550
DAVID T. BAZELON
a strong central authority. This tradition of central authority in the
one, and the contrary tradition in the other, is very likely the essence of
the two responses to technology. But the effort at centralization in
Russia (according to Alexander Gerschenkron) is frequently ineffec–
tive: "The fundamental ignorance of the central authorities restricts
their ability to enforce their will. Obversely, it is the knowledge of
the manager that assures for him his area of freedom." In other words,
there is something like the decentralization of our "markets" in Russia
not because of the absence of central authority, but because of its
limited effectiveness.
The Soviet manager operates more independently and is much
freer in fact than
is
allowed for by the theory or the Plan within
which he functions. For example, Gerschenkron asserts that managerial
disobedience is
required
to fulfill the Plan. But he says this cannot
be
recognized openly because to do so would contradict the posture of
the dictatorship.
Recent reforms in Russia have amounted to legal recognition of the
enlarged scope of managerial discretion. In 1957, central control was
modified and partly abolished, and a very significant decentralization
of planning and administrative authority was brought about. Ger–
schenkron believes there is a characteristic cyclical swing to and away
from central control in Russia. I wonder whether there is any con–
nection between this movement and our business cycle? With the dif–
ference, of course, that ours would be the inverse of theirs-it is only
after the excesses of decentralization have occurred here that the central
authority is called upon to patch up the picture.
The industrial differences between the United States and Russia
are not limited to "Planned" on one side and "Markets" on the other.
We both plan, and we both plan badly: they from too much centraliza–
tion, we from too little. In America, major industry is planned–
markets are internalized and dealt with administratively-but these
plans are autonomous for the particular company (which is often
enough a financial rather than a production unit) and the purpose of
the plan is quite frequently to curtail production rather than to
administer the full use of available technology. In Russia, on the
other hand, there is also considerable factory autonomy-that is, effort
directed toward self-preservation of the unit, which undoubtedly also
operates to achieve less than the fullest production.
We can assume that there is considerable waste in the form of
misuse and under-use of productive capacity in Russia. (This may
be
identified as the issue of "negative" competition.) For a particular
