237af6da   
   XPost: soc.culture.baltics, soc.culture.czecho-slovak, soc.culture.russian   
   XPost: soc.culture.nordic   
   From: holman@mappi.helsinki.fi   
      
   In article   
   , David   
   Friedman  wrote:   
      
   > In article ,   
   >  Anton  wrote:   
      
      
   > >   
   > > This view is generally regarded as the correct one by most scholars. Had   
   > > the relationship been "extortion and tribute" as this Donald guy is   
   > > suggesting GDP and other figures would not had looked the way they did...   
   >   
   > You may well be correct that the trade was profitable for the Finns   
      
   Of that there is no doubt. It was not only profitable, it was profitable   
   beyond human comprehension. A country with a population of 5,000,000 being   
   in the privileged position of supplying a virtually insatiable and   
   non-discriminating market of 300,000,000 with everything from nylon   
   stockings to an entire city and industrial infrastructure key-in-hand at a   
   price set by the seller and paid for in raw materials significantly below   
   world market prices.   
      
   > --on   
   > the evidence of this thread, one plausible explanation is that the   
   > Soviets were bribing the Finns to support them in various political   
   > ways.   
      
   That is partially true. But there is a simpler reason. The Soviets did not   
   want to consign their industrial capacity to the production of what they   
   considered to be frivolous and ideologically suspect light industrial   
   products such as nylon stockings, macaroni, and galoshes. On the other   
   hand, their population craved these products. Allowing the capitalist   
   Finns free access to the consumer goods sector of the economy kept the   
   Soviet population happy, the Finns employed, content, and prospering as   
   they managed the heavy industrial infrstructure that the Soviets had   
   forced them to build to pay the war reparations, and showed the world that   
   the peaceful coexistence of capitalism and communism could be mutually   
   beneficial to both parties. It also allowed the Soviets to focus on what   
   they did best: munitions manufacture, raw materials extraction, heavy   
   industry, and space technology.   
      
   The Finns only supported the Soviets politically when it was in their own   
   national interests, as the 1975 CSCE in Helsinki was, in many people's   
   opinion. It finalized the results of WW II at the price of   
   internationalizing human rights abuses. The Finns vigorously protested the   
   worst Soviet abuses ­ there was a massive demonstration lasting for days   
   outside the Soviet embassy in August 1968 protesting the invasion of   
   Czechoslovakia, in addition to which Finland took in hundreds of   
   Czechoslovak defetors ­ and did not automatically repatriate defectors   
   from the USSR, but they tended to be prudent and maintain a low profile   
   when it came to criticism of day-to-day Soviet abuses and policies. When   
   the Soviets proposed to the Finns such projects as joint miltary   
   exercises, the Finns told them to shove their proposal where the sun   
   doesn't shine.   
      
   > But your argument doesn't work. If the Finns had a much more   
   > productive economy, as they did, they could have been paying tribute to   
   > the Russians and still ended up richer than the Russians.   
      
   The Finns had a much more productive economy than the Soviets, they   
   arguably paid tribute to the tune of $300,000,000 in the form of war   
   reparations to the USSR between 1948 and 1952, but after that they had   
   free access to one of the largest and most insatiable markets in the world   
   on exceedingly, almost insanely, preferential terms. When this   
   asymmetrical system eventually came to an end after almost forty years,   
   the Finns wound up with a bloated but easily downsized, retooled, and   
   redirected industrial   
   infrastructure, while the Soviets wound up with warehouses full of nylon   
   stockings, cheese, and baggy men's suits.   
      
   After 1952 the Finns were no longer paying tribute to the Soviets, but   
   rather using their privileged access to the Soviet market to earn back   
   many times what they had paid in tribute. In the end, Finland ended up so   
   much richer than Russia that between the collapse of the USSR and the   
   spectacular growth of the Russian economy after the 1998 ruble collapse   
   and Putin's accession to power, the gulf in living standards at the   
   Finnish-Russian border was said to be the greatest in the world.   
      
   In 1994 I worked in Kiev, not Russia, but Ukraine, which was arguably even   
   worse off than Russia. Salaries averaged $15 (fifteen) to $20 (twenty)   
   dollars a month, and they were paid in scrip: Ukraine did not have a   
   functioning currency at the time and the rate, if I remember, was 4,000 to   
   4,500 'coupons' to the dollar. I exchanged $20 on arrival and received a   
   shopping bag full of 'coupons'. In Finland people were making more than a   
   hundred times that much. In Russia, salaries were at the Ukrainian level,   
   but rubles were in short supply, so many people were being paid, if at   
   all, quite concretely in the products of their labor, such as T-shirts,   
   sausages, or brassieres.   
      
   Regards,   
   Eugene Holman   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)