FROM
AND
JULY.
[16
July

g.]
Copy] of Lenin.
Resolution of the Presidium of the VSNKh of 11/VII-21.
I.
1. The acute crisis in our national economy, which we entered in May, is primarily a consequence of the severe food situation. At the same time, we encounter a series of phenomena, without the elimination of which the Soviet Republic will not be able to cope with the problem of developing productive forces, nor withstand the struggle against hunger; the essence of these phenomena lies in the lagging of our economic policy behind the new economic course, which was proclaimed at the 10th Party Congress and at the spring party conference. The noticeable deterioration of our economic situation (decline in productivity of the Donbass, metallurgical industry, etc.) requires a decisive acceleration of the transition to this new economic policy. Otherwise, we will be forced to do this several months later under qualitatively worse conditions.
2. One of the main shortcomings of the current economic policy is the absence of an economic subject, and as a result, rational management of industry. This is felt first and foremost in the area of supply. Food supply is obtained: a) by ration cards and norms from the People's Commissariat for Food, b) through theft from factories and enterprises, c) as a result of natural premium through cooperation, d) as a result of the realization of the natural fund by the enterprise itself or by workers. Work and special clothing are distributed by trade unions; technical and material supply comes from the Chief Committees. Enterprises are supplied with food and work and special clothing not according to productivity, but according to need. That is, the connection between supply and productivity is established not directly, but indirectly. (Production increases, decreases, supply remains approximately the same.) This system was a consequence of the war period of our revolution, when the Republic was a military camp. In a besieged fortress, it was quite understandable to strive to supply everyone as evenly as possible, to feed, to support, while it was impossible to take up the restoration of production. Now the task is different; it is necessary at all costs to restore production, to achieve the development of productive forces.
3. A direct consequence of this is the complete vagueness of our economic activity. We throw out a mass of food and other resources with a negligible production effect—unproductively, to the wind. This inevitably must lead us to defeat on the economic front if we do not quickly and decisively reorganize in accordance with the new conditions.
4. It is necessary to immediately reorganize on the following foundations: first, it is necessary to establish, as a principle, that in the field of the national economy, the state gives nothing to anyone for free. Second, all the supply of the worker should be included in his wages, which, for the part that remains, should be significantly reduced and brought closer to the average subsistence level of the worker. Third, all received worker supply is divided not by the number of workers, but by the unit of produced product, except for those industries and branches of industry and the national economy where, due to the very nature of the work, this is not possible. Fourth, the matter of supplying workers is carried out by all supplying organizations through the factory management, administration, which receives what is necessary only in case of obligations given to a higher body, for the non-fulfillment of which it is responsible in court. The basis of the entire economic policy should be economic calculation.
The above is implemented starting with the largest and most threatened enterprises, by the Presidium of the VSNKh as the necessary preliminary organizational work is carried out.
5. Given the revealed impossibility of providing industry with all types of supplies even at a starvation norm from state funds, it is allowed for state industrial associations to realize a larger, than now, part of their own products, both within the Republic through Centrosouz, and abroad, through the Narkomvneshtorg.
6. It is necessary to get off the dead point the issue of unloading the state apparatus from small enterprises and factories. It is necessary to energetically and decisively implement the decree on leasing enterprises. Ambiguity and incompleteness in this matter must end. Otherwise, our industry will undoubtedly not utilize all the possibilities before it.
7. In the development and organization of small and artisanal industry, it is necessary to go definitively and firmly along the path of cooperation of small producers, combining, where it is economically and technically expedient, cooperatively organized artisanal industry with large industrial enterprises. Only such a policy will raise the productivity of small-scale farming and contribute to the transition from small, scattered production to large-scale production on the principles of voluntary association. Therefore, it is necessary that all organs of Soviet power, based on this policy, encourage in every way the development of industrial cooperation and the voluntary association of small industry.
II.
8. At the present moment, with changes in economic policy, Gosplan is assigned a particularly responsible task of urgently developing a general economic plan and coordinating the interests of industry with agriculture, transport, food, etc., for which Gosplan must, in particular, set itself the task of conducting, in the shortest possible time, a correct selection of the main, viable enterprises and individual sectors with maximum production density, commercial viability, concentration, with the identification of specific priority directions for key productions and sectors of the economy. In doing this, the special needs of regions and the profitability of the principle of combined enterprises should be taken into account.
9. The excessively slowly developing operation of commodity exchange currently provides some material for judging what it will give us in the near future. The limits of local turnover, as well as commodity expeditions of industrial centers or departments of factories, saturating the markets of their areas of operation with homogeneous goods (threads or textiles or metal), finally disrupt the markets and any possibility of commodity exchange. The equivalents practiced in free exchange: one hundred for one hundred at pre-war prices or free market prices for both city and rural goods, dictate the transition to buying and selling. In all commodity exchange operations 1) we should not limit ourselves to the framework of local turnover, 2) alongside natural commodity exchange, where it is advantageous, we must resolutely move to the monetary form of exchange.
10. In order to establish greater stability of our ruble, it is necessary to carry out a series of measures for the return flow of money into the treasury. It is necessary to introduce fees in municipal services, taxes, payment for state services, etc. Open savings and loan offices and widely use credit cooperation.

into the state treasury. It is necessary to introduce fees in Communal Services, taxes, charges for state services, etc. Open savings and loan offices and widely use credit cooperatives.

NOTES ON THE TEXT OF THE RESOLUTION
\ \ \
11. To facilitate trade relations with abroad, the NKVT should be structured in such a way that interested departments would have the right to independently conduct relations with foreign countries, conclude deals, and implement them. The NKVT, from being a monopolistic body, should gradually transform into a regulatory and controlling body for transactions of state departments and institutions, as well as private enterprises, with abroad.
III.
12. The struggle against bureaucracy and red tape will be completely successful only when the decisions of the All-Russian Party Conference are carried out much more energetically than now. It is necessary to resolutely and quickly break free from the clutches of polyarchy, inter-departmentalism, coordination of all sorts of trifles, and preliminary control, and to introduce strict personal business responsibility*. All this is in glaring contradiction with the course taken in the spring.
MARGINAL NOTES ON THE RESOLUTION.
///railway tariff///
Collective [supply] support (or development) of capitalism
Trotsky: (against GOELRO)
Trotsky.
"No State Planning Committee does he have" ("Liberation from
the idea of electrification")...
I
I. Trotsky
I. Goldore (Bukharin)
sh.]
Trotsky:
"Krizhanovsky's plan has nothing in common with VSNKH.
The Chairman of the State Planning Committee must be the chairman of VSNKH".
Trotsky:
"The State Planning Committee and VSNKH are not coordinated"...
details to be corrected
+ Krasin
+NKProd.
* In the original, there is a typo: "obviousness", corrected by Lenin to "responsibility". Ed.

LENIN'S COLLECTION
AMENDMENTS TO THE THESIS OF THE CC COMMISSION ON IMPLEMENTING ECONOMIC POLICY.
[July 21, 1921]
Draft.
1. At the Tenth Party Congress and the All-Russian Party Conference, the basic principles of our new economic policy were established. However, it must be noted that the implementation of the outlined directives in the area of direct economic activity of Soviet organs, the enforcement of corresponding decrees, and the assimilation of the new principles of economic policy by the broad masses of party and Soviet workers—proceeds too slowly and does not go at the pace required by the [catastrophic] severe situation of the national economy. * This severe situation has particularly intensified in connection with the food crisis, which has led to a sharp deterioration in many sectors of the economy even compared to the end of 1920. Party and Soviet organs must take the most decisive measures to get out of the current situation, which is possible only on the basis of energetic and practical implementation of the established party directives to the end.
2. Our economic policy up to the present time was characterized primarily by the following features:
a) The Soviet state had to directly manage a huge number of enterprises of the most diverse types, the servicing of which did not correspond to the raw material and food resources at the disposal of the state. The immediate result of this was the impossibility of rational economic use of the resources provided by the state and, as a consequence, their dissipation. The supply of enterprises was divided among various institutions and was not directly linked to the productivity of the enterprise. As a result, polyarchy and irresponsibility. Under these methods of supply and * The amendments "catastrophic" and "catastrophism" are marked by Lenin with numbers "1" and "2", which we have moved to the margin. Ed.

AMENDMENTS TO THE THESIS OF THE CC COMMISSION
existing conditions of labor remuneration, the participants in production were not and could not be interested in the results of their labor and in improving production methods. Due to the three-year war situation and extreme devastation of the country, it was impossible to formulate and implement a unified economic plan that would cover and coordinate various sectors of the national economy. To prevent further decline of the national economy, it is necessary to reorganize on the following principles:
The state, through VSNKH and local organs, concentrates in its direct management a certain number of large or, for some reason, important from the state's point of view, as well as auxiliary enterprises, where the principle of combining enterprises that complement each other should be widely applied.
b) These enterprises are run on the basis of precise economic accounting, i.e., all production costs are fully covered by the output obtained.
c) The launch and operation of enterprises by VSNKH and its local organs are permissible only within the limits in which, according to the general state plan, the mentioned enterprises will be provided with material, food, and financial resources, both from general state organs and from other sources (self-procurement, free market, etc.).
d) To supplement the insufficient resources with what the state provides, enterprises (or their governing bodies) are given the right to sell part of their own products to acquire the missing items of supply, both domestically and abroad, with raw materials and fuel being procured by their own apparatus, and food through Centrosouz.
e) All types of worker supply are included in wages, so that the workers of the specified group of enterprises should be provided in a manner that interests them in production and encourages initiative to increase productivity, but in any case not below the average subsistence level. Supply is distributed both among individual workers and groups of them (working on piecework, contract, etc.) in accordance with the production results they achieve.

as
both between individual workers, and groups of them (working
on a piece-rate, contract, and so on.
according to the production results achieved by them.
Collection
XX
N

(*)
Both products and clothing and other (6)
c) The supply of workers is carried out by all supply organs through the factory management, the administration, which receives what is necessary only in case of obligations given to the higher organ. For factory management, the norms established by trade unions and the People's Commissariat for Food (Narkomprod) are mandatory in distribution. At the direct disposal of the factory management, for unforeseen cases and for those exceeding the norm for incentives, natural and monetary
FUNDS
are allocated, for which the factory management reports in the order of subsequent control (Voting on this point resulted in 2 for and 2 against).
4. All other enterprises not included in the above-mentioned groups should, on the basis provided for by the decree on leasing and the instructions of the Supreme Council of National Economy (VSNKh), be leased to cooperatives, partnerships, and other associations, as well as to private individuals. Soviet bodies should without hesitation and energetically implement this decree on leasing with regard to those enterprises that cannot be put into operation and maintained by Soviet economic organizations, thereby relieving the state apparatus of small enterprises and factories.
5. Enterprises that remain unsold on lease and whose operation the state does not take upon itself shall be closed, and the workers and employees shall be distributed among the operating enterprises, while those remaining without work shall be transferred to [existing state-wide supply] other jobs.
6. 1. For cottage and small industry, conditions must be created under which artisans and craftsmen can
[peacefully] properly develop their production and freely dispose of the products of their labor.
2. In the development and organization of small and cottage industry, it is necessary to firmly and decisively follow the path of cooperation of small producers, combining where economically and technically expedient, the cooperatively organized cottage industry with large industrial enterprises.
3. It is necessary to create the most favorable conditions primarily for those branches of small and cottage industry that serve the needs of large industry and peasant farming, or work on state orders for consumer cooperation.

AMENDMENTS TO THE THESIS OF THE CC COMMISSION 

4. All organs of Soviet power must encourage the development of industrial cooperation and voluntary association *
7. Local economic organs (VSNKh) must, regarding the enterprises under their management, immediately apply the same division into enterprises remaining under their management and those being leased, applying accordingly to particular groups all the above-mentioned provisions.
8. In connection with the collection of the food tax, it has become clear that the expected collection of the food tax will not cover the state's need for bread in a number of regions, the shortage of which can be made up on the internal market through the development of commodity exchange; on the other hand, the interests [of our monetary circulation. ] of the restoration of the national economy in general and monetary circulation in particular require the development of commodity exchange between the city and the countryside. In view of all this, measures must be taken to develop state and cooperative commodity exchange, and we should not limit ourselves to the framework of local turnover, moving, where possible and advantageous, to the monetary form of exchange.
9. For the same purposes of raising and stabilizing our ruble, it is necessary to carry out a series of measures to bring money back into the state treasury, proceeding from the principle that in the field of the national economy, the state, given the state of its state resources and until at least the main branches of it are raised, cannot provide any economic services to anyone for free. Among the measures to be taken, attention should be paid to the opening of savings and loan offices, the encouragement of credit cooperation, the transition and operation of municipal enterprises on a fee basis, etc.
10. To develop trade relations with abroad, economic organs should be granted the right to participate in the conclusion and implementation of such transactions, as well as to have their own representations with foreign bodies of the People's Commissariat for Foreign Trade (Narkomvneshtrabot).
11. At the present moment, with the change in economic policy, the State Planning Committee (Gosplan) is assigned a particularly responsible task of urgently developing a general economic plan and coordinating the interests of industry with agriculture, transport, food, etc., for which Gosplan must, in particular, make it its task to conduct in the shortest possible time a correct selection of the main, viable enterprises and individual branches of industry with maximum production intensification, commercial viability, concentration, with the identification of specific priority directions for key productions and branches of the economy. In doing this, the special needs of regions and the advantage of the principle of combined enterprises should be taken into account.
12. In implementing the entire above-mentioned economic policy, it is necessary to clearly delineate the functions and competencies of various Soviet economic institutions. The Council of Labor and Defense (STO) should be the general director of economic policy, establishing through "Gosplan" a single economic and coordinating plan for the People's Commissariats, as well as overseeing the implementation of the economic plan, both in general and in all parts.
The VSNKh is an organ (with the rights of a Commissariat) that carries out in a businesslike manner the plans and general economic directives approved by the STO in the field of industry.
In carrying out the production tasks of the STO, all organs of industrial management bear strict personal responsibility in court for the rational management of the enterprises entrusted to them on the above-mentioned economic bases; under these conditions, the preliminary control of the Russian Communist Party (Bolsheviks) (RKP) is lifted.
SL8
NOTE ON THE THESIS
To Comrade Kamenev.
July 21 [1921]
I propose the following amendments to your draft thesis on the implementation of economic policy:
1.— In paragraph 1, the word "catastrophic" (the situation of the national economy) should be replaced with the word "severe".
* The note to L. B. Kamenev was transmitted by telephone and survived in a typewritten version. At the end of the note, after the clerk's notation: "Received by telephone on July 21, 1921," there is an addendum: "Send to Kamenev immediately with a request to write a few words to V. P. and send it to him today by the first opportunity." Ed.

TELEGRAM TO THE SAMARKAND COMMUNISTS 

2. — In the same
paragraph the word "catastrophic" (in the next sentence) should be replaced with the phrase "severe situation".
3. — In paragraph 2, subpoint "A", after the word "thanks to the three-year war situation" insert the words "and extreme impoverishment of the country".
4. — In the same paragraph, in subpoint "E", add in parentheses after the word "supply" the phrase "both food and special clothing".
5. — In paragraph 5, at the end, instead of the words "transferred to the existing state-wide supply" insert the words "transferred to other jobs".
6. — In paragraph 6, the word "peacefully" should be replaced with the word "properly" in the first subpoint.
7. — In paragraph 8, after the words "require the interests" say "of the restoration of the national economy in general and monetary circulation in particular".
Chairman of the Council of People's Commissars V. Ulyanov (Lenin).
TELEGRAM TO THE SAMARKAND COMMUNISTS.
( K

After the words "require the interests" say "of restoring the national economy in general and monetary circulation in particular."
Chairman of the Council of People's Commissars V. Ulyanov (Lenin).
TELEGRAM TO THE SAMARKAND COMMUNISTS.
( K

27 VI [1921]
Urgent. Send them a telegram of gratitude and approval. Add a draft."
Lenin.
Samarkand. Gubpartkom. To Shafiransky \
[27 June 1921]
I thank the group of friends for the greeting. The main thing now is to
immediately improve the condition of the workers and peasants. Everything now depends on the energy
and skill of the local workers: the food tax, the development of trade between agriculture and industry, the development of small
industry. Capitalism is not to be feared as long as the proletariat firmly holds power, transport, and
large-scale industry and can direct it into the channel of state capitalism. Under these conditions,
capitalism will help in the struggle against bureaucracy and the dispersion of small producers. We know what we want, therefore
we will win. [6971
Signed Lenin.
1 This refers to a greeting telegram from 15 July 1921, addressed to the "First Soldier of the Communist Revolutionary Army" Lenin by a group of party members of the Samarkand organization. The telegram was a response to the brochure "On the Food Tax."
8 The draft of the reply telegram was prepared by the Secretariat of the Council of People's Commissars, undoubtedly based on Lenin's instructions.

FEBRUARY — 17
JULY

G.

First, the imperialist, and then the civil war caused extreme devastation
of the Soviet Republic. A severe economic crisis led to
a
political crisis in the spring of
1924.
The transition from war to peace required the party to review
the methods of struggle and construction that were applied
during the period of war communism, and to change them according
to
the new tasks of socialist construction. In that broadly conceived
plan for restoring large-scale socialist industry and peasant
farming, which
Lenin began to develop in the second half of
1920 (this plan was completed in March 1924, in the form of the New Economic
Policy) — concessions were given a major role. Concessions, i.e., the leasing by the Soviet state
to foreign capitalists under certain conditions of some mines,
oil fields, forest tracts, etc., partly represented a tactical step on the part of the Soviet government, a known political move to make it difficult for the imperialists to create a united front against us (Collected Works, Vol. XXV,
p.
45). Of course, concessions also had a purely economic significance:
they were intended, according to Lenin's plan, to serve the cause of rebuilding
large-scale socialist industry and improving the condition
of
workers and peasants.
By
the spring of
1924, the decline in the productive forces of the republic
was so great, the economic crisis had become so acute, that
there arose a fear about the possibility of quickly restoring
the destroyed economy with the own strengths of the workers
and peasants of our country.
Therefore, Lenin raised the question of concessions especially
sharply.
In
essence, Lenin considered concessions only one of the possible
ways to raise the economy
—
the most favorable way under the given conditions.
Only by our own strengths or also "with the help" of foreign
capital?
—
Lenin posed the question, outlining ways out of the severe
economic crisis, and answered it by demanding all measures
be
taken to attract foreign capital to the task of rebuilding
our socialist industry (in the form of granting capitalists
concessions), since this path of building large-scale industry
on
the basis of state capitalism, which concessions represented,
opened up prospects for the working class of relatively
quick exit from the severe economic crisis.
Lenin viewed concessions as an auxiliary means, which, in
the conditions of extreme destitution of the country, would
allow us to overcome the economic ruin more quickly, catch
up
with
Western
European countries faster, and build socialism earlier than
if
there were no concessions and capitalists did not provide
us
with machines, technical equipment, and products in exchange.
Let us cite some of
Lenin's statements on this issue.
In
the theses for the
III
Congress of the
Comintern, Lenin clearly states that the practical task
of
concessions, through which we hope to obtain "additional
equipment and machines" from foreign capitalists, is to
"accelerate the restoration of
Soviet large-scale industry" (Vol.
XXVI,
p.
453), which is the only basis of socialism.
Granting concessions to capitalists is linked to the payment
of
"tribute" in the form of oil or other products that the
concessionaires will receive from the leased enterprises;
Lenin considered it possible to agree to pay that "tribute"
with the same goal "only to accelerate the restoration of
our large-scale industry and serious improvement of the
condition of workers and peasants" (ibid.).
Elsewhere, Lenin, speaking about the necessity of improving
peasant farming and restoring large-scale socialist industry,
says that "with the help of concessions, we will do all
this sooner than without concessions" (Vol.
XXVI,
p.
308).
We
need, said
Lenin, to "bring our technology up to modern standards"
(Vol.
XXVI,
p.
243); we need to "catch up (and then overtake)
modern advanced capitalism" (present collection, p.
458); without concessions, we "will be in a very difficult
position and without colossal efforts of all our strengths,
we
will not catch up with them
[European capitalists.
Ed.]" (Vol.
XXVI,
p.
243).
Lenin fought for the creation of the most favorable conditions
for our further economic development, conditions that would
ensure the fastest possible rates of restoration of socialist
industry.
Attracting foreign capital in the form of concessions would
certainly have helped the
Soviet government to emerge more quickly from the economic
decline experienced by the republic.
Here is what
Comrade
Stalin says about concessions:
"In
1924, knowing that our industry was underdeveloped and the
peasantry needed goods, and knowing that industry could
not be revived immediately, and that workers, due to the
situation, were engaged more in making lighters than in
industry, — in this situation, Lenin believed that the best
opportunity among all possibilities was to attract foreign
capital, to get industry going with its help, to thus introduce
state capitalism and through it to establish a link between
the
Soviet power and the countryside.
This path was absolutely correct at the time, because we
had no other possibilities to satisfy the peasantry, and
our industry was lame, transport was standing still, or
almost standing still, there was no fuel, or not enough
of
it" (On
Opposition.
1928, p.

We did not have the means to satisfy the peasantry at that time, for our industry was limping, transport was at a standstill, or almost at a standstill, there was no, or insufficient, fuel (On the Opposition. 1928, p. 

While fighting for concessions, thoroughly developing this problem in a series of reports and articles, dispelling the prejudices and fears that existed in the party circles regarding concessions, Lenin at the same time did not in any way close his eyes to the possibility of failure of our, generally speaking, extremely advantageous proposals to European and American capitalists concerning concessions. Did this mean that we would not be able to "get out" of the economic difficulties with our own forces, without concessions? No, it did not mean that at all. If the capitalists are not tempted by the exceptionally high profit which concessions promise them, do not wish to render "aid" to the Soviet republic (of course, this "aid" must be understood very relatively; Lenin repeatedly emphasized that concessions represent merely a new form of intensified class struggle), then in such a case we will resolve all the tasks set before us ourselves, "single-handedly" (Vol. XXVII, p. 363), with our own forces—but, of course, with great difficulties, with "colossal strain on all our forces." Such was Lenin's view on the prospects of our development. As is known, the capitalists did not go for concessions on any significant scale. In the bourgeoisie's refusal of concessions, undoubtedly, the desire to slow down, complicate, and delay the economic development of Soviet Russia played a significant role, the conviction that without "aid" from foreign capital, the Soviet republic would perish under the weight of its economic difficulties. The calculations of the enemies were not justified. The working class of our country, led by the Bolshevik Party, managed to restore the ruined economy and at present has "entered a period of gigantic expansion of socialist construction" (resolution of the XVI Congress). Already a year after the introduction of the New Economic Policy, it became evident that the working class, with immense effort, with real mobilization of all its forces, but still, was pulling the country out of a most severe economic situation. Another six months pass, and the Soviet power, as a result of the successful implementation of the New Economic Policy, recognizes the economic position of the republic to be so stable and secure that, on Lenin's proposal, in October 1921, it rejects a major concession from the well-known Urquhart, a fierce interventionist. The times when the party, for the sake of reviving our industry, considered it possible to make rather significant concessions to foreign capital, have passed irrevocably. Concessions did not receive wide development and did not yield significant practical results. But Lenin's work on the problem of concessions, his articles, speeches, notes on this subject, retain all their enormous theoretical and political significance, since they substantiate the principled admissibility for the proletarian state, building socialism, of concessions as one of the forms of state capitalism, regulated and controlled by the proletarian dictatorship. On the other hand, Lenin's documents vividly show how V.I. worked on specific material related to one or another object of concessions, and what practical instructions he gave in this area.

A. WORK ON THE STUDY OF THE OIL INDUSTRY FEBRUARY 3 - 1921

Between February 4, when the Council of People's Commissars (CPC) adopted a decision on granting oil concessions in Baku and Grozny, and March 29, when the "Basic Principles of Concession Agreements" were approved, Lenin carried out extensive work both in familiarizing himself with materials illuminating the situation of the oil fields in Baku and Grozny, and in studying special issues related to the oil industry. Between February 8 and 46, Lenin familiarized himself with L.B. Krasin's report "On the Danger of Losing Oil-Bearing Areas and on Concessions in Baku and Grozny," addressed to the Central Committee of the RCP; on February 19, with the second report by L.B. Krasin "Concessions for the Development of Oil in Baku and Grozny," written after L. Krasin had acquainted himself with the opinions of specialists from the Main Oil Committee (Glavkonftei) on the issue of concessions. The reports of the specialists were presented by the Chairman of Glavkonftei, Z.N. Doser, to the Chairman of the Supreme Council of National Economy (SCNE), A.I. Rykov, along with a brief note from Z. Doser. These reports were forwarded by A.I. Rykov to Lenin, and on February 23, Lenin had the opportunity to acquaint himself with the following documents: 1) Doser's memorandum "On the Threat of Flooding of Oil Field Areas and on Granting Some Developed Areas in Concession to Combat Flooding," 2) Memorandum by a member of the Glavkonftei Collegium, I.Z. Gubkin, "On the Situation in the Oil-Bearing Regions of the Republic," 3) Memorandum by the Head of the Commercial-Operational Section of Glavkonftei, A.I. Tsevchinsky, "On the Issue of Water Influx into the Oil Deposit in the Baku Region," 4) Note by I.I. Strizhov, Head of the Technical Section of Glavkonftei, "On the Issue of Flooding of Oil Deposits," and 5) Report by N.N. Smirnov, Head of the Production Department. All documents, except the last one, are preserved in the Institute's archive and are published below with Lenin's markings and underlines. In addition, at Lenin's disposal was the report of the STO authorized representative for oil production and transportation (State Publishing House, Azerbaijan Central Publishing, 1920), which Lenin also studied at this time. As can be seen from the secretarial records, Lenin worked on the above-mentioned materials on February 23, and on the same day, he turned to the specialists of Glavkonftei, requesting literature on the issue of foreign legislation ensuring the rational conduct of the oil industry. Based, apparently, on the study of these materials, Lenin developed the "Basic Principles of Concession Agreements," which he handed over to Rykov and which formed the basis of the CPC resolution published below on March 29 (see pp. 448-449).

NOTE TO L.B. KRAZIN [February 8, 1921]

1) When will you write a review of the PSFTN in Baku*? 2) Have you found specialists here who will write it? 3) In Petrograd? Tikhvinsky?

*Note, as established from adjacent documents stored in the Institute, was written at the meeting of the CPC on February 8, 1921. * The People's Commissar for Foreign Trade, L.B. Krasin, submitted a report "On the Danger of Losing Oil-Bearing Areas and on Concessions in Baku and Grozny" to the Central Committee of the RCP on February 8, 1921 (see the next document). 8 Answer from L. Krasin: "1) The report will probably be submitted no later than tomorrow. 2) Specialists need to be taken from Baku. There are no people who know oil production in these latitudes, and there never have been. 3) The chairman should send Tikhvinsky and outline Baku specialists (I will give 2-3 names)."

MARKS ON L.B. KRAZIN'S REPORT "ON THE DANGER OF LOSING OIL-BEARING AREAS AND ON CONCESSIONS IN BAKU AND GROZNY" [Between February 8 and 16, 1921]

[2]... But why is it not possible to exploit all the wells? For a thousand and one reasons. First of all, the lack of workers... Only a change in the method of payment or systematic rewarding of labor in kind could attract them back.

MARKS ON L.B. KRAZIN'S REPORT

In Grozny, the equipment suffered greatly during the civil war, and its restoration will require an expenditure of 20-30 million gold rubles. The cost of materials necessary for current operations is estimated-

The equipment has been severely damaged by the civil war, and its restoration will require an expenditure of 20-30 million gold rubles. The cost of materials necessary for ongoing exploitation is estimated at the same amount for Grozny. For Baku, where there are no major destructions, materials for proper exploitation would amount to 250-300 million gold rubles...
...Disruption of transport, lack of wood, cement, pipes, ropes, iron, all kinds of auxiliary materials, general disruption of production and life in general as a consequence of the revolution and national strife... all these reasons sufficiently explain why only one-third of the existing wells are being worked and exploited...
[2 — 3]... Even with an allocation of 200-300 million in gold, it is difficult to hope for a quick purchase of a very diverse, largely American material...
[3] It should also not be forgotten that we have these funds in the form of gold bullion, and the realization of such quantities of gold through ordinary means would take no less than half a year.
Is it possible to drastically change the situation through the issuance of concessions? Yes, on the condition of a sufficiently bold and decisive! concession policy...
...Salvation is possible, I repeat, only with a very! bold! and decisive! policy, which should consist in providing three or four competing major syndicates on the world market, as well as the governments of Italy, perhaps also France, Belgium, with sufficiently attractive areas in the well-ordered parts of the Baku and especially Grozny regions... Such leasing does not represent any capitulation to capitalism even in these regions, because the best and most extensive areas will still! remain in the hands of Glavkonetsvetmet. Concessions can and should be linked to the construction of oil pipelines, strengthening the composition of railways, delivery of all necessary materials and food from abroad, and supplies for workers...
...Rational exploitation of existing and proper laying and drilling (as well as water pumping, cementing, etc.) of new wells can also be quite precisely! stipulated in the contract.
1 Krasin's note is dated February 8; apparently, Lenin familiarized himself with it before the meeting of the Politburo (February 16), where the issue of oil concessions was discussed.
* Here and below, exclamation marks in the middle of sentences were added by Lenin. Ed.