- 26 Apr 2006 21:00
#859662
This article debunks the stereotype of the GULAG being a brutal system of forced labor. As reported by J.Arch Getty in the American Historical Review in October 1993, the vast majority of GULAG inhabitants were common criminals instead of the myth that political criminals were dominant. Since these laborers received wages, it would be inappropriate to classify them as slaves. They were no more slaves than industrial workers for big business in the West.
Comparative Economic Studies, June 2005
Forced Labour and the Need for Motivation: Wages and Bonuses in the Stalinist Camp System.
Leonid Borodkin
Simon Ertz
Abram Bergson's first monograph was his 1944 study of the Soviet labour market, in which he began his exploration of what was then the terra incognita of the Soviet planned economy (Bergson, 1944). His overall conclusions probably surprised the early postwar generation of scholars: He found that Soviet labour markets, although formally functioning under distinct working arrangements, exhibited many features characteristic for market economies. In particular, he discovered a surprising degree of wage differentiation--perhaps even surpassing that for contemporary US industrial workers--a phenomenon which he explained as follows: 'The upward movement in differentials after 1951 is hardly evidence of the application of a peculiarly socialist wage policy. It is rather the response to be expected of wage differentials when skilled labour is scarce and capitalist wage principles prevail' (Bergson, 1944, p. 209). In his work on Soviet wages, Bergson was able to gather ample information to describe the Soviet labour market, and his basic findings remain essentially unchallenged to the present day.
Clearly, Bergson could not have studied one of the most unusual features of the Soviet labour market--the widespread use of political and criminal prisoners under the direction of the Soviet ministry of interior (NKVD/MVD). Some information about prison labour and its output was required for his studies of national income, but despite efforts to penetrate the veil of secrecy, his estimates of the camp economy and its financing were based on grossly inadequate information. Bergson wrote: 'Actually we are in the dark as to the extent that penal labour is supported out of the budget appropriation to the NKVD' (Bergson, 1961, p. 23).
The opening of formerly secret Soviet archives allows to gain new insights in the working arrangements of the Stalinist camp system, in its financial dimensions and in the practice of managing forced labour. As recently summarised in contributions by O Khlevnyuk and P Gregory, one rationale of the massive exploitation of forced labour during Stalinism must be seen in the perceived advantages of this approach. Unlike free workers who demanded material incentives to work in remote regions, penal labour could be dispatched by administrative decree. The use of punishment rather than material rewards was intended to save vital resources and 'surpluses' were to be extracted from prison workers (Gregory, 2003; Khlevnyuk, 2003). Our findings in this paper challenge this stereotype of Soviet forced labour, just as Bergson's 1944 monograph challenged the stereotypes of that time. We find that even in Stalinist prison camps, where force could be most conveniently applied, camp administrators combined overt coercion with (material and nonmaterial) incentives, and, as time passed, they placed more weight on the latter. By the time the camp system was abandoned as a major instrument of Soviet industrial policy, one major distinction between forced and free labour had been blurred: prisoners were being paid wages according to a system that mirrored that of the civilian economy described by Bergson. (1)
THE GULAG VERSUS CAMP DIRECTORS: PRINCIPAL AND AGENTS
Berliner and Granick in their classic studies of the Soviet enterprise dispelled the myth of a harmonious hierarchy--ranging from the Politburo to enterprises--of communist leaders dedicated to the single goal of building communism. Subsequent research has shown the presence of vast principal/agent problems within the vertical command system, with the principal conflict between those who issued orders and those who had to fulfil them (Gregory, 2004). When we study the camp economy, we must consider similar issues: Was there a distinction between the ministry of interior, including its embodied main administration of prison camps (GULAG) and the top leadership of the Soviet Union, or were they one and the same? Was the GULAG, like its industrial ministry counterparts, in constant conflict with the leadership over plan targets and material inputs? Were the individual NKVD construction sites and plants, staffed with forced labour, engaged in a principal/agent conflict with their superiors in the central ministry, like their counterparts in civilian industry?
Although such conflicts are not the prime focus of this paper, we can report that the former Soviet archives provide ample evidence of conflicts between high NKVD/MVD and GULAG officials and local camp administrators. Judging from administrative documents and the information they provide for the period from the 1930s through the 1950s, the GULAG was generally oriented towards keeping its labour force in reasonable condition for hard work so that it could fulfil construction and production plans handed down from above. Already in the 1930s, and to an even larger extent during the post-war period, it issued numerous orders to ensure the provision of minimum levels of food, clothing and living conditions, and seeked to enforce limits imposed on the exploitation of prison labour by legislation. In contrast, camp managers (and their immediate subordinates), to our surprise, in many cases appeared less interested in maintaining bearable living and working conditions, and often proved crude, cruel, and indifferent in their dealings with prisoners. The GULAG's intense interest in inmate labour productivity is particularly reflected by the large number of requests sent to their NKVD/MVD bosses, especially during the post-war period, asking permission to introduce more efficient labour motivation systems. The most important decisions concerning labour motivation programmes in the camps system had to be made by the supreme Soviet authorities. Sometimes it took several years to get such permission 'from above'.
LIVING CONDITIONS AS WORK INCENTIVES
In general, prison camps offer ideal environments for the application of coercion. If so, why were incentive systems, as such, even necessary? The work of prisoners could be monitored and poor performance punished. Indeed, forced labour in Stalinist camps was regulated by harsh measures. The 'Temporary instruction on the regime for holding prisoners in corrective-labour camps' issued by the NKVD with top secret order no. 00889 on August 2, 1939 placed prisoners refusing work on a 'penalty regime', and hardcore 'work refusers' were subject to criminal punishments. Depending upon the violation of work discipline, workers could be deprived of correspondence for 6 months, deprived of the use of their own money for 3 months, transferred to general work (a punishment for specialists and office personnel), placed in isolation for 20 days, or they could be placed on reduced rations.
The tying of consumption to work performance in camps where inmates were already close to subsistence represented a combination of material incentives and coercion. The 'stick' was that if you worked poorly, your rations could be reduced below subsistence to leave you a victim of starvation. In camps, as in the economy as a whole, labour-motivation systems were directed at the fulfilment of work norms, which were dictated according to the branch of the economy, with some lower norms for 'physically weak' workers. Thus, prisoner living standards depended on fulfilment of norms. Norm underfulfilment typically meant reduced rations, but the lowering of rations could so weaken workers that they could not fulfil their norms in subsequent periods either--with severe long-term consequences such as dysentery, tuberculosis, and death. On the flip side, prisoners who overfulfiled their norms received improved rations and other advantages.
Such penalties and rewards were often applied to the work brigade as a whole, which meant that the work of one prisoner affected the living conditions of other brigade members. Consequently, within the brigade, mechanisms for increasing productivity could ensue as well, such as peer pressure or even punishments, on the one hand, or mutual help and assistance, on the other. Brigades achieving good work results, were rewarded with better rations, praise on the 'red board', better clothing, and the right to buy goods in the camp store, while their leaders, in addition, could count on doubled rations. Prisoners could also receive commendations that were placed in the prisoner's record, monetary rewards, rewards in kind, the right to receive packages without restrictions, the right to send money to relatives (not exceeding 100 rubles per month), or to be transferred to more qualified work. Prisoners working according to 'Stakhanovite' measures were supposed to enjoy additional privileges such as better living quarters, boots or coats, special rations, a separate dining room or the right to be served first, first access to books or newspapers in the prison library, the best seating in the camp theater (if such existed), or a place in training courses to raise their professional qualifications (Order No. 00889 NKVD of August 2, 1939).
Most of the incentives, which directly linked inmate living conditions to labour productivity, required minor additional expenditures as compared with other forms of bonuses. For prisoners living at the margin of subsistence, however, they were supposed to act as powerful and efficient motivators. Yet, not always did such an effect result: If the additional nutrition allotment for norm overfulfilment did not make up for the extra energy spent to receive it, this kind of 'incentive' produced just the opposite outcome as intended. Moreover, prisoners unable to adapt to severe working and living conditions could be driven to starvation if they experienced cuts in supplies as a consequence of norm underfulfilment. The ensuing loss of manpower thus raises serious questions about the economic effectiveness of incentive systems that linked work to living conditions in prison communities living on the edge of subsistence.
The fact that tying living standards to work performance tended to back fire did not prevent its widespread use throughout the entire history of the Stalinist prison camps. The best workers could always count on receiving something extra, either in the form of more food during times when others were starving or a less vital privilege, such as better housing, or even linen sheets.
MONETARY BONUSES FOR GOOD WORK
Starting from the very beginning (in early 1930s) monetary payments were to be paid to all working prisoners in Soviet camps who fulfiled their work norms. Throughout the 1940s, these payments were referred to as 'monetary rewards' or 'bonus remunerations' (premvoznagrazhdeniia). Additional monetary payments in form of supplemental bonuses for individual prisoners were also possible, although granted extremely rarely. The above-mentioned 1939 temporary regime instruction for corrective-labour camps required that monetary bonuses be credited to each working prisoner's personal account up to a monthly upper limit. Inmates could also be given cash totaling no more than 100 rubles a month, subject to the approval of the division chief. Bonuses and personal cash were to be issued 'piecemeal at different times, in such a manner that the total amount in an inmate's possession does not exceed 50 rubles' (Order No. 00889 NKVD of August 2, 1939). The 1947 procedures for inmates of all Soviet prison camps and colonies spelled out similar terms, limiting the maximal amount of cash to be in any prisoner's possession to 100 rubles (Order No 0190 MVD of March 29, 1947). According to another source, a speech by GULAG director Nasedkin from the same period, inmates could receive cash amounts of not more than 150 rubles at one time. Any sums above this limit were to be credited to their personal accounts and to be paid out as previously issued cash was spent (GARF 9414.1.77: 28 ).
Figure 1 shows monetary payments per man day for the period 1939-1949 to all prisoners working at the Norilsk integrated metallurgy plant located above the Arctic Circle, one of the most important among the NKVD/MVD's industrial projects. Probably a considerable number of inmates did not receive bonuses; therefore the average figures were presumably somewhat lower than the bonuses actually paid out. However, even under this assumption they did not significantly exceed 2 rubles per day. (2)
The information in Figure 1 provides some notion of the importance various Norilsk camp administrations attached to these small monetary rewards. In 1936, the average amount of the monetary remuneration in Norilsk was higher than plan figures because of norm overfulfilment, an increase in bonuses for skilled workers, and, for certain projects, 'there was an artificial increase in bonus remuneration for the purpose of accelerating projects of an extremely urgent nature' (State Archive of the Russian Federation, hereafter: GARF 9414.1.854: 12). However, there were also cases in which 'the amounts of work completed were artificially inflated' (GARF 9414.1.854: 12). (3) The increased bonuses for skilled workers shows that the first directors of Norilsk were actively and deliberately using monetary rewards at the start of operations as an incentive. Yet in 1937, the fact that 'even a small overfulfilment of output norms by individual groups of workers' could cause a disproportional overexpenditure of the monetary-reward fund was already perceived as a problem (GARF 9414.1.968: 24-25). Consequently, the Norilsk management drew up new rates 'to lower the growth of bonus remuneration for overfulfilment of norms' and introduced 'bonus bread' which meant that 400 g of bread were 'moved from the basic allotment to bonus bread that was issued instead of money bonuses' (GARF 9414.1.968: 25). These and subsequent measures drove down expenditures on monetary rewards (GARF 9414.1.969: 10). Finally, the Norilsk plant's annual report for 1937 raises some doubts concerning the accuracy of the disbursement of the marginal monetary bonuses, earmarked for working prisoners: 'Accounts of inmate depositors were managed in 1937 by the divisions themselves, which caused numerous abuses, both on the part of workers and on the part of accounting employees' (GARF 9414.1.968: 9).
In the 1940s, and especially during the second half of the decade, actual monetary rewards were significantly lower than planned amounts, even though the Norilsk plant was consistently fulfiling and overfulfiling its norms. From handwritten notations in archival documents, it can be inferred that in 1948 the planned amount, which initially stood at 2.15 as in previous years, was reoriented toward a more realistic, lower figure.
When evaluating the use of monetary rewards at Norilsk, one might consider that, from the plant management's perspective, bonuses were part of the factor costs of forced labour. Curtailing these could serve as a convenient means of lowering overall production costs. Financial reports for the Norilsk plant reveal that savings on 'monetary rewards' in the 1940s contributed significantly to keeping overall expenditures per man-day below planned levels right up until 1948. This effect was especially noticeable from 1944 to 1947, when savings on other types of costs were melting away. Given that cost economies not only improved the general financial capabilities of the enterprise but also were regularly cited in the plant's reports as distinctive achievements, it seems plausible that the camp management tended to jettison the (presumably small) incentive effects of marginal bonus remunerations for the perspective of cost cuts.
THE MOVE TOWARDS A WAGE SYSTEM
During the second-half of the 1940s, a number of requests from the GULAG as well as from local camp administrations were sent to the NKVD/MVD asking to introduce wages for camp inmates to increase their labour productivity. In a letter from January of 1948, the head of Enterprise #4 of the MVD's Glavneftgazstroy branch administration traced the observed decrease in prisoners' labour productivity back to the lack of incentives, which became more apparent after the abolition of rationing (inmates no longer received additional hot dishes for the overfulfilment of norms), remarking, 'Still no other incentive has been created, and this influences their productivity' (GARF 9414.1. 330: 49). As a remedy, the author suggested a progressive scale of cash bonuses for those overfulfiling output norms (GARF 9414.1. 330: 49).
Another document of special interest is a memo on payments for inmate labour prepared by the Deputy Minister of the Interior (Chernyshev) in July 1948, in which the author provides a brief history of the pre-revolutionary experience with remuneration of prison labour. Chernyshev emphasised, that in the pre-revolutionary period the costs of maintaining inmates had been covered by the State Treasury (GARF 9414.1. 330: 168-169), while, according to current policy, expenditures on corrective labour camps and colonies were to be covered entirely by revenues from inmate labour. According to Chernyshev, this scheme of financial self-sufficiency worked out until 1946, but 'starting in 1946, in connection with such factors as rising prices of rations and clothing and increases in other expenses [a direct cause of the September 1946 price reform--authors' remark], the state is budgeting subsidies to cover maintenance costs of nonworking and disabled inmates only' (GARF 9414.1. 330: 169). In his memo Chernyshev stressed the fact that the prisoners, apart from insignificant monetary payments (1.5-2 rubles a day per person) for those fulfiling and overfulfiling output norms, received no monetary remuneration for their labour. He went on to argue that the share of inmate labour costs to total costs was below that of civilian workers due to minimum expenditures on inmate rations and clothing.
Drawing on these facts as well as on the judgment that MVD enterprises were operating under more difficult conditions than their civilian counterparts, Chernyshev demanded that any net expenditures accruing in the camp economy be covered by the state budget. In conjunction with this measure, prisoners should receive, as an incentive, minimum wages supplemented by progressive bonuses for plan fulfilment. Finally, Chernyshev advocated that all calculations of production and construction tasks performed by forced labour be aligned to the scaling and pricing schemes effective in corresponding civilian ministries--as a pre-requisite to gauging the comparative 'profitability' of prison camps and colonies (GARF 9414.1. 330: 171-172). Altogether, this document, prepared by one of the highest MVD officials, promoted the abandonment of some of the basic principles of the Stalinist camp economy and the adaptation of practices from the 'civilian' Soviet economy.
Chernyshev's call for a differentiated wage system did not fall on deaf ears in the Soviet leadership. On November 20, 1948, the Council of Ministers enacted regular wage payments for the prisoners in the camps of Dal'stroi (Decree #4293-1703). (4) Shortly after, S Kruglov, Minister of the Interior sent a report (Dokladnaia zapiska) to the USSR Council of Ministers entitled 'On the Measures of labour Improvement in the MVD Correctional labour Camps and Colonies' (GARF 9414.1.334: 191-200). Against the background of shortages of labour force facing the MVD, Kruglov once again called for the creation of effective incentives to raise inmate labour productivity as the existing ones 'are extremely insufficient and do not provide the needed effect' (GARF 9414.1.334: 194). Kruglov stated that the current system of bonuses, 'insufficiently motivates the increase of labour productivity, and that is why it should be replaced by monetary payment for inmate labour' (GARF 9414.1.334: 194, emphasis added by the authors). Further in his letter, Kruglov suggested the general introduction of a wage system for inmates like that of civilian workers, which should guarantee inmates' interest in greater output, improve their physical condition, as they would buy additional food from their extra earnings, which would result in increases in the number of able-bodied labour force' (GARF 9414.1.334: 195).
Kruglov sought to bolster his proposal with evidence that suboptimal practices in the exploitation of forced labour and the lack of appropriate incentives could lead to a complete failure to extract 'surpluses' from camp labourers: Referring to camp inmates not employed in MVD economic projects, but instead 'hired out' to enterprises of other ministries, (5) Kruglov asserted that sub-optimal practices cost the MVD 111 mln. rubles for the first-half of 1948 alone, and: 'at the same time, the inmate labour force costs these ministries much more than civilian workers, since they have to provide a considerable number of guards, due to working activities in crowded units and small groups of inmates distributed among civilian workers' (GARF 9414.1.334: 196). Kruglov went even further, arguing that the 'overall appreciation of the costs of maintaining prisoners associated with the impending cost increases' required a fundamental change in procedures for financing camps and colonies.
The Kruglov report, as well as a number of other documents sent to the Council of Ministers by GULAG and MVD administrators during this period, attempted to link more effective incentives for the motivation of forced labour with the necessity of placing the entire camp system on the state budget (GARF 9414.1.334: 195). The MVD's motives seem all too clear: Although the ministry's leadership was convinced that more effective labour incentives were essential, a promise that the introduction of wages would make forced labour profitable would have been too large a commitment. Accordingly, they choose to bundle the two issues, while transferring the financial risk to the budget. A transfer of the camp system to the state budget was tantamount to making it subject to a significantly softer budget constraint, which, from the MVD's perspective, was an advantage by itself.
While the Soviet leadership did not immediately follow this more general recommendation, it could be persuaded to introduce regular wage payments for the inmates of all prison camps and colonies (except the MVD's 'Special Camps' that followed with more than 1 year delay--see GARF. 9414.1.510: 39), which was enacted by the Council of Ministers Resolutions no. 1065-376ss of 13 March 1950 and the subsequent operational MVD order no. 00273 of April 29, 1950. Inmate wages were based on rates corresponding to civilian sectors, but with an appropriate reduction. Inmates received only a portion of their wages in cash after deduction of food and clothing costs and income taxes. After these deductions, inmate cash wages were to be not less than 10% of their total earnings. Progressive piecework rates and other bonuses, if in effect for free workers at MVD enterprises, were to be extended to forced labourers as well. Prisoners occupying administrative and managerial posts could expect to receive 50-70 percent of the pay of free workers in equivalent jobs.
The establishment of a direct link between the wages of prisoners and civilian workers implied that inmate wages followed the same principles of wage differentiation as in the economy at large. These principles translated into higher pay in high priority branches, such as coal, gold mining, and metallurgy as compared to light industry, higher wages for qualified and skilled workers, and higher wages for workers in the main field of production as opposed to secondary and ancillary industries. Prisoners who were temporarily excused from work due to illness or other reasons were not credited with wages while away from work, but their food and clothing costs were not withheld. Certified disabled prisoners who were used in piecework were paid according to prisoners' piecework rates for the amount of work they actually completed.
CASE STUDIES OF THE INTRODUCTION OF WAGES--NORILSK AND VORKUTA
To examine the impact of the introduction of wages at the camp level, we turn to the Norilsk corrective labour camp (Noril'lag) again. First and foremost, the changeover to wage payments, which took place in June/July 1950, created financial problems, since the MVD order required that cash wages be paid from the total appropriation limit authorised for 1950. No supplemental funds were allocated to cover the ensuing costs. As a result, the MVD's main administration for metallurgy camps reported 'inevitable difficulties in the camps' work during this transitional period' and significant deviations 'between the authorised estimates of the revenues and expenditures of correctional-labour camps and actual results' for all camps under its auspices, including Noril'lag (GARF 9401.4.2693: 177). Camp managers attempted to close the financial gap by reducing 'food and clothing allowances as compared with estimates,' but these cutbacks 'did not offset the increase in wages paid out, since wages at a number of camps were paid out in increased amounts due to the overfulfilment of production norms' (GARF 9401.4.2693: 178). Regardless of these problems, the director of Noril'lag, Zverev, could report a notable increase in overall plan fulfilment (from 105.6% during the first 6 months of 1950 to 116.4% in the second half of the year), which he mainly attributed to the introduction of wages (GARF 8361.1.273: 151). Similarly, a 1952 inspection report on the Norilsk camp stresses the effectiveness of the measure: 'The changeover of inmates to wages was a major incentive for most inmates to raise productivity' (GARF 9414.1.642: 80), whereas the deputy director of the Norilsk Correctional-Labour Camp and the Special Camp no. 2, also located in Norilsk, stated in a letter dated 5 June 1952 that certain groups of inmates, especially in skilled vocations, were working much more productively as a result of the introduction of wages (GARF 8361.1.305: 10).
In addition to such anecdotal evidence, aggregate data on the money wages for the entire contingent of the Norilsk camp's working inmates for the years 1951-1953, presented in Figure 2, show that the average wage per worker credited as cash was about 225 rubles (after deduction of cost of food, working clothing, etc.). (6) Because of generally higher wages in the metallurgical industry, wages in Noril'lag were higher than at most other camps. Nevertheless, they fell well below the average wage of a qualified worker in the civilian economy, which stood in that year at 1,465 rubles per month in mining, 1,343 rubles in ferrous metallurgy, and 651 rubles in garments and shoes (Popov, 2000, p. 65). Thus prisoners at Norilsk received about one-third the pay of the lowest-paid civilian workers and about 15% of the pay of workers in comparable jobs, although they did receive 'free' housing and food. The gap between wages for prisoners in Norilsk and civilian wages was even wider considering that the latter would have received polar bonuses for working in Norilsk, which prisoners did not receive.
[FIGURE 2 OMITTED]
Documents from another MVD major camp complex, whose inmates were mainly engaged in coal mining--the Vorkuto-Pechorskii Corrective-labour camp ('Vorkutlag') in the Komi ASSR--also provide valuable information on the changes brought about by the introduction of wages. A memo dated March 15, 1951, prepared by Vorkutlag director Fadeev for the chief of GULAG, reports a significant increase in the number of inmates involved in production (which rose from 57.7% in the first-half of 1950 to 65,2% in the second-half), as well as in per worker output (which increased from 33.98 rubles per day to 36.43 correspondingly). Like in the Norilsk case, both these observations are attributed to the introduction of wages on prisoners' motivation. In addition, the Vorkutlag report provides information on the utilisation of the monthly cash payments working prisoner received (and which, in this camp, equaled 266 rubles on average, as compared to 610 prior to the deduction of maintenance costs). One direct effect of the introduction of wage payments was the growth of the aggregate balance of inmates' personal accounts, as the following figures show:
by July 1, 1950 - 7,753,000 rubles
by October 1, 1950 - 13,254,000 rubles
by January 1, 1951 - 18,839,000 rubles
At the same time, the trade turnover of the camp stores also increased:
1950, first 6 months
Manufactured goods - 1,495,000 rubles
Food products - 2,244,000 rubles
1950, second 6 months
Manufactured goods - 2,480,000 rubles
Food products - 11,481,000 rubles
Although less substantial, there was also a rise in both in numbers and the average sums of money transfers inmates sent to their relatives:
1950, first-half of the year 280,000 rubles (2,750 transfers)
1950, second-half of the year 683,000 rubles (5,012 transfers)
These figures suggest that prisoners in fact had the opportunity to use the wages they earned, but also, that the MVD and camp administrators took a real interest that they did so. The gain in utility prisoners received from being able to purchase modest amounts of food and consumer goods in camp stores may have been limited. Nevertheless, the observable increase in prisoners' productivity indicates that it served as an effective incentive to increase work performance for many inmates, as MVD and GULAG officials had intended.
THE IMPACT OF THE INTRODUCTION OF WAGES ON THE CAMP SYSTEM
The GULAG archives contain a large number of documents revealing the great interest of the MVD authorities in the impact of the introduction of wages on inmate labour productivity. Local camp administrators were obliged to provide detailed assessments of the impact of wages on labour productivity and on other core measures of the efficiency of inmate labour. In addition, top officials of the GULAG's Third Administration were deputised to a number of republics and regions to conduct special inquiries on these issues. In most cases, they reported back significant improvements, a development that kept up its momentum after wages had been introduced (GARF 9414.1 dop. 150: 137-145). The 'Short Review on the Results of the Changeover of the MVD USSR Corrective labour Camps and Colonies to a Wage System for the First Half of 1951' (GARF 9414.1 doc. 150: 137-145) sent by the MVD Planning Office to the Deputy Minister of Interior (Serov), summarizes these findings, stating that 'now, with a new payment system, and prevalence of individual work delivery, each inmate receives payments in direct dependence on the results of his personal work [...] The wages received give them the opportunity to obtain additional food and clothing, and have a favorable effect on the physical condition of inmates. The factors listed above have resulted in an increase in labour productivity and in an improvement of the financial position of the camps, meeting the main objective of the inmate changeover to the wage system' (GARF 9414.1 dop. 150: 137-138). This document also provides figures on the increase in the fraction of inmates that performed productive labour. In the camps subordinated to the Main Administration for Road Construction, for instance, their share increased from 75.9% of all prisoners in the first quarter to 84.6% in the second (GARF 9414.1 dop. 150: 140).
To what extent can we trust these optimistic evaluations? Of course, the implementation of this major reform throughout the vast camp system involved problems and shortcomings and did little to eliminate cases of entrenched mismanagement, collusion and corruption, as the following fragment from the above-discussed 'Short Review' corroborates: 'There are still a lot of drawbacks in the organization of labour, control, and accounting of completed work. There are all kinds of forgery; sometimes the amounts of work completed by one brigade is ascribed to another brigade aimed at charging to it the monetary bonuses [...] A considerable number of local regulatory positions are still manned by prisoners, who often forge specifications under the influence of bandit elements, under physical menace, or on agreement' (GARF 9414.1 dop. 150: 145). Nevertheless, the MVD concluded the payment of wages to prisoners a highly effective incentive mechanism, and a plentitude of quantitative data confirms this view.
Wages for prisoners, however, failed to be a panacea with regard to the problem of self-financing of the camp system. According to the GULAG's General Accounting Office's note on production plan fulfilment for the first-half of 1954, the costs of maintaining camps and colonies exceeded revenues to 448.1 mln. rubles, or 50.6 mln. rubles more than planned--which implies that a 400 mls rubles deficit was planned from the start (GARF 9414.1.206: 125-126). The government, however, provided subsidies of 270.7 mln. rubles only, so that a deficit of 177.4 mln rubles remained, generating 'financial tension in camps and colonies' that, in turn, required the spending of 'inmate personal money in the amount of 46 mln. rubles' (GARF 9414.1.206: 125). We might assume that this money was either temporarily diverted from the inmates' personal accounts, or was simply not paid to them. In his memo, the head of the GULAG's Financial Department, Lisitsyn, forecast that in 1955 the costs of maintaining camp and colony inmates would exceed the revenue from exploiting their labour force to an even greater degree, requiring budgetary subsidies of 859 mln. rubles (GARF 9414.1.206: 150-151). Thus the camp system continued to struggle against financial losses that the MVD had to somehow cover. Its initiative to achieve its transfer to the state budget had still not been crowned with success.
One reason for these negative balances can be seen in the increased expenditures for administrative personnel, which made up 10% of the inmate maintenance expenditures (guard expenditures accounted for another 20-25%). Hence the costs alone of the GULAG's large bureaucratic apparatus--which produced an ever increasing stream of administrative documents, circulars and regulations (GARF 9414.1.206: 150-151)--not to even talk about the hundreds of thousands military guards--likely offset the cost-reducing effect of the new incentive system. This was all the more true given that average labour productivity within the camp system was lagging behind that of civilian workers even after the introduction of wages for prisoners: In 1951 at all MVD enterprises the share of civilian workers who underfulfiled output norms was 10.9%, while the according value for prisoners stood at 27.4% (GARF 9414.1.1.326: 178 ).
THE DISTRIBUTION OF WAGE INCOMES OVER THE PRISONERS IN THE CAMP SYSTEM
To address the question of the distribution of wages for prisoners in the Soviet camp system, we again refer to Figure 2 on wage levels in Noril'lag, which displays a considerable dispersion of money wages: In 1951, for instance, almost 5,000 prisoners at Norilsk received more than 500 rubles a month in cash, while more than 8,000 were paid less than 75 rubles. (7) Figure 3 exhibits similar patterns for a total of roughly 430,000 inmates of corrective labour colonies in 13 regions of the USSR in the first and second quarters of 1951. The diagram shows also that along with a rapid decrease in the number of inmates underfulfiling norms (from 32 to 21%) and hence receiving only the 10% of salary, the share of those receiving relatively high wages (200 rubles and above) kept increasing in this period--from 7.8% in the first quarter to 11.1% in the second. Simultaneously, the number of prisoners who earned just enough to cover the costs of their maintenance fell by more than 75,000 persons in the second quarter (GARF 9414.1 dop. 150: 90-91).
[FIGURE 3 OMITTED]
Archival data on the average distribution of monthly salaries in a number of large industrial or construction camps are also available. Figure 4 juxtaposes some of these records, which show considerable differentiation in each of these camps, although differences in the wage levels across them are also discernable. Moreover, a comparison of these figures to those on corrective labour colonies, presented in Figure 3, reveals that the level of wages in colonies was on average lower than in camps. Yet this does not change the fact that wage differentiation was rather significant throughout all these places of confinement, which once again underscores that the introduction of wages in the prison camps was indeed intended to serve as a powerful incentive to motivate work effort. Although we should be careful in drawing generalised conclusions, the tendency of the number of prisoners who received just small or minimum salary payments decreased over time, providing additional evidence that wages for many prisoners were an attractive, and thus an effective type of incentive. The fact that a considerable number of camp inmates received much larger sums indicates that an elevated work effort was in fact rewarded.
[FIGURE 4 OMITTED]
It would be of great interest to compare the distribution of wages among the prisoners in the Soviet camp system with equivalent indicators for the civilian economy in the same period, but unfortunately, we lack such data. What we can do is consult figures on industrial workers' wages in the USSR in 1934 (Figure 5), which yield a similar level of differentiation in the 'noncamp' economy. On these grounds we can conclude that the patterns of wage differentiation prevalent in civilian industries in fact found its way into the camp economy.
[FIGURE 5 OMITTED]
CONCLUSIONS
The conclusions of our research can be summarised as follows.
(1) The leadership of the OGPU-NKVD/MVD understood, from the very beginning, that forced labour needed motivation. The first major incentives introduced in the camps were varying food rations, early release schemes, and monetary payments--each of which were tied to the fulfilment of output norms. Still, shortly after World War II, the GULAG (and later MVD) administrative authorities started to question the effectiveness of these measures of inmate labour motivation, and to suggest a system of regular wage payments for working prisoners. By the end of the 1940s, the Council of Ministers approved these plans and decided to introduce a wage system first in selected camps, and shortly after, in 1950, in nearly all camps and colonies.
(2) According to a multitude of reports, the introduction of wages in the camp system largely yielded the expected results: Labour productivity increased significantly, as did the share of working inmates. Wage differentiation among the prisoners was considerable and perhaps close to the level of differentiation in the civilian economy, which was the result of civilian wage scales being used in regulating the remuneration of forced labour.
(3) Starting in 1946, the MVD officials admitted that the camp system could no longer operate on the basis of self-financing and was in need of considerable government subsidies to cover the increasing expenses of camps and colonies. Repeated lobbying efforts to transfer it to the state budget, however, failed. The introduction of new types of incentives, including wages, by the end of the 1940s, did not alter this situation, since the productivity of forced labour remained lower then that of civilian workers, while the costs of maintenance increased. The attempt to extract 'surpluses' from prisoners had thus proved fallacious long before Stalin's death, when the process of demise of the system of corrective labour camps started.
Figure 1: Monetary incentive fund of Norilsk complex and its usage
(average monetary incentive payments per prisoner worker per day,
in rubles). Source: GARF 9414.1.854: 57, 80; 968: 24-26; 969: 10;
1118: 24; 8361.1.40: 42ob; 56: 40; 71: 56; 95: 101; 156; 125: 152ob.;
155: 140; 174: 98
according to plan in fact
1936 1.28 2.32
1937 1.98
1938 0.70
1942 1.60 1.39
1943 1.60 1.47
1944 2.10 1.54
1945 2.20 1.57
1946 2.15 1.37
1947 2.15 1.33
1948 * 1.70 1.60
1949 1.66 1.74
Note: Table made from line graph.
Acknowledgements
We would like to thank Paul Gregory and Mark Harrison for their comments on earlier drafts of this paper. We would also like to thank the Hoover Institution and its archives department, Elena Danielson director, for its support of this research.
(1) Besides the various incentive systems described in this article, another particular motivation system was used throughout most Soviet prison camps in the 1930s and again at the beginning of the 1950s, which consisted in the allotment of 'workday credits', allowing forced labourers to effectively reduce their sentences (by 2 days or more for every day the norm was overfulfilled). The evolution and the impact of these specific incentives, which, as many sources reveal, were among the most effective ones, is described in the contribution by Ertz in this volume and therefore will not be touched upon in this article.
(2) We can compare those payments with the average monthly worker's wage in civil industry, which increased from 250 rubles in 1937 to 767 rubles in 1953 (Bergson, 1961, p. 422).
(3) This citation depicts a case of 'pripiski', notorious for Soviet enterprises in virtually any period. In the Soviet camp system, the practice of pretending to work and of subsequently falsifying or exaggerating the real amount of work performed (which in the context of forced labour can actually be considered as a hidden form of work refusal} was also a wide-spread phenomenon, called 'tufta'. The administration of every camp fought a constant battle against it.
(4) It is evident that these camps were selected first for their priority, as most of their inmates prisoners were dispatched for gold mining and related colonising activities in the Far East.
(5) During the concerned period, those constituted roughly 20% of all prisoners in Soviet corrective labour camps and colonies (gregory, 2003, p. 13).
(6) This takes into account prisoners who were deprived of wages. The available data, however, do not allow calculating precisely the average wage so that we have to proceed from a possible error in this estimation in the range of 5-10%.
(7) We conclude that prisoners who received the guaranteed 10% of salary are also in this category. Prisoners who received no wages are not included in this sum.
REFERENCES
Bergson, A. 1944: The Structure of Soviet Wages: A Study in Socialist Economics, Harvard Economic Studies, Vol. 76. Harvard University Press: Cambridge.
Bergson, A. 1961: The Real National Income of Soviet Russia Since 1928. Harvard University Press: Cambridge.
Gregory, P. 2003: An Introduction to the Economics of the Gulag. In: Gregory, P. and Valery, L. (eds). The Economics of Forced Labor: The Soviet Gulag. Hoover Institution Press: Stanford.
Gregory, P. 2004: The Political Economy of Stalinism. Cambridge University Press: London.
Khlevnyuk, O. 2003: The Economy of the OGPU, NKVD, and MVD of the USSR, 1930-1953: the Scale, Structure, and Trends of Development. In: Gregory, P. and Valery, L. (eds). The Economics of Forced Labor: The Soviet Gulag. Hoover Institution Press: Stanford.
Popov, VP. 2000: Ekonomicheskaia Politika Sovetskogo Gosudarstva 1946-1953. Tambov: Moscow.
LEONID BORODKIN (1) & SIMON ERTZ (2)
(1) Department of History, centre for Economic History, 1st Building for Humanities and Social Sciences, Moscow Lomonosov State University, Vorobyevy Hills, Moscow 199899, Russia
(2) centre for Russian, East European & Eurasian Studies, Stanford University, Stanford, CA 94305-2006, USA
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