The period of the Soviet occupation of Latvia (1944-1991) has been controversial subject among Latvian historians and Latvian society. It’s either shown too much in negative aspects or gets too much idealization from certain members of the society. The critics of the Soviet period usually sticks to repressions, forced mass immigration, lack of free choice and low standard of living compared to west at those times. The apologetic minded people usually praises the high level of employment, ethnic harmony and lack of poverty. The present day economic crisis has made the voices of these people more stronger. Among many left and far left parties and their supporters a desire of revision of the Latvian democratic capitalist system is getting stronger. One of their arguments to praise the socialist system is soviet time Latvian industry that was described as productive and strong and gave people jobs and social security. The great bankruptcy of this industrial complex after regaining the independence often is put on blame solely to Latvian government and privatization. However, the greatness of Latvian soviet industry is surrounded by many myths that will be discussed here. The facts come from the newest research published just recently by authors who study the economical and demographic losses done by Soviet Union.
The Soviet propaganda machine made a large effort to promote communist model as the best for industry and as a great contribution in industrial development and raise of the standard of living for the working people. However, the facts show that after the occupation Latvian economic development was lot more slower than on average Soviet Union level.
Despite that, until the collapse of the Soviet Union so-called “old republics” (union members before 1940) continued to fall behind the Baltic states. But comparing to Western powers, Latvia, along with other parts of USSR and its satellite states were on deep stagnation and in rapidly growing disproportion between various regions of the Soviet Union. These facts were hidden from Soviet society.
The thing worthy to note is the specific growth of the Latvian industry in first years after the war that was far more greater than the rest of the Soviet Union. These differences were caused by economical and demographic disaster in so called Nechernozemye region (non black earth region in contrary to black earth region in South Russia and Ukraine with distinctive fertile soils) that covers vast areas in European part of Russia including St. Petersburg, Pskov, Novgorod, Moscow, Smolensk, Ryazan and other areas. The damage done by Stalin purges and World War II made large masses of people to escape to Baltic States mainly to Latvia from these areas. Most of them came from poverty driven soviet state collective farms (kolhkhoz’s) and poor small towns, despite the actions trying to preventing to escape from these places these people found ways to do it. Also large parts of soviet soldiers stationed in Latvia did not wish to come home and choose to stay here instead and bring their whole families with them. The regions in Russia was so badly devastated by Stalinist actions and war that they did not will to go back there.
The numbers of these people were so great that in Latvia and Estonia the main cities faces enormous sufficiency of the employment. Already in 1950 the population in Riga was two times higher than in 1945. With such worker sufficiency in Riga resulted in never seen before overfulfillment of industrial plans many times faster than set dates. According to industry five-year plan (1946-1950) the 1940 amount of product had to rise to 180% but in reality it rose up to 303%. Comparing to regions of western Russia the Nechernozemye areas were industrial plans were never fulfilled the Latvia was industrial metropolis. But it was at the expense of the people who came from these regions, the Latvian post war population without immigrants could never achieve such productivity. Despite that the Soviet authorities ignored this and their attempts to fix the bad situation in Latvia close regions failed mainly because of the lack of desire.
Latvia was already a highly industrial country before the war. Despite the great WWI damage Latvian industry in private means could develop faster than agriculture. Latvia was a place for radio equipment, photo product, telephones, bus, bicycle, cement and electroenergy production. Comparing to relative slow industrial growth in most Europe Latvia was a leader in industrial development. It was even greater comparing to many areas of the Stalin’s Russia. So Latvia was sustainable to achieve industrial success without the help of USSR and their immigrants.
After the WWII Latvia lost the quarter of its population in 1939, 1 million 885 thousand people in 1945 1 million 48 thousand people. The first five after the WWII in Latvia was time of great losses as the Soviet government depleted Latvian economy bringing in equal situation with rest of poor Soviet areas.
In Cold war situation the Soviet leaders promised to pull ahead the US and Western Europe. In reality the Latvian industry in technological level was far behind the western counterparts. Also the investments from Moscow for many years was far behind in investments made in old Soviet Republics and Russia itself. The resources and production made by Latvia was largely allocated to Russia and old republics. The investments were two times lover than average in USSR and Moscow according to official data published in Khrushchev times. Latvia donor for Soviet Union not Soviet Union to Latvia.
The great rise of industrial production in Latvia was only achieved by mass immigration from Russian regions of Nechernozemye. Surely also a significant number of intellectual and middle class Soviet immigrants came but the main part was played by lower class uneducated people from poor Soviet regions whose culture and lifestyle greatly differed from Latvians.
Another important thing to note is the great military involvement in the Latvian industry. Soviet Union started arms race already before the WWII and because of the Cold War the arms production mania was greater than before. Soviet Union invested in military equipment and nuclear weapons many times than needed. Despite the fact that both sides had already a significant amount of nuclear weapons to destroy one and another many times and conventional weapons would be useless in such war, Soviet Union continued to invest more and more in all military fields. By this the more than half of actual civilian state-run industrial enterprises were allocated to Soviet military industrial complex. That was one of the main reasons for stagnation of the soviet economy and its collapse later on.
According to modern-day research 70% of Latvian industrial productions were allocated to the military. We know that State Electrotechnical Factory VEF produced great civilian products such as radios, telephones and other things but 80% of its production was made for military. The Soviet military was like octopus that stretched its tentacles around every Latvian factory. Even pharmacological factories made substances for chemical weapons.
By this its no wonder why the Soviet built industry collapsed so quickly after the regaining of independence. There was no longer a soviet military complex to relay on. Also as the Soviet technological level was greatly lover than the western these factories could no longer compete in international market. And that was the fault of the deeply flawed Soviet model of economy. However, the incompetence and often avidity that was present in first years after the regain of the independence was also to blame.
As mentioned before Latvia could reach prosperity without Soviet help and with soviet help it only reached it in artificial way that was deeply devastating for Latvia. The massive flow of immigrants has caused more losses for years to come than productivity of Soviet industry. It completely changed the Latvian society and has made only problems in social and national level after regain of independence. So when driving past the deserted factory blocks people should remember that advancements made by these factories were achieved in a faked way that could no longer work in independent Latvia.