# The Shield/The Jews and Russian Economic Life

Mikhail Vladimirovich Bernatzky, born in 1878, is a noted writer on economical topics. He taught economics at the Kiev University and at the Polytechnical Institute, Petrograd.
THE JEWS AND RUSSIAN ECONOMIC LIFE
By M. BERNATZKY
MUCH has been written about the insufferable situation of the Russian Jews, these serfs of the twentieth century, chained to "the Pale of Settlement," somewhat like the Roman colons, "glebae adscripti." The tragic history of late years and the epoch through which we are living can disturb the inner composure of the most indifferent spectator of current events. It is painful to touch upon many aching and essentially clear questions, but life constantly and severely demands that they should be brought before our minds, and life awaits an answer to them from the thought and conscience of Russian society.
It is not our intention to discuss the necessity for the removal of Jewish disabilities from the humanitarian standpoint. However ​majestic may be those "elementary principles of law and morality," which have been achieved by mankind on its long historic road and which are now the very basis of civilisation, in the eyes of many they are still little more than "fine words," stylistic embellishments of high-brow talk. Of course, the atmosphere of discriminations is equally pernicious for those who suffer and those who are privileged: did not serfdom corrupt the master as well as the slave? All this is eminently true. But there are arguments, which we regret to say, are more appealing and convincing. It is these arguments that we shall treat in the present paper.
The reader is well aware of the fact that in these days nothing has been discussed more vividly than the necessity of developing Russia's productive powers. The intimate connection between the general prosperity of our country and its economic progress has penetrated into the consciousness of people at large. It is the war, evidently, that has driven this truth home to us: namely that the ultimate success of the conflict depends not only on the activity of the armies, but also on the ​economic stability of the belligerent nations. The economic difficulties which are being experienced by Germany, strengthen our faith in our final victory. More than a quarter of a century ago the Russian Minister of Finance, who took great pains to develop our industry, wrote in the explanatory memoir which accompanied the project of the state budget:
"I believe it to be the duty I owe Your Imperial Majesty to express my firm, clear, and profound conviction that economic prosperity of the people even when coupled with a somewhat imperfect military organisation will be more useful in case of war than the most complete military preparedness combined with economic weakness. In the latter case, the people, however eager they may be to sacrifice both their life and property, can bring to the altar of the fatherland their life only, but they will be unable to furnish the necessary financial means for the State."
It is from this standpoint of economic interests that we shall approach the painful Jewish question. The time is long since past when it was possible to say with the Empress Elizabeth Petrovna: "From Christ's enemies I ​desire no profit." It is precisely in this profit that both the Exchequer and the higher classes, and—what is most important—the people at large, are greatly interested. The basic productive force of a country is the living work of its population. The body politic of Russia contains about six millions of gifted and undoubtedly industrious Jews. The manner in which the forces of this people are applied will be treated further on. For the moment let us state this: it is to the interest of the Russian State to utilise economically this living Jewish energy as completely and rationally as possible. From this standpoint all the obstacles which are created for the Jews in the field of education are absolutely incomprehensible: it is as if our country, sorely lacking as it is not only in representatives of superior qualified labour, but actually in literate people, were striving to increase its ignorance and intellectual backwardness. Of course, formal justification can be found for every act, and every evil-doer endeavours to convince himself of the justice of his evil deeds. So it is in this case, too: the intentional shutting-off of the Jewish masses from education is motivated ​by the desire to keep them from becoming superior to the Russian population, which, it is said, is intellectually inferior to the Jews. This argument is an outright insult flung in the face of the Russian people. It shows that the official guardians of the nation do not know its rich natural powers. But this argument cannot obscure the essential nature of Jewish disabilities as an intentional neglect of that productive power which is represented by a portion of the Russian subjects. Our economic organism does not get all the benefits to which it may rightfully lay claim.
Let us turn to those characteristic social and economic conditions under which the Jews exist in our country. Nearly all of them, upward of five millions, live within the Pale of Settlement, which comprises fifteen governments and Poland, and only six per cent, live outside of this territory. Within the Pale, Jews are not allowed to buy or take on lease real estate outside the towns and townlets, which circumstance makes it impossible for them to become farmers. This, in connection with the limitation of residence, has naturally resulted in a peculiar character of the Jewish ​occupations. It is characteristic of the part the Jews play in Russia's economic life that nearly seventy-three and eight hundredths per cent. of them are forced to seek employment in the country's commerce and industry. Of the entire Jewish population throughout the Empire, only two and four tenths per cent. are engaged in agriculture, four and seven tenths per cent. in liberal professions, eleven and five tenths per cent. in personal service (domestic service etc.); the rest, minus the persons without any definite employment are forced to seek for means of livelihood in the field of commerce (thirty-one per cent.), industry (thirty-six and three tenths per cent.), and transport (three per cent.) In the same way works the artificial congestion of the Jews in the cities: only eighteen per cent, live in the villages of the Pale of Settlement, while the rest—more than four-fifths—toil in the towns and townlets. Such a one-sided distribution of Jewish labour would not be a negative phenomenon if it were possible to spread it uniformly over the entire country. For, backward as Russia is industrially and commercially, the Jews would easily find a place in the ​fields of endeavour which suit them best and would greatly benefit the country by furthering the process of its industrialisation. Under present circumstances they are crowded in one place and overburden the commerce and the industry of the Pale of Settlement. As a result, the struggle for existence among them is so keen and desperate that in some sections they are undoubtedly on the way to degeneration. In the West, Galicia and Roumania excluded, the Jews are well represented in the wealthy classes; in Russia an overwhelming portion of them are proletaries, "free like birds," poverty-stricken people who literally do not know to-day by what they are going to live to-morrow. Heart-rending pictures are painted by impartial observers of the life of the Jewish poorer classes, of all these tradesmen, factory workers, petty merchants and peddlers. They literally starve and cripple both mind and body in the slums of cities and towns. The natural result is that in their eager search for means of livelihood they are forced to have recourse to all sorts of expedients. Hence, all this talk about the "criminal features" of the Jewish character and their ​propensity for financial speculation, which propensity is, however, easily forgiven and even encouraged in the "true-Russian" representatives of our commercial interests. On the other hand, the Jews lower "the standards of living" by offering their services often at a very low price. Thus a peculiar "social anti-Semitism" comes into being, in Russia as well as in the countries of Jewish immigration,—a phenomenon not unlike the movement against "yellow labour" in the United States and in the Australian Federation. There can be no doubt that the artificially restrained field of application of Jewish labour is alone responsible for the unspeakable condition in which it is forced to exist. In spite of the exodus of a large mass of Jews from Russia, which bears analogy to the emigration of the Irish people from their native country,—upward of one and a half million Jews left Russia between the years 1881 and 1908,—the remaining millions seem to be doomed to starvation and degeneration. The popular tales about Jewish wealth are most emphatically contradicted by impartial facts. Of the emigrants who reach the shores of America the ​Jews are the poorest. A Scotch emigrant coming to the United States brings on the average $41.50, an Englishman $38.70, a Frenchman $37.80, a German $28.50, while a Jew brings the sum of $8.70, the smallest of all, far below the general average, which is $15.00. Consequently, if any real danger at all threatens the aboriginal Russian population, it is precisely the cheap labour of the congested Jewish masses, and the more the Jews will be oppressed the worse it will be for the Russian workman! For the employer will always give preference to cheaper labour. It is evident, therefore, that the present treatment of the Jews is really not dictated by the native Russian population, and that the democratic argument is but a false pretext. The Russian labour market, while congested in the Pale, is scarce in other sections. That the economic life of Russia, as a whole, suffers from it is obvious.
In this connection, another point is worthy of our attention. Contrary, to the popular idea of the Jewish greed, the Jews are usually satisfied with a lower rate of interest on the capital invested, since what they are after is ​the bare means of livelihood. In this fashion they lower, to a considerable extent, the capitalist's profits, a circumstance which cannot fail to irritate the Gentile capitalists. Consequently, all this comes to competition of capital, and it is significant that the fiercest anti-Semitic outcries come from the capitalistic classes. Let us not forget that the early pogroms at Odessa were caused by the agitation of the Greek merchants who feared for their commercial ascendency.
What has been said so far demonstrates with sufficient clearness that the anti-Semitic economic policy is detrimental to the economic organism of Russia as a whole. The true interests of our country demand that Jewish labour and Jewish means should be given complete freedom of application. Russia will only gain from such a change of policy toward the Jews. Anti-Semitism, from the economic standpoint, is nothing but a tremendous waste of the country's productive powers.
Here is another aspect of the question. Whether the Jews as a race are to one's liking or not, is a question of individual taste, the solution of which cannot be allowed to ​influence the sane economic policy of a state. This must be guided by objective data. As a matter of fact, the Jews constitute more than one third, thirty-five per cent., of the commercial class in Russia. If we believe our country's prosperity to be bound up with the process of its progressive industrialisation, we must admit that the part the Jews play in Russia's commercial life is tremendous, that to a considerable degree they handle her entire commerce. All that hinders the untrammelled manifestation of the Jewish economic energies is harmful to Russia's economic organism.
"If there were no Jews now in Russia, it would be necessary to invite them, in the interests of both the commercial and industrial development of the country, just as they were more than once invited for the same purposes in the past." This conclusion, reached by a student of the Jewish question in Russia, is eminently and profoundly true. The opinion of an individual student may not appear authoritative, but it has been many a time endorsed by social groups and organisations. We need not go far back into history to find ​facts of this sort. In 1912 at the time when the customary fair was in full swing, the Governor of Nizhni-Novgorod showed an unusual zeal in persecuting the Jews. This was in all probability connected with the Duma pre-election campaign. The "Society of the Manufacturers and Mill Owners of the Moscow Industrial Section," an organisation which is rather far from being liberal in its opinions, saw fit to interfere in its own interests. A memoir dealing with the prohibitive measures directed against the Jews was composed and presented, through the president of the Society, Mr. Goujon, to the chairman of the Council of the Ministers. Here is a quotation from this memoir: "In the economic life of the country the Jews play the part of middlemen, placed between the producer and the consumer of goods. In the Northwestern, Southern, and Southwestern provinces this function is almost exclusively that of the Jews. To isolate under such conditions, the commercial and industrial population of a considerable section of the country from the centre of its manufacturing districts is equivalent to inflicting a tremendous loss not ​only on the Jewish merchant class but also on the many millions of the non-Jewish population. . . . To isolate the village from the town, the towns of the West and South from the towns and villages of the Centre and the East, is to disturb intentionally the economic life of the country, to undermine credit and depreciate the people's labour."
That is the opinion of the Moscow manufacturers. Well aware of the real needs of the country, and unwilling to sacrifice their commercial interests to anti-humanitarian mottoes, they expressed their fear that the actions of the administration would hinder the realisation of the harvest and that the "stocks of goods would find neither consumers nor buyers nor energetic middlemen to the extent to which they otherwise would have."
The Jewish people has grown to be a living part of Russia's economic organism, and the blows which are directed against the Jews affect in an equal, if not a greater, degree the mass of the aboriginal Russian population. We do not intend to discuss here the Zionistic dreams and aspirations of the Jews. One thing is clear to us, namely, that a complete ​exodus of the Jews from Russia would be greatly detrimental to her economic development. The Western world understands this truth very well. Werner Sombart in his work Die Zukwift der Juden (The Future of the Jews) reaches the following conclusion: "If by a miracle all the Jews would decide tomorrow to emigrate to Palestine we (the Germans) would never allow them to. For it would mean a catastrophe in the field of economic relation, not to speak of other fields, such as we have never as yet experienced and which would probably cripple our economic organism forever."
But we, Russians, give little thought to such questions. As late as the year 1914 we did not hesitate to inaugurate new restrictive measures, which it took the great trial of this War to stop.
Whoever has our economic welfare at heart, whoever dreams about the mighty development of our country and of its real emancipation from foreign influence,—inasmuch as this is generally possible,—must understand that anti-Semitism is the worst foe of our economic prosperity, that, in short, the Jewish question ​is a Russian question. Full rights for the Jews, equal with those that the rest of the population of the Empire enjoy, are an indispensable condition for our peaceful cultural development. Only on that basis can we achieve the broad ideals which have come into prominence in this tragic struggle with German imperialism.
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