing industrial production costs and wholesale prices of commodities possible and quite practicable? For that it is essential to have a radical improvement of the technology of production, a radical improvement of the organisation of labour in the factories, a radical improvement and simplification of the entire economic apparatus and a determined fight against bureaucracy in this apparatus. All this is what we call socialist rationalisation of production and of the management of economy. Our industry has entered a phase of development when a substantial increase of the productivity of labour and a systematic reduction of industrial production costs are becoming impossible unless new and better technical equipment is introduced, unless a new and better organisation of labour is introduced, and unless our economic apparatus is simplified and made cheaper. We need all this not only in order to raise labour productivity and reduce the prices of manufactured goods, but also in order that the resulting economies may be used for the further development and expansion of our industry. That is why we need socialist rationalisation of production and of the management of economy.

We thus get a chain: we cannot develop industry further unless we systematically reduce industrial production costs and wholesale prices; but it is impossible to reduce prices of manufactured goods unless we introduce new technical equipment, new forms of the organisation of labour and new simplified managerial methods. Hence the question of socialist rationalisation of production and of the management of economy is one of the decisive questions of the day.

That is why I think that the recent decision of our Party’s Central Committee on rationalisation of production and of the management of economy is one of the most important decisions of our Party, one that determines our industrial policy for the period immediately ahead. It is said that rationalisation entails certain temporary sacrifices on the part of certain groups of workers, including the youth. That is true, comrades. The history of our revolution tells us that not a single important step has been taken which did not involve certain sacrifices on the part of individual groups of the working class in the interests of the whole working class of our country. Take, for instance, the Civil War, although the present inconsiderable sacrifices will not bear any comparison with the serious sacrifices that were made during the Civil War. You see that we are already being compensated with interest for those sacrifices. It scarcely needs proof that the present inconsiderable sacrifices will be more than compensated for in the near future. That is why I think that we should not hesitate to make certain inconsiderable sacrifices in the interests of the working class as a whole. The Young Communist League has always been in the front ranks of our fighters. I know of no instance when it has lagged behind the developments in our revolutionary life. I do not doubt that now, too, in carrying out socialist rationalisation, the Young Communist League will take its due place. (Applause.) Permit me now to pass to the second question—that of the Nanking events. I think that the Nanking events should not have come as a surprise to us. Imperialism cannot live without violence and robbery, without bloodshed and shooting. That is the nature of imperialism. The events in Nanking cannot, therefore, be a surprise to us.

What do the Nanking events indicate?

What is their political meaning?

They indicate a turn in the policy of imperialism, a turn from armed peace to armed war against the Chinese people.

Before the Nanking events, imperialism endeavoured to hide its intentions by unctuous talk about peace and non-interference in the domestic affairs of other countries, by a mask of “civilisation” and “humanitarianism,” the League of Nations and so forth. After the Nanking events, imperialism is discarding its unctuous speeches, its talk of non-intervention, the League of Nations and all the other masks. Now imperialism stands exposed to the eyes of the world in all its nakedness as an avowed plunderer and oppressor.

Bourgeois pacifism has sustained another telling blow. For what, indeed, have those who sing the praises of imperialist pacifism, such as the Boncours, the Breitscheids and others, to oppose to the fact of the massacre of Nanking inhabitants except their false pacifist talk? The League of Nations has been given another slap in the face. For who but lackeys of imperialism can consider it “normal” that one member of the League of Nations massacres the citizens of another member, while the League of Nations itself is compelled to keep silent and assume that the matter does not concern it? It is now proved that our Party was right when it assessed the dispatch of troops to Shanghai by the imperialist countries as the prelude to armed attacks on the Chinese people. For one must be blind not to see now that imperialism needed troops in Shanghai in order to pass from “words” to “deeds.”

Such is the meaning of the Nanking events. What could have been the intentions of the imperialists in risking the Nanking gamble? It is possible that by stripping off their mask and having recourse to their artillery in Nanking, the imperialists wanted to turn back the wheel of history, to put an end to the growing revolutionary movement in all countries, and to undertake a fight for the restoration of that relative stability of world capitalism which existed before the imperialist war. We know that capitalism emerged from the imperialist war with incurable wounds. We know that ten years ago the workers and peasants of the U.S.S.R. breached the front of capital and inflicted an incurable wound on it. We know that the imperialist war shook the foundations of imperialist rule in the colonies and dependent countries.

We know that, ten years after October, the Chinese workers and peasants have also begun to breach the imperialist front, and there is no reason to assume that they will not finally breach it.

Well then, it is possible that the imperialists wanted to wipe out all this at one stroke and begin a “new page” of history. And if that is what they really wanted, it has to be admitted that they have missed the mark. For one must be in one’s dotage to think that the laws of artillery are stronger than the laws of history, that the wheel of history can be turned back by the firing in Nanking.

It is possible that when the imperialists bombarded Nanking they wanted to intimidate the oppressed peoples of other countries who are straining for liberty, as though to say: The Nanking affair is meant for your benefit. That is by no means excluded, comrades. The policy of intimidation has its “grounds” in the history of imperialism. But that this policy is unsuitable and is not achieving its purpose is hardly to be doubted. It was applied “with success” by Russian tsarism in its day. But how did it end? You know that it ended in the complete collapse of tsarism. It is possible, lastly, that in bombarding Nanking the imperialists wanted to strike at the very heart of the Chinese revolution and to make impossible, firstly, the further advance of the South Chinese troops and the unification of China, and, secondly, the carrying out of the terms of the concessions negotiations held in Hankow. That is quite possible and, perhaps, quite probable. That the imperialists do not want a united China and prefer to have two Chinas in order to be able to “manoeuvre more effectively” has been blurted out by the capitalist press more than once. As to the Shanghai and other concessions, there is scarcely room for doubt that many of the imperialists “do not sympathise” with the terms which were worked out and endorsed in Hankow. And so, in bombarding Nanking the imperialists evidently wanted to make it known that they preferred in future to negotiate with the national government under pressure and to the accompaniment of artillery fire. Such indeed is the musical taste of the imperialists. That this strange music smacks of the music of cannibals is something which apparently does not disturb the imperialists. Whether they will achieve their aim, the near future will show. It should be observed, however, that so far they have achieved only one thing, and that is to intensify the hatred of imperialism among the Chinese, to unite the forces of the Kuomintang,47 and to swing the revolutionary movement in China further to the Left.

There can scarcely be any doubt that so far the results are the opposite of what was expected. It turns out, then, that in bombarding Nanking the imperialists were striving for one thing, but what actually happened was something else, moreover something the very opposite of what they were striving for. Such are the results and perspectives of the Nanking events. Such is the policy of the wiseacres of the conservative camp. Not without reason is it said: whom the gods wish to destroy they first make mad. (Stormy and prolonged
applause.)

Pravda, No. 72,

March 31, 1927