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Western Technology and Soviet Economic Development 1930 to 1945 Second volume of a three-volume series By ANTONY C. SUTTON in HOOVER INSTITUTION PRESS STANFORD UNIVERSITY, STANFORD, CALIFORNIA 1971 121641 The Hoover Institution on War, Revolution and Peace, founded at Stanford University in 1919 by the late President Herbert Hoover, is a center for advanced study and research on public and international affairs in the twentieth century. The views expressed in its publications are entirely those of the authors and do not necessarily reflect the views of the Hoover Institution. 6A S a 8 £ -.v Hoover Institution Publications 90 Standard Book Number: 8179-1901-5 © 1971 by Antony C. Sutton All rights reserved Library of Congress Catalog Card Number: -68-24442 Printed by Cathay Press, Hong Kong TO MY WIFE Betty Janet Preface This is the second volume of an empirical study of the relationship between Western technology and entrepreneurship and the economic growth of the Soviet Union. The continuing transfer of skills and technology to the Soviet Union through the medium of foreign firms and engineers in the period 1930 to 1945 can only be characterized as extraordinary. A thorough and systematic search unearthed only two major items—SK-B synthetic rubber and the Ramzin 'once-through' boiler—and little more than a handful of lesser designs (several aircraft, a machine gun, and a motorless combine) which could accurately be called the result of Soviet technology ; the balance was transferred from the West. Once again I must express sincere appreciation to those who have helped me—and absolve them from responsibility for my errors. The Relm Foundation granted research funds and a fellowship tenable at the Hoover Institution, Stanford University, In addition the Hoover Institution provided research assistance from its Special Fund. Among those at Hoover who have given their personal assistance, particular recognition is due Dr. W. Glenn Campbell, Director of the Hoover Institution, for his unfailing support; Mr. Alan Belmont, Associate Director for Administration, for his prompt solutions to my varied problems; and Miss Carolyn Conrad, for research and secretarial work well and conscientiously performed. To these and others, thank you; without your understanding assistance, this study could not have been completed. Acknowledgment is also due Congressman John E. Moss (Democrat, Sacramento) and his staff for assistance in locating some 600 boxes of Lend- Lease cargo manifests and letter files which had been temporarily mislaid by the Executive Branch of the Federal Government. Finally, I must express my appreciation to the Douglas Aircraft Company (now McDonnell-Douglas) of Santa Monica, the Warner & Swasey Company of Cleveland, and the Kern County Land Company (now a division of "»» mil viii Preface TENNECO) of San Francisco, and also to Dr. Roger Freeman of the Hoover Institution, and Colonel Samuel F. Clabaugh and Mr. Joseph Gvvyer (both of Washington, D.C.) for various forms of assistance, London G. Green handled the editorial chores with his customary expertise. None of these is, of course, in any way responsible for my errors, arguments, or conclusions. A. C. S. Stanford, California November 28, iq68 . .... Contents Tables , , , . xvii Figures xxi . , Glossary . , . , . , . xxiii Chapter One: Introduction: Methodology and Sources Methodology and Data Sources , . 6 Identification of Foreign Technology 8 A Quantitative Framework for Technical Assistance Discussion . 10 Definition of the Phrase, 'Built by Western Companies' . 13 of Clarification . , , . Three Points . 14 Chapter Two : Soviet Liquidation of the Foreign Concessions Methods of Expropriation: Physical Force . 19 Methods of Expropriation : Breach of Contract . 20 Methods of Expropriation: Taxation .. .. .. .. 21 Methods of Expropriation : Harassment . 22 History of the Lena Goldfields, Ltd., Concession 23 Soviet , . Explanations for Liquidation, . 27 The Lessons of the Foreign Concession . 30 Chapter Three : Technical Assistance to Irrigation Construction The Turkestan Irrigation Project of A. P. Davis 32 The American Bureau (Amburo) in Tashkent 34 The Work of Foreign Irrigation Engineers 36 Relations between American Irrigation Engineers and the Soviets 39 Irrigation . Planning and Construction . 41 Irrigation . Conclusions on and Cotton Development . 42 . ,.. ,.. .... Contents Chapter Four: Technical Assistance to the Non-Ferrous Metals Industry The Karabash and Kalata Mines and Smelter 47 Giprotsvetmet: Non-Ferrous Planning Institute 50 Arthur Wheeler Engineering Corporation Technical Assistance at Copper Smelters and Refineries 51 The Bogomol (Krasnoural'sk) Copper Combine 52 The Karsak Pai and Kafan Copper Smelters 54 The Lake Balkash Porphyry Copper Deposits 54 Design and Operation of Zinc and Lead Plants 55 Development of an Alumina-Aluminum Industry , . 57 The United Engineering Contracts for Aluminum Rolling Mills . 58 Chapter Five: Technical Assistance to the Iron and Steel Industry General Design of Soviet Iron and Steel Plants . 61 Development of Iron-Ore Mines by the Oglebay, Norton Company 64 Development of the Standard Blast Furnace 67 Standard Open-Hearth Furnaces . 69 Development of Standard Blooming and Slabbing Mills . 69 The United Engineering Contract for Hot and Cold Continuous Wide-Strip Mills 71 Construction of the Magnitogorsk Complex by McKee Corporation 74 Construction of the Kuznetsk Complex by the Freyn Engineering Company 77 Conclusions . 79 Chapter Six : Technical Assistance to the Fuel Industries 'Mister Graver, Who Became Comrade Graver' . 81 The Return of U.S. Firms for Construction of the 'Second Baku' .. 82 Lubricating-Oil Units by Miller and Alco Products . 87 Winkler-Koch Gasoline-Cracking Technology 88 Western Assistance for Mechanization of Coal Mines . 90 The Ramzin 'Once-Through' Boiler: an Indigenous Development 94 Conclusions . • . 96 Chapter Seven: Technical Assistance to the Chemical Combinats The Nitrogen Engineering Corporation Agreements of 1 928 and 1931 98 The Du Pont Nitric-Acid Contracts 100 .. Contents The Vsekhimprom-Westvaco Chlorine Products, Inc., Technical Assistance Agreement IOI The Berezniki-Solikamsk Chemicaf Combinat 1 02 The Bobriki Chemical Combinat 103 The Kalinin Chemical Combinat 1 °S Technology in Alkali Production 108 The Russian Tenteleev Process for Sulfuric-Acid Production 109 The Chamber Process for Producing Sulfuric Acid no The Contact Process for the Manufacture of Sulfuric Acid III Production of Chemicals for Military Use I 12 Technical Assistance for Minor Chemical and Pharmaceutical Production "3 Conclusions 114 Chapter Eight: Technical Assistance to the Coke-Oven, Synthetic-Rubber, Cement, Alcohol, and Wood Distillation Sectors Koppers-Becker Designs in the Coke-Chemical Industry . , . 115 Construction of Coke-Oven Batteries at Magnitogorsk and Kuznetsk 116 Changes in Coke-Oven Technology . 117 Coke-Oven By-Product Technology and the Koppers Corporation 118 Danish and German Equipment in the Cement Industry . 119 Soviet Development of Synthetic Rubber 122 Reclaimed Rubber Technology 127 Carbon Black Manufacture 127 E. B. Badger Wood-Distillation and Continuous Alcohol Units . 127 Conclusions 128 Chapter Nine; Technical Assistance to the Machine Building and Allied Industries Expansion of the Fitzner 3c Hampner Machine- Building Plant at Kramatorsk 130 The Uralmash Plant at Sverdlovsk *3S Changes in the Soviet Demand for Imported Machine Tools 136 Technical Assistance to Machine-Tool Plants 140 Specialized and Automatic Equipment 143 Acquisition The of Ball- and Roller-Bearing Technology . 144 Plans for the Manufacture of Diesel Engines 149 , ,.., xii Contents Chapter Ten: Technical Assistance for Electrical-Equipment Manufacture and Power-Station Construction General Electric Assistance to the KHKMZ Turbine Plant at Kharkov . , , , , . , ki Moscow Elektrozavod t^ The Utilization of Heroult and Detroit Electric- Furnace Designs by Elektrozavod X j6 The Dynamo (Kirov) Plant ^g Sperry Gyroscope Company and the Leningrad Elektropribor Plant 158 The Urals Elektromash Combinat 160 The Radio Corporation of America Agreements, 1927-41 , . .. 161 The International General Electric Company Technical-Assistance Agreement of 1939 ^-j The Brown Instrument Company Technical-Assistance Agreement 165 The Great Northern Company Telegraph Concession 166 American, British, and Canadian Lend-Lease Shipments . 167 Foreign Equipment and Supervision for Construction of Large Power Stations , . , ^q Conclusions X y6 Chapter Eleven : Technical Assistance to the Automobile and Tractor Industries Development of an Automobile Industry . 177 The Amo Plant in Moscow , . , , , jjj Hercules Motor Corporation Reconstruction of the Yaroslavl Plant 179 Construction The of Other Automobile Plants . 181 United States and Swiss Assistance in the Manufacture of Automobile Parts xSz The Origin of the Stalingrad Tractor Plant 185 The Kharkov Tractor Plant 187 The Chelyabinsk Tractor Plant 188 The Putilovets (Kirov) . Tractor Plant in Leningrad . , 19 j Agricultural Combine Plants 191 Conclusions . , . , , , , , xg-. Chapter Twelve: Technical Assistance to the Railroad System The Development of a Modern Railroad System 195 The Design of Russian Steam Locomotives 199 , . ... Contents XIII Soviet Electric Locomotives . 200 Car, Wagon and Axle Manufacture . 202 The Beginning of Railroad Electrification 202 . The Moscow Subway , . 203 The Installation of Automatic Block Signals 205 Chapter Thirteen: Technical Assistance to the Shipbuilding
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