V. I.

Lenin

775

LETTER TO THE POLITBUREAU OF THE R.C.P.(B.) C.C. ON AN AGREEMENT WITH A CONSORTIUM OF GERMAN FIRMS [1]

Comrade STALIN for the POLITBUREAU
Copy to Comrade KAMENEV

I have given a careful reading to the agreement with
Otto Wolff. I find that Comrade Kamenev’s objections are based entirely on a misunderstanding, and I believe the
question should be brought up for decision by the
Politbureau not later than tomorrow, because the difference
between Kamenev and myself calls for an authoritative and final decision.

Kamenev writes in his note that “we are under an obligation to Wolff to buy his goods”. This is a complete
misunderstanding. When reading the agreement, I saw in several clauses that we have the right to check the list of
goods given us by Wolff. We do not undertake the slightest
obligation to buy Wolff’s goods. If Wolff fails to draw
up a list of goods which we agree to buy, then the agreement extends only to that part of Wolff’s goods which we
have agreed to buy. I clarified this matter in detail today
both with Lezhava and Frumkin, and both have confirmed that not the slightest obligation in any sense falls on us
to buy Wolff’s goods.

A similar misunderstanding on Comrade Kamenev’s part explains his allegation that Lezhava has “enhanced” his
doubt. Actually there is quite a different explanation to
Stomonyakov’s proposal, which is formulated on page 2 of Protocol No. 62, and which was unanimously accepted
by all our economic executives. The proposal is that, in
the interests of our reviving industry, Wolff should develop
to the utmost the delivery to us of machine-tools and other implements necessary, for example, for the electric
trust. Wolff may accept this because such an order will
also give him earnings, and it happens that the German metal industry is in need of orders in general. We are
absolutely in need of machine-tools and machinery for the
electric trust, let us say, because this industry of ours is
beginning to revive, and it is of extreme importance for us
to develop this industry here, by finally reinforcing it with
German means of production.

Consequently, the amendment tabled by Lezhava flows from the correctly understood economic interests of
Russia, which now needs protectionism, especially for her
whole light industry, because then it will be easier for us
to rehabilitate this industry, thereby ensuring the interests
of our proletariat. Lezhava’s amendment has nothing in common with free trade of any sort or even with the opening of frontiers, assuming the retention of customs tariffs.
At the end of his note, Comrade Kamenev writes:

“ The result: for a deferment of our payments to Wolff for a year, for unknown goods, we are now giving him a
monopoly right to purchase and export raw materials. That
is cheap.”

This is total misunderstanding. It is impossible to imagine a more advantageous agreement than the one we are
concluding with Wolff. We pay him 10 per cent a year, whereas even Britain now pays 7 per cent, and the German
Government pays 12 per cent. That’s the first thing. The
second is that we are not buying from him any unknown goods, but only those we have checked by list and
permitted for import. The third fact is that we are giving him a
monopoly right to buy and export for a sharing of the profits
which can have nothing to do with any kind of customs tariffs. Namely: first, we receive a 10 per cent dividend,
second, we receive a 10 per cent profit, like Wolff, and
third, if the profit is in excess of 40 per cent, we receive
75 per cent of the rest, whereas the consortium receives
only 25 per cent.

I think the agreement with Wolff is a typical agreement
with German capitalist enterprises.

Such an agreement is immensely advantageous to us if only because we receive a half share of the profits which
might go up to hundreds of per cent. In the process, the
interests of our reviving industry and consequently of our
industrial enterprises are fully protected. There is not a
trace of the devastating consequences which would flow for us even from a conditional, even from a temporary
opening of the frontiers. That is why I absolutely insist
on approval of the agreement with Wolff, and in view of
the extreme urgency of the matter I request that this question should be raised in the Politbureau tomorrow, and
enclose herewith the agreement with Wolff and Comrade
Kamenev’s note. [2]

V. Ulyanov (Lenin )

Chairman, Council of People’s Commissars