The sun., 1916-09-01
THE ECONOMIC CONDITION OF RUSSIA
AFTER TWO YEARS OF WAR.
Changes in Business Life Are Occurring That Indicate the Likelihood Of
Tariff and Trade Reforms

Until the other day the impression
was abroad that II a complete dis
location Of industry were to be looked
for anywhere It was among the
various states Of the Russian Empire.
Although Russia to-day presents to
the student of economics a very singu-
lar picture OF the vic~issitudes which
an impresslonabie nation Of many
races could undergo in this war. there
Is no trade collapse. In fact. NJ.
Raffalovich. who ought to know. writes
that a continued series OF gradual
changes and notifications OF business
life Is taking place, with the result
that production Is beginning to re-
cover from the shock OF the conditions
which Immediately followed the out
break of hostiiities. Many novel and
definite conceptions have risen from
the confused details. At first 1t was
the work of a man whose business
handling was merely loose handling;
then gradually this confusion gave
way and traders worked with more
and more freedom and power. and
finally, what was aimlessly ineffective
Is changed for what is intrinslcally
expressive Of Il prosperous state. That
Is not the popular view of Russian
business: not tho view of a recent
writer. for instance. who declared that
actually tho war has clearly demon
strated the Industrial and commercial
dependence Of Russia upon Germany"
II may he useful. then, to examine
these tive views, however briefly. i'll
some order Of perspective.
The most significant things in the
nature Of russian trade are these: The
great strength of all markets. which
makes any trading as We understand
it almost impossible; secondly. the
disturbed condition Of Russian eX-
change. and thirdly. the magniiicently
stupid Russian tariff. Taking the last
first. w find that the Russian tariff
in most cases places a higher duty
on ray materials than upon finished
products. Tho effects of such a singu-
lar anomaly are not difficult to grasp.
\ good illustration Is given by NJ.
Bloch in Industry and Commerce.
~"C.nchona, which is imported from
South America, pays "a duty OF II
contimes n k%ilogrammc: II, therefore
We base u calculation upon II aver
age yield OF pure quinine from cin-
chuna. We must conclude that uuinine
should pay Il duty of 1 francs 60 cen-
tines on the kilogrammc. but. as q
matter III fact, quinine imported from
abroad only pays IA duty Of 40 cen
times Such "a tariff obviously does
not favor home made goods or the
home manufacturer.
still another Illustration Of the
working Of this unmerciful system
is given in the Engineering Ncics
The trader is often compelled to ad,
the railway expenses 10 the hign cos
If raw materials. Raw goods, i'm.
ported 10y sea. arrive at Russian in,
dustrial centres at a lower price than
native products from the Black Sc;
ports. The freight charge. for OK.
ample, on tar from London and Amster
dam to H.cvcl-r r~c,rograd Is 20 franc,
a ton. while railway transport from
Ekatcrina. the centre of the coke pro.
ductior. costs from 100 TO 40 francs .
ton. Considering the intrinsic Nalu,
of tar, IN" cost Of the London an,
Amsterdam product il enormously les
than Russian tar.
II j. natural that foreign manufac
t%ircrs, Ike the Germans. have III