Letter to L.M. Kaganovich, V.M. Molotov, June 26, 1932

Source: Tom 17

Kaganovich. Molotov.

Comrade Sheboldaev raises in his memorandum a fully ripe question. He is right that the role of consumer cooperatives, both in procuring agricultural products and in selling urban industrial goods -- especially in the countryside -- must be enhanced (the "intermediary" role of cooperatives).

It is possible that he is also right in saying that the cooperatives should be freed from state procurement functions and should concentrate on procurements of a local, "decentralized" character. One need only study the question of whether the state procurement organizations will be able to manage procurement work without the cooperatives.

Sheboldaev is unquestionably right that consumer cooperatives must be freed from excessive taxes, "levies," and similar exactions.

But Sheboldaev is, in my opinion, wrong on the question of procurement prices (in the countryside) and selling prices (in the city). I fear that if the cooperatives are allowed to procure products in the countryside at free-market prices, our state procurements will be undermined at the root. It is possible that at some point it will be necessary to raise prices for state procurements. But this year it is out of the question. One might declare state procurements with their low prices a state tax, a state obligation. But this cannot be done without abolishing direct taxes on the countryside. Moreover, in any case, carrying out this procedure -- even if upon study it proves correct -- is something we cannot do this year. One thing is clear in any event, namely: we cannot free the cooperatives from all state control and regulation in the area of prices.

Evidently the cooperatives will have to conduct their procurement at state prices, and only after the completion of state procurements (January 15, 1933) will it be possible to allow them to procure -- that is, to buy -- at prices exceeding state prices by approximately 5 percent.

Comrade Sheboldaev is also wrong on the question of selling prices in the city. I have no objection to the cooperatives selling urban goods in the countryside at semi-commercial or even commercial prices. But I am against the cooperatives raising selling prices in the city on account of "normal" profit. I am against this because it would mean an increase in the prices of bread and other agricultural products. What we need is a Bolshevik cooperative as an intermediary organization between town and country, and cooperatives with high profits.

It goes without saying that Comrade Sheboldaev must in no case be scolded for certain extreme points in his memorandum. On the contrary, he should be praised for raising an overdue question openly and in a timely manner. All the more so since the greater part of the practical proposals in his memorandum is entirely correct.

Well, that is all for now. Greetings!

I. Stalin.

P.S. I have just received your letter of June 23, 1932.

In reply:

1) It is sufficient to establish one more military district -- the Donbass district -- in Ukraine.

2) On grain export, I propose to seriously reduce Rozengolts's plan (for the third quarter).

3) In my opinion, Babel is not worth spending foreign currency on for his trip abroad.

I. St.

Source: Stalin i Kaganovich. Perepiska. 1931-1936 gg. [Stalin and Kaganovich. Correspondence. 1931-1936], pp. 197-198.

RGASPI, f. 81, op. 3, d. 99, ll. 81-87.