Pravda, 20 September 1925 

From the national economic standpoint as opposed to the standpoint of private economic activity, paper assets cannot by themselves accelerate industrial growth, just as a person's shadow cannot increase his height. From the international economic point of view, however, the question appears yet again in a different light. American banknotes alone cannot produce a single tractor, but if the Soviet state possesses a considerable number of them, then tractors can be imported from the United States.

In relation to the global capitalist economy, the Soviet state acts as a giant private owner: it exports its goods, imports foreign ones, uses credit, purchases foreign technical assistance, and finally attracts foreign capital in the form of joint ventures and concessions.

The “restoration” process restored us and our rights in the world market. Therefore, we must not forget for a moment the enormous interdependence that existed between the economy of capitalist Russia and world capital. Suffice it to recall that nearly two-thirds of the equipment in our plants and factories was imported from abroad. It is unlikely that this relationship has changed significantly in our time. This means that it is unlikely to be economically advantageous for us in the coming years to produce more than, say, two-fifths or, at best, half of our machinery and equipment domestically. If we were suddenly to shift our resources and forces to the production of new machinery, we would either disrupt the necessary proportion between the different branches of the economy and between the fixed and circulating capital in a given branch, or, if we maintained this proportion, we would greatly decrease the overall growth rate. And for us, a slowdown in the pace of development is much more dangerous than the import of foreign machinery, as well as other necessary foreign commodities in general.

We borrow foreign technology and foreign production methods. Our engineers, in ever increasing numbers, visit Europe and America, and those who are sharp-sighted bring back from there everything that can accelerate our economic growth. We are now resorting more and more to the direct purchase of foreign technical assistance, linking our trusts with prominent foreign firms that undertake to set up production of certain products in our country within a specified period.

The decisive importance of foreign trade for our agriculture is completely obvious. Industrialization and, consequently the collectivization of agriculture, will go hand in hand with the growth of export. In exchange for our agricultural products, we receive agricultural machinery or machinery for the production of agricultural machinery.

But the question is not only one of machinery. Every foreign product which can fill a known gap in our economic system, whether it be raw materials, semi-finished products, or an article of consumption, can, under certain conditions, facilitate our economic work and accelerate its pace. Of course, importing luxury goods or articles of parasitic consumption can only hinder our development. But the timely import of certain consumer goods, if they serve to establish the necessary balance in the market and to fill gaps in the working-class or peasant budget, will only accelerate our overall economic progress.

In our foreign trade, which is managed by the state, and flexibly complements the work of state industries and domestic trade, we have a powerful tool for accelerating our economic growth. The fruitful significance of foreign trade will, of course, be greater the more extensive credit opportunities it gains on the world market.

What does foreign credit mean for our economic dynamics? Capitalism makes advances to us against our savings which do not yet exist, but which we still must accumulate within one, two, or five years. As a result, the basis of our development extends beyond the limits of our actual savings of today. If we can accelerate the production process with the help of European technical knowhow, then all the more so with the help of European or American machinery obtained on credit. The dialectic of historical development leads to capitalism becoming the creditor of socialism for a time. Well, did not capitalism nourish itself at the breasts of feudalism? One good turn deserves another.

Concessions fall under the same category. A concession combines the transfer to our country of foreign equipment and production methods, and the financing of our economy with the resources of world capitalist accumulations. Among many branches of industry, concessions can and must acquire the greatest significance. Needless to say, the limits of concession policy remain the same as those applicable to private capitalist forms in general: the state retains the commanding heights and vigilantly guards the unconditional and decisive preponderance of state industry over concessionary. But even within these limits, there is still considerable scope for concessionary policy.

Finally, this also includes, as the crowning glory of the entire system, possible state loans. A state loan is the purest form of advance payment for our future socialist savings. A loan of gold, the commodity of all commodities, enables us to buy manufactured goods abroad, raw materials, machinery, and patents, and to attract the best engineers and engineers from Europe and America to our country.

From all that has been said, it follows that we need an increasingly accurate, i.e., systematic and scientifically based orientation in all matters related to the global economy. What machinery should be imported? For which factories? When? What other goods should be imported and in what order? In what proportions should the currency fund be distributed among different industries? Which specialists should be recruited? In which sectors of the economy should concession capital be attracted? On what scale? Within what time frame? It is quite obvious that these questions cannot be decided overnight, on the spur of the moment, under the impact of individual economic shocks. Our economists are now persistently, tenaciously, and by no means unsuccessfully engaged in developing methodological approaches to resolving the above issues and many others inextricably linked to them, primarily export issues. The aim is to preserve a dynamic proportionality between the main sectors of industry and the entire economy by incorporating into this balance, in a timely manner, those elements of the world economy that will help to accelerate the dynamic of the process as a whole. To resolve specific practical issues arising from this, as well as to develop long-term plans—annual, five-year, and longer—the system of comparative coefficients should become an invaluable and indispensable aid. In important areas of industry where the comparative coefficient gives us particularly unfavorable readings, this establishes the need to turn to foreign countries for finished products, patents and methods, new equipment, specialists, or concessions. Foreign trade policy, like concession policy, can only become truly proactive and planned if it is based on a broadly developed system of comparative industrial coefficients.

The same methods will later form the basis for resolving the issue of renewing fixed capital and expanding production. In which branches of industries should equipment be renewed first? What new factories should be built? Needless to say, the needs and requests far exceed any possibilities. How can this issue be resolved?

First of all, of course, we need to identify the reserves that can be used to re-equip factories and build new ones. We will cover the most urgent and pressing needs from our own accumulation. If access to other sources turns out to be closed, domestic reserves will determine the scale of the expansion of production.

Along with this, it is to necessary to prioritize applications from the standpoint of the needs of the economic process as a whole. Comparative coefficients will serve as direct indicators of those areas of the economy that require capital investment first and foremost.

Such, in very broad terms—with the deliberate elimination of a number of complicating factors—is the transition to a planned resolution of issues related to the renewal and expansion of the fixed capital in industry.