8 
LAND & WATER 
Januan- lu, 191S 
The Bankruptcy of Russia 
By H. M. Hyndman 
Mori: ihan sixty viai> ago Alexander Herzcii 
wrote ; "Cicsar knew the Gauls better than Lurop;- 
doei the Russians." Onlv a few days ago a 
most important and influential Russian C omnnttee 
formally made a similar complaint to the British (,oyernment 
about "luiglish knowledge of Russia. But ofticial ami 
general ignorance is not surprising on the part of foreignci> 
'who attempt to grasp the complications of a yast population 
and an enormous territory which include many ditlerent 
eUmates and races. Kveii highly-educated Americans, who come 
oyer to this countr\- knowing, of course, our language well. 
and understanding tlioroiighly a great part of our institutions 
and law*> ha\-e been heard to declare that, after scyeral years 
of observation and study, tliey went away not much wiser 
than they came. 
While," howe\-er. diflieulties of language, temperament, 
habits, customs and religion, varying greatly in different 
localities, are \ei\- hard indeed to overcome in the matter of 
Russian politics, economics are not so troublesome to handle, 
jirovidcd the facts are known und the statistics are reasonably 
iiccmate. For economies, like mathematical formula; and 
musical notation, have a world-wide significance understood 
by every civilisod nation. In this department, therefore, 
if we throw aside the old obscurantist fetish of money and 
mercantilism, the truth about Russia becomes speedily 
apparent. Thus it is now clear that Western luirope greath' 
overrated Russian power in the war. because most, if not all. 
of the Allied statesmen, forgot that modern war is itself a 
function of industrial development. But Russia is only just 
emerging from the feudal period which continued in force there 
until iSOr. Whereas japan in the past forty years has, indus- 
trially and socially, "almost accomplished a transformation 
which it took Western Europe 400 years to achic\-c, Russia 
has moved veiT much more slowly. So we immcdiateh' 
discovered that "the Allies liad to furnisli the Russian armies 
with equipments, armaments and munitions of every descrip- 
tion, largely purchased from America and even from japan. 
Machinery of War ■» 
The reason for this was that Russia, unlike England, the 
I'nitcd States, or even France, had not at her command suffi- 
cient machinery ^\■hich could be transformed from production 
lor peace into production for war, even if enough supplies 
of raw material had been at hand. It was an awkward dilemma 
and, but for the loan of hundrc-ds of jnillions sterling to our 
Ally, to purchase indisix-nsable necessaries of warfare, it is 
possible that German troops w'ould have been cantoned 
in Petrogiad, Moscow, Kiev and Odessa quit* early in the 
contlict ; not because the Russian troops were otherwise than 
bra\-e and patriotic, but because, as was shown along a great 
j)art of the Eastern front, the most courageous soldiers with 
old-fashioned weapojis cannot effectively face the Germans, 
who possess the latzst modern instruments of slaughter. The 
blowing up by the agency of traitors of the Go\-ernment works 
at Ochta only made this Russian industrial inferiority 
the more apjxireiit. M. Witte's State-fostered factory 
system broke down at once under the strain of war. This 
;night have lx^;n expected, but it was none the less a very 
ierious matter when it occurred. 
.The steady impovmshment and tlecay of l^ussian agri- 
■ulture and the Russian jx-asantrv- is a ground of more 
l>ermanent uneasiness. Russia is above all an agricultural 
•oiintry. More than tiinc-tenths of her population are cul- 
tivators of the soil. The i)rol(;tariat of her cities, therefore, 
are in a small mriiiority, and the revolutnonary theories of their 
more adv;u]cedTeade^■s are quite inapiTi'icable to the economic 
conditions whicSi jirc'.-ail among the miess (.)f the people. Tlie.sc 
look to the 1;uk1 as /.he main question for them ; though their 
terribly sweated, ove rworked and underpaid cottage industries 
go on in most regio ns throughout the winter months. Even 
in the much talkwl of Black -artli districts the condition of 
the peasantry is de]ilorable. The plain (Ascription of a peasant 
village and a peasanr t home in official reports is frightful to read. 
rho.se educated imm who have lived among the pea- 
santry in order to be ; >.ble ,to form a sound judgment of their 
home life, especially du ring the winter months, give a terrible 
account of the ordinary state t)f things. Overcrowded 
msanitary dwellings, fr e<iuently inhabited bv animals as well 
IS human beings, witli a Jl the liorrors of existence thus engen- 
lered, the acmlt nienibci .s of the family working under noisome 
onditions for 12 and i ^ hours a day where home industries 
indcr small capitalism prevail— tlu- lot of the peasant is 
jnenviablc inrked. Ha' J air, bad light, bad food, poor rai- 
ment, miserable remuneration, and then, with the return of 
op)en weather, unceasing toil on the land which barely suftires 
to pay taxes and give enough to keep body and soul together. 
Suciris the life of the majority, of the "Russian peasantry. 
\'et those are the people who "are supposed to ha\e ample 
agricultural ])roduce to spare to meet the growing wants of 
\\'estern luirope ! This, of course, is not the trutli. The 
Russian agricultural population is desperately poor. What 
is worse, it is getting steadily poorer, and, unless a complete 
change is brought about, and brought about soon, Russia, as 
a whole, apart from the more fortunate districts of Siberia, 
will be utterh- ruined.. 
Steady Deterioration 
As I ha\-e mori' than once recalled. Professor Issaieff, 
formerh' the Chief Professor of Political Economy at the; 
University of Petrograd, told me more than ten years ago that, 
even thcii, it would have required hundreds of millions, 
perhaps thousands of millions, of roubles to put hack Russian 
agriculture where it had been twenty years before. From 
that time to this the same deterioration has been going on at 
an increased rate. The war has most certainly not made 
matters better, but rather worse owing to the removal of 
cattle and horses —which were already diminishing in numbers 
--for military purposes. ]\loreover, the very heavy fall in the 
rouble, the iiiipossibility for the peasants to obtain the articles 
required for tillage, house repairs, etc., in return for their 
surplus produce, haw intensified the prevailing misery ; and, — 
what is very important at the present moment — ha\-e increased 
the antagonism lietween country and town. But the main 
j)oint is the unchecked extension of the poverty of the great 
mass of the hard-working cultivators. What are the chief 
causes of this now generally admitted and deplorable im- 
poverishment and the consequent steady reduction of the 
fertility of the soil ? They are : 
1. The heavy taxation of the ix-asantrj', payable in money , 
and the necessit}' for paying the redemption fee for their 
' overvalued plots of land in money also. 
2. The ruthless manner in which this taxation is enforced. 
3. The inevitable application of the peasants to usurers, 
Russianor Jewish, in order to meet these taxes or to purchase 
again (at much higher prices than they have been forced to 
sell their own crops of grain) food or seed to enable them 
to carry on at all. 
4. The lack of good country roads which necessarily lowers 
the price of agricultural prc)duce in the \illages. 
> The tremendous drain of agricultural produce to Western 
Juirope in order to pay interest on Go\erninent loans and 
interest and profits on private investments for which there 
is no coinmerical return. 
Here is the main groundwork of the great Russian agrarian 
revolution now going on, beside which the political|revolution 
and the o\'erthrow of the Romanoffs is child's plaj'. The 
])easants are demanding and taking more land. They are 
cpiite right. The impoverishment of their own soil calls per- 
emptorily for an extension of their holdings. But no matter 
how much land they may seize and cultivate, it will merely 
])ostix)ne their economic and social bankruptcy, so long as 
over-taxation and other mischiefs grind them to the earth, 
("o-operation, of which we hear so much, and which is good 
enough in itself, cannot alone save them from ruin. 
It is impossibli', within the limits of an article, to deal ade- 
(piately with the economic and social problems here involved . 
.\11 Russian economists and honest Russian statesmen ac- 
knowledge the truth : that nothing short of an economic 
revolution can save their country. Thus it is universalK' 
admitted that the taxation of the peasantry was excessi\e 
in comparison with the means at their disposal for paying it, 
and that the rigid demands for money payments to the Go%'ern- 
ment at fixed dates constituted a serious grievance, even if 
great consideration had been shown by the official ta.x-gatherers 
and local agents. But notoriously, no such consideration was 
shown. Tlie taxes were collected \vith the utmost rigour. 
Peasants who were behindhand were harassed by the author- 
ities in every possible way, being thrown into prison and even 
flogged for their remissness. They were, in fact, forced 
into the hands of the usurers by the action of the (jovernment 
itself. And the usury to which they were subjected was of 
the kind familiar to students of the rural economy of the 
^liddle Ages and the Roman Empire. It was a direct trading 
upon the urgent necessities of the borrower, not in any sense 
whatever a participation in profit. 
Hence the rates of interest were enormous. Cases are 
