JPRS ID: 8680 USSR REPORT ECONOMIC AFFAIRS

• Document Type: CREST
• Collection: JPRS
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00850R000100090039-9
• Release Decision: RIF
• Original Classification: U
• Document Page Count: 70
• Document Creation Date: November 1, 2016
• Sequence Number: 39
• Content Type: REPORTS

APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
~ 'R I RS
24 ~EPTEMBER i9T9 C~'~td iil~9) i OF i

APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFI('IAI. USE ONLY
" JPRS L/8680
24 September 1979
USSR Re ort
p
ECC)IdOMIC AFFAIRS
. ~FOUO 1 1 /79)
1
FBIS FOREIGN BROADCAST INFORMATION SERVICE
FOR OFFICIAL USE ONLY
I
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
NOTE
JPRS publications contain information primarily from foreign
newspapers, periodicals and books, but also from news agency
transmissions and broadcasts. Materials from foreign-language
sources are translated; those from English-language sources
are transcribed or reprinted, with the original phrasing and
' other characteristics retained.
Headlines, editorial reports, and material enclosed in brackets ~
are supplied by JPRS. Processing indicators such as [TextJ
_ or [ExcerptJ in the first line of each item, or following the
last line of a brief, indicate how the original information was
processed. Where no processing indicator is given, the infor-
mation was summarized or extracted.
Unfamiliar names rendered phonetically or transliterated are
enclosed in parentheses. Words or names preceded by a ques-
tion mark and enclosed in parentheses were not clear in the
original but have been supplied as appropriate in context.
Other unattributed parenthetical notes within the body of an
item originate with the source. Times within items are as
given by source.
The contents of this publication in no way represent the poli-
cies, views or attitudes of the U.S. Government.
For further information on report content
call (703) 351-2938 (economic); 3468
(political, sociological, military); 2726
(life sciences); 2725 (physical sciences).
COPYRIGHT LAWS AND REGULA,TIONS GOVERNING OWNERSHIP OF
MATERIALS REPRODUCED HEREIN REQUIRE THAT DISSEMINATION
OF THIS PUBLICATION BE RESTRICTED FOR OFFICIAL USE O~TLY.
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
_J
r';
FOR OFFICIAL USE ONL�.L '
JPRS -L/8680
24 Sept.ember 1979
0 -
USSR REPORT
ECONOMIC AFFAIRS
(FOUO 11/79)
CONTENTS PAGE
Devalopment of USSR State Insurance, (1917-1977)
(Gaydar Mukhtarovic~h Tagiyev; RAZVITIYE GOSUDARSTVENNOGO
STRAKHOVANIYA V SSSR, 1978) 1 '
'Round Table~ Discussion on Economizing Resources Reviewed
. (VOPROSY EKONOMIKI, Jul 79) 19
.
- a - [III - US5R - 3 FOUO]
FOR OFFICIAL USE OI~ILY
~ . . . .
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
~FOR OFFICIAL USE ONLY ~
~ DEVELOPMENT OF USSR STATE INSURANCE, (1917-1977)
Moscow RR,ZVITIYE GOSUDARSTVENNOGO STRAKHOVAINIYA V SSSR (1917-1977) in Rus-
sian 1978 signed to press 5 May 78 pp 2~3-220
[Chapter 10 by Gaydar Mukhtarovich Tagiyev from his book oF the above title,
Izda~el'stvo Finansy, 6,200 copies, 224 pagesj
[Text] Chapter 10. State Insurance During the Period in Which Developed
Socialism Was Perfected and Communism Was Built (1971-1977).
1. Social and Economic Prerequisites of Developing Insurance Relations.
Mature socialism sets the direct goal of ineeting people's needs comprehen-
sively. This found expression ~n tlxe primar~ task of the Ninth and lOth
five-year plans. ~ .
In a report at the 25th Congress of the Communist Party of the Soviet Union,
Comrade L. I. Brezhnev, General Secretary of the CPSU Central Couniittee,
said: "In terms of their primary tasks and"'yt~asic directions of economic ac- ~
tivity, the Ninth and lOth five-year plans are a single entity. The refer-
ence is to the long-term orientation o� party economic policy, in which we
see, to use V. I. Lenin's expression, 'the overall plan of our work, our po-
licy, our tactics, our strategy....' 1 The highest goal of party economic
strategy 'has been and remains a steady rise in the material and cultural
s tandards of living of the people ."'2
As a result of successful implemenration of the Ninth Five-Year Plan, real
per-capita incomes in our country rose'by nearly one-faurth, industrial pro-
duction increased by 43 percent, and the average annual volume of agricul-
tural output was 13 percent higher than in the Eighth Five-Yeaz Plan, in
spite of extremely unfavorabl~ weather conditions.
1. "Materialy XXV s"yezda RPSS" [Materials of the l5th CPSU Congress], p 39
2. Op. cit., pp 39-40 ~
1
i' - FOR OFFICIAL USE ONLY
/
t ~ - /
.:1~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
- The 25th CPSU Congress adopted a program of continued increase in worker and
employee wages, kolkhoz member incomes and social consumption funds, a pro-
gram of dynamic and proportienal production development and increased pro-
duction efficiency, and it approved the moat important aeaignmenCa on utianu-
fackured and agricultural ouCput groWth and the development of other branches
of the national economy. '
By satisfying a certain range oF nee:is of the Soviet people, state insurance ~
, particip~aCes directly or.,,indirectlyl'in resolving the tasks of raising work-
ers' standard of living.~~;The objective necessity of insuring'kolkhoz and
personal property against the negative consequencea of natural calamitiea
and accidenrs will remain throughout the entire period of tranaition to com-
munism. As th~ ~aell.-being of the people increases, the kolkhoz economy de-
velops and social wealth increases, insurance requirements will grow and the
importance of insurance prokection will intenaify.
Like other economic categories of socialism, state insurance has a hietorical
character. In the highest phase of communism, there will be no objective ne-
cessity for finances, for creating a special ins~rance fund gene~ated fram
insurant payments. Ho~ever, until such prerequisites are created, insurance
work must be developed and perfecCed.l
The rise in worker real in~omes, personal property ~rowth and change in the '
structure of that properCy have resulted in substantial change in the ter~;s
of nearly all types of insurance for the populace. The introduction of new
types of life insurance is a natural pattern. i~oluntary citizen inauring of
personal property has been further developed.
!
~ Democratic centralism has been intensified throughout the USSR state ir~sur~
ance system. It has been a consequence of the perfecting of the socialist
state system which has occurred in our country, of the development of social-
i,t democracy and the increasing activeness of public organizations.
The creation, from kolkhoz, cooperativp, public organization and individual
insurance payments, of a special monetary fund and its uae for designated
plrposes generate relAtions for redistribution a portion a~ Che naCional in-
cowe. Although the role of state insurance in redistributing USSR national
income is relatively small, it is steadily increasing yersr by year. In 1959,
only 0.6 percent of the national income was redistributed through atate in-
surance; in 1967 0.8 per~ent, and in 1970 1.2 percent. Subsequently,
grow~h i.n insurance payment receipts considerably outsrripped the national
l. Certain economists mistakenly suppoe.e that eliminating all types of state
' insurance will accur considerably before commodity-monetary relations
' wither away, approximately at the same time that individual t~n~s are
fully rescinded, and so forth (see "Ekonomicheskiye zakonomernosti pere-
rastaniya sotsializma v ko~unizm" [Economic Patterns of the Grawth of
Socialism Into Communism], Moscaw, Izd-vo Nauka, 1967, p 532).
2
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
~ ~
FOR OFFICIAL USE ONLY �
;
income growth. Thus,.Whereas USSR netional incoma in 1970 had increased
- t~ro-fold as compared with 1960, the total Funds mobilizad by the atate in- _
surance system durinit that same period had increased nearly four-fold. In
the Ninth Five-Year Plan (1971-1975), aomething over two-fold more iasurance
paymenta (contrib~ntians) were received than in the 8ighth Five-Year Plan,
while total national income incr~ased 36 percent.
Voluntary ~rsonal insuranc~ developed at the highest rates during the I~inth
Five-Year Plan. This trend has continued into the current, lOth Five-Year
, Plan. ,
Growth in the public Wealth of the kolkhozes and the increased agricultural
crop yields have been reflected in an increase in insurance security for all ~
types of kolkhoz property.
' 2. Present Trends in Individual Personal and Property Insurance
Property belonging to citizens by right of pereonal awnershi;~ can be insured -
under mandatory or voluntary insurance. And voluntary insur~nce is devela;a= ~
ing more rapidly at present. This results, first of all, fram the fact that -
it was inadequate in the preceding period and secondly, because of a substan-
tial r.estructuring of insurance terms for various types of property anci be-
cause of important organizational m~easures.
~ Nonetheless, mandatory insurance also~plays an important role. Its terns
have remained practically unchanged, having been adjusted only quantitativel}�
number of farms and objects insured, amount of coverage, and amount of pay- ~
ments received. At the same time, sociceconomic changes in.the lives of the
populace, increased urbanization and other factors hava had an important im-
pact on the relationship of corresponding indicators of manda~ory inaurance ~
development.
The development of mandatory worker property insurance is described by the ~
following data. The total number of insurants in the USSR w~s 36.3 million
in 1976, including 23 million rural residents (a four-percent decrease from
1966) and 13.3 million in urban azeas (a 13-percent increase frc~m 1966). The
amount of coverage under mandatory insurance increased from 24.6 billion rn~-
bles in 1966 to 27.6 billion in 19~0 8nd to 33.9 billion in 1976.
_ Mandatory insurance covers structures and agricultural livestock belon~ing
to citizens. The ratio of irisurance on these objects has been changir?g in �
fav~r of an increasing proportion of structures: whereas structures com-
prised 88.!6 percent of the cayer~g~ in 1966 and livestock 11.~;. percent, in
- 19~'6 th~ figures were 89.4 and 10.6 percent, respectively. Grawth in the
i.~isurance ~amount per strucrure h~s been very revealing. For rural areas,
it was 441 ruhles f~r the USSR as a whole in 1966 and.653 rubles in 1976,
that is, an increasc of 48 percent. For urban areas, the insurance amount
increased from 958 to 1,150 rubles, or by 20 percent, during this sa~ae per-
iod. As is known, this appraisal does not xeflect the full value of struc-
tur_es, but the trend towards growith in th~''value of structures is obvious.
3
FOR OFFICIAL i?SE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
. -
FOR OFFICIAL USE ONLY
The developmer~t of voluntary property insurance for the popu;'lace has resulted
both from overall improvement in rhe well-being of the workera ax~d change in
the structure uf private ownership, and in particular from the increased pro-
portion of durables, and from improvement in the insurance itself.
In order to increase the effectivenesa of voluntary structure insurance, be- '
' ginning in 1973, property (structures) has been appraised at atate retail -
prices for building materials, shipping rates, and wage rates for workers
employed in construction (previously, the insurance was based,'on wholesale
building material prices), '
The development of voluntary property insurance in the USSR, both as a whole
and by individual type, is described by the following daCa: the total amount
of insurance coverage increased from 12.5 billion rubles in 1966 to 23.8 bil-
lion in 1970 and to 54.6 billion in 1976, that is, a 4.4-fold increase over
the entire period, including a four-fold increase for building insurance, a
2.4-fold increase for livestock, and a 4.4-fold increase for household pro-
perty. Payment receipts from the population during the period from 1966 ~
through 1976 increased 3.6-fold as a whole, including 3.8-fold for building
insurance and 3.1-fold for household property. The total number~:of voluntary ~
property insurance contracts drawn up with citizens.was 45.4 million at the
start of the IOCh Five-Year Plan, as against 31.4 million at the start of the
- Ninth Five-Year Plan. As of 1 January 1977, the following were volunCarily
insured for the USSR as a whole: structures on 32.4 percenE of farma, houae-
hold prQperty of 26.5 percent of families, 54.2 percent of cattle, 25.9 per-
- cent of other livestock, and 11 percent o� means of tranaport in priva[e use.
The figures presented bear out the fact that, along with certain succeases,
- t~ere are still large reserves for developing voluntary insurance.
During the Eighth and Ninth five-year plans, the ratio of mandatory to vol-
untary insurance payu?ents changed. Whereas mandatory property insurance ac-
counted for 75 percent of all payments in 1966 and voluntasy insurance for
25 percent, the proportions ~aere 53 and 47 percent, respectively,in 1976.
~otor transport insurance is exceptionally promising. As motor vehicle pro-
d~~ction in~reases and the;material well-being of the Soviet people iaeproves,
the number of passenger cars in private use is increasing. Sales of passen-
ger cars to the population reached nearly one million vehicles in 1975
seven-fold more than in 1970.1 The total amount of coverage under voluntary
vehicle and other means of transport insurance among the population had in-
creased 11.4-fold in 1976 over 1970, and 70-fold as against 1966. Whereae '
. means of transport accounted for a total of 0.7 percent of all payment re-
cepits from tt~e population for voluntary property insurance in 1966, the'
fi.gure was 14 percent in 1976.
The intensive development of motor transport has increased the danger to
both the means of transport themselvea and the people. In this connection,
1. See: "Materialy XXV s"yezda RPSS," p 114.
~ ~
_ ~ FOR OFFICIAL USE ONLY
~f.
~
. . , ~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
a nuwber of economists quite legitimately poae the quc+stion of inetituting
mandatory civil liability insurance for aWners of private motor tranaport.
~ This type of insurance is important for both t~e injured party and the in-
surant himself, as it is sometimes beyond Che ~ean~ of,;the guilty party to
. make up losses caused third parties while op~rating mean's of transport, and
he must be~helped by shifting such ccmF~ensation to an ineurer. We had such
insurance back in the 1920's, but Lt Was cancelled due to a lack of condi-
tions for its developsaent. At present, the extraordinarily high rate of
motor trnnsport acquisition [automobi.lization] by the populace necessitates
the introduction (or more accurately the restoration) of civil liability in-
~ surance. Thia is borne out by the experience of socialist and capitalist
countries, where this type of insurance is on,e of the leading types in terma
of amount of insurance payments received. `
Personal insurance has also developed rapidly in the period under review.
That is evident from the following data:~'..,`
number of people insured, millions growth from 1970, in percent
year all life accident paym~ents on payouts on
personal insurance .insurance personal in- personal in-
insurance surance as a surance as a
Whole Whole
1970 34.5 17.8 16.7 100.0 100.0 ~
1971 40.3 22�3 18.0 134.2 132.2
1972 46.9 27.7 19.2 174.1 157.9
1973 52.9 32.5 20.4 218.0 217.0
1974 58.8 37.3 21.5 262.6 295.5 ~
1975 64.8 41.9 22.9 306.1 385.4
1976 70.7 46.1 24.6 348.1 463.7 _
In 1976, the total number of people insured under a11 Cypes of personal in-
surance had more than doubled as compared With 1970 (the last year of the
Eig:~th Five-Year Plan). By the ~tart of 1977, nearly 61 percent of all
workers, employees and kolkhoz members were covered by it. Contributions .
increased 3.5-fold during that peri~d, and vayouts to workers increased 4.6-
fold.
The following data testify to the importance of personal insurance. Its
proportion of total funds receiv~d by the state insuzance fund in 1976
reached 62 percent, and its share of insurance payments to the population
86 percent. The role of p~rsonal insurance in shaping the financial re- _
sources of the Soviet state l~as grown: the life insurance contributions
reserve increased 4.3-fold during the 1970-1976 period.
Since 1972, the draWing up o� mixed-insurance agreements has been simpler:
such agreements are concluded without a physician's certificate for any sum.
The accident insurance liability has been broadened. Mixed insurance at
double the insured sum for loss of ability to work has bean introduced.
5
FOR OFFICIAL USE ~NLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
The consrant effort by the USSR Main Administration for State Insurance Co ~
improve personnl insur.ance and more fully a~et the interests of the worker~
has been reflected in the developn~ant of a new type of inauranc~, wedding
~ insurance, introduced on 1 Jsnuary 1977. It combines features of mixEd life
insurance and child insura~nce. "
, Further prospects for developing personal insurance se~m to us to lie in the
introductiAn of group insurance. Various types of group insurance are being
successfully developed in a number of socialist countries (Hungary, Poland,
Czechoslovakia, the GDR) and in a number of capitalist countries as well.
- This experience, as well as our own experience in collective insurance, will ~
evidently be used in the future.
3. Insuring Rolkhoz-Cooperative Enterpr.ises and Organizations.
As our new Constituti~n states, the basis of the USSR economic sysCem is so-
cialist ownership of the means of production in the form of state (national)
and kolknoz-cooperative property. The ~,oviet state facilitates the develop-
ment of kolkhoz-cooperative ownership and its rapprochement to state owner-
ship.
Among the measures facilitaCing the development and strengthening of the kol-
khoz, consiimer and other cooperative economy, state in~urance occupies an im-
portant pJ.~ace. .
- The development of agriculture in the Ninth Five-Year Plan occurred during
a most difficult struggle against the calamitous foxces of nature. During
- the five years, only one, 1973, was good for farming, and t'wo~ 1972 and 1975,
had unprecedentedly severe droughts. Our countryside had not er.countered
such an unfavorable confluence of circumstances in any other five-year plan.l
It was during precisely these years that kolkhozes were given tremendous fi-
nancial assistance through staCe insurance, ensuring uninterrupted produc-
t'.on in ull field~ of their activity. During 1971-197b, kolkhozes were paid
10 billion rubles from the state insurance fund to cover losses from the
d~~th of (damage to) agricultural crops, livestock, buildings, structures
and other pr~perty. As a consequence of the certain periodicity of natural
calamities, this insurance compensation amount Was distributed very unevenly
over the years, whic~: is confirmed by the Following daCa.
1971 1972 ?.973 1974 1975 1976
insurance compensation pay-
ments to kolkhozes, in
millions of rubles ~ 1,186 2,282 1,070 1,481 2,243 1,699
in percent of the total .
amount for the six years 11.9 22.9 10.7 14.9 22.5 17.1
1. See: "Materialy PJN s"yezda KPSS," p 37.
b
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
~
The two least-favorable yeara, 1972 and 1975, accounted for nearly hal~ the
six-year total amount paid in insurance compensation. It is precisely here
that the economic essence of insurance ia displayed especially clearly. R.
Marx wrore that insurance is necessar~? "to eliminate the consequences oE the
extraordinary destruction caused by chance and the forces of nature."1
The period under review is also characterized by the fact that a new system
of kolkhoz production insurance was given a final check. This system passed
the test for soundness primarily on the basls of its financial stability.
In fact, this was the first tiw~e anywhere in the World that fields were in-
~ sured against crop failure. '1'here was a definite risk of revenues failing
to correspond to expendiCures. In practice (beginning in 1968), the mathod-
ology adopted to calculate insurance rates, Which was developed by the USSR
Main'Administration for State Insurance, joinCly with the Finance Scientific
Research Institute, was shown to be correct.
For the 1968-1976 geriod as a Whole, payments to kolkhozes from tha atate
insurance fund were 102.9 percent of the payout amount anticipated to cover
losses. The eyuivalency uf. interrelations between kolkhozes and the Main
Administration for State Iiisurance anticipated by the legislation was es-
sentially secured.in practice. Nonetheless, it is necessary to continue
perfecting the rates, fir~C of all by differentiating them territorially
and by type of property insured.
Insurance coverage for all types of kolkhoz property reached 110.8 billion
rubles in 1~76, an 81.6 percent increase over 1970 and a 2.2-fold increase
over 1968. Kolkhoz insurancc~> payments in 19i6 had increased 30.7 percent
as against 1~70 and 46.3 percent compared to 1968. The average payment per
farm increased 66.8 percent during the 1968-1976 period, reflecting growth
in the value of kolkhoz property.
At the same time, mandatory insurance of kolkhoz property during the Ninth
and ~Oth five-~year plans has demonstrated the possibility and necesaity of
furtlier per.fecting it.
Voluntary insurance of cooperative and public enterprise and organization
property was also widely developed. In 1976, som~ 31,700 insurance agree- '
- ments were drawn up, including 23,900 with consumers' cooperativps and 6,300
with housing-construction, cabin [dachs] construction and other cooperatives.
- Insurance coverage on cooperative and public organization property in 1976
~as 29.5 billion rubles, a 34.2 percent increase over 1970.
~r
In 1975, the Main Administration for State Insurance expanded liability for
voluntary insurance on the property of these organizations,by including in ~
it losses from mud, ground sagging, subsoil water effects, and also liabiliCy
for moving property, regardless of to F~hom the means of transport belong.
1. K. Marx and F. Engels, "Soch." [Works], Vol 24, p 1~9.
7
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
� FOR OFFICIAL USE ONLY
In spite of the considerable development of voluntary cooperative and public
organization groperty insurance, the reserves available here have been used
inadequately. This applies, in particular, to insuring housing-construction
cooperativea. As of early 1975, only 20 percent of the cooperativea were
covered by insurance.l At the same time, in conformity with cr~diting pro-
- cedures, housing-construction cooperatives are obligated to insure houses
for that portion of any bank loan not repaid.
One of the primary directions in which insurance is developing and improving
is comprehensive consideration of the features of cooperative and public or-
ganization activity and the reflection of these specifics in the terms of
such voluntary insurance.
The extensive deveLopment of agricultural production speciali2ation and con-
centr~tion on a base of interfarm cooperation and agroindustrial integration
- is leading to the creation of kol~Choz-sovkhoz, state-kolkhoz and other asso-
ciations. In this connection, creation of a single system of insurance pro-
tection for all agricultural enterprises, both cooperative and state, i.s a
pressing problem. '
4. Intensifying Democratic Centralism in the State Insurance System
The Communist Party of the Soviet Union has always attached great importance
to perfecting the organizational structure of national economic management,
to combining centralized planning and leadership with local initiative, fur-
ther development of socialist democracy and increasing the activeness of pub- '
lic organizations. This party line is also manifest in full measure in the
way the sCate insurance system is run. The organizational principles and
work methods are determined wholly by the economic tasks facing the insur-
ance sys~em. '
In accordance wiCh the USSR Supreme Soviet Presidium Ukase and USSR Council
of Alinisters Decree o� 28 August 1967, fundamentally new conditions for in-
Qaring the property of kolkhozes were determined and centralized leadership
oF insurance work was strengthened -=~the USSR Main Administration fo~ State
I~isurance was restored. Changes were subseyuently made in the Standard Sta-
- tute on State Insurance Organs.
Currently, a11 the country's insurance organs are united into a single cen-
tralized union-republic cosC-accounting system headed by the USSlt Main Ad-
ninistration for State Insurance, which is called upon to ensure a�unified
- financial policy and the general principles and provisions for running the
state insurance system. The unity of the system is combined with simultane-
flus expansion of the rigl~ts of the union republics and local organs to solve~ �
practical state insurance problems. The cost acconnting is done by each un-
ion republic for all State InsuLance organs as a whole. The USSR Main
1 See: FINANSY SSSR No 3, 1976, p 57.
8
,
FOR'OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY ~
, Administration for State Insurance is also on cost accounting. It runs op-
eratione covering mandatory ir.surance for rail tranaport passengers and in-
surance for workers through enterprises of uniou subordination. ~
Councils on questions of kolkhoz property insurance have been created on a
public basis under the USSR Main Administration for State Insurance and the
- union republic (main) administrations for state insurance, with the partici-
pation of representatives of the ministries and departments concerned (Min-
istry of Agriculture, Ministry of Internal Affairs, and others), as well as
kolkhoz representatives, which reflects the genuinely democratic nature of
insurance management. It is the task of this advisory organ to examine and
discuss the annual results of kolkhoz property state insurance operations and
proposals on improving the terms of this type of insurance in arder to fur-
ther improve its economic effectiveness for kolkhoz production. The bond
between the state insurance system and agricultural organs which are being
enlisted directly in developing and resolving many insurance questions has
been considerably strengthened.
During the course of building coumiunism, given simultaneous strengthening
oP centralized plan leadership, the rights of the regional link of the in-
surance sysCem have been broadened and an increasing number of,qnestions un-
der the competence of the administrations have gradually been traneferred to
the insurance inspectorates for solution. During the Eighth and Ninth Eive-
year plans, a number of important steps were t~iken to improve the system of
moral and material incentives for insurance workers. in 1968, a system of
bonuses for state insurance inspectorate workers, as well as workers of the
state insurance administrations in oblasts', krays, ASSR's, okrugs and cities,
was instituted.
In eva~uating the status of insurance work, first place was previously given
to quantitative indicators. Now, plan fulfillment is not the sole criterion ,
for evaluating the activity of the collective and its leader, consideration
now being given as well to at what price this is achieved,and to hnw reserves
are being used. Socialist competition, which has been unfolding in all in-
surance organs, plays a large role in production plan fulfillment. 'I'he po-
sitive experience of the leading collectives and shock workers af communist
labor and the forms and methods which have proven their viability and effec-
tiveness are generalized and studied dur.ing the competition.
In connection with the transition ;to the system of cashless transactions
with insurants and the necessity of stimulating the concluding of new agree-
ments and meeting the plan for ~ach type of insurance, changes have been
made in the wages of insurance agents not on permanent staff. The work
forms of insurance agents have also been improved. The brigade method,
which has received broad dissemination, is very gromising. On the basis of
a generalization of the experience of leading inspectorates of the USSR Min-
istry of Firiance and the central committee of the trade union of workers at
state institutions, a Regulation on the Brigade Work Method for Insurance
Agents Not on Permanent Staff was approved on 6 January 1975.
9
FOR OFFICIAL USE.ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICT.AL USE ONLY
During the period under review significant successes have been achieved in
actualizing the very imporCant Leniniat principle of significantly lowering
the cost of insurance and making it universally accessible. In -+rder Co po-
pularize voluntary types of insurance, adverkising film shorts are shown in
movie rheaters, Cape recordings are broadcast over the radio, and local te-
?evision studios are also used. All these mass media and propaganda are
combined with lectures, reports and conversations.
The assistance of trade union and other public organizations is of enormous
iniportance to developing voluntary insurance among the populace. Life has
produced various forms of community participation in insurance work, the moat
widespread of which is the cxeation of councils to assist the Main Adminis-
tration for State Insurance, in whose work trade union and Komsomol organi-
zations, leading production workers and others participate extenriv~ly. As
of early 1977, there were 90,000 such assistar~ce councils, uniting 450,000
workers, employees and kolkhoz members. -
As insurance operations have grown, the volume of accounting and reporting
and the flow of incoming information have increased considerably. The ex-
rensive introduction of modern computer equipment has permitted making Che
numerous compilatio~s snd groupings of accounting data quickly and accurately.
~ With prompt and reliable accounting information available to them, Main Ad-
ministration for State Insurance~organs are in a position to actively in-
fluence Che development of operations, to guide them purposefully, and ex-
ercise betker control over Che protection of sCate funds. At the same time,
the mechanization of accounLing frees accountants from unnecessary technical
work, increases the efficiency of their labor, and frees Cheir time for eco- _
nomic analysis and monitoring. The introduction of electronic computers,
inieiated by insurance organs of the Beloruusian SSR, has taken on increas-
ingly broad scope. Nonetheless, a number of complex organizational and~tech-
nical Casks must yet be resolved for modern calculating and computer eyuip-
ment to be used everywhere.
The steady growth in the economic importance of stata insurance under pre-
sent conditions and the necessity of perfecting the methods of running iC
hr.ve resulted in the adoption of a Aecree "On Steps to Further Develop State
Insurance" by the USSR Council of Y~ini~ters on 8 February 1977. With this
decree, the govern~nt obligated the USSR Ministry of Finance to ensure the
continued development of insurance work in the country, expansion of types
of peraonal and property insurance meeting the needs of the population and
~~F kolkhoz production, improvement in services ta the workers, and also
serengthening cost accounting in the Main Adminiatratior. for State Inaur-
ince system.
It has been suggested Chat the union and autonomous republic councils o�
ministers and the kray, oblast, city and rayon Soviet of People's Deupties
ispolkoms pay more attention to state insurance questions and render in-
surance organs assistance in carrying out their activity.
10
FOR OFFICIAL USE ONLY
'
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
According to this particular decree, funds for developing atate insurance
and deaignated for building facilities, introducing means of inechanizing
accounting and computation, acquiring equipmant, office auppliea, meana of
transport and carrying out other measurea associated With runnic~g insurance
operations are created in the eCate insurance aystem. Nousing construction
and worker material incentives funde are also fos-med. Under the Main Admin-
istratior~ for State Insurance, corresponding centralized funds are generated
; to supplement the funds of union republic insurance organs.
The USSR Council of Minisrers decree is undoubtedly a measure of ~xceptional
importance to subsequent development and perfection of state insurance in
our country.
Significant changes have occurred in the foreign (outside) insurance syatem.
In 1973, the USSR Foreign Insurance Adminiatration was reorganized into the
USSR Insurance Joint-Stock Company (Ingosstrakh). Along with the USSR Min-
istry of Fin~nce, its shareholders are foreign trade associatione of the
M~nistry of ForPign Trade, the USSR Council of Ministers' State Com~nittee
for Foreign Economic Ties, and other organizations. The necessity o� re-
organizing sesulted from a considerable expansion in recent years of USSR
trade and foreign policy ties with foreign states, from cultural ties and
foreign touri~m. The joint-stock enterprise corresponds best to the tasks _
facing foreign insurance. The prospects for developing foreign insurance
are determined in considerable measure by the resolution of both specific
- and general problems of insurance work under conditions in socialist society.
5. Scientific Research problems of SCate Insurance.
Economic devel.opment would be inconceivable without the extensive develop-
ment of scientific research and the introductiou of iCs resulCs into prac-
tice. The CPSU Central Committee has repeatedly pointed to the necessity
of a turn-around towards working out problems of present and future imme-
diacy ss the primary task of the social sciences. This party demand appliea _
in full to financial science, an integral part of which is research on sCate
insurance problems.
Up to a certain time, state insurance problems remained the theoretically
least developed. Extensive research on various aspects of the development
of property and personal insurance began in the 1960's. IC has not been en-
- tirely fruitful in all direcLions, but a considerable advance is quite evi-
dent. The interlinking and interdeterminancy of science and practice are
indisputable. Science illumin~tes the way for practice and shows optimum
ways and methods of solving problems which arise. The tasks of science and
the demands made on it are determined by the requirements of practical ac-
tivity. Successes in developing and perfecting state insurance during the
Eighth and Ninth five-year plans have been connected with a scientific a~-
proach to sol~~ing the largest problems. They have served as an additional
stimulus to broadening and deepening scientific research. '
il
FOR OFFICIAL USE ONLY
~
~
~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFTCIAL USE ONLY
In speaking ~f a scientific approach to solving the most importanr practical
problems, we have in mind both leadership of all inaurance organ work on a
scientific basis on the part of the USSR Main Administration for State In-
eurance and the developaQent by it of new types of ineurance and perfecCing
existing types, as well as independent scientific research being done in the
scientific inetituCes and WZ's.
The following monographs and textbooks on state insurance have been published
during the posC-war period:
Raykher, V. K. "Obshchestvenno-istoricheskiye tipy strakhovaniya" [Socio-
Historical Types of Insurance~, Moscow, Izd-vo AN SSSR, 1947;
Kon'shin, F. V. "Gosudarstvennoye strakhovaniye v SSSR" [State Insurance
in the USSR], Moscow, Izd-vo Gosfinizdat, 1947-1968 (five editions as a tekh-
nikum text and two as a WZ text) ;
Tagiyev, G. M. "Gosudarstvennoye sCrakhovaniye v SSSR" [State Ineurance
in the USSR], Moscow, Izd-vo Gosfinizdat, 1953;
Shermenev, M. K. "Sel'skokhozyaystvennoye strakhovaniye v SSSR" [Agri-
cultural Insurance in the USSR], Moscow, Izd-vo Gosfinizdat, 1956;
Rybnikov, S. A. "Osnovy tarifnykh rascheCov po strakhovaniyu zhizni"
[Principles of Life Insurance Rate Calculations], Moscow, Izd-vo Gosfinizdat,
1959 ;
Grave, K. A. and Lunts, L. A. "SCrakhovaniye" [Insurance], Moscow, Izd-
, vo GosyurizdaC, 1960;
Drozdkov, I. P. and Batorin, V. G. "Lichnoye strakhovaniye v sotsialis-
ticheskikh stranakh" [Personal Insurance in Socialist Countries], Moscow,
Izd-vo Finansy, 1963;
"Voprosy gosudarstvennogo strakhovaniye" [Problems of State Insurance]
(collection of arCicles), Moscow, Izd-vo Finansy, 1964;
Reytman, L. I. "Lichnoye strakhovaniye v SSSR" [Personal Insurance in
the USSR], Moscow, Izd-vo Finansy, 1969;
Kagalovskaya, E. T. and Popova, A. A. "Finansovyye osnovy strakhovaniya
zhizni v SSSR" [Financial Principles of Li�e Insurance in the USSR]; Moscow,
Izd-vo Finansy, 1971;
Yakovlev, V. N. "Gosudarstvennoye strakhovaniye imushchestva kolkhozov"
[State Kolkhoz Property Insurance], Rishinev, Izd-vo Rartya Moldovenyaske,
?~71;
"Gosudarstvennoye strakhovaniye v SSSR" [State Insurance in the USSR]
(texCbook), Moscow, Izd-vo Finansy, 1971;
Motylev, L. A. "Gosudarstvennoye strakhovaniye v SSSR i problemy ego
razvitiya" [~tate Insurance in the USSR and Problema of Its Development],
4oscow, Izd-vo Finansy, 1972;
Kolomin, Ye. V. "Gosudarstvennoye strakhovaniye i khozraschetnaya de-
yatel'nost' kolkhozov" [State Insurance and Kolkhoz Cost-AccounCing Activity],
Moscow, Izd-vo Ekonomika, 1972;
Kolomin, Ye. V. "Strakhovaniye obshchestvennogo imushchestva pri sots-
falizme" [Public Property Insurance Under Socialism~, Hoscow, Izd-vo Finansy,
1975;
Kulikov, V. S. "Voprosy teorii i praktiki gosudarstvennogo strakhova-
niya v SSSR" [Problems of State Insurance Theory and Practice], Moscow, Izd-
vo Finansy, 1975.
12
FOR OFFICIAL USE ONLY
~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
A significant range of state insurance problems has been examined in these '
monographs:
Sheremeneva, M. K. "Finansovyye rezervy v raschirennom vosproizvodstve"
[Financial Reserves in Expanded Reproduction], Izd-vo Finnnsy, 1973;
Polovinkina, P. D. "Rezer~vnyye fondy i vo~proizvodstvo v kolkhozakh"
[Reserve Funds and Reproduction on Kolkhozes], Izd-vo Ekonomika, 1970;
Allakhverdyanr~, D. A.� "Finansy i sotsialisticheskoye vosproizvodstvo"
[Finances and Socialist Reproduction], Izd-vo Finansy, 1971;
Karpova, K. D. "Finansovo-kreditnyye otnosheniya s kolkhuzami" [Finan-
cial-Credit Relations With Kolkhozes], I?.d-vo Kolosr 1971;
Semenova, V. N. "Rol' finansov i kredita v razvitii sel'skogo khozyay-
stva" [The Role of Finances and Credie in Develaping Agriculture], Izd-vo
Finansy, 1973, and others.
The list of published monographs above testifies to the substantial growth
in publications on state insurance questions and the diversity of their sub-
ject matter. To them we might add the valuable practical references pub-
lished in the 1970's by V. S. Averin, N. I. Gladkov, F. S. Gulyayev, M. Ya.
Katsov, A. P. Pleshkov, I. P. Shcheglov and others. One naCural consequence
of the growth in these publications was the allocation in FINANSY SSSR of a
special section for "State Insurance Questions." Articles on state insurance
are published in VOYROSY EKONOMIKI, EKONOMIKA SEL'5KOG0 EQiOZYAYSTVA, EKONOMI-
CHESKAYA GAZETA, SOVETSKAYA YUSTITSIYA and other periodicals.
We should note the exceptionally important role personnel training at the
Moscow Finance Institut~ plays in developing scientific research on state
insurance problems. All the doctoral dissertations and a majority of the
candidate dissertations on various questions of insurance theory and prac-
ti~e have been defended at that institute. In recent years, the number of
state insurance researchers has increased and the geography of the research '
being done has broadened: candidate dissertations have been prepared, for
example, at the All-Union Correspondence Finance-Economics Institue, at the
Rostov-on-Don, Azerbaijan and Kiev institutes of the national economy, and
at Tadzhik and Yerevan state univezsities.
Since 1965, pressing problems of state insurance have received broader, sys-
tematic, scientific examination at the USSR I4inistry of Finances' Finance
ScientiFic Research Institute. They cover problems of kolkhoz and sovkhoz
production insurance, motor transport and personal insurance, use o� the ex-
perience of insurance institutions of socialist and capitalist countries,
and so forth.i
The work of the Finance Scientific Research Institute on all the indicated
and other problems is coordinated with the work oF the USSR Main Administra-
tion for State Insurance. The striving to ensure complete unity of theory
and practice is clearly displayed here. At the same time, the necessity of
further broadening scientiflc zesearch on state insurance questions is obvious.
1. FINANSY SSSR, No 3, 1973, p 89; No 8, 1975, p 87; No 8, 1976, p 88.
13
_ FOR QFFICIAL USE OI3LY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
Having reviewed the history of atate insurance development in the USSR, the
conclusion can be drawn that the very important principles, developed by V.
I. Lenin, on whoae basis Che Soviet inaurance aystem has e~olved have endured
Che test of time over many years and have been enriched by new theoratical ,
theses and forms o� practical application which take into account the ~ro-
found socioeconomic changes in the country. Leninist concepts have retained
their importance throughout the entire period of building co~unism, and in
Chem lies the key to solving contemporary tasks of developing and perfecting
insurance work.
By relying on Leninist principles of organizing insurance and by creatively
developing them as applicable to changing historical conditions, the party
and government have been tirelessly concerned about the development of state
insurance and abo~at strengthening insurance organs and subordinating all
their activity to the tasks of building communism at all stagps of economic
development, and they continue to be so concerned.
Com~ade L. I. Brezhnev, General Secretary of the CPSU CenCral Committee and
Chairman of the USSR Supreme Soviet Presidium, in describing the path taken
by our country over the 1917-1977 period, said: "Six decades of building
socialism is the brightest possible demonstration.of what people of labor are
capable of once they take in their hands the political leadership of society
and take on the responsibility for the destiny of the country. Theae decades
proved thar there have been and are no other paths to sociilism wiChouC the
power of the workers, without the socialist state system."
Soviet state insurance, having received a qualitatively new content, has come
a long way and has played an important role in resolving the tasks facing the
country at various sCages of building socialism in the area of developing the
- national economy and improving Che material well-being of the workers. It
has demanstrated its Cremendous advantages over capitaliat insurance and real
possibilities for further improvement. The social orientation of insurance
hae predetermined the rapid development of all types of insurance during the
years of Soviet power.
An important stage in the continued advance of our country along the path
Cowards communism, in building its material-technical base and in raising
the well-being of the people was the Ninth Five-Year Plan (1971-1975). It
waa alsa most productive in Che history of the development of Soviet atate ,
insurance. During 1971-1975, payments totalling 26.4 billion rublea were
received for all types of insurance, which is more than two-fold more than
in the preceding five-year period. In this regard, payments for voluntary ~
types of property and peraonal insurance were 15.4 billion rubles, or more
than three-fold more than in the Eighth Five-Year Plan. Insurance has also
been developing rapidly in the lOth Five-Year Plan now underway.
1. L. I Brezhnev, "Great October and Human Progress. ReporC at the Fes-
tive Meeting of the CPSU Central CommiCtee, USSR Supreme SovieC and
RSFSR Supreme Sov3.et," in PRAVDA, 3 November 1977.
14
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICTAL USE ONLY
In the lOth Five-~Year Plan, payments of approximately 40 billion rubles must
be received for a~l types of insurance, including 28 billion rublea Eor vol-
untary insurance. By the end of 1980, we anticipaCe having concluded about
140 million agreements with the populaca. We plan to have increased pereonal
insurance coverage to 70 percent of the workers, employeas and kolkhoz mem~
bers able to'work. On the basis of the experience of all the pr.eceding his-
torical development of insurance work in Cl~e country, it can be confidently
assumed that the new assignments"will also be carried out.
One outstanding event in the life of the Soviet people has been the adoption
by an extraordinary session of the USSR Supreme Soviet held on 4-7 October
1977 of a new USSR ConsCituCion.
The ConsCitution secures a new historical frontier in our movemene towards ~
coA�nunism. Each line of the Constitution is germeated with concern for com-
prehensively developing the historical creativity of the popular masses. It
ensures conformity of tY~e tasks, structure, functions and procedures f~r
state organ activity to the stage our development has achieved, the stage
of mature socialism.
The new Constitution is unquestionably an im~ortant stage as well in the
continued development of insurance work, one oF the ~ore complex branches
of Soviet state financial activity. ~
While perPoru~ing important socioeconomic functions, insurance changes and
sometimes fundamentally restrvctures the forms and methods of its own work, .
- as the times and concrete new circumstances demand. The search continues
_ for ways of further improving i.nsurance practice, deepening and perFecting
~ the system of cost accounting, rates, insurance coverage norms, forma of
planning and economic incentives, and the most effective msthods of organi-
zational activity. Many problems which could not have been anticipa[ed
ahead of time and in all the diversity of their spec~ific manifestations
have been solved for the first time in our country. The Main Administra-
tion for State Insurance ia now the largest insurance organization: no
other insurance organization in the world can compare with iC in terms of
work volume or number of facilities.
TABLE ~F CONTENTS
Introduction ..3
Chapter I. Insurance on the eve of October and in the initial years
_ of Soviet poW~r .............................................6
1. Insurance in prerevolutionary Russia ......................6
~ 2. Reorganizing insurance after the victory of the Great '
Uctober Soci.alist Revolutian ...........................16
3. State supervision of all types of insurance ..............19
4. Steps by the Soviet state to prevent and fight fires.....23
5. Introduction of the state insurance monopoly .............26
- 5. Elimination of monetary insurance under conditions of
civil war and forei~n intervention .....................29
15
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
`11
FOR OFFICIAL USE ONLY
Chapter II. Ss:ate insurance during restoratien of the naCional economy
(1921-1925) .........31
, 1. New economic policy and insurance .......................31
2. Organizational establishment of the state insurance ~
system.......... .......................................36
3. Insuring peasant farma ..................................41
4. Mandatory insurance rate system .........................48
5. Insuring property of state i~dustry, goods and freight..50
b. Banks and insuring state property .......................53
7. Insuring exports and imports ............................57
8. Insuring rented state property ..........................59
9. Main AdministraCion for State Insurance financing and
stimulation of fire-fighting and other preventive
. measures. ...........................................62 ,
10. Property and',personal insurance after the monetary
reform ................................................64
11. Cooperative insurance and the Main Administration for
State Insurance .......................................67
Chapter III. State insurance while laying the foundation for the so-
cialist economy (1926-1932) ......:.......................70
1. Steps to make the insurance system more efficient ~
and to train personnE~ .............70
2. Voluntary insurance on state industry during indus-
trialization of the country ..........................73
3. Introduction of mandatory state property insurance.....76
4. Reducing the insurance sphere in the state sector of
~ the economy ..........................................78
~ 5. Problems of developing insurance for individual pea- ,
sant farms .....80
6. Insurance during the mass collectivization of agricul-
ture '......................86
7. Guaranteed insurance and insuring state loan obliga-
tions ................................................93
~ 8. Personal insurance .........97
9. Organizational restructuring of state insurance........99
C!~.apter~IV. State insurance during the completion of socialist recon-
stzuction of the USSR national economy (1933-1937).......102
1.� All-Russian Communist Party (bolshevik) Central Com-
mittee Decrae "On Distortions in the Work on Insur-
~ ing Agricultural Property and Sown Areas"............102
2. Restructuring state insurance ..........................104
3. Developing mandatory salary insurance .........:......:.110 '
4. Voluntary kolkhoz and individual property insurance....112
5. Development of personal insurance ......................116
~ 6. Changes in financing preventive measures ...............117
Chapter V. State insurance during the struggle to consolidate social- 1~
ist society (1938-June 1941) ..............................121
1. Reappraising structures belonging to kolkhozes and the
populace . .................121
16 ~
. ~ FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
2. Necessity of putting the rate system in proper order....i22
3. New law on mandatory salary insurance ...................124
4. State propert:-y insurance for entarprises, institutions
~ � and organizations .....................................127
~ 5. Development of insurance operations .....................129
6. Leninist national policy and insurance ..................131
Chapter.Vl. SCate insurance during World War II (June 1941-1945).......134
~a~' 1. ~.�~n~nomic importance af arate insurance during the ~rar..134
2. Fe~}~!res of property insurance develop~nent .............138
3. Reorganizing life insurance ............................143
4. Organizing insurance work in wartime ...................145
Chapter VII. State insurance during restoration and development of the
national economy during the post-war period (1945-1952).147
1. Steps to improve mandatory salary insvraYice practice..147
2. Voluntary property insurance operations ...............152
3. Intensi�ying inspection-monitoring ~aork ...............154
4. Perfecting tl~e state insurance organs system..........156
5. Personal insurance in the post-war years ..............159
Chapter VIII. State insurance during the struggle to develop socialist
society in the USSR (1952-1961) ..............'..........162
1. Organizational restructuring of the state insurance
system............ ...............................162
2. Cessation of state property insurance ................167
3. Development of agricultural insurance following the
. September (1953} CPSU Central Committee Plenum.....170
4. Legislative heightening of the ecouomic importance
of kolkhoz and individual property insurance.......173
5. Change in property insurance terms for cooperative
and public enterprises and organizations...........179
6. Innovations in individual personal and voluntary
property insurance .................................181
� Chapter IX. State insurance in developed socislist society and during
the gradual transition to communism (1962-1970)..........183
1. Development of property insurance ......................183
2. Economic stimulation of sCate insurance ................186
3. On Main Administration for State Insurar?ce responsi-
bility for insuring agricultural crops ...............188
4. State kolkhoz property insurance reform ................191
5. Expenses on preventive measures ........................197
6. New stage in personal insurunce ........................199
Chapter X. State insurance during the period in which developed social-
ism was perfected and co~unism was built (1971-1977).....203
~ 1. Social and economic prereqnisites of developing insur-
ance relations ........................................203
2. Present trends in indivi:dual personal and property in- ~
surance ...............................................205
l7
, ~
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
_ 3. Insuring kolkhoz-cooperative enCerprises and organiza-
Cions .209 '
4. Intensifying democraCic centralism in Che staCe insur-�
ance system ...........................................212
5. Scientific research problems oE stat~e insurance.........216
CUPYRIGHT: Izdatel'stvo "Finansy", 1978 '
CSO : 8144/167Lt
~
18 ~
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY '
. -
. �
- 'ROUND TABLE' DISCUSSTON ON ECONOMIZING~RESOURCES REVIEWED
Moscow VOPROSY EKONOMIISI in Russian No 7, Jul' 79 pP 35-65
[Article: "Reserves for Economizing Material~Resources"]
[Text] In February, 1979, a"Rourid Table" conference ~rhich had been or-
ganized by the editors of this periodical was held. The i~apor~ant pro-
blems of decreasing materials intensiveness as a crucial direction in the
intensification an.d increased efficiency of social production were posed
for discussion.
Representatives of scientific institutions and of number of ministries
and departments took part in the discussion, Some of the "Round Table"
participants presented their reports in written form. The materials of
the discussion are being published in abridged form. ~
Academician P. S. Khachaturov (Chief Editor of the periodical VOPROSY
EKONOMIKI~. This is not the first time that the editors a.re holding a
"Round Table" meeting to discuss important economic problems which have
been insufficiently worked out and require treatment~on the pages of the
periodical.
Today we wish to discuss an extremely important problem--the ways of eco-
nomizing material resources. It is necessary to determine what kind of
~ situation.has developed in this field now and what has to be done to im-
prove it. The efficiency of our entire econo~y depends to an enormous
extent upon increasing the efficiency of the use of material resources.
~ As is known, 85 percent of the output costs of industry is made up of mate-
rial expenditures. An analysis of the.data shows�that there are enormous
reserves for economizing here. An efficient use of material resources
would ensure a substantial incr.ease in our economic growth rates.
It would tie desirable to give the discussion a completely conerete charac-
ter. We shall be talking about an econo~y of fuel, electric energy, and
met al and about the use of raw materials in light industry and agricultural
output. At the same time, definit;e proposals are needed--how to eliminate
existing shortcomings in the use of materials.
1
~ ~9 '
FOR OFFICIAL USE ONLY ~
f,r . .
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
We know that there is an overexpenditure of fuel in our country. A con-
- siderable amount of coal and petroleum fails to be taken out of the earth,
and a great deal of ~as is wasted. Although' definite progress ha~ been
made in the use of electric energy, it is overexpended. There are small
inefficient power stations. In machine building metal waste comes to
lg million tons, and use is not bein~; made of the.possibilities of ration-
alizing production processes which would make it poasible to use metal
much moz�e economical'ly.
Around 300 million cubic meters of commercial timber is taken out of our
forests, but much of it remains at procurement sites. As early as the
1930's there were discussions of the fact that our method of floa~ing
timber was inefficient, but, nevertheless the practice continues to this
da,y .
Losses of agricultural output are quite palpable. The a~velopment of
agricul~ture at the current stage is especially important and erormous
resources are being assigned to increase the production of agricultural .
~ output. At the same time, a great effect can be achieved by dealing
more carefully with the collected harvest. There are not enough elevators
and grain storage units in~the country and`a considerable amount of grain
has to be "stored" in trenches. The situation is even worse with the
storage of potatoes, vegetables, and fruits. There are great losses of
agricultural output when it is transported.
The task of the conference is not only to establish the facts. It is
- necessary ~to define the ways and n~~thods of work which will make it possi-
ble to improve the situation.
L. L. Zusman (Doctor of Economic Sciences, professor). The problems of
economizing ferrous metals are not being considered here for the first .
time. Although there have been a number of achievements in this work,
technological progress has been creat~ing many more possibilities for eco-
nomizing material resources. The use of ferrous metals (including castings)
has to be looked at along the entire cycle of inetal's movement in the
econoi?~y; that is, in i~s production, structural, and functional elements.
An analysis of the problem has to embrace all three cycles simultaneously;
otherwise, an econoir~y of inetal in one of them could give rise to an over-
expenditure in another,
The potential reserve for economizing metal in the econor?~y ca.n be charac-
terized by the following data for 1977. In the production use of m~:tal
metal waste came to 60.7 million tons (31.7 million tons in metallurgy,
8.8 million tons in casting, and 20.2 million tons in metal working and
machine building), while with the inclusion of irretrievable losses it came
to around 63 million tons; in structural use, excepting the fact (accord-
ing to the published data of a number of writers) that domestic machinery
and equipment exceeds the proportion of progressive models by approximately
25 percent, around 15 million tons of inetal was expended as a result of the
20 . -
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
exce:;~ wei~ht of equipment; and around 20 million tons of inetal was expen-
ded to mrzintain machinery and equipment in working order during the pro-
cess of capital and current repairs. Thus, with 1~+6.7 million tons of
steel an d 16.8 million tons of iron castin~s produced in 1977 the potential
reserve for economizing metal comes to 98 mi~.~ion tons.
The achievement of a waste free producticn and consumption of inetal and
of machinery and equipment elements of equal strength is in the future.
However, there exists at the present time substantial reserves for de-
creasing the metal intensiveness of social production.
The following data testifi~es to the economic damage which is caused to our
econoiqy as a result of inetal losses. In ferrous metallurgy from one ton
which goes into metal waste--25 rubles; in metal working 100 rubles from
one ton which goes into piece waste and 600 rubles from one ton which -
goes into shavings; 1,000 to 1,200 rubles from one ton of surplus weight
in stationary machinery and equipment, and more than 2,000 rubles in mobile
structures; and more than 1,500 rubles from one ton of machinery and equip-
ment elements which require replacement with spare parts, and 2,500 to
3,000 rubles including the expenditures for repairs.
TYie structure of economic damage is the opposite of the structure of the
natural losses of inetal. Thus, production losses of inetal come to 7.2
billion rubles (11-12 percent), strurtural--15 billion rubl.es (22-25 percent),
a.nd operational--20 billion rubles (63-67 percent).
A decrease in losses has to be achieved by means of decreasing metal inten-
siveness alon~ the entire cycle of the production, use, and functioning of
- metal. In addition, the production and structural cycles have to be sub-
_ ordinated to the task of decreasing the metal intensiveness of the operation-
al cycle .
ihe most substa.ntial losses arise as a result of the short service life and
insufficient reliability of machinery and equipment and of the necessity to
stop them and make repairs. Decreasing waste is frequently spoken about,
but very little is said about the strength of machinery. .At the present
time every fifth ton of inetal is expended to repair fixed capital, chiefly
machinery, equipment, and transportation equipment. Capital and current
repairs cost the econon~y axound 40 billion rubles a year. Therefore, an
increase in the strength of the machinery and equipment parts and units
which wear out most rapidly is a very important source for economizing
expenditures through a decrease in metal intensiveness.
In order to decrea.se losses of inetal and resources connected with the
repa.iring of fixed capital it is necessary first of all to speed~up the
replacement of obsolete machinery and equipment. At the present time
decommissioned obsolete equipment in industry is almost times smaller
than newly commissioned equipment (in 1977 this data was 2.~+ and 8.9 per-
_ cent, respectively). An increase in depreciation allotment norms has had
21
FOR OFFICIAL USE ONLY
I
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
practically no effect upon renewal periods. The point is that the economic
balances for ~Lhe planned products list ca.nnot provide for the allocation of
substantial resources for the replacement of obsolete equipment. Two-thirds
of the ntetal-cutting machine tool pool is employed in the production of spare
parts. Therefore, it is necessary to''make seriuus changes in the machinery
and equi.pment balance, increasing ~he proportion of resources which are
assigned for the replacement of obsolete machinery and equipment.
'I'he question oi' repair services is of especial importance. Machine building
plants establish a guaranteed period for their output which at best is equal
~to 10 to 15 percent of service life. They do not have ar~y repair service
oblig~.tions. In our opinion, machine building enterprises should be m~,de
responsible for servicing the machinery and equipment they supply with ca-
pital and current repairs throughout the entire service life of this ma- ,
chinery and equipment and for the production of spare parts. It is neces-
sary to provide economic stimulation for them by establishing wholesale
prices for spare parts which are close to their cost at non-machine buil-
din~ enterprises. Finally, the All-Union State Standards should provide
for the strict regulation of the service life and reliability of machinery
and equipment until their current and capital repair periods.
A. M. Polyak (Doctor of Economic Sciences, Professor, Moscow Institute of
Ste~l and Alloys). Different authors and specia:Lists put different contents
into ~;he concept of "materials intensiveness" and. "level of materials
intensiveness." The data of the USSR Centr~,l Statistical Administration
on the structure of expenditures for the production of output, particular-
ly industrial output, is frequentl~y used in order to characterize these
concepts. However, this data makes it possible to judge only about the
snare of material expenditures in the overall costs of output production
in the individual branches and about the relationships between the indivi-
dua.1 expenditure elements. The lowest proportion of material expenditures
exists in the fuel branches. It is in this sense that the terms "materials
intensive" and "non-materials intensive" branches should be understood--
if ~the indicator of the share of material expenditures in overall produc-
i:ion.~costs is taken as the level of materials intensiveness. In order
to`determine the level o~ the real materials intensiveness of the produc-
tion of homogeneous output it is advisable to use the measurement of the
specific expenditures of material resources in physical terms (kilograms,
tons, lite�rs, cubic meters, and so forth) as the basic method.
In order to compare the levels of materials intensiveness of heterogeneous
produc~s a cost evaluation of the specific expenditure of the relevant
material resources fo.r their production is used. At the present time this
method is the simplest and most accessible. However, the defect of the
existing forms of price measurement are automatically ~;ransferred to the
results o:f the comparison of the materials intensiveness of output. The
metYiod of evaluating the levels of the materials intensiveness of hetero-
geneous products by labor expenditures is the most acceptable froin the
theoretical point of view. Note should be taken of the promising nature
22
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
' FOR OFFICIAL USE ONLY
!i' of this method and of the availability of the necessary basic information.
~ I[~wevc.r, thi's method hns not yet received employment. I:ts introduction
i_:~
as a supplementaxy and, in a number of cases, as the basic method for
measuring the levels of the materials intensiveness of heterogeneous pro-
ducts is an important and.top-priority task for economists who are study-
~ ing the problem of determining the efficiency of,the use of material
resources.~
With regard to what has been said, it is also necessary to bring some
clarity into the question regaxding the tendencies in the movements of
materials intensiveness in ~the USSR econo~y during the period 1961-1978.
With the existing methods of planning and accounting the amount of mate-
rial expenditures which are included in the gross output of branches or
of the entire econo~y is determined by the influence not onl,y of the so-
called technical factors. The amount of material expenditures in cost
terms.is influenced by interbranch and intrabra.nch structural changes,
the price factor, and also by "double counting" whose amount may increase
either as a result of an expansion of cooperation, or as a result of the
accounting and planning methodology being used in the branches,
The share of material expenditures in the social product in the USSR
econorqy has increased somewhat recently, which is confirmed by the data
on the d~ynamics of the gross product and of na-~ional income in comparable
prices. In 1961-1965 the gross social product increased by 37 percent
and national income also increased by 37 percent. In 1966-1970 the gross
product increased by ~+3 percent and national income by 45 percent; in
1971-1g77 the gross�product increased by 36 percent and national income
by 3? percent; and in 1971-1977 the figures were ~+9 and ~+6 percent, res-
~ pectively. Approximately the same figures are received from calculating
the gross product and.national income in actual prices for the same years
(as is proposed by certain economists in order to determine the tendencies
of materials intensiveness).When calculated in actual prices the share of
. produc.tion material expenditures (excluding depreciation) in the gross
product came to approximately ~+9 percent in 1960 and 1965, around 50 per-
cent in 1970, 52 percent in 1975,and 51 percent in 1977; that is, again
it increased somewhat. At the same time, the specific expenditures.of
material resources to produce the basic types of output in the econo~}r
decreased consistently. This kind of rela,tionship between the tendencies
for the movement of the physical indicators of materials intensiveness
and the share of material expenditures reflects the objective fact that
independently of the direction of changes in the share of material expen-
_ ditures in the cost of the social product a steady decrease in the specific
expenditures.of'materials in concrete ~oductions, shops, sectors, and
jobs is a law (which permits only individual exceptions) that is org~.nically
inherent in a developed socialist economy.
In this connection, one has to agree with the point of view of a number of
~conomists who propose tha~t the movement of.materials intensiveriess in the
econorqy be judged only by changes in the indicator of the share of material
ti;'j expenditures in the cost of the social product (or material expenditures
23
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007/02108: CIA-RDP82-00850R000100090039-9
FOR OrFICIAL U5E ONLY
per unit of ~ross product, national income). O:f course, the rel~,tionship
between pro~-Luction m~.terial expenditures ~,nd na�tional income is one of the
_ central ~~roport,ions of social production, and the 9 ndicator of materir~l
cxpenditures per unii; of t;z~oss pz�oduct, or national income is one of the
1Iil~OZ�t~,nt indicators of production ~fficiene,y. However, a change solely
in i:tiis indi.c~,tor, ~taken in isolation and outside of the overall system
of indicators of ~he use of the material x�esources, does not characterize
the full. totality of the processes involvec3 in the farmation of materials
intensiveness in the econorr{y.
7'Yie delrelopment of a system of the most important indicators of materials
inbEnsiveness which has i;o be constructed tiri.th regard to ~he use of the `
econom~y's basic material resources is of great i;nportance for analyzing
the tendencies towards changes in material expenditures. Along with the
materials intensiveness of national income, this should include: the
relationship between the growth rates of ~he processing and extracting
industry; ~the electrici�ty intensiveness of na,tional income, industrial
ou~;put, agricu.lture, construction, and transportation; the use coefficients
o� finished metal output in ~(;he economy, machine building, and construction;
~;he ~~pecific expenditures of rolled ferrous metals in machine building
and construction; the specific expenditure of fuel for the production of
~i uriit of national income , the expenditure of conventional fuel for a,
kilowatt-hour of electric energy, and the specific expenditure of colce
Cor one ton of steel making pig iron; the specific expenditure of chemical
products per unit of na~tional income; the production of the basic types
of' finished output per 1,000 cubic meters of procured timber; the specific
expendi~tures o� the most irnportant physical materials for ~the performance
of construction and installation work and per unit of housing space; and
the expenditure of basic raw materials in the production of the basic pro-
ducts oi' th.e light and food industry, and others.
~he role of non-ca.pital intensive methods of reducing materials intensive-
ness zahich do not require substantial capital investments is now becoming
~ especiaily important. They include, first of all, measur~s on economizing
m~.ter�ia1 resources which also provide for an improvement of the system
of accounting and planning their production and consumption. In this con-
nection, ii; has to be noted that the indicator of net output as a whole
has to orient enterprises toward decreasin~ the materials in~ensiveness of
the output they produce. This influence has to be exercised by the intro-
duction of indicators for inventorying the production of equipment in
units and sets, instead of in ph.ysical tonnage and by the replacement of
~;he indicator of physical tonnage in a number of spheres of its applica-
tion in metallurgy with indicators of adduced tonnage (in accordance with
labor intensiveness), theoretical weight, meterage, and others. It has
to be noted that the use of a different indicator for inventorying the
product~on of output changes the very results of evaluating the work of
a production collective and the psychological climate at an enterprise.
Thus, during the years 1971-1g75 assortment was expanded and the quality
of large-diameter pipes was improved at the Volgograd Pipe Plant. Never-
24
FOR OFFICIAL USE ONLY -
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
- theless, in measur~.ng the o.nnual amount of commodity output in physical tons
or~ in a cost evalua~ion the enterprise's rei;urn on capita.7. 3ndicator de-
creased. And, on the contrary, when the amoun~ of commod3ty ou~put wag
expres^ed in meters the return on ct~pital indicat;or increased which, in
our opinion, more ob,jectively reflects the real results oi' the enterprise's
work.
N. K. K~.yumov (candidate in economic sciences, deputy director of the
Institute of ~conomi.es of the Acadeir{y of Sciences Tadzhik SSR). I would `
like to touch upon a number of questions which are specific and axe of ~
importa.nce not only for T~dzhikistan. First of a11, there is the ques-
tion of the quality of cotton and of reducing losses in its harvesting,
transportation, and storage. In recent yeaxs our selection specialists
have been performing serious work to raise high-yield ~nd high-qua.l.ity
varieties of cotton. However, low-quality cotton goes for inclustrial
processing. For example, during the last 15 years the proportion of
first grade r~.w cotton in the total amount of cotton has decreased by
more than 18 points, while the decrease in machine ha.rvested cotton has
- been even greater. As for the select grade, it has completely disappeared
from the assortment. Thus, the efforts of selection speci~.l.ists and
practical work~rs aimed at improving the qutLlity of cotton axe being
recluced to naught .
One of the chief reasons for the situation which has developed is a rise
in the level of the mechanization of the process of harvesting raw cotton.
It does not, of course, follow from this that we should give up machine
harvesting. On the contrary, the mass use of equipment shortens the har-
vesting period, makes it easier, and ensures a large econonqr of live labor.
But due to iiaperfections in the design of cotton-haxvesti.ng machines a
great deal of cotton is lost and its moisture and contamination levels
are increasing. TYie moisture and con~;amination 7.evels of machine-harvested
cotton is 1.3 and 2.3 times greater than that af hand-harvested cotton.
This has led to a decrease in the production of fiber and to a deteriora-
tion of its quality. The production of fiber a.s a whole in the republic
has decreased by 1.7 points and is now at the level of the 1940's. For
thi~ reason, output losses come to approximately 28 to 3a million rubles.
At the same time, the losses of cotton plants due to grade chan~es are
also increasing. Every year in the Uzbek and Tadz}iik union republics
alone the losses resulting from m~~ving from the first grade to the second
come to more than ~+0-lt2 million rubles. The use of raw cotton in the
cotton textile industry has also worsened. In order to counteract the
process of quality deterioration our machine builders have to not only ~
improve the design of existing machines, but to create fundamentally new
and highly efficient cotton-harvestin~ combines.
Ths.price formation system ~or cotton fiber is also i.n need of serious
improvement. The price mechanism for stimulating an improvement in the
quality of raw cotton provides for differentiated prices in relation to
the use value of the raw materials. But the prices i'or cotton fiber are
25
FOR dFFICIAI, USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000100090039-9
- FOR O~FTCTAI~ US~ ONLY
establi~hed ti~ithaut re~~rd ~o this demand. T'oz~ exaarm~.e, a plant receives
profi~s of ~.38-1.1t0 rubles �rom the produc~ion of l ton of firs~ ~rade
cotton fiber, and 228-230 rubles Por fourth, grade fiber. Such prices
do not stimulat~ co~ton plants to 3.mprove the quality of their raw mate-
r~ia.t:~ .
It is necessary to consider one more question which is direct~y rela~;ed ~
~;o tYie qura.l.ity of textile goods--an increase in the product3.on of fine-fiber
~rades of c~tton which have the best spinning properties and are in great
demand aanong the country's textile workers. There have been subs~;antial
succesues in this field, bu~ nevertheless the country's needs for this
type of raw material are being met by on1,y 50-60 percent. Tn recent years
in number of ~the cotton sowin~ republics the gross harvest of fine-fiber
cotton h~.s even decreased, and this despite the fact that the level of
proFitability is twice as high as that of inedium-fiber grades. The lack
of efficien~t cotton-harvesting combines is, in our opinion, the basic
re~~con. As a result, harvesting periods are bein~ stretched out and the
].n,bor intenciveness of production is increasing. In addition, the farms
w}~:icYl ~;.row fine-:Ciber grades will fulfill their plans much later than other
fartns and tYiis is unprofitable. In this connec~ion, we should raise the
~ question not only of the creation of efficient equipment, but also of a
dif'f~rent way ~f evaluating the work of a farm.
Scientific studies w~:ic~? are being carried out in the Institute of Econornics
of the Acaderqy of Sciences of the Tadzhik SSR show that a definite quantity
o#' cotton is lost as a result of' the insufficient development of the pro-
duction infrastructure, particularly due to imperfections in the road
- network. In the republic there are 1.4 hectares of sown land with a lower
yield of three to four times for every kilometer of dirt raad. Etiren at
a minimum estirnate this decreases the gross harvest by five to six percent.
The insufficient development of the road network is probably explained by
the fact that only transportation expenditures are considered in determining
- effectiveness. It is obvious that account also has to be taken of the
ni'fect which is obtained by agricultural enterprises as a result of an
improvement of the road network. '
In addition~to cotton, a great deal of fruit, vegetables, grapes, ~ocoons,
and other cropping and animal husbandry products is lost. Our agriculture
procluces much more products than are actually consumed. This raises the
task of a serious improvement of warehouse and refrigeration work.
The general conclusion amounts to the following: first, it is necessary
to move from the deveZopment of small-scale a.nd scattered measures to the
realization of large overall special-purpose programs which ensure a sub-
stantial econorqy of material resources; secondly, it is necessary to uti ~
lize the large reserves for economizing resources which exist at the ~unc-
tion of individual branches which are organically a part of large economic
complexes. For this reason, in order to have a clear idea about the use '
of raw materials from the moment of their production to the receipt of
26
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007/02108: CIA-RDP82-00850R000100090039-9
FOR OFFTCIAL USE QNLY ,
finttl resu].~s it i~ usefu]. to consider th~ problem o~' reduc3ng materiels
in~tensiveness within the .framework o~ individual cnmplexes.
- 1C. S. Khachztiturov. How is the qual.ity of cotton to be improved?
N. K. Kayumov. Our selection speci alists are doing a 1ot of work, although
their efforts are aimed basically at increasing the yield of cotton. Yet,
it is essential first of all to develop measures to counteract the process
of the deterioration of the quality of raw cot~on.
V. M. Ivanchenko (doctor of economic sciences, Depu~y Division Chief at
Gosplan USSR). There are also methodological aspects ~~o the problem being
discussed. I am speaking about the creation oi' a system for economizing
resources and of a progranuned solution for many problems. I think that
nowad~ys the content of a plan and its conception has to be looked upon
Pirst; of all from the position of an improvement in the structure of
production, scientific and technological progress, and the realization of
an effective econoi?~y regimen and a system of stimulation. These are the
four directions whic}i have to make up a complex and ensure systems ap-
proach to the solution of the problem.
Structural policy. A chfange in the proportion of pi�o~ressive bi�anches
helps to accomplish definite tasks in scientific and technological pro~;ress,'
but the capital and metal intensiveness of production is not reduced here.
The essence o.f the problem consists in the fact that too little attention
is devoted to the qualitative proportions of production. A qualitative
characterization of the structure of production is wht~t to produce, how
to produce it, and with what technical and economic parame-~ers and charac-
ter.istics with an orientation toward final consumption, having in mind
that the consumer should receive what he needs a.nd, in addition, a national
economic effect should be achieved. '.Phe problem of structure in its ~lobal
understanding is very important for us because it determines a reorientation
of capital investments'toward accomplishing the task of raising the tech-
nical level of production and output. Without a radical turn toward a
qualitative production structure it wi11 be impossible to solve the problem
of material intensiveness, ca,pital intPnGi.veness. a.nd a.n increase in econo-
mi c ~rowt;h rates .
5cientific and ~technological progr~ss is connected basically with a rise
in labor productivity, with only live labor meant. This is understandable,
especially since the i.ncr.ease in labor resources in the 1980's will be
lowered by 2 to 3 times. To economize resources means to economize labor
power, labor, time, and capital investments. A rise in the tiechnical level
oF production has to be the equivalent of an increase in production poten-
ti al .
In our opinion, the basic directions of scienti.fic and technological pro-
gress.are: an improvement of technology, an improvement of designs, and
an increase in the reliability and service life of equipment; the wide use
27
FOR OFFiCIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000100090039-9
FOR OFFTCTAL USE ONLY
of substi~utes; and a rise in the technic~,l level o~' production which ensures
the product~.on of high-quality output with a decrease in labor intensiveness.
A regimen of econorrpr hrzs to become state policy. A regimen of econoiqy,
of course, not at the cost of narrowing assortment and worsening quality.
Above a11, it means a decrease in the specific expenditures of resources
for a uni~ of useful effect in output. This policy has to become the basic
one from the point of view of a regimen of econorqy. As long as we speak
about a regimen o:f economy and simply reduce expenditures at each indivi-
dual enterprise or sec~or, we will economize in one place, while we will
get additional expenditures in another. A national economic approach is
essential here. We have to achieve the kind of decrease in expenditures
in which the total expenditures for the final pr~duct are minimal with
regard to the use properties and characteristics of each product. �
In this connection, attention has to be called to the problems of s~imu-
la~:ion. Stimulation has to be achieved not merely ~hrough a system of
m~.terial incentives, but through plans and its indicators. However, a
quection arises here: what i.ndicators should be used for evaluating the
warx of enterprises and for forming incentives ftiinds and bonuses? In a
number of branches the net output indi.cator should occupy the leading
pl~,ce. I'or example, for construction organizations conventional net ou~put
would be best. Nevertheless, construction workers speak a great deal
about the negative aspects of gross amounts of construction output and
are in no hurry to introduce conventional net output indicator which
excludes an interest in material intensive work. A stimulation system
has to provide for increased attention to the fulfillment of contract com-
mi~;m~nts in mutual production relations whose violation leads to large
materi~,1 losses. At the same time, it would be use~zl. to make wider use
of direct forms of allotments to the incentives funds of a part of the
econorr~y (40-50 percent) of material resources. A decrease in the specific
expenditures of materials has to become a very important criterion in the
work of associations and enterprises.
It has now become necessary to move from the solution of individual aspects
of a problem to its overall solution in which the plan, the tasks of
scientific and technological progress, the state policy of a regimen of
econo~, and stimulation have to comprise a single system which is aimed
at economizing current and lump-sum expenditures which define national
economic effect and make it possible to manage the concrete factors in
economizing resources while planning and achieving high cost accounting
indicators at every enterprises. And this national economic effect has
to be determined for an.y measure and be transformed, and be taken account
af in norms, standards, and cost accounting indicators.
T.S. Khachaturov. I would like to know to what extent the service life
of our machines will be increased if better quality metal is used, and
if there is an interest in our country in decreasing, or, on the contrary,
incre.asing the weight of machines on the part of those who produce them?
28
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007/02108: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
I. G'. Pashko (candidate in economic: sciences, Chief Specialist at Gosplan
USSR, Honored Metallurgist of the RSFSR). USSR group "A" industry is marked
by a very hi$h level of ma~erials intensiveness. There are enormous re-
serves here. Thus, in ferrous metallurgy ~he smelting of 8 million tons
o:f casting iron is connected with a 26 percent decrease in the productivity
of blast furnaces and a 30 percent increase in the expenditure of coke
(in.the United States only 1.5 million tons of blast furnace iron is smelted,
that is, five times less). The production proportion of rolled sheet goods
is relatively low in our country (41 percent in the USSR compared to 68
percent in the United States and 61+ percent in Japan); in machine building
3 to 4 times more steel and iron castings is used than in the developed
capitalist countries; and metal cutting me~hods predominate over the pro-
gressive processes of working metal by pressing, stamping, zind extrusion.
For this reason, in 1977 waste in machine building came to 19 million tons,
with around 9 million tons in shavings. According to the data of the
USSR Central Statistical Administration for 1967 and 1977, the use coef-
ficient of inetal had stabilized at the level of .72 (in the United States
--.84).
/1s is known, the growth rate of national income came to 3.3 percent in
1977 and percent in 1978. In our opinion,such rates are clearly insuf-
ficient for accomplishing major socio-economic tasks, It appears that
without decreasing the level of inetal intensiveness it will be impossible
to plan high economic development rates a.nd a high increase in national
income. A decrease in materials intensiveness, for example, of one bil-
lion rubles ensures an econo~y of capital investments of 6 billion rubles.
In order to achieve higher g.rowth rates for national. income it is necessary
to have material resources and, above a11, metal: rolled goods, piping,
hardware, and products for subsequent conversion. In 1978 more than 151.~+
million tons of steel was smelted in our country. No other country in the
world. smelts as much steel and produces as much rolled goods as the USSR,
but, nevertheless, there is not enough metal.
In the past, the country's economic potential was defined on the basis of
the level of steel smelting. At the present time the use of this method
is inadvisable. A great deal of steel is produced, but there is not enough
fina7;;~~utput from it--metal products.
The reason for this is the unsatisfactory use of steel. The r.elationship
of our total;smelted steel to finished rolled goods (151.4 million tons
of steel to 105.3 million ~tons of finished rolled goods) is 1.4~? (in Japa.n
--1.16, in Western Europe--from 1.18 to 1.24). If our steel smelting were
to be recalculated by the rela,tionship which has been achieved in Japan,
the surplus of steel would come to around 30 million tons of which it would
be possible to produce approximately 23 million tons of finished rolled
goods, or not to ex.pend around 200 million tons of iron ore raw materials
(the West European relationship of 1.2~ would give a surplus of steel of
20 million tons of which it would be possible to produce more than 15
29
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000100090039-9
~ FOR OFFICIAL USE ONLY
million tons of rolled goods).
In our opinion, it is entirely realistic to bring the relationship between
_ steel and finished rolled goods to 1.34.
What measures.will have to be carried out in the 11th Five-Year Plan �
~ in order to achieve this?
First, in the USSR in 1977 around 13 million tons, or 8.8 percent, of our
steel was smelted on continuous steel smelting installations, while in
Japan which bought the license for these installations for us the figure
- was ~+2 million tons, or ~+1.6 percent, which is 3 times more in tonnage
and ~+.7 more in proportion. In order to ~.chieve the relationship of 1.3~
smelting has to be increased on the continuous installations to 40-42
million tons.
. Secondly, the industrially developed countries produce more rolled goods
(20-22 pe.rcent) from semi-killed steel than from killed steel. The pro- .
duction of rolled goods from semi-killed steel has to be brought to 20
percent. Ten years ago we produced very little semi-killed steel and
there are achievements, but they are still insufficient.
Thirdly, a large amount of steel castings are used in machine building,
In 1978 the USSR produced 6 million tons of steel castings and expended
10 million tons of steel on them (the United States--2.2 million tons of
s~Leel, Ja.pan--740,000 tons). In making machines the United States and
Japan used much more rolled goods, which is cheaper and requires less
capital investments for the creation of casting capacities. In addition,
lab'or productivity in rolling shops and ferrous metallurgy is twelve
tirnes higher than in the casting shops of machine building. The use of
unjustifiably..large amounts of castings reduces the effectiveness of the
use of steel and increases the metal intensiveness of machines. In recent
years there has been an increase in the production of economical types of
rolled ~oods, thermall,y strengthened rolled goods, 1ow-alloy and cold-
rolled st~el, and bent sections, the quality of the metal has improved
�~.nd there has been an exp~.nsion of assortment, but none of this has had
an essential influence on decreasing the weight of machines and decreasing
waste in producing them. This is explained by defects in the development
of the billeting production in machine building and, above all, by the
obsolete struc~ure of inetal-working equipment (the predominance of cutting
to the detriment of pressing equipment, the negligible use of sheet rolled
~oods in machine building).
In the gth Five-Year Plan the Ministry of Machine Building Industry over-
fulfilled its plan for metal-cutting machine tools by 105 percent while
its plan for forging and pressing equipment was fulfilled only at the
level of 69 percent. The structure of the forging~and pressing equipment
tools is insufficiently progressive: hammers predominate,.while there
are too few progressive machines--crank hot presses, radial presses, and
30 ~
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
ol;hers wtiich make it possible to produce parts with minimum waste or without
wf~te .
In our opinion, it is necessary to make amendments to the overall program
which has been made up by the USSR Acade~y of Sciences and to the Basic
Directions for the socio-economic development of the country for the years
1981-1985. In order to increase the influence on productian efficiency
when annual and five-year plans are worked out it would be useful for minis-
tries, department;s, and republics to establish material intensiveness re-
duction assignments, that is, to begin to plan material intensiveness.
D. M, Palterovich (Doctor of ~conomic Sciences, Senior Scientific Associate
at the Institute of Economics of the USSR Acade~y of Sciences). A decre~.se
in material intensi~eness is determined to a large extent by how much the
development of the i~plements of labor ensures a saving of raw materials,
materials, fuel, and energy. This c~ependency shows up in all of the stages
of production. Thus, in the extracting industry the extent to which raw
materials and fuel are extracted from the earth and their delivery to the
consumer depends upon the designs of mining machines, the quality of rigging,
the use of deep pumps, and the availability of special railroad cars, trucks,
~.nd oi;her transporL-ation equipment, which exclude losses during shipment.
For exa.rnple, the introduction of modern electric loading pumps ensures an
average increase in the yield of petroleum wells of five times compared to
ordinary pumps, that is, almost the average level of gushing we11s. The
use of special railroad cars for loose types of raw materials and materials
almost completel,y prevents losses during shipment which sometimes reach
10 percent of the total amount of the frei~ht shipped.
In the processing industry the development of machinery ensures: a deeper
and more overall processing of raw materials with the extraction of all
useful components from them; a decrease in the specific expenditures of
raw materials and materials by means of the int~roduction of more economical
technological processes; and fuel and electric ener~r savings on the basis
of the use of more economic engines, electric generators, light sources,
Fas burners, and appaxatus and instruments which optimize the expenditure
of fuel, recovery boilers, and so forth.
One can point as an example to the creation of equipment for new and less
enerpr intensive processes of obtaining a number of products.(aluminum,
magnesium, cellulose, and others). Another example is the possibility of
utilizing the resources of waste heat. The Sterlitamak "Soda"
Production Association has createcl equipment and installations for the use
of waste heat which make it possible to obtain in the chemical, petrochemi-
cal, and m~.crobiology industri.es an annual economic effect of more than 20
million rubles. However, due to an insufficiency of equipment and the lack
of specialized plans for the production of recovery and he~.t using appara-
tus the industry still has large losses of heat in order to obtain which
hundreds of thousands of tons of fuel has to be expended..
31
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
Substantial. reserves for decreasing metal and fuel intensiveness and, con-
sequently, m~~terials intensiveness could be realized in the production of
, the implements of labor. What are the ways of realizing these reserves?
First, an optimization of the needs for implements of labor and an improve-
ment of their structure and design t1nd, secondly, an improvement of the
technology of inetal workin~.
In an economic analysis of the reserves of ma'terials intensiveness atten-
tion is usually called to the possibility for economizing metal by means
of strengthening it or replacing it with other materials, and also of a
wider.,use in machine building of the methods of the precision stamping of
parts from rolled sheet goods, precision casting, powder metallurgy, knur-
ling and welding methods, and so forth.
A large amount of published data shows, however, that the use coefficient
of the b asic types of rolled goods and castings ~,n machine building fluc-
tuates on ~he average within the range of .7-.8 (excluding forgings made
of ingots for which the use coefficient of inetal usually does not exceed
.3), while the introduction of progressive technology makes it possible
~to increase it by 10 to 15 percent with a corresponding decrease in the
expenditure of inetal. In effect, the overall growth in the use coefficient
of inetal in machine building does not come to one percent in a five-year
plan.
In the production of individual products the use of various types of im-
proved quality metal (heat-resistant, poly,mer or aluminum coated, low-
alloy steel, shaped and bent sections, and so forth) ensures an econorr{y ~
o� from 5 to 25 percent of the metal, while in certain cases it is even ~
larger. However, in the foreseeable future as a result of the introduc-
. tion of progressive ~technology it will only be possible to economize se-
veral percentage points of the metal consumed. As for the use of plastics,
it is now replacing around one percent of the ferrous metal in machine
building and even according to the forecasting data this econoray will not
exceed �our to five percent during the next two to three five-year plans.
The im~portance of the above-enumerated directions of economizing is very
great; however, they still cannot be compared with the possibilities for
economizing metal as a result of an~improvement of the designs and type-
~ size structure of the machinery and.equipment being produced. In other
words, in evaluating the problems of "what to produce?", "from what to
produce it?" and "how to produce it?" it has to be emphasized that the
decisive importance for decreasing metals intensiveness is the question
of "what to produce?"
In our opinion, it has become necessary to make more radical changes in
the character of the designs and in the type-size structure of the equip-
ment we produce in such a way as to make it possible to obtain a greater
econoir{y not only of inetal, but also of fuel, elec'tric energy, and of other
operational expenditures.
~ 32
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000100090039-9
~ FOR OFFICIAL USE ONLY
Subst~.ntial reserves for economizing met~,l are connected with doing away
wi.~th the excess and practically unutilized reserves of s~.rength ~in struc-
tures, with miniaturization and microminiaturization, and wi�th the uae
of: fundament~.l.ly new, economical, structural-technological solutions.
Repeated note has been taken in our economic literature of the differences
in the size structure of the metal working equipment which is produced by -
Soviet and American machine tool builders. From 1961 through 1970 '
1,861?,000 me~a1-cutting machine tools were produced in the United States,
including 1,2~+7,000 units, or 60 percent, of small very simple machine
tools with a cost of up i;o 1,Q00 dollars (excluding machine::tools for
home workshaps and schools). From lg7l through 1977 the production of
machine tools was 1,5~+9,000 units, including 1,158,000 small machine tools
--the latter's proportion had increased to 75 percent. Basing aurselves
on the average weight of a machine tool which is produced in the USSR
(more thran three tons) and in the United States (1.2 tons) and the average
metal use coef:f'icient in machine tool building (USSR--.B, United States--
.85), it can be calcula,ted that in our coun~try g00,000 tons of inetal
are required for an annu~l production of around 240,000 m~,chine tools,
and in ~the United States around 3~+0,000 tons are required. The difference
is 560,OU0 ~tons and, moreover, this is basicfally a consequence of diffErences
not in the technolog}r of inetal workin~ and machine tool building, but in
the size structure of the machine tools produced.
Of course, sma11 machine tools can only be used to replace larger ones in
limited numbers. But even a sma11 (compared to the United States} in-
crease in the propor~tion of small equipment can ensure a large econorqy of
metal. The.re are also considerable reserves for economizing metal in re-
placing a part of our excav~,tors with ligh~er loaders, and in the optimi-
zation of the size structure of tractors, trucks, cl.rillin~ installations,
and certain other machines.
The processes of the creation of new types of machineryr and equipment and ~
the forma.tion of the structure of their production are still insufficiently
oriented toward economizing raw materials, materials, fuel, and energy.
In our view, it is necessary for designers and p.roduction engineers to
devote more attention to the creation and improvement of equipment which
ensures this kind of econorr{y and to orient the -~echnical and structural
policy of the rnachine building br~.nches toward the formation of an econo-
mical type-size struct~xre for machinery and equipment. A special overall
interbranch scientific and technical and production program has to be
worked out for the purpose of economizing raw materials, materials, fuel,
and energ~r~. The gradual exhaus~:ion of rich and convenient mineral deposits,
the worla market increase in th~ cost of raw materials of 2 to 2.5 times
and of more than 4 times for fuel, and the enormous possibilities for
economizing resources through the introduction of pro~ressive equi_pment
ma.ke the development of s~uch a program not only important, but also essen-
tial.
33
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY .
V. .T.. F~,vlov (candidate in economic sciences, sector chief at the Scien�tific
RE.,carcti Zn~titute of Planning and Standards ~,t Gosplan USSR). A re-
or:ientation ~f our econorqy in a materials economizing direction would make
it possible to decrease ~he materials intensiveness of the gross social
product from 580,000 rubles in 1g75 to 570,000 in 1978, with the result
that the econoi?~y of raw materials, materials, fuel, and thermal and electric
enerpr and other types of material and technical resources in 1978 com-
p~,red to 1975 would be around 10 billion rubles against the 8 billion
rubles p].anned in the five-year plan for 1980. The achievement of such
results would be helped by the introduc~ion of an indicator for materials '
intensiveness among the calculated indicators. And the planning of the
materials intensiveness of output in all of the elements of the economic
mechanism would make possible a fuller disclosure and use of production
reserves.
Due to the fact that material expenditures comprise the basic share of
expenditures for production and their rational use can bririg about the
greatest national economic effect, it would be advisable to introduce
~L-he indicator for materials intensiveness among o~zr directive indicators,
providing for its planning even in connection with the planning of output
costs,
At the present time more than 20 billion rubles worth of purchased semi-
goods and component products is used in machine building. The experience
connected with technological improvement of product design testifies to
~he fact that the use of different design schemes for the same product '
and a variation of the products list of purchased component products can
reduce their costs by an average of 15 to 20 percent, and, with regard to
theiz~ consumption, this will make it possible to obtain an econorr~y of
several billion rubles.
In order to ensure ar~ interconnection between physical and cost indicators ,
it is necessary to develop and regular~jr renew (not less than once in two
to three years) products list price lists for the types of outp~t whic~
are included in the national economic plan, and for material and technical ~
resources this has to be done with regard to the specific nature of branches,
productions, and suppliers.
In our opinion, there should be the most rapid introduction of the proposal
by A cademician A. Aganbegyan to take account not only of the quantitative
bv~ also of the quantitative indicators of our output, that is, to evaluate
economic work not by the gross, but by the quality of the gross. This will
make it possible to ~,void the shortcomings which are characteristic of the
gross output indicator.
In connection with the decrease in the materials intensiveness of the social
product, the demands are increasing upon the development of overall inter-
connected economic programs for resource economizing. Programs of this
kind which are being used in the CEMA countries are very effective. The .
34
FOR OFFICIAL USE ONLY
L
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
. FOR OFFICIAL USE ONLY
l~ck of an interconnected overall plan of ineasures for economizing various
types of resources leads to economies of certain resources and overexpen-
ditures of others. For example, an excessive decrease in the thickness of
wn.lls leacl~ to losses of heat as result of poor insulation. In the coun-
i:ry's lr~r~;e cities during the last 15 to 20 years as a result of a dete-
riora,tion of heat insulation the heat consumption norms for one cubic meter
have increased by 1..6 times, anc~ in panel buildings compared to brick
buildings~specific heat losses have increased by two to three times, while
in a number of countries the insulation oF buildings has improved by 1.5
to 1.8 times. In this w~y, an economy of construction materials turns
into enormous losses of heat throughout the entire service life of buil-
dings.
;
The introduction into the econo~y of scientific research a.nd development
achievements which have found a wide application in world practice will
make i~ possible to sharply increase the efficiency of social production
and to decrease its materials intensiveness. Thus, better strength cal-
cul.ations for the parts and units of machinery and equipment and an improve- ~
men~ of the billet base of machine building wi11 make it possible to free
around 10 to 12 million tons of additional metal while impro~ring the use
properties of output. A simple decrease of 4 to 5 million tons in the
"p.roduction" of excess shavings in ma.chine building will give the econorrpr
~n annual savings of around 7 billion kilowatt hours of electric ener~y
and of the labor of more than 230,000 machine tool operators. A rise in
the level of traffic control in railroad transportation of only one percent
will make it possible for the same rolling stock to carry an additional
2 million tons of freight every year.
An analysis of the structure of overall national economic materia.ls inten-
siveness shows that around one percent of the material expenditures in
the econorr~y is accounted for by such resourLes as theriual energy, steel
piping, mineral fertilizers, and commercial ~imber, approximately 1.5
percent by synthetic resins and plastics and wall materials, almost three
percent by boiler and fuxnace fuel and rolled ferrous metals, 7.5 percent
by feed, and around nine percent by a11 types of fabrics and chemical
fiber. It should be noted that a decrease in the materials intensiveness
of the output oi' machine building by one percent produces an econom~y of
more ~han 400 million rubles, a.nd the same decrease in agricultural output
saves around 7~+0 million rubles. In addition, an average annual increase
in the production of agricultural output by 1 billion rubles requires ca-
pital investments of 12 billion rubles (60 branches of industry work di-
rectly on the output of fields a,nd farms, while 90 branches of industry
are directly or indirectly involved in processing agricultural output). ~
Fvery year in machine buildinP the econom~y of rolled ferrous metals comes _
to 150 to 200 million rubles, and as a result of imperfections in the
technolo~r of painting parts, units, and products the annual losses of
primers, lacquers, and paints are estimated at 300 million rubles. Due
to ~the large amounts of fabric wastes the econo~y of the RSFSR alone loses
3 t~o 4 billion rubles annually. It is necessary to stimulate an econo~y
35
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
' FOR OFFICIAL USE ONLY
of all types of material and technical resources in all of the branches of
the econorr~y, and for this reason uniform methodologic~,l principles for
paying bonuses for an econo~y of resources have to be worked out.
0. I~. Cai;c,:i.z�idze (deputy division ~hief of Gosplan iJS~R). An enormous
indu.^i;ri~.l proiiuc~;ion potential has been created in the USSR. With the -
present scope of production and consumption the problems of a maximally
efficient use of the economy of material and technical resources and their
econo~y are of exceptionally great importance.
An econor?~y of material and technical and fuel and energy resources is achieved
both by means of carrying out organizational and technical measures, a wide
use of progressive design solutions, and an improvement of technological
processes a.nd by means of an improvement in the quality and use properties
of resources themselves, an increase in the production of efficient and
economical types of mate'rials, a decrease in the specific expenditures of
material~s and raw materials for the production of finished output, and
a deeper and more overall processing of raw materials.
However, in the future the maintenance of the development rates of our
econou~y is only possib le on the~basis of a qualitative and not a quantita-
tive change in the mass of material and technical and energy resources.
We are speaking about the necessity for developing and introducing iiito
our econor~}r qualitatively new materials and enerpr sources which must
sharply change the quantitative characteristics of the resources which are
consumed. For example, the appearance in the 1950's of film technolo~}r ,
and integral circuits instead of electronic bulbs and mounted parts led ~
to qualitative changes in the productiori of electronic equipment and the
output of the radio engineering inclustry, and to a sharp decrease in the _
need for ferrous metals, cable output, other materials, and electric ener-
~y and current sources. Similar changes are now occurring in the develop- ~
ment of power engineering--the construction of atomic electric power sta-
tions and thermal stations does not require a substantial increase in the
Axtraction and transportation capacities for organic types of fuel.
~f great importance for providing for the econo~y's needs for material and
technical resources is the use of secondary resources a.nd production and
consumption wastes whose utilization will make it possible to obtain addi-
~ional valuable raw materials, to decrease the expenditure of primary
� raw materials, materials, and fuel and energy resources, to increase the
economic efficiency of social production, and to improve environmental
protection. ~
However, insufficient use is still being made of secondary resources and
production and consumption wastes. Some of them are lost, destroyed,'dumped,
and put into bodies of water, which damages the econorqy and leads to en-
vironmental pollution. Thus,.in 1979,791,000 tons of polyethylene will be
produced, including 154,000 tons of polymer film, while the polyethylene ~
balance provides for the repeat use of only 10,000 tons, ox only 5.2
percent.
. 36
FOR OFFICIAI, USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
.
l.n E~ur�~uii, ol r.i.n ordcr from Gosplan iISSR and Gossnub USaR and ttie USSIi
' Central Statistical Administration, for the first time in 1972 an in-
ventory of the formation and use of 318 types of secondary resources -
was conducted at the enterprises of ~+2 ministries. As a result, it was
est ablished that more than 65 million tons of ash and slag'is formed at
thermal electric power stations, while only 6 percent is used. More than
20 million tons of pyrite cinders which contain a substantial quantity of
iron, sulphur, zinc, and other ferrous and rare r~etals had accumulated at~
the dumpiing grounds of sulphuric acid productions, but only 20 percent of
these resources were utilized. A large number of such examples could be
cited. While there has been a substantial overall growth of industrial
production in the country, unfortunatel,y, the use of production wastes
has increased negligibly.
The shortcomings in the organization of the procurement, processing, and
use of secondary resources are to a large extent the result of this work
being scai;tered through various organizations, which leads to the disper-
siori of monies and the under-utilization of technical possibilities and
a.n insufficient coordination of the scientific research work being done
. in the branches to rationalize the processes of the use of secondary re-
sources and production and consumption wastes. Little work has been done
on stuc~ying the problems of economically stimulating and increasing the
interest of enterprises a.nd organizations in collecting, processin~, and
using secondary resources an d wastes. Al1 of this confirms the necessity
for developing and realizing a state overall program for the efficient use
of secondary resources which has to become a component part of the country's
economic and development-. plans.
D. G. Radina (r_andidate in economic sciences, senior scientific associate
at the Scientific Research Institute of Labor of the USSR State Cotrm?ittee
for Labor). The organization of material and moral stimulation for the
workers of industrial enterprises (associations) and also the development
of a system of their responsibility for the inefficient expenditure of
resources is an important precondition for decreasing the materials inten-
siveness of output.
The grea.test attention at a number of industrial enterprises (associations)
is devoted to the organization of bonuses for an econo~{y of inetal. This is
a. result ~of the iniportance of this type of material for a11 of the branches
of the econoir~y arid also of the fact that norm setting for it and a calcu-
la.tion of its expenditure is at a higher level than for other types of ma-
terial resources.
One of the effective and promising methods of increasing the interest of
workers in ec~nomi~ing material resourses is team cost-accounting (ZIL, the
Moscow Electrovacuum Instruments Plant;, the Yaroslav Motor Plant, the Lenin-
g.rad "Sevkabel'" Cable Plant, and mar~y enterprises in ferrous metallurgy).
The organization of production and labor by team contract has become wide-
spread in a number of branches. An econo~y of material resources is a very
37 ~
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
import~,nt indicator of increasing the effectiveness of the work results of
such collectives. The most effective forms of socialist competition which
are a.imed at economizing material resources are enterprise counter-plans,
personal and team econo~{y accounts, personal, group, and collective creative
en~i.neering and technical worker plants, ~.nd reviews ra,nd competitions for
i;he effectiveness of tihe use of raw materials, materials, fuel, and elec-
tric energy.
On the whole, insufficient at~ention is devoted to the organization of
bonus payments for the workers of industrial enterprises (associations),
and tliis was confirmed by a study which was conducted by the Scientific
Research Inst�itute of Labor in 1978. The basic reason is that the minis-
tries and departments do not devote the necessary attention to this problem.
There is a universal absence oF a progressive norin base and of scientific-
all,y substantia.ted methods for establishing~resource expenditure norms;
of organized weigYiing work, warehouses for storing raw materials, and
control and measuring instruments; and at ma,r~y enterprises inventory Fand
corltrol work over the receipt and expend.iture of raw materials, materials,
and fuel is poorly organized. As a result, at a number of enterprises
there is practically no base for the introduction of effeetive bonus sys-
tems for an economy of resources.
A decrease in materials intensiveness or other concrete indicators which
are aimed at an efficient use of resources is not calculated as basic .
indicators in paying bonuses to leading enterprise (associat:on) workers.
F3ont~s payments for economies to the engineering and technical workers of
m~,nagement divisions and services which by virtue of their work axe sup--
posed to have a.n incportant influence on improving this indicator are not
sufficiently widespread. ~
~ In 1977, ~Lhe Scientific Research Institute of Planning and Standards at
Cosplan USSR and the Scientific Research Institute of' Labor of the USSR
State Committee for Labor developed the "Regulation on the Organization
of Bonus Payments for the Workers of Enterprises (Associations) for
Cconomizing Material and Technical Resources and Reducing the Materials
Zn~tensiveness of Output." The purpose of this regulation is to provide
assistance to ministries and departments in their work on organizing
bonus payments for these indicators. In addition to organizational and
economic factors, serious attention is given in this regulation to the
creation of an effective source of bonuses, since the effectiveness of
the incentives systems whi~h are introduced depends upon the solution
of tY,~s problem.
An econorr~y which is achieved at industrial enterpriaes (associations)
compared to the operating material resources expenditure norms ensures
a substantia.',. amount of above-plan profit in the mater.ial; intensiv`a
bra.nches of industry. This, in its turn, should have an influence on ~
increasing the amount of monies which are allocated for paying bonuses
to workers for decreasing the materials intensiveness of output. A.s
38
FOR OFFICIAL USE 0~1LY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
a r.esi~]:t of calculations which have been performed at a number of enter-
prises it has been discovered that additional allotments to the material -
~ incentives f~nds from above-plan economies come to 2 percent of the
achieved econoir~y of material resources.
In order to create a real source (apart from increasing the amounts of
bonuses or economizing through a redistribution of monies among the esti-
mated expenditure items of the material incentives funds) the "Regulation" -
provides for a direct allotment of monies from the above-plan profits
which are obtained on the basis of an econou~y of resources compared with
the approved expenditure norms--in the amount of from 10 to 50 percent
of the value of the economized resources. A differentiation of the a11ot-
ment should be performed by ministries (departments) in accordance with
, the specific nature of the branches (types of productions).
The ministries, departments, and production associations should probably
devote more attention to the problems of ensuring a closer connection be-
tween the system of incer~tives for executive and engineering and technical
workers for new equipment and bonus paymen~ts for the basic results of
economic work; of strengthening control over the direction of organization-
al and technical measures plans in the materials intensive branches of
industry; fznd of increasing the interest of workers at industrial enter-
prises (associations) in developing and introducing less materials in-
tensive output. The amount of the allotments for incentives has to be
determined with .regard to the weight of the economic effect achieved
~;hrough decreasing materials intensiveness.
I. V. Rakhlin (doctor of economic sciences, senior scientific associate
at the Institute of Economics of the USSR Acade~y of Sciences). Under
present conditions, as a result of poor work on a number of fundamental
problems, technical policy in general and in the field of material resources
in particular has an insufficient grounding. Among these problems are,
first, a methodology for evaluating the effectiveness of decisions on the
b~,si:~ of a, consideration not only of economic but also of sQCial factors,
and, cecondJ,y, a f~rther development of the balance methods of planning.
A program of social development and of raising the standard of living
of our people was adopted at the 25th CPSU Congress. In this connection,
the problem arises of determining ~the economic effectiveness of the use
of' materials in the form of material goods and services to satisfy the
needs of the people. Thus, 45 percent of the chemical output produced in
our country is designated for non-production consunrption. However, the
existing methods of determining the effectiveness of capital investments
(1969) and of new equipment i1977) do not contain any recommendations re-
garding methods of calculating the effectiveness of the use of new equip-
ment in the non-production sphere and in households. This direction is
connected with the`~:�eceipt of an enormous socio-economic effect through
~ the elimination of ~:amage which is caused to the health of people, the
quality of faods, the environment, free time, and the population's con-
sumption buc3get; that is, real social results some of which can and must
39
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
rF:ceive an economic evaluation.
- For the time b~ing, the results of effectiveness calculations which largely ~
take no account of social factors and results are being used to substantiate
a single technical policy. I'or example, only 20 percent of our plastic
resources have been brought into the sphere of economic substantiations
since the existing documents for calculations (use in the non-production ~
sphere and in households, ~.n increase in the a.mounts of use in previously
developed fields, the lack of analogues for comparisons, and so forth) do
not correspond to those which have been adopted in the methodologies in
~ effect . ~ ~
An extensive products list of material balances which are necessary for
achieving physical-material interbranch and intrabranch proportions in
the economicdevelopment pl.ans is developed in planning agencies. The syst~m
of these balances consists basical],y of so-called mono-product balances
and embraces products which are homogeneous in their physical-material ~
function (for example, rolled steel, piping, cement, linoleum, and others).
With this kind of organization of the work a large number of isolated
narrow branch balances are made up wfiich are poorly connected with overall
pY~ysical-material balances. As a consequence of the physical character
of' these balances there arise discrepancies between certain pY~ysical and
cost indic~tors of the plan.
A further� development of balance methods has to be based, first, on a
shift to material resources consumption balances and, second].y, on a shift
f.rom mono-balances to overall balances which embrace interchangeable mate- ~
rial resources of various types. The development of a inethodology for
corrrposing overall material resources consumption balances (for example,
balances of st�ructural materials in machine building, of packing and pack- �
- aging materials, real and artificial leather in the shoe industry, a.nd ,
so forth) will be the b asis for substantiating a technical policy of the
consumption of material resources. In addition, it is important to provide '
elements f'or optimizing these balances with regard to ~n economic evalu~.- ;
~ ~ion of the social results which are achieved. This will make it possible '
to substanti~.te optimal ma,~terial resources consumption variants from the
~~oint of view of socio-economic effectiveness.
V. A. ~pektor (candidate in economic sciences, division chief of the '
Scientific Research Institute of' the Economics of Construction of Gosstroy
USSR).
The assignments for economizing construction materials which have been
stipulated for 1976-1980 are based above all on an exp ande d use in construc-
tion of new effective materials and products and on the development of new
and the improvement of existing structures and methods of calculating them. ~
If the econorr~y of rolled ferrous metals which is being planned for 1980 ~
in the USSR Ministry of Industrial Construction is taken as 100 percent,
then 31 percent of this econorqy has to be achieved through an expanded use ;
40
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY '
' of effective types of rigging steel and of economical sections of rolled
goods with high physical-mechanical characteristics, and 43 percent through
~ the development of new and improvement of exist3ng construction structures
and methods of calculating them.
Under the conditions of intensification an improvement of the system of
material and technical supply is of great importance for economizing re-� .
sources. The development of a system of overall production supplies as
one of the very itrlportant directions in improving supplies also promotes
a.n econom~y of material resources in construction, The realization of the
measures which are being provided for by the long-term program for the
introduction of the "Komplekt" overall production supply system in the
USSR Ministry of Industrial Construction will make it possible in the mi-
nistry as ~a whole to decre~,se stoppages at construction and installation ~
~jobs by 25 to 30 percent, to decrease labor expenditures at construction
sites by 10 to 12 percent, losses of materials and products--from 1.5 to
10 percent and more, and labor expenditures at loading and unloading and
warehouse operations by an average of 20 to 25 percent.
During the years 1g74-1978 the inerease in waxehouse capacities in the
USSR Ministxy of Industrial Construction came to around 60 percent, while
the amount of work increased by 10 percent. During this same time the
volume of the centralized processing of materials a.nd products and the
level of their glant re~.diness in the production subdivisions of the
adininistration for overall production supplies increased by 1.5 times.
However, despite the work which has been accomplished, the ministry's
need for warehouse space was met by onl,y ~+0 percent, while for closed
~ warehouses an d production premises the figure was 35 percent.
An analysis of the data of the construction enterprises of general con- ~
struction minist'ries shows that the centralized processing of materials
at overall preduction suppl_ies bases makes it po~sible to decrease waste
and losses of petroleum bitumen by 10 percent, rigging and roofing
steel--by 3 percent, rolled roofing materials--b;~ 5 percent, construction
~lt~ss--by 10 percent, linoleum-by 4 percent, fillers--by 15 percent,
wa11 coverings- by 5 percent, paint and dye materials--by 4 percent,
chalk pastes--by 11 percent, and sawn materials--by 11 percent.
The proportion of processed ma.terials in the total a.mount of materials
came to the following at the bases of the ministry's (for example, the
USSR Ministry of Industrial Construction), administration for overall
production supplies (as of 1~'anuary 197$)~ 58.~+ percent for glass cutting,
33 percent for linoleum, 55.8 percent for wa11 covering, 66.1 percent for
the preparation of paints, 90.3 percent for the preparation of fillers
and cements, 59�3 percent for the production of products made of roofing
and gFil.vanized iron, and 3~.4 percent for the production of carpentry
products. Work on the centralized processing of materials has been orga-
nized unsatisfactoril,y at the ministries of industrial production of the
Armenian and Azerbaydzhanian Union Republics, at the Main Administration
.
~t1
FOR OFFICIAL USE ONLY
i
'
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFTCIAL USE ONLY .
fc,:r Indu~~trial Construction of Stavropol'skiy Kray, the Main Administ;ration
fur 1'ndustri ~3.1 Construction of Tyumenskayr3, Oblast , the Main Administration
for Industrial Construction of Astrakhanskaya Oblast, and others. For
exa.mple, a~ the Ministry of Industrial Construction c~f the Azerbaydzhanian
S5R centralized processing is provided for only l7 percent of the linoleum,
14 percent of the floor boards, 40 percent of the paint and dye output,
and 30 percent of construction glass.
The question of the packet and container shipment of freight is of great
importance, Unfortunately, such shipments still comprise a sma11 proportion.
iyeanwhile, the experience which exists in cons~ruction organizations shows
tha.t container and package shipments make it possible to reduce labor expen-
ditures in loading and unloading and warehouse operations by an average of
20 to 25 percent and losses of small item and loose materials by 10 percent,
and to decrease rolling stock idle time during loading operations. In the
USSR Ministry of Industrial Construction containerization equipment is used
to supply construction proj,ects with 81 percent of their brick, 30 percent
of' their door and window blocks, 82 percent of their glass and glass blocks,
~+0 percent of their linoleum, 68 percent of their wall coverings and ferro-
conerete products, parquet, floorboards, rolled roofing materials, plaster
panels, and others..
The Mosotdlprom Trust of the Main Administration for Construction of Moscow
contains the large "Stroydetal combine which is equipped with highly
productive mechanisms and equipment and which has an annual production of
50,000 fillers, chalk pastes, oil tints, primers, cements, and mastics.
'I'he produc~tion by the "Stro,ydetal"' combine of varnish-free i'illers and
a water-oil ennalsion makes it possible to economize 1,000 tons of varnish
a year. At this combine around 1.9 million square meters of linoleum is
wel.ded into carpets an d delivered to projects in a centralized manner in
a set with skirting and other accompanying materials, which exeludes losses
of insulated 1inol.eum that.previously had come to 5 percent. The central-
1'LC(j cutting of 8.5 million square meters of wall coverings and their de-
livery in sets has made it possible to compl.etely eliminate losses which
hacl reached 18 percent with hand work. The introduction by the Trus~t of
_ centralized supplies for construction sites of finishing materials with
increased plant readiness has made it possible to eliminate losses of them
and to reduce labor expenditures at finishing ~obs by more than 200,000 .
man-days a year. '
The system of supplying canstruction site orders through the agencies of
Gossnab USSR is of great import:ance for�economizing material resources in
construction. True, it is no~ yet possible today to speak of its wide and
universal. introduction. Only S percent of the capital construction is
supplied in this way, but the existing experience shows that from the point
of view of economizing material resources this system is effective. Thus,
supplying the orders of the.construction organization of the Main Adminis-
tration for Construction of P~urmanskaya Oblast in accordance with needs
defined by plans and estimates helped to decrease the actual expenditure
42
FOR OFFICIAL USE ONLY
-
.
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY '
o:f construction materials by 1 million rubles of the estimated cost of
, cc~nstruction and installation work. The annual econoiqy of materials com-
~ pared to the expenditure norms came to 3 to 5 percent for cement, 2 to 3
percent for construction glass, 5 to 8 percent for soft roofing, 4 to 5
percent for slate, and so forth.
The effectiveness of the new supply system which was developed and intro-
duced in the construction of the Kama Motor Vehicle Plant was.an expression
� of the fact�that control is carried out over the expenditure of material
re'sources iri.accordance with the expenditures for materia.ls stipulated in
the estimates. This provided for an econo~y of basic materia.ls of 4 to 9
percent compared with the expenditures in the construction of the Volga
Motor Vehicl:e Plant. One of the effective~ways of economizing material
resources`in construction is an improvement of norm setting. The develop-
ment of a system of planning material and technical supply for construction
requires a constant improvement of its norm.base.
I. A. Mikhaylova-Star~yuta (candidate in economic sciences, senior scientific ~
associate at the Institute of Economics of the Acade~y of.Sciences Belo-
russian SSR). In Belorussia primarily the processing branches have been
developed and the proportion of their material expenditures in production
expenditures is quite high. Thus, for industry as a whole their proportion
' is 86 per.cent (91,5 percent in the light industry, 96.2 percent in the
food industry, 76 percent in machine building and metal working). With
the present scope of the consumption of materials an econou~y of only 1
percent is equal to an econo~y of 180 million rubles compared to ~+6 million
rubles in 1960.
' An econo~y of inetal.plays a special role for Belorussia since the republic
does not have its own metallurgical enterprises. Ninety-eight percent of
the need for rolled ferrous metals is met through imports from otlier areas ~
of the country which come to 2 mi.llion tons a year. How is the scarce
imported metal used? The use coefficient of rolled ferrous metals in the
republic's machine building comes to .736, that is, 26.~+ percent goes into
waste. True, compared with 1969 (.71~+), it has increased somewhat. However,
such an increase over a ten-yeax period is c],early insufficient.
'I7ie level of the coefficient in the republic's machine building is approxi-
mately the same as the average union one, but the formation af its average
magnitude has been influenced by the high metal use coefficient in the
electricaT engineering and instrument making branches which define the
specialization of production in the republic, At the enterprises of the
Ministry of the Motor Vehicle Industry the coefficient is lower than the
average one and comes to .721, while it is .728 at the Ministry of Tractor
and Agricultural Machine Building. Yet, the metal use coefficient reflects
the progressiveness of technology and technological solutions.
The net weight of a product characterizes the decrease in materials inten-
siveness. In this ax�ea there .are definite successes in the republic. For
43
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
~ FOR OFFTCIAL USE ONLY
er.~.mple, the specific materials intensiveness of the MT'L-80 tractor� compared
~ ta the MTZ-50, calculated per unit of power (horsepower), decreased from
70 to 40.2 kilograms, that is, by 41 percent, while its engine decreased
fz�om 7(the D-50 engine) to 5.4 kilograms (D-240) and 4.4 kilograms (D-240T),
that is, by 37 percent. The specific materials intensiveness of the MTZ-80
and MTZ-82 tractors is on the level of the best foreign analogues of the
Ford, John Deere, and Perkins-Massey-Ferguson companies which, it is true, .
have a somewhat smaller motor potential, but, then, are more ecor~amical
~ in their fuel expenditure. In their specific mass (kilogram/horsepower)
and specific fuel expenditure the engines of the Minsk Motor Plant are
also lower than the analogous American ones (the Case 336VD and Jbhn Deere
4270D). The Minsk Motor~Vehicle Plant has the country's lowest expenditure
of inetal per ton of truck freight capacity, and there has been a constant
decrease in tYie weight of the large-capacity trucks of :the Zhodino Motor
Vehicle Plant and of the motorcycles and bicycles and also of many other
types of machine building output which is produced in the republic.
At the same time, a stuc~y of the technical and technological levels of
engineering solutions confirms that there are substantial reserves for
reducing rnaterials intensiveness. An analysis of individual indicators
of the machine tools produced in~our republic and of foreign analogues
testifies to the fact that with the same and, in certain cases even worse
technical parameters our machine tools have a much greater mass.
In order to explain such losses it is necessary to analyze the formation _
of materials intensiveness beginning at the stage of technological design
preparation. Alreac~y at this stage there is a lack of control over the
level of materials intensiveness. The client is interested basically in
the technical parameters of the machine tools and the area occupied by
tYiem so as to be able to place a line in the existing area. The price
in which material expenditures are taken account of plays a secondary role
for the client. On the other hand, a high price is important for the
producers. It is advantageous for them to have large material expenditures,
since the price for new products will undoubted~y cover them and ensure
a profit which is established in percentages of.cost. If it is considered.
that ~hree-fourths of the cost is comprised of material expenditures, it ~
wi11 be clear that the producer sets himself the task not of reducing
material expenditures, but rather, on the contrary, of validating an in-
crease in them. �
Thus, the producer and the consumer have no claims on materials intensive-
ness. Another question arises: are the production designing services
interested in reducing materials intensiveness? After all, weight is
specified in a product's documents. In part it is limited, but if a1.1
of the other parameters, except materials intensiveness, correspond to
the demands made upon them, this will not put a stop to starting output
in production. Moreover, a high materials intensiveness is not a barrier
even to the awarding of the Token of Quality. The reason is the replace-
ment of grades of inetal. Production designing calculations are made for ~
FOR OFFTCIAL USE ONLY
~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR.OFFICIAL USE ONLY
hi~;h-stren~;th ~;rades of ineta.7. of a definite profile, but they are not de-
:l.:i.vcl�ed. 'I'his is how replacements of less strong materials of inappro-
pi�i~.~;e prof'i~e ~ appear, which leads to a decrease in the reliability r~nd
service life of products ~nd an increase in the expenditure of materials.
In addition, designers are not always well-informed about the conditions
o� the operation and use of mass and series production products in the ~
spheres of.their greatest application. For this reason, when thPy design
they a11ow large guaranteed allowances for parts and units.
Not all of the types of type sizes of our products are sub~ected to cal-
culations for rigidity, strength, and so forth during planning and designing
work. Such calculations are performed only for base products, and subse-
quently this cumbersome "base" moves from one model to another. In addi-
tion, neither designers nor production engineers are properly provided with
incentives for the development of ].ess materials intensive types of output.
11 decrease in materials intensiveness depends to a large extent upon the
planning of technological progress. In practice technical development plans
are more concerned with the problems of labor organization and reducing
labor intensiveness than materials intensiveness. An analysis which was
performed by us has shown that most enterprises which do not fulfill their
cost plan do nat fulfill their pltans for a`;,decrease in material expenditures
either. The increased attention to a growt~i in labor productivity is un-
derstandable, since the stimulation funds are formed in relation to the
growth rates of labor productivity.
While~the:problems of reducing the expenditure of materials at enterprises
are nevertheless given attention, the problems of reducing stocks of commo-
dity assets are ignored. Enterprises are not interested in the best use
of stocks which sometimes greatly exceed the established norms. In indi-
vidual years above-norm stocks at the Minsk Motor Vehicle Plant have ex-
ceeded 70 percent of the norm, at the Minsk Motorcycle and Bicycle Plant--
50 percent, while at remaining enterprises they have not been lower than
25 percent. In Belorussia as a whole, above-norm stocks have reached 55
percent. In addition, the increase in stocks has been occurring inde-
pendently of the dynamics of materials intensiveness.
Practice has shown that the close interconnection between all the factors
of produc~;ion makes it possible in individual cases to deliberately in-
cre ase materials intensiveness, if other types of expenditures are mate-
rially reduced on the basis of this increase. For example, cases are
known when a unified part or unit exceeds, albeit negligibly, specialized
ones in materials intensiveness, However, the econorqy does not suffer
any damage from this, since the increased expenditures for materials are
compensated for by an econcm,y of various expenditures in the producti.on of ,
unified parts a.nd units. The chief thing in evaluating effectiveness is
the combination of factors, especially when their dynamics moves in diverse
directions. However, in this combination materials intensiveness, like
any other factor, can at a certain stage play a corrcpensating role which in
45
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
~ FOR OFFICIAL USE ONLY
~he final an~lysiswill bring about a positive evaluation of effectiveness.
A study of t}?e problem of materials intensiveness in its region~,l aspect
makes it possible to discover how the special characteri~tics and place
of a republic in the socit~,l division of labor effect the actual level
of materials intensiveness. Thus, in Belorussia rzn increase in the
materials intensiveness of gross ou~put during the past 15 years per-
~~~ent) was the result of branch structural ch anges (9 percent), although
non-structural factors helped to decrease materials intensiveness (5 per-
cent) but were unable to neutralize its growth which was caused by an
increase in the proportion of industry (from 50 to 69 percent). Tn indus-
try the influence of the above factors moved in a single direction. More-
over, during the last 10 years one-third of the decrease (2.g percent of
8.3 percent) was a result of structural changes (the share of gross output
in the most materials intensive bra.nch--the food industry--decreased by
10 points). Structural changes also had a great influence on the level
of the metal use coefficient.
Of course, it is difficult to "manage" materials intensiveness in a region
thr�ou~h the structural factor. The faborable influence of structural po-
licy should not be reduced merely to decreasing the materials intensive-
ness of production. However, we can alreac~y observe changes in the branch
specialization of the republic's machine building which are directed toward
decreasing the share of the metal intensive branches which do not have
a r_orresponding metallurgical base and toward increasing the share of the
electrical engineering and instrument making branches which are provided '
with the necessary labor resources.
Practice testifies to the highly effective influence on mater.ials inten-
siveness of intra- and interbranch production specialization. Unfortunate-
ly, the existing planning system reduces to a minimum the possibilities
of a region for solving these problems.
To this day, ~the republic has no overall program for economi.zing material
resources which is baclced up by directed capital investments. The rea-
lization of such a program would make it possible to avoid many unwarranted
losses.
P. S. Malinovskiy (candidate~in economic sciences, division chief at the
All-Union Scientific Research, Planning, and Designing Institute for Metal-
lurgical Machinery).
In order to satisfy the econorr~y's needs for pipelines with anti-corrosion
plating the Al1-Union Scientific, Planning, and Designing Institute for
Metallurgical Machinery has developed a process and created a unit for
the production of thin-walled welded pipes whose use will make it possible
not only to fully satisfy the needs of agriculture, but also to provide
the econorr~y with an enormous e:eonom~y of inetal. .
46
FOR OFFICIAL USE ONLY '
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICTAL USE ONLY
In 1y72 a shop for the production of thin-walled welded pipes was con-
structed ~,t the Davydov Agricultural Machineiy Plarit. The use in irriga-
�~~ion sy:;tems of galvanized pipes with a 1.~ millimeter wall mekes it
~.~~~;;~~ib1c ta replace the ordinary ateel pipes with a 6 millimeter wall.
'I'hc nnnurzl c~r,onomy of inetal in the production of thin-walled pipes on ~;he
m~.chine tools which are slated to be instr~lled at the Davydov P1ant wi11
be around 90,000 tons . The production of this quantity of inet~..1. requires
the expenciiture of around 60 million rubles. The basic equipment which
contains many original machines was produced in accordance with blue-
prints made up by the All-Union Scientific Research, Pl.annin~, and Designing
Institute for Metallurgic~.1. Machinery in Romania at a cost of around
6 million rubles, but it has not yet been installed. Thus, the~delay
in starting up the corrrplex at the Davydov Plant is causing t;he econorqy
triple damages: every year 90,000 tons of inetal is overexpended, valu~.ble
equipment costin~ 6 million rubles is not used, and agriculture is not
supplied with pipes for a.rrigation cropping..
An expansion of the production of rolled goods and piping with protective
cover~ngs is a very important nati~nal economic task: Their use makes it
possible to ~zvoid corrosion during ~torage and transportation, and r~1so
substantially increases the service life of construction structures and
machine building parts. It is not surprising that especial attention is
devoted to the production of rolled goods with protective coverings in
-the United S~ates, Japan, and other developed capitalist countries. For
example, in 1977 the production of galvanized sheet in the United States
. was 5.13 million tons, in Japan--5.21 million tons, and in the USSR--only
.61 million tons, that is, 8.5 times less. Despite this lagging, a number
of design developments which have been achieved at the All-Union Institute
for protective covering machines have not been re~.lized for a long time.
The production of hollow castings ~.t continuous stePl casting machines
makes it possible to substantially shorten and simplify the technological
cycle in the production oi sea.mless piping, to decrease capital expenditures,
a.nd to improve the quality of piping and reduce its cost. The All-Union
Scientific Research, Planning, and Designirig Institute for Metallurgical
Machinery and the "Tulachermet" TSNIICHMINPU have developed a technology
for. the production of hollow castings and have tested the design of the
basic technological units of a machine for casting hollow castings.
According to the calculations of the Ukrg'ipromez , the introduction of
this installation at the Taganrog Metallurgical Plant will make it
possible to decrease the metal expenditure coefficient by 8.2 percent,
to increase the production of first-grade piping by 1.6 percent, and to
obtain an annual economic ef fec1: of 2.5 million rubles . However, since
1974 the USSR Ministry of Ferrous Metallurgy has been posi:poning the
schedules for the production of the machine, thereby holdin~ back the
introduction of a highly ~ffective method of producing hollow castings.
The All-Union Scientific Research, Planning, and Designing Institute
for Metallurgical Machinery and the Institute of Electric Welding imeni
47
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
A
FOR OFFICIAL USE ONLY
Pa,ton have developed a.n original technolog,y for producin~ economical
double-T sections. The process has been brought to perfection on an ex-
pez�iment~,l unit. Tests of the double-T's have shown that they are in no
way inferior to rolled bea,n~s in their strength properties. The speci~.l
f.Patures of the new technological process which has been developed for
the first time in ~Ghe~,world make it possible to economize 120,000 tons
of inetal with an annual mill productivity of 350,000 tons. However, under
various pretexts since 1971 the USSR Ministry of Ferrous Metallurgy has
been refusing to finance the creation of this mill. A large number of
such examples could be cited.
A substantial incre~se in experimental productions which are a part of
head institutes or scientific-production associations is a very importan~
means of acceZerating the introduction into production of new and highly
efficient units and machines. The effectiveness of the development of
experimen~tal productions is confirmed by the following examples. In me- ~
, tallurgical machine building experimen~al productions account for slightly
more than one percent of the capacities of all of the plants. Neverthe-
less, the experimental plant of the Al1-Union Scientific Research,
T':lanning, and Designing Institute of Metallurgical Machinery has produced
and introduced into industry a number o f new machines which are of ex-
ce~~tionally great importance for the country's econorr~y: pilot models of
mi11s which represent a new direction int3~e production of billets for
machine buildin~ parts which are close in form to finished products, mills
for tYie production of axles, shafts, wheels, bearings, screws, rings, and
so forth. The use of such bil.lets in machine building makes it possib le
to obtain an average metal econorr~y of 18 percent of the weight of the pro-
C~L1CtS. Today 92 detail-rolling mills are being used in industry and around
200,000 tons of inetal a year is being economized; the basic mill models axe
for joint processes of continuous casting and rolling. At the present time
a large part of our aluminum and copper rolled goods is being produced on
such mills. Thanks to.the complete continuity of the processes labor pro-
ductivity h as increased five times, the cost of conversion has decreased
by 38 percent, and specific capital expenditures have been reduced by three
times; on the basis of a new technology for producing especially thin wel-
ded pipes which has been developed at ~he All-Union Institute for Metallur-
~ica1 Machinery, small-dimension mills have been designed and manufactured
for ~he Voroshilovgrad Plant imeni Yakubovskiy which have an annual production
of 4.5 million meters of thin-wal.led piping for agriculture and provide
an econorr~y of around 200,000 tons of inetal a year; the same is true of the
first models of systems for the autematic regulation of the thickness of
rolled sheets for continuous cold rolling mills. The system has made it
possible to sharply decrease uneven thickness in the strip with the re-
sult that the actual precision of the finished sheet is 4 to 5 times greater
than that regula.ted by the existing standards. The econom~y of the metal
with a mill productivity of aroun d 1 million tons a year will be 50,000
tons. 'I`hese systems have been successfully introduced at the Magnitogorsk
Metallurgical Combine, the Cherepovets Metallurgical Plant, the Zhdanov
Metallurgical Plant imeni I1'ich, in the GDR, and elsewhere.
48
FOR OFFICIAL USE ONLY
/i
/
. -
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
f~:
A single technical policy has to be carriec~ out of supplying domestic
metallurgy with the necessary machinery and equipment to meet the growing
. nceds for steel, ferrous metals, and alloys with regard to the unique
experience which has been gained in creating fi~st-class metallurgical
uriit ~ and i�olling mills w~iich in a number of cases are superior to their
foreign analogues.
Machine b uilders are frequently reproached for increasing the weight of
structures. Yet, the existing system of planning rolled goods compels
a designer to orient himself not towaxd the modern methods of inetal
working. The ea-penditure of rolled goods and not the expenditure of
metal as a whole is planned, an d for this reason the designer is compelled .
to make greater use of c~,sting structures. The experience of the Electro-
Steel Plarit for Heavy Machine Building which was permitted to use rolled
goods in excess of the norm has shown that the use of welded structures de-
creases expenditures by 2 to 3 times and reduces the consumption of various
material s by 8 to 10 times.
It has been said her~ that it is necessary to set norms for every product.
In our opinion, this will lead to even greater conf~sion. Norms have to
be set in such a way that a designer has the possibility to think about
a structure beforehand and to make it more elegant and more efficient.
T. S. I~hachaturov. In m~}r cases designers are not interested in increasing
the weight of products. However, there exists an interest in using stan-
dard creator's parts, which objectively does not stimulate a decrease in
materials intensiveness.
V. I. Radin (doctor of technical sciences, chief designer at the Electric
Machinery Plant imeni Vladimir Il'ich). I would like to illustrate with
several concrete examples the points which have already been spoken about
_ here, and also to raise a number of problems. The USSR produces electric mo-
tors with a total capacity of more than 40 million kilowatts every year.
Their in stalled capacity is greater than the capacity of all of our elec-
tric power statiions. Electric engines both in our country and in the
entire world consume 43 percent of the electric energy which is produced,
while in certain very i~nportant branches of industry this figure is 90
percent. Their production consumes around 500,000 tons of electrical
engineering steel a year and around 50,000 tons of coiling copper. More
than one million people tend electric motors. Our electric motor pool is
constantly growing. The use of electric motors characterizes the use of
all inst alled equipment. In the USSR~a large amount of positive experience
has been gained in developing uniform theories of electric motors. Thus,
during the 9th Five-Year Plan ~roduction began on synchronized motors of
_ the fourth all-union series ~+A which i.n their technical and economic in-
dicators correspond to their best foreign models.
The economic effect fr.om this series is characterized by the fact that
every new motor is approximately 20 percent lighter than its analogue from
49
FOR OFFICIAL USE ONLY
~ '
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
.i
FOR OFFICI.AL USE ONLY ~
the pY~evious uniform series, that there is a 20 to 25 percent smaller
~ expenditure of coiling copper, steel, and iron, and that the efficiency
coefficient of the electric motors is one ~ercent higher (a one percent
- increase in the efficiency coefficient will economize approximately 2.5
billion kilowatt-hours of energy a year). The overall economic ei'fect
from thei~r use is estimated at 35o million rubles a year. ~
It was possible to achieve all of this above a11 on the basis of an over-
all approach to the development of the series in which 43 designin~ and
scsentific rese~.rch organizations from 8 minist ries took part. All of
their work was conducted according to a single network schedule involving
the use of computers. New materials, electrical engineering steels, wire,
and ball-bearin~,s were created.
Tn addition, at the same time that the motors were developed all of our
electric machine building plants were re-equipped with the result that
as carly as the lOth Five-Year Plan the entire increase in electric motors
is being achieved without increasing material expenditures, since the new
series is being mastered. On the basis of the fact that the new series
is replacing obsolete models, material expenditures for the production of
the electric motors are being decreased and, in this way, the increase is
bein~ a,chieved without increasing material expenditures.
However, I would like to consider some unsolved~and important problems.
If ~the growth rates of the production of electric motors continue in the
f'uture to be the same as in the 9th and lOth Five-Year Plans, by the year
2000 all of our electrical engineering steel and coiling copper will be
expended for the production of electric motors and the economy will ex-
perience a shortage of labor resources.
We pioduce many more electric motors than the United States, but their
installed capacity is.the same in both countries and their power-labor
ratio is much higher than ours. A comparison has shown that the average
output of our. electric motors is 1500 hours, while in the United States
it is !+OUO hours; that is,~our electric motors are used approximately
2.5 times less efficiently. Of course, it is not a ma,tter of the electric
motors theniselves . YJhat is involved is the use of machinery and mechanism
equipment.
An analysis which has been performed for all brar:ches has shown how many
hours machine tools operate in every branch.. If our electric motors ope-
rated at least 2,000 hours a year, ~;his would r,~ake it possible not to in-
crease the production of electric motors as intensively as has been plaruled ~
in our country. 'I'herefore, the basic question is the use of equipment,
particularly of electric motors.
Today a number of foreign companies have produced electric motor.s which
require approximately 20 to 30 percent more electrical engineering steel
and copper, but which have higher energy indicators. They believe that
5a
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
l the econorqy of electric energy will reimburse the expenditure of materials.
This is a.tso an important question, although in our country there is less
use time of electric motors and electric energy is cheaper.
In our opinion, it is necessary to create not one but two series of elec-
tric motors for their more or less intensive use. For example, we know
that in the textile industrie:; electric motors operate 3 to ~+,OOOhours and
more; this means that it is acLvisable to increase the expenditure of
copper and steel and to o.btai:n a large econo~y of electric energy. In
- certain other branches eler_tric motors operate.800 hours. There it is
advisable to use electric motors which, although'� they have somewhat poorer
energy indicators, require less metal for their production. This will
yield a large econoir{y both of inetal and of electric energy.
~nterprises today are not interested in reducing materials intensiveness
a.nd producing cheaper and lighter output. On the contrary, they strive
to increase the expenditure of materials and of extremely expensive com-
- ponent products. There is one more question--the efficiency of various
preparatory and auxiliary productions. Let us cite an example. An elec-
tric motor plant in the FRG is analogous to our~Mogilev Plant in the
a.mount of output it produces. However, there are three times fewer workers
there. A comparison of production and labor intensiveness has shown that
at the basic processes the technology is the same an d, moreover, it is even
better in our country for. certain basic processes. But the ~auxiliary pro-
cesses cannot be compared. In e].ectric motor production ~+0 percent of our
workers ar~~employed in the basic operations, and 60 percent in auxiliary
operations. '~~ere is an enormous expenditure of inetal here. In fact, metal
expenditures arE~not planned for the production of tools, non-standard e-
quipment, and r~~ging. For this reason, the branch's basic task is mecha-
nization and an improvement of the pla.nning of auxiliary and preparatory
productions.
T. S. Khachaturov. The reports proiride us::wi~h valuable and sharp material
whose publication in the periodical will be very useful.
The ~ituation in the field of economizing material resources has been cha-
racterized and many successes and achievements have been noted. At the
same time, criticisms were made during the course of the analysis and
shortcomings were demonstrated.
It was correct]~y stated in the reports that in a number of cases the
pr�oblem of economizing materials can and must be solved on the basis of
an interbranch overall approach. It was said, for example, that coristruc=
tion workers economize construction materials, but the result is an enor-
mours overexpenditure of fuel for the econorr~y. It is absolutely clear
that this i~ an in~terbranch problem. Or an increase in the shift coeffi-
cient. Tt follows from Comrade Radin's report that an increase in the.
shift coefficient can lead to an economy-wide. savings of ma~;erials.
51
. FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
~
~ ,
FOR OFFICIAL USE ONLY
The probl~m of economizing materials has to be solved not only on an '
intrabranch level through iruproving technology, and so forth. A national
er.onomic approach is x~equired. A number of fundamental issues follow
fr~om this. Among t~em are the use of both production and consumption
b~Llances. A cYiange in the structure of production was also discussed.
This requires an improvement of economic planning.
It is hardly~ worth repeating a11 of the interesting ideas which we have
heard today. The opinions and proposals which have been expressed on
. eliminating shortcomings wi11 be printed in the periodical and it would
be desirable for planning and economic agencies to take measures to carry
out these proposals.
Some of the participants in the "Round Table" presented their proposals
on the problem of reserves for economizing material resources in written
form.
I. P. Zhavoronkova (candidate in economic sciences, senior scientific
associate at the Institute of Economics of the USSR Acade,z~y of Sciences).
The re].ationship between the extracting an d processing branches of indus-
try in ~ross output is one of the indicators which characterizes a decrease
in the materia.].s intensiveness of social production. Meas ures being
carried out during the lOth Five-Year Plan to improve the use of raw
material resources and decrease the materials intensiveness of production
are crea~Ling the~necessary preconditions for a further improvement of t}ie
sLructure of social, production on the basis of decreasing the share of
tlie capital intensive extractin~ branches in the total gross output of
industry.
_ In this connection, note should be taken of the large reserves for econo-
mizin; raw material resources which ex~.st at the first stages of their
involvement in economic turnover. A further increase in the overall
use of~raw materials is one of these reserves. In the future more than ~
30 percent of the need for all types of mineral resources can be covered
~hrough the overall use of raw materials. Substantial successes have been
achieved in the development of the overall processing of raw materials;
Yiowever, they have basically an intrabranch thrust.
Insufficient attention is still being devoted to interbranch problems of
the overall use of raw materials and this is leading to subs~;antial losses
at the junctions of individual branches. For example, there is a lack
of coordination in the work of the ferrous and non-ferrous metallurgy
branches on the use of raw materials. Many large non-ferrous metallurgy
deposits are characterized by a substantial iron content. And along with
iron, iron-bearing deposits contain non-ferrous metals.
In order to expand the coun~;ry's raw material base the use as secondary
raw materials of the waste of processing branches and also of depreciated
52
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
~ FOR OFFICIAL U5E ONLY
?m.~nn~ ra.nd ob,jects of' l~,bor is acquiring increr~sing importance.
`l'licrc i~ ~sn e;,peci~.lly subs~;antial effect from the utilization of sulphur
discharge~, secondary ener~y resources, scrap metal, and the processing
oP slag into construction materials. At the enterprises of ferrous met~1.-
lurpr alone the total amount of additional output from slag processing now ~
comes to around 90 million rubles, an d the reimbursement periods on the '
capital investments for the creation of the relevant installations do
not exceed two years.
As fuel intensive and enerpr intensive productions develop a.nd as their ,
concentration increases, the total production of secondary energy resources
which axe suitable for use increases. The high effectiveness of the uti-
lization of secondary energy resources is chaxacterized by the fact that
the specific capital investments for salvage installations comes to 11 to
15 rubles per ton of salvaged fuel, while the capital investments for the.
construction of extracting enterprises are 5 to 8 times greater.
Ttie development of utilization processes depends upan the planning and dis-
tribution of ca.pital investments. The question arises: should these
investments be directed toward searching for technica.l means and methods
for fullez� salvaging and processing, for example, of sulphur-containing
discharges, or for geological surveying--for searches for sulphur deposits?
In order to decide such questions use has to be made of the compensation
possibilities which.are contained in a fuller utilization of waste. In -
acldi~ion, the economic advisability of these measures cannot be regarded
as the only criterion of their effec~tiveness. For example, under certain
conditions the replacement of a primary raw materials productimn with a
secondary one not only economizes the former, but also prevents environ-
mental po.llution. Thus, the use of one ton of inetal scrap replaces natural
raw materials at the level of 90 percent and decreases water pollution by
approximately 7 percent, while it reduces the amount of waste by 2 times.
Every ton of paper or cardboard not only completely saves raw materials,
but also decreases air pollution an d reduces the amount of solid waste by
40 to 50 percent.
T'or this reason, an improvement of the production preparation system and
the introduction of effective technological processes for p-reparing second-
ary raw materials for subsequent processing should be regardec~ as leading
directions of contemporary investment policy in the field of the use of ~
secondary raw materials. This undoubtedly demands a redistribution of
capital investments among the extracting and processing branches.
N. A. Nte~.vedev.(candidate in economic sciences, chief of the economic plan-
ning adlrunistration of the Pti.nistry of Timber Industry USSR) . The main ~
�ask of the ~;imber industry at the present time is an improvement of the
structure of production on the ba.sis of an overall use of timber raw
materials, Compared to 1975, in 1980 it is planned to increase the pro- ,
curement and shipment oi' round ~timber materials by only 6.9 million cubic
53
FOR OFFICIAI, USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
,
FOR OFFICIAL USE ONLY ~
me;ters, while the production of commerci~l timber wi11 incr~ase by 14.4
milliori cubic meters. The production of commercial timber substitute~
which is plarined for 1980 is equal to approximately 64 million cubic
meters of tim~er materials. According to the ca.lculations, this pro-
mi~c ~ r~,n econorqy o.f almost 1.1 billion rubles . The need for workers
w~il1 Ciecrca.se by 55,OOQ peopl.e, and the w~,ge econorr~y will be around 9Fi
million rubles. The concentration of the production of commercial timber
substitutes primarily in the European part of the country where this out-
put is basically consumed will make it possible to do ~,way with railroad
shipments from Siberia which during the five-year period will make it
possible to economize more than 50 million rubles.
_ The intensive development of the production of wood slabs--shavings and
fiber (1 cubic meter of wood shavings slabs replaces almost cubic
meters of round timber)--plays an enormous role in a better use of timber
raw materials. During the 9th Five-Year Plan an increase in the produc-
tion of wood slabs made it possible to decrease the.expenditure of com-
mercia'1 timber by almost 16 million cubic meters, to release around 30,000
workers, and to save more than 300,000 hectares of plantings from bein~
telled. During the lOth Five-Year Plan there will have to be a substan-
~ tial new increase in the production of wood slabs. In this connection,
of paramoun~t importance is the reconstruction of operating enterprises
so as to bY~ing their capacities to an average of 75,000 to 80,000 cubic
meters (today the average plant capacity is 58,000 cubic meters), an im-
~ provement of the quality and widening of the assor~tment of slabs, the
construction of new enterprises stipulated by the plan within the esta-
blished schedules, and the most rapid mastery of newly created capacities.
Another impo.rtant factor in economizing in the use of timber raw material
Y�esources is a substantial increase in the production of production chips
for. the cellulose and paper industry. Production chips are a.universal ~
~
raw material. The economic effectiveness of the use of capital invest-
ments for the creation of' capacities for the production of chips is 2.5
times greater than wi.:`,h the construction of timber procurement enterprises.
The cost of one cubic meter of production chippings at advanced enter-
prises does not exceed 10 rubles, while at a number of enterprises it is
considerably lower.
A decrease in the expenditure norms at timber industry enterprises of only
one percent would make it possible to economize more than 100;000 cubic
meters of wood, around 30,000 cubic meters of wood shavings slabs, more
than 400 tons of polyester varnish, and almost 90.million kilowatt-hours
of el.ectric energy. An econo~y of material resources means not only a
decrease in expenditures, but also the possibility of substantially in-
crcasing the production of output and consumer goods. Thus, an econorr~y
of it00 tons of polyester varnish would make it possible to finish an
additional 12 to l~+ million rubles worth of first-category furniture.
54 ~
FOR OFFICIAL USE ONLY
~r.
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
Losses of wood material.s occur at a11 of the stages of industrial timber
production. Solely by increttsing the extraction of wood frora one hectare
by one cubic meter it would be possible to procure an additional 1.5
million cubic meters of wood from the existing areas. A great deal of
wood is lost during storage, processing, and transportation. Tf we were
to count all of the losses beginning with the height of the stump which
_ is left by wood cutters (instead of tYie statutory five centimeters, a
stump frequently reaches 15 centimeters and in some places more, especially
during winter procurement), we would get a substantial figure. Simply by
decreasing the height of the stump to the size stipulated by the technical
specificat.ions, it would be possible to increase the production of commer-
cial timber by approximately 1-1.5 percent, and cutting the wood flush to
the ground would make it possible to obtain an additiona.l 7-8 million
cubic meters of high qua.lity wood.
The problem of so-called shortfalls, especially of leaf~ and also of
defective trees and thin standing trees is also important. On the average,
~.round 2 to 3 percent of the original wood remains on the root. In addi-
tion, wood with low consumption value is of`ten left at felling areas
(approxirnately 2 to 3 percent of the wood before felling). In shipping
trunks, especially on the railroad, it is necessaxy to trim those which -
are too large for the cars. These losses comprise approximatel,y one
percent of the total shipments. During the cross-cutting of the trunks
at down-river warehouses defective parts are cut away and chippin~s are
made. In addition, cuttings which do not correspond to the standard assort-
ment length are left over. As a result, losses from inefficient cross-
cutting reach two percent of the total procurements. Timber procurers
transfer a large amount of commercial timber into firewood because of
machining damage.
Regrading also leads to losses. The existence of commercial timber in
firewood stacks is a.quite widespread phenomenon.
There are also large monetary losses from the underutilization of the
timber felling fund. Payment by the stump for shortfa]_1s and fines for
violatioris.alone sometimes come to 3 to 5 percent of cost. Losses of
wood from shortfalls are increasing as a result oi' remnants of unshipped
wood when transportation packets are formed at down-river warehouses.
Despite the annual increases in the production of wood slabs, with ~ach
pa.ssing yea.r it is becoming increasingly difficult to supp],y the furniture
industry, construction, ar_d ~;he econotqy as a whole with timber ma~terials .
Ma.terial expenditures occupy the la.rgest share (more than 60 percent of
total cost) of the ~output costs of furniture and woodworking industry
enterprises, The expenditure.of raw materials and basic materials per
ruble of commodity output is growing every yeax at furniture enterprises,
which is increasing the importance of economizing material expenditures.
F'or exarqple, the average enterprise expends 6 to 7 million rubles worth
of raw ma.tex�ials and materials. Consequently, an economy of only one
55
~ FOR OFFICIAL USE ONLY
~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
' ~ FOR OFFICIAL USE ONLY
percent ma,kes it possible to reduce costs by 60,000 to 70,000 rubles, or
to increase flzrniture production by approximately 100,000 rubles. This
kind of minimum econo~{y can be achieved at every enterprise.
A decrease in the expenditure of timber for floors is an important reserve
for econonuzil~g wood raw materials in other bra.nches of the econo~y, for
example, in construction. Every year around 250 mill.ion cubic meters
of various materials are required for the laying and repairing of floors.
In 1g77, 80 million square meters of linoleum was produced, which even
with imports included comes to no more than 30 to 35 percent of the floor
area. Par:t~uet covers around 55 percent of the need for floor materials
(around l50 million square meters is met every year by floor boards) and
it requires -~.he expenditure of approximately 6.5-7 million cubic meters
of sawn materials, or 10-ll~million cubic meters of round timber. In
view of the fact that every 1,000 square meters of linoleum replaces ~+5
cubic meters of sawn materials, its use has to be incre.ased in the future.
It is also necessary to decrease the expenditure of timber materials for
packing and packaging. During the last 12 years there have been marked
improvements ,in the structure of packing materials: with an overall
increase in the production of packing materiais of 68 percent, the amount
of wood packing increased by only 25 percent. The proportion of wood
packing materials decreased from 86.7 percent in 1965 to 65.5 percent�in,
1977, while cardboaxd increased from 13.3 to 35.5 percent. (In the ~
United States, England, and the FRG wooden packing materials come to '
only 5-7 percent of the total expenditure of materials for packing and
packaging).
The use of one ton of cardboard for packaging output makes it possible to
economize more than 10 cubic meters of f~esh timber. For this reason,
' an increase in the use.of cardboard packing is a very ~:mportant reserve
for economizing wood. Used wood packing is being utilized unsatisfactori-
ly (~he repeat use of wood packing increased from 2g.7 percent in 1965
~to only 42.7 percent in 1977, that is, by only 13 percent). Of the.45
million cubic meters of wood and packing which is in circulation, in 1977 ~
only 19.2 million cubic meters, or 42.6 percent, was used for a second ~
time. An enormous quantity of.this packing materiel is burn ed, Meanwhile,
the repeat use of wooden packing could be increased to 75 percent. The
use of containers ensures a substantial econon{y of timber materials. i
According to the data of the Institute of Complex Transportation Problems
of Gosplan USSR, container shipments of one million tons of freight will~
economize approximately 250,000 to 300,000 cubic meters of timber. With
the shipment of 60-70 million tons of freight by the end of the lOth Five
~ Year Plan from 15 nu llion to 17.5 million cubic meters of timber could be
economized.
Around three percent of our timber materials (in terms of round timber)
of the highest grades is cons w~ed in machine building for the production � ~
of agz�icultural machines, railroad cars, trucks, trailers, and containers.
56 ~
~ FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
With a total conswaption of 11.1 mi]lion cubic meters of timber materials
(in terms of round timber), quality timber materials comprise 3,760,000 �
cubic meters, or 5,460,000 cubic meters in terms of round timber--51.2 per-
cent of the tot al quantity, --and l.l million cubic meters of round ship-
building timber. The need for these quality timber materials is net de-
creasing in the lOth Five-Year Plan and this is holding back the produc-
tion of timber materials for export.
At the satree time, in foreign countries quality sawn ma.terials~~or the pro- .
duction of freight cars, trucks, and containers are replaced by formed
p~ywood. For example, in the ITnited States 90,000 cubic meters of this
plywood is used in railroad tr.ansport alone. In order to replace one
million cub ic meters of quality sawn materials 300,000 cubic meters of
wide-formed plywood are needed. It is necessary to sharply.increase the ~
_ production of large-size plywood for initial use in the production of
. containers, and~then of railroad cars and truck cabs.
Every year around g million cubic meters of select coniferous� timber
is expended in our country for the production of ~+0 to ~+5 million rail-
road ties. The service life of wooden ties does not exceed 16 years,
while the.estimated service life of ferroconcrete ties is 40 years. Taking
account of service life, expenditures for the production and use of. ferro-
concre~te ties are 20 percent lower than for wooden ties. However, the
production of these ties does not exceed 10 million unii;s (an d is hardly
increasing), which covers only 25 percent of the need for them. Every
year 4 million cubic meters of laxge coniferous .timber is expended for
wooden poles and, moreover,~a large part of these poles goes to replace
rotted ones. It is known that wooden poles are successfully replaced by
ferroconcrete poles. These poles serve for 40 years, while wooden poles
serve for only 16 to 18 years. FPrroconcrete poles are 30 percent cheaper
to use than wooden ones; however, their production comes to only 1.3
million cubic meters.and is increasing very slowl~t. It is necessary to
increase the production of ferroconcrete ties to a minimum of 20 million
units and of poles to 1T1.5 million cubic meters, which will economize
a minimum;of 5 million cubic meters of high-quality timber.
N. G. Feytel'man (doctor of economic sciences, Institute of Economics
USSR Academy of Sciences). Scientific and technological progress is ex- ~
panding the possibilities for discovering and makin~ use of new mineral
deposits ( at d eeper strata, unde-r difficult geological mining and geo-
graphical conditions). At the same time,."poorer"~deposits whose exploit-
ation was previously unprofitable are being developed. In addition, the
development of science is leading to the discovery of new types of raw
materials and energy sources which are beginning to successfully compete
with the previously known ones. For exaaaple, a substantial part of the
world's petroleum stocks are connected with petroleum-bearing shale. ~
Theiz� amount in the United States and Canada is estimated at 153 billion
tons. However, the extraction of this petroleiun is connected with large
. capital investments (70,000 dollars per ton per day compared to .7.dollars
57
FOR OFFICIAL USE ONLY ~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
� ~ FOR OFFICIAL USE ONLY
per ton per day for the ordinary deposits of the Middle East). The limited
nature of stocks of mineral raw materials is an economic category which is
based on the inaximum possible amount of expenditures to develop them within
a given period of time. �
- An increase in the petroleum yield coefficient would make it possible to "
achieve~the amount of petroleum planned for the lOth Five-Year Plan while,
at the same time, curtailing the average annual commissioning of new capa-
cit ies . '
In a number of cases losses of minerals in the earth are the result of an
endeavor by mining enterprises to decrease costs and increase above-plan
profits and, on this basis, the economic stimulation funds. Frequently
mines first work sections of a deposit which have an increased mineral
content; after this the work is shifted to lower strata and substantial
stocks of ore with a lower mineral content are left on the upper strata.
The latter leads to a premature lowering of the level of mining work and �
to an increase in losses of minerals in the earth. Consequently, the
cause is in i;he contradictions which exist between national economic in-
tc~r~c~ts a.nd the cost accounting interests of individual mining enterpri- .
ses : . .
Important losses of minerals during mining are also explained by the fact
that investment and construction programs have an insufficiently overall
nature and are insufficiently coordinated for amount and time. In mar~y
cases the construction of a gas refining plant begins 5 to 6 years after
and encis 8 to 10 years after petroleum deposits have begun to be worked,
wYien 50 percent of the petroleum gas has already been extracted and (due .
~to.the absence of consumers and also of gas storage units) has been large-
l,y burned in torches. On the other hand, the commissioning of gas refi-
ning plants only ~i to 10, years after a deposit has begun to be worked
(that is, at a time when there has been a substantial exhaustion of the
ga,s resources) often raises the problem of providing a raw materials
workload for tihe newly built plants. Consequently, in addition to the
~ gas losses before the construction of these plants which lower the effi-
ciency of the capital investments for the prospecting, development, and
construction of the deposits, the efficiency of :the capital.investments
and the return on capital at the gasoline plants is also lowered. In .
these cases, it is advisable to use the petroleum gas for reverse pumping
in order to increase the petroleum yield. -
The rapid development of the mining industry in areas of pioneer develop-
ment demands that the problems of.the overall use of the.natural resources
of a region be posed more broadly. This riecessitates the development and
absolute fulfillment of overall investment and construction programs for
new territorial production complexes. In our opinion, it would also be
advisable to examine the question of expanding the territory of a terri-
torial production complex with regard to the sphere of its influence on
the development of the environment and of creating on their basis natural-
-
58 -
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
product-,ion complexes, including in their composition not only technologi- _
cr~:l.1y connected productions but also other ones, if they are based on the
~ame raw material sources, and also recreation enterprises and organiza-
tion~. This wi11 make it possible to accelerate the development and f~,ci-
litate the reali,zation of the territorial overall environmental protection
plans which were stipulated by the December (1978) Decree of the CC CPSU
and USSR Council of Ministers.
St wonld be advisable to establish a wholesale price for minerals whose
deposits are being developed by new methods at the lev~el of the maximum
price adopted in the branch which reflects the poorer conditions of working
a deposit with ordinary methods: An improvement o.f economic stimulation
for an efficient use of minerals will make it possible to sharply decrease
~ losses in the earth and to provide for the econo~y's.needs while sharply
reducing expenditures for the development of the country's mineral-raw
materials base .
P. G. Yakovlev (candidate in economic s~ier~ces, senior scientific asso-
ciate at the Institute of Economics of the USSR Acade~y of Sciences).
An increase in the efficiency o:f the use of mineral and technical resources
in stocks..an d~the relatively lower growth rates connected with this means
i:he release of substa.ntial resources for the econo~}r. In five years begin-
ning with 1970 the turnover rate of material working capital in industry
accelerated from 61.3 to 56.5 days. This was occurring alongside an over-
- all acceleration of tt-ie turnover rate of stocks of material and technical
capital in the econompr. However, by the end of the 9th an.d 'beginnin~ of
the lOth Five Year Plans there was already occurring a slowing down of
the turnover rate of circulating capital and an increase in above-norm
and surplus stocks of ma.terial resources an d of installed equipment.
During the years 1q75-1976 almost an additional 2 billion rubles worth -
of physical assets were ~iverted into stocks. During the years 1976-1977
uninstalled equipment remainders increased by 1.6 times, with new imported
eguipment increasing by almost 2 times. At the construction sites which
_ are supplied by Gossnab USSR alone warehouse stocks oi' uninstalled equip-
' ment came to ~t.5 billion rubles at the end of 1977. To a large extent
this is output which is in mass demand a.nd which does not find use for
a long time,_3espite the fact that it could be used at other pro~ects.
In our opinion, construction sites should be supplied with this kind of
output only as they are ready for it. An improvement of the quality of
supplies will be promoted by an expansion of the practice of enlisting
regional material and ~technical supply agencies to participate in supply-
ing construction sites and to shift to progressive forms of deliveries to
industrial and agricultural consumers on the basis of contracts.
The mechani zation of hoisting and ~transpor.tation, Ioading and unloading,
and warehouse work (HTLUW) is a large reserve for intensifying the pro-
cesses of storing and moving stocks of material and technical capital,
The mechanization of HTLUW work on a countrywide scale will make it possi-
ble to shorten the circulation time of stocks of production and technical
5~
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
. FOR OFFICIAL USE ONLY ~
oui~,rut. ~I'h~~ sa.ze of ttiis kind of .reser.ve can be ,jud~;ed ~'r~om the ~ftict t}lnt;
r~ppr~~ximate:l.y twa-th~i.rda o:C our freight i~ now bel.n~ procf~:;:;rd by means
o:f machinery and mechanisms r,,t HTlit;:~1 work in the eGOnorr~y and that this work
is performed by around 10 million peopie. 2t is obvious that technological
pro~ress in the field of HTLUW operatinns has the task of becoming one of
the most important means of developing progressive changes in the technolo- ,
~ of moving the means of production from the producer to the consumer.
This requires an improvement of the structure of hoisting and transportation
equipment and the satisfaction of our needs for warehouse equipment and,
above all, for equipment for processing packaged piece freight--such equip-
ment as shelving, stacker cranes, and also packing, trays, and containers,
without which it is difficult to bring about a fundamental change in the
� technology oz these operations. In contrast to liquid and loose freight,
the processing of pack~,ged piece freight is especially labor consuming.
Of the total expenditures for the performance of loading and unloading and
warehouse operations which at the present time come to more than 10 billion
rubles a year in the sphere of distribution, expenditures for the processing
of such freight a.mount to 75 to 80 percent, while its share and total freight ~
turnover is estimated at 20-25 percent. Consequently, the processing time �
for such freight is also great. The development of packet and container
shipments of packaged piece freight is a decisive means of shortening the
time for moving material and technical capital. The shipment of a million
tons of freight by containers ensures an economy of 4 million rubles, re-
leases around 1500 transportation workers from heavy manual labor and 4,000
industrial workers employed in warehouse, packaging, and packing repair
work, and accelera~tes turnover.
There are now more than 1 million containers in operation in general use
transportation. Eighty.percent of the pool consists of low-capacity con-
tainers (up to 3 tons), while according to the nature of our deliveries
it should consist of 45 percent with a freight capacity of up to three
tons, 25 percent--5 tons, and 30 percent more than 10 tons. Specialized
and la.r~e-capacity containers are still not being used enough in turnover.
The development of warehouse work has developed into a ma~or national eco-
nomic problem. The~existing warehouse network of sa.les and supply orga-
nizai;ions is scattered. Max~y of the warehouses of this network are incon-
venient to operate, have insufficiently high ceilings, and have a small
capacity. A large part of the operations at these warehouses is performed
m~,nually and the bizildings cannot be adaptecl for the introduction of inecha-
nization. In the country as a whole economic losses in warehouse work as
a resu].t of excessive expenditures for the storage and processing of freight
are estimated at 2 billion rubles.a year.
The current state of warehouse work does not correspond to the level of
development of b asic production.or to the possibility and requirements of
scientific and technological progress. The shortage of warehouse capacities
is still great. Thus, warehouse freight turnover in the state system of
material and technical supply exceeds their planned capacity. Grain
60
FOR OFFICIAL USE ONLY
i
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
r~ception enterprises axe still unable to acco~nodate the necessary amount
� o:f grain. The lagging in the development of the material and technical
b,~se of the grain reception and processing enterprises of the agricultural
p.rocurement system is still substantial.
At the present time the covered warehouse capacities of the State Committee '
for Agricultural Equipment does not provide for the necessary amount of
storage for mineral fertilizers, agricultural tools and machinery, and
so forth. So-called package-free shipments of mineral fertilizers have
become widespread. However, the fact that many storage units are poorly
adapted, the shortage of them, and also the shortage of specialized trans-
portation and equipment for the overall mechanization of loading and un-
loading and warehouse work with unpacked fertilizers leads to losses whose -
amount is estimated at a minimum at 10 to 12 percent of the mineral fer-
tilizers which are supplied to agricu].ture.
The process of storage is less labor and capital intensive than the pro-
cess of production, and, consequently, f~om ~a national economic point of
view an attempt to compensate for losses of output during storage by means
of increasing production is.ineffective. The optimal functioning of the
sphere of the movement and storage of material and technical resources
not only brings about a reduction in surplus time for the non-production
function of dis~ribution, but also rationalizes production time.
L. S. Bragina (candidate in eeonomic sciences, ,junior scientific asso-
ciate a,t the Institute of Economics of the USSR Acade~y of Sciences). .
According to the data of Gossnab USSR, the packing enterprise is valued
at 10 billion rubles and consists of more than 1 billion units of various
boxes; around 60 million barrels and dr.ums, and more than 1 billion sacks.
However, the USSR packing enterprise is lagging behind the econoa{y's needs
both quantitatively and qualitatively, which leads to substantial losses
of output during its transportation and storage. At the present time
the packing enterprise (as well as the produc:tion of packing) is repre-
sented only by scattered and insufficient~jr develo~ed elements of the
branch. .Yet, an increase in the efficiency of sor;ial production demands
an integration of the packing enterprise into a sl;ngle specialized branch
of the infrastructure, or into a subbranch of the~,system of material and
technical supp~y, "
In our opinion, the deconcentration of packing production and the lack
of a single packing branch is the reason wY~y for a long period of time
the production of packing in the country has been developing without a
single plan and technical direction. Capital investments for the ex-
pansion and construction of specialized packing enterprises is still
not provided for by a single line in our plans.
The quantitative relationships between packing which is produced from
various materials is of the greatest importance for the econorqy of our
p~.eking enterprise. The level of economic efficiency and technological
61
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
r~n vrrl~irw ua~ u1vLY
pr~ogress in the packing enterprise can be ~udged from the relationships
between the materials from which packing is produced. The consumption
sh~.res of various materi~,ls in the world production of packing and
p:~ck~ginp; are as follows: paper and cardboard--51 percent, metal--21 per-
cent, plastic--10 percent�, gl~,ss--9 percent, and wood, fabrics, and other
materials--9 percent. However, these are only average figures and the�
relevant indicators in different countries vary greatly. For example,
the cost structure of cardboard an d paper packing is 16 percent, metal--
12 percent, plastic--3 percent, and other types--17 percent.
An analysis of the current structure of the production and consump~ion of
paclcing in our country shows that the traditional urieconomical types of
packing made of wood and metal occupy the basic place in ~the country's
packing balance, while progressive packing made of cardboard and polymer
and combined materials comprises a negligible proportion. A change in ~
the structure of t;he production of packing demands first of.all the re-
equipping of the packing industry, since as a result of a lack of equip-
ment most of the packing assembly operations are performed by hand.
An improvement of the orgariization and mana~ement of the production and ~
use of packing should be named as one of the possibilities for improving
the structure of packing made of various materials. Three forms of pro- �
duction organization exists: in the subsidiary shops of consumer enter-
pr.ises, in the specialized sYiops of enterprises which produce materials
~ for packing, and at specialized packing enterprises. In view of the
~reat importance of spec ialized enterprises in the econorr~yy of packing
production, they should be regarded as the basic form of organization.
It has a.l.so become necessary to single out a specialized branch for.the
use of packing.
The production of consumer packing.is not planned and is not taken account
of by a single organization. Only in the 9th Five-Year Plan was'the
Interdepartmental Council for Packing Work created--a coordination center
for the production and use of packing. In the United States there is
a special congressional committee which deals with the problems of pro- ~
ducing and improving packing. A large,amount of attention is given in .
foreign .cauntries to the efficient use of packing and packaging. In a
number of socialist countries special packing ar_d packaging centers,
commissions, or administrations have been formed in connection with
~ovei�nment agencies (in the GDR the Divisi:on of Packing at Gosplan, in
Poland--the Center for Packaging). In order to improve packin~ and pack-
aging work in 1958 the European Federation for Packaging which consists
of 19 European countries was created.
N. P. Ivantsova (candidate in economic sciences, senior scientific asso-
ciate at the Institute of Economics of the USSR Acaderr~y of Sciences).
The economical use of inetal and a decrease in the metal intensiveness of
output depends to a large extent upon the ava,ilability of inetal of the '
appropriate quality and assortment. An expansion of the production and ~ ~
62
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
- . ~ FOR OFFICIAL USE ONLY �
~ consumption of economical types of inetal and an i.mprovement of its struc-
ture is vitally connected with the overall solution of three interconnected
problems: a rise in the technical level of the production and consumption
of inetal; the optimization of the organizational structure o~ ferrous.met-
allurgy and of the the billet production of machine building; and an im-
' provement of the system of planning and stimulating the production and '
consumption of economical types of inetal.
An improvem,ent of the structure of inetallurgical production is connected
, with an increase in the proportion of roZled and finishing conversions,
an~;intensification of the structure of steel pro.duction by means of a more
rapid development of oKygen conversion and electro-steel smelting pro-
cesses, cqntinuous steel smelting, and various methods of vacuuming, '
and so forth. The realization of these directions in planning requires
an optimization of the'structure of capital investments in ferrous metal-
lurgy. To this day the basic part of the capital investments in our
country is assigned to inerease the production of ferrous metals and,
in insuffi;cient amounts, to rolling and finishing production~(~+5.7~percent
in the gth Five-Year Pla.n and ~+8.8 percent in the lOth Five-Year Plan of
~ our capital investments for basic meta.llurgical production compared with
60 percent in the developed capitalist countries).
_ Reserve produ;.tion capacities should also be created in ferrous metallur~y. ~
- The existence of a definite (optimal) reserve of production capacities is .
~ one of the basic conditions for the rapid mastery of new output and for
the punctual satisfaction of consumers' needs. In the USSR there is a
high (q5-98 percent) actual workload on capacities, and sometimes enter-
prises do not have enough capacities even for the production of planned
output. The reasons for this are the practice of planning production
in tons, insufficient capital investments for an expansion of capacities,
an d the slow use of capital investments and new facilities.
The production of quality metal of the required assortment which is -
characterized by a low metal intensiveness demands the appropriate metal-
lurgical equipment, especially for the fourth conversion. However, met-
allur~ical machine building is not yet capable.of providing for the growing
needs of inetallurgy for progressive equipment and of improving the quality
of these machines. One of the reasons is the inadequa,te level of even
~ item specialization. Metallurgical. machine building produces machinery
and equipment for 10 other branches of the econorqy. Of 17 plants, only
at is the proportion of pro.file output more than 60 percent. Metallur-
gical machine building enterprises work basically for the needs of "their .
own" branch--heavy machine building,
The amount of output produced, its products list and series nature, and
the complexity group of parts exercise a direct influe:~ce upon th~ quali~ty .
of billets and upon their metal intensiveness and cost. At the same time,
today at almos~t every machine building enterprise there are sma.ll billet
shops or sectors for the production of castings, stampings, and welded
63
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY . ~
metal structures. The technical level of these shops, as a rule, is in- ~
sufficiently high and there is a large products 1.ist of parts with the
result that there is a low metal use coefficient and a cost of 1.5 to 3
times ~.reater than at a specialized production. Even in one of the most
^pr~ciali~hd branches--tractor and agricultur~,l machine building--the
, lrvcl o:C ~ectinolof;icnl. specialization in 1.975 w~,s only 1.~ percent. Tl~~e
- proportion oi' centrally produced castings, stampings, and welded structures
comes to only 3 percent of the output of machine building. For this reason,
~an intensive realization of specialization and the creation of the neces-
sary large capacities for the centralized production of billets has to be
considered one of the b asic factors in improving the quality of machines,
including decreasing their metal intensiveness and increasing la.bor pro-
ductivity in.machine building.
Yu. V.. Sinyak (candidate in economic sciences, laboratory chief of the
Worl:ing Consultative Group for the Development of the ~zture Prospects
for the Development of Power Engineering Attached to the President of the
USSR Academy of Sciences). ~In.1977 fuel and energy came to 6 percent of
- industrial expenditures and, for this reason, the problem of economizing
energy as a factor in reducing materials intensiveness is very important.
The limited nature of the stocks of,organic fuel on our planet is~no less
important. And although the Soviet Union in this respect is in a better
position than other countries, the basic auspicious depos~.ts of organic
fuel in the USSR are located in remote areas (western and eastern Siber.ia)
with unfavorable climatic conditi:ons, which results in a substantial in-
crease in expenditures for prospecting, mining (including the development
of the area), and transportat:ion. During the period 1965-1975 the specific
capital investments for an increase in the mining and transportation of
petroleum increased by 30 percent and for natural gas by approximately .
60 percent and now comes to around 140 ruble~~per ton for petroleum an d
200 rubles per cubic meter of gas. 'Iihe increase in expenditures will ~
. continue in the future (it is not excluded that it will be at accelerated
rates). For the purpose of comparison it should be posnted out that the
specific~capital investments in measures to economize ener~}r resources are
estimated at 50 to 70 rubles per ton of coriventional fuel,�and although '
they will also increase, they will do so much more slowly than expenditures
lor the development of natural energy resources.
In the USSR the problem of economizing energy resources has always been
one of the most important ones in the field of energy policy. During the
9th Five-Year Plan around 130 million tons of conventional fuel was
economized. It is expected that during the lOth Five-Year Plan the econo- .
?ny of energy resources will be 150-160 million tons of conventional flzel.
The .following basic ways of economizing energy may be singled out: an ~
econo~ o� organic fuel (above all, high quality fuel: petroleum, coke, .
and in the future natural gas) by means of replacing it with other energy
resources--cheaper ones (coal and nuclear fuel); an econorr~y by means of
increasing the efficiency~factor of the transformation of energy; an
6!~
FOR OFFICIAL USE.ONI,Y ~ ~
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPR~VED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9
FOR OFFICIAL USE ONLY
econorqy of ener~,}r at the final consumers; and an econoiqy of energy connec-
~ ted with changing a style and way of life.
One of the general directions of economizing organic fuel is an increased
use of practically inorganic sources of energy (nuclear and thermonuclear,
hydraulic, solar, geothermal, and so forth). Moreover, the development
of nuclear energy (and after the year 2000, perhaps, thermonuclear energy)
is the basic~factor in economizing organic fuel in the future, since a
renewal of sources of energy even with maximum development will scarcely
be able to provide for 10 to 15 percent of the world's energy needs.
The~development of nuclear energy and the production of syntHetic fuel~.
is inevitably connected with an increase in energy losses during transfor-
mation. While at the present time losses resulting from the transforma.tion
of natural energy resources into electric energy come to approximately
22 percent in the energy balance, in the future as. a result of an increase
~ in the consumption of electric energy of 2.5-2.6 times they will increase
ta 28-30 percento In addition, it should be kept in mind that an increase
in the efficiency of energy transformation is limited and, on the average,
can come to no more than 7 to 8 percent compared to the present level
by the year 2000. If it is also cunsidered that in the future the pro-
duction of synthetic liquid and gas-like fuel from coal will begin to
develop intensively (and the efficiency factor of this process does not
exceed 60-70 percent), the overall losses during transformation may be
even higher. ~
In order to~compensate for the increased losses of energy in connection
- with t~e,increased proportion of its transformed types, the efficiency of
energy use by final consumers has to constantly ~be increased in the energy
b~a,lance and this requi.res carrying out an active policy in the field of
economizing fuel an d energy in absolutely all br.anches of the econoir~y.
_ The share of energy consumption by industry which comes to 55 perce.nt
will probably be.maintained in the future. Therefore, as is the case
.today, industrial power engineering will continue to'play a leading role
in economizing energy.
To date the problems of energy connected with production processes have
not been given the nec.essary attention in designing industrial installa- _
.tions. However, the only acceptable future direction of the development
ot industry is the developmen~ of production processes which provide for
society's needs for necessary.products with minimuzn energy expenditures, ~
that is, a shift from an extensive to an intensive use of energy.
`i'he use of low-temperature plasma is another promising direction in the
development of industrial power en~ineering. Also promising are metal
hea~t genera,tors which make it possible to increase the efficiency factor
- of fuel in low-and medium-temperature processes by 1.5-2 times and to
increase the thermal tension of furnace volume by 1-2 times. This makes
. it possible to reduce the size of installations by dozens of times, ta
65
FOR OFFICIAL USE ONLY
1%
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9

APPROVED FOR RELEASE: 2007102/08: CIA-RDP82-00850R000140090039-9
FOR OFFICIAL USE ONLY
ensure the c:omplete combustion of fuel without the dischar~;e of �the ~toxic
pi~oducts oi' hi~h-~emperature combustion, and to minimize the alnount and
te?rrpera~ture of waste gases. Catalytic heat generators can find a wide use .
in the processes of heating and vaporizing various liquids in heat-exchange
apparatuses, of drying wet materials, and of water purifica~ion.
As a result of the increased costs of organic fuel, the field of applica-
tion of heat purrms for low-temperature heat and cooling supplies for in-
dustry and municipal services is undergoing a substantial expansion. The
use of this purpose of the heat of waters or rivers with a relatively con-
stant temperature or of the heat~bearing discharges of production and mu-
nucipal facilities, including the heat of ventil.ation discharges, is very �
prornising. The econorqy which is achieved here comes to 20 to 40 percent
dependin~ upon the conditions of the extraction of 1ow-potentiality heat
a,nd the efficiency of the system being replaced.
~1n increase in the unit capacity of equipment, an improvement of the
quality of basic raw materials, and the accelerated decommissioning of
obsolete equipment with low technical and economic indicators also ex-
ercises a large influence on energy consumption. The increase in prices
for electric energy is taking place much more slowly than for hydrocarbon
fuel. In the future, when nuclear energy sources will play a more appre-
- ci.able role, a stabilization or even decrease in the cost of electric ~
energy should be expected.
The basic.factor in economizing energy in maritime transportation is
the replenishment of the fleet with ships with modern ecor~omical diesel
erigines and the decommissioning of old steamships. In air transportation
obsolete airplanes will be replaced with new, faster, and more comfortable
ones. However, here the prospects for economizing energy are still un- ~
pt�omising as a result of the increased expenditure of aviation�kerosene
on new airplane models.
`I'he reserves for economizing enerpr in the municipa.l sector are determined
chiefly by the possibilities of reconstructing the construction base t~.nd
by a shift to new norms in planning residential and industrial construc-
tion.
COPYRIGHT: Izdatel'stvo "Pravda", "Voprosy ekonomiki", 1979 ~ '
2959
CSO: 1820 END
66
FOR OFFICIAL USE ONLY
APPROVED FOR RELEASE: 2007/02/08: CIA-RDP82-00850R000100090039-9