on the World Today

YUGOSLAVIA has gone through two revolutions in ten years, the first of which took place concurrently with the war and was not clearly discerned as a revolution. The partisan warfare was not only a struggle to expel the Germans from Yugoslavia: it was also an insurrection against old Yugoslavia which laid the foundation of present-day yugoslavia, a socialist federation composed of five nationalities — Serbs, Croats, Slovenes, Macedonians, and Montenegrins.

Having achieved that first revolution, Yugoslavia promptly found herself faced with two problems closely linked together — to maintain political independence and to maintain freedom to develop her internal economy according to the needs and best interests of her people. The Yugoslav leaders believed that national progress and well-being lay in a policy of industrialization. Being rich in natural resources, possessing in abundance 23 of the 26 ores and minerals vital to modern industry, such as lead, bauxite, and antimony, in the production of which Yugoslavia holds first place in Europe, the Yugoslavs thought they should build up their industries and convert their raw materials into the manufactured goods they needed.

The Russians said no. They said Yugoslavia should produce raw material for the Soviet and satellite industries. The Russians said no about a lot of other things, including the Army. They told the Yugoslavs what they must print in their papers, and handed them the copy already prepared.

This went on for three years, and then the Yugoslavs rebelled. That was the second or counter revolution, which though bloodless was not an easy one. The Yugoslavs were Communists, and Moscow was the Mecca of Communism. How could they sustain themselves as Communists in a hostile capitalistic world without the help and protection of the Kremlin?

The West gives aid

Nevertheless, five years ago Yugoslavia emerged from behind the Iron Curtain, to face an unfriendly West, which doubted the genuineness of the breach and suspected that it might be some clever Communist ruse. There were two grim years of economic and political isolation.

Then in 1950 the country suffered a calamitous drought, and the United States government came through with an outright grant of $62 million. At the same time CARE gave food to the value of $23.6 million. The following year the United States made a further contribution of $29 million for the purchase of raw materials for Yugoslav industries. The most recent American contribution is for $33 million, to relieve the hardship of last year’s drought, no less severe than the one in 1950.

In addition to these and other grants, Yugoslavia has been receiving economic aid from the United States, Great Britain, and France for the past two years under a tripartite agreement. Of the first such aid, in 1951, which amounted to $120 million, the American contribution was 65 per cent. Of the $99 million allotted for 1952, America’s share was raised to 78 per cent. Up to July of this year the total aid received by Yugoslavia from tripartite sources and directly from the United States adds up to $343.9 million. This does not include military assistance which Yugoslavia is regularly receiving through an agreement with the United States concluded in November, 1951, and through special agreements with France and Great Britain.

Management by the workers

After the break with Moscow, the government turned over the management of the economy to the workers. Previously the economy was state-owned and state-managed as in Russia. The Yugoslavs found that under state ownership the status of the worker did not improve. He was still a wage-earner working for the state and he had not much interest in the job beyond getting his pay. Production lagged behind the government’s expectations.

Under the new system, actual management of individual factories and business establishments is attended to by a managing committee, but a workers’ council, which is elected by the workers at large, elects the managing committee from among its own membership. At least two thirds of the council’s members must be direct producers, and none may serve for more than two years in succession.

Yugoslav economists say that worker management has had a salutary effect upon production and upon the economy as a whole. They say it has stimulated the worker’s interest in what he is doing, has engendered competition among manufacturing and business establishments — which was lacking before — and has resulted in better products, more efficient utilization of plant capacities, and greater operational economies.

Gap between prices and wages

But this system has obviously not improved the economic condition of the worker himself. The living standard of the “self-managing” Yugoslav worker is still very low. In assuming management of the economy, the Yugoslav worker also assumed many social responsibilities formerly carried by the state. Although he now has the right to determine his own wages and to dispose of his surplus product, the worker cannot, set his wages so as to strike a fair balance between what he earns and what he must pay for food and clothing. But the state requires him to set aside percentages of his product for a multiplicity of social, communal, state, and other needs.

Yugoslavia has no personal income tax, no private businesses and corporations from which the government can derive taxes, no private and foreign capital to develop natural resources and build up new industries. It all has to come from the worker’s product; and the worker’s product is pre-taxed through percentages set by the government. National defense siphons off one fifth of the total national income. Other percentages are set aside for children’s allowances, amortization, social and health insurance, pensions, a sizable “accumulation fund" for capital investment, and numerous other funds.

Consequently the goods the worker produces are sold for fantastically high prices, oftentimes for 1000 per cent of the actual cost of production. Some of these same goods are sold abroad for a fraction of what the Yugoslav public has to pay, in order to get needed foreign currency for the purchase of factory equipment. And there is no prospect of any immediate relief in the situation. Marshal Tito has said that it would be at least four years before the wide gap between wages and prices would be bridged.

Revamping the government

Early this year the Yugoslav government radically revised the constitution. The old Presidium, which was a kind of collective chief-of-state modeled after the one in Moscow, was abolished. But what is more important, the cabinet with all the ministries was also abolished. Central authority is still exercised by the federal assembly through an executive council elected from among its own membership. This council is not a government, but an organ of the assembly, a kind of permanent parliamentary committee. It chooses secretaries for national defense, foreign affairs, home affairs, economy, and budget and administration, but these secretaries have no cabinet rank—they are merely clerks of the council.

Marshal Tito, as President of the Republic, represents state sovereignty internally and externally, performing such official functions as the sending and receiving of ambassadors, awarding decorations, signing proclamations. His real power comes from the fact that he is commander-in-chief of the defense forces, secretary-general of the League of Yugoslav Communists (Communist Party), which has a membership of 800,000, and president of the Socialist Alliance of Yugoslav Workers (People’s Front), which has a membership eight times as large and of which the League of Yugoslav Communists is the core.

The People’s Committee, elected by direct and secret ballot, not only administers the commune, town, county, or city, but appears as the public’s direct representative in the operation of the publicly owned economy. The workers directly engaged in them manage the factories and stores and hotels and restaurants, but the People’s Committee operates them. It does exactly what the state organs formerly did.

This, the Yugoslavs say, is government from the grass roots. But in practice the secret ballot does not mean much. There is only one list of candidates to vote for, since all candidates belong to the People’s Front, of which the Communist Party is the core. One still may not criticize the government or the state, or denounce the system. One may not openly be a Cominformist and expect to stay out of jail. There are still some five thousand people in jail who continue to think that the revolution against Moscow was treason.

The need for mechanized farms

One of the first directives of the newly established Federal Executive Council was to put the peasant, collectives on a strictly voluntary basis. A peasant may now withdraw from a collective, taking away his fields and implements, or the whole collective may disband, or reorganize in any form that suits the members, or merge with one of the traditional general agricultural cooperatives such as existed in pre-Communist days and still exist, especially in Croatia and Slovenia.

Under collectivization production has consistently fallen 15 to 20 per cent below the average for the decade from 1930 to 1940. This has worked hardship on the whole economy, especially on industries like sugar refining which depend on agriculture for their raw materials. Even industries relying chiefly on foreign sources for raw materials have suffered, for imports have to be curtailed so that available foreign exchange may be used for the purchase of bread grains and other foodstuffs. The textile industry has been operating at less than 60 per cent of capacity because of lack of cotton.

The change of policy toward collectivization is bound to have a beneficial effect on production. But it will not solve thec problem. For only 14 per cent of the peasants and 20 per cent of the arable land were collectivized. The answer lies in mechanization. The prospect of raising the national standard of living is dim indeed when more than 70 per cent of the total population is engaged in food production and still it cannol feed the nation even on an inferior diet. Contrast this with the United States, where only 16 per cent of the population is engaged in agriculture and that 16 per cent feeds itself and the rest of the population on a superior diet, and helps feed other peoples as well.

Yugoslavia’s newest allies

The tripartite agreement which Yugoslavia signed with Greece and Turkey on February 28, 1953, is unique in that it is a defensive pact involving one Communist and two non-Communist states. The agreement is based on mutual security and noninterference in internal affairs. The three countries now form a continuous political, economic, and military bloc facing the Iron Curtain from Austria to Soviet Armenia.

The agreement has been denounced by the Cominform press and radio as a pact of aggression, and Soviet and satellite propaganda against Yugoslavia has increased. Tons of leaflets and pamphlets denouncing Marshal Tito and trying to undermine the people’s confidence in him are smuggled into the country. The most common method of distribution is to drop the leaflets from small balloons and planes, or to pack them in waterproof wooden cases and other hermetically sealed containers and float them down the Danube and the Tisza and other rivers which flow into Yugoslavia from satellite countries.

Eyes toward America

The Yugoslavs’ attitude toward the United States is now one of good will, which is a decided change from their tactics a few years ago, when they shot down American planes, closed the United States Information Center in Belgrade, and filled the press with denunciations of American imperialism. Yugoslavs are bewitched by American technological advances and the American standard of living. As good Communists, they would like nothing better than to obtain some of the fine things of life achieved by capitalistic America.

They are also eager for contact with American culture; but while the United States gives them military and economic aid, it still excludes them from the cultural provisions of the Fulbright law. They do what they can themselves by translating American classics and the latest works of Hemingway,Faulkner,Steinbeck, Dos Passos, and other contemporary writers. The English language is rapidly displacing French and German in popularity.

The Yugoslavs, being realists, know that America is bolstering them up economically and militarily as a matter of expediency, and not because of any sympathy with their form of government or their economic system. But they hope that today’s ally may be tomorrow’s friend.