Russia’s Emergency Call for Western Know-How Has Familiar Ring

Russian leaders, alarmed that their nation has slipped so drastically behind the West, throw open the doors to foreign consultants. Sound familiar?

Actually, the 1980s surge in East-West business ties is a footnote to a much larger--if little-known--story of how Americans helped build the modern Soviet Union before the Cold War, setting up steel mills, auto plants, machine factories, the very basis of its military-industrial might.

“There wasn’t a single project in the Soviet industrialization drive (that) didn’t have significant Western technical assistance,” says Stephen Kotkin, a Princeton University historian and expert on 20th-Century Russia.

Ford Motor Co. helped design auto plants in Gorky (now Nizhi Novgorod) and Moscow. General Electric and the Arthur McKee firm of Cleveland helped build the great steelworks at Magnitogorsk in the Ural Mountains. International Harvester and Caterpillar helped the rising giant produce heavy equipment.

Du Pont, RCA and other major U.S. corporations--a “Who’s Who of capitalist industry” in Kotkin’s words--played a role, with German specialists even more prevalent.

Much of the activity was pure business: The U.S. government didn’t even recognize the Soviet Union until the end of 1933, so the firms were on their own. Soviet leaders, eager to modernize their sprawling, rural land, actively recruited in the United States and Western Europe for the know-how, just as Third World nations do today.

Western experts typically were paid in hard currency and given housing superior to the primitive barracks often reserved for local workers.

In other cases, however, assistance had a decidedly political motive. Thousands of workers poured into Russia from North America and Europe in the 1920s and ‘30s, offering their skills to build the new, socialist society.

A colony of American coal miners, true-believers in the socialist credo, set up shop in the Kuzbass region of Siberia. A group of black Americans, attracted by Soviet claims of social equality, brought advanced cotton-growing techniques to Uzbekistan in Central Asia. Unions of American electricians and seamstresses sent squads overseas to join the heady quest.

Bill Wheeler, now retired in the San Fernando Valley, worked in a Moscow auto factory in the early 1930s and recalls a life that compared favorably to the hard times he had escaped in New York City.

“There was so much poverty, the suffering all around you, it was unbelievable,” Wheeler, 81, said of the Depression, when he scrambled for part-time work as a dishwasher and mover.

So he followed his father-in-law to Moscow--and into a factory that produced light trucks and limousines with Western technology. For about a year, Wheeler handled a drilling machine on an assembly line that made engine blocks. Tool-and-die makers from Germany helped keep key equipment humming efficiently, he recalls.

Wheeler also remembers a refreshing concern for the ordinary worker, illustrated by the time he went to the infirmary with a cut on his finger and soon was getting his teeth repaired for free: “It was a period when you could say, ‘Gee whiz, humanity has a chance,’ ” he said recently in his Mission Hills home.

Wheeler left Russia in 1934 after a few years, moved to California and settled into a career in sales and customer relations. If his wife hadn’t wanted to leave Russia, “I probably would have stayed.”

Other volunteers were more famous. Walter and Victor Reuther, brothers who became leaders of the U.S. labor movement, spent more than a year in the early 1930s offering their mechanical skills to a plant 260 miles east of Moscow in Gorky, which was launching production of a Ford Model A car.

Apparently, the factory later was converted to military production, possibly for tanks, said Anatoly Ilyashov, a labor social historian and former Fulbright scholar who maintains that U.S. know-how essentially launched the Soviet auto industry.

Later, “We denied helping them, but we were helping them all over the place,” Ilyashov said.

Benefits went both ways. While the Soviets gained much-needed Western expertise, the Westerners got business opportunities at a time when few existed. As one example, the Arthur McKee firm never got full payment for designing the Magnitogorsk steelworks, but that didn’t prevent it from signing another contract to help build oil refineries in the Caucasus and other regions.

“For most of the Western firms, it was either build in the Soviet Union or build nowhere, because the industrial West was in a Depression,” said Kotkin, author of “Steeltown: USSR,” a study of Magnitogorsk.

The open door to foreign know-how, introduced by Lenin, started to shut in the mid-1930s. The Stalin government grew chilly to foreigners, and most of the economic activity petered out. Ultimately, an unknown number of the foreign volunteers, typically those who had no corporate sponsorship, ended up in jail or were executed.

Later, as the Cold War flared, officials in the Soviet Union and United States each found the past business partnerships embarrassing and rarely spoke of them.

Yet now, with the Russian economy in chaos, many in Moscow again are calling for foreign technical assistance. Joint ventures with Western firms are widely sought--250 existed with U.S. partners alone as of last year.

And once more, many Russian enterprises look to Western investment as crucial to the success of their new nation. Some experts wonder, however, if past experience offers any caution for the future.

“Foreigners, especially with working-class backgrounds, came to the Soviet Union in the 1930s feeling welcome--as we feel welcome today,” said Paula Garb, a researcher at UC Irvine who lived in the Soviet Union for 16 years. “But who knows how long it’s going to last?”