By TOM MORRIS

One offers energy,

the other missiles

As the modem-day cowboys in the
White House try and heat up the inter-
National situation with renewed charges

of a “Soviet threat’, one of their key §

problems will be to whip western Europe
into line behind a new weapons’ program
and greater participation in the cold war.

But life goes on and multi-lateral rela-

tions between socialist and capitalist 7

Europe continue to grow. In the works
now is an incredible plan to build a
3,000-mile natural gas pipeline linking
Soviet gasfields in the northern Yamal
Peninsula to energy-hungry Western
Europe.

The line, which would take five years
to complete and cost $10-$15-billion, will
Supply Western Europe with 25% of its
8as needs compared to 9% at present.
“Even the American experience with the
Alaskan pipeline, which is only one-
quarter as long, is nothing compared to

we face here,’’ said one West Ger-
Man industrialist.
In addition to guaranteed gas supplies,

Western Europe’s economy will benefit |

from contracts to provide steel, com-
Préssors, pipelaying equipment and
Other items. The deal will be partially
financed by western consortiums ‘in ex-

Change for gas deliveries. Western loans 9)

are expected to be paid off in eight to 10
years.

Everyone’s happy, you might con-
clude. Soviet gasfields will open up and
western Europe will receive guaranteed
supplies — an example of mutual interest
and mutual benefit.

But not so. Getting wind of this
€normous deal, Reagan adminstration
officials warn darkly that the proposed
Pipeline ‘tis an enormous security risk’.

It’s revealling that the White House,
which brands international solidarity as

terrorism” now brands mutually-bene-
ficial trade as ‘‘an enormous security
Tisk’’. The USSR offers Western Europe
energy resources, ‘the U.S. offers
medium-range rockets and the neutron
bomb. The comparison will not be lost on
erica’s ‘‘allies’’.

They enjoyed their
Great Beginning’

The menu card in front ofeach guest at
Reagan’s 70th birthday party at the

ite House bore the words, ‘‘Let Us |

Enjoy Our Great Beginning’.

Enjoy they did. The eight-course din-
ner included foi gras on toast, scallops
with truffle butter, salmon, veal, ravioli
Stuffed with wild mushrooms and French

Wines and champagnes. The ravioli, said }

the chef, took five hours to prepare.

Nancy Reagan had her manicurist
flown in from California. The U.S. tax-
Payer got off lightly, though, because her

esser, Julius, also from California,
Was already in Washington.

Seemingly content at 70, and pleas-
antly stuffed, Reagan then got back to the
business at hand which inclyded tearing
- guts out of federal school lunch and
Sod stamp programs.

New U.S. ambassador
More to junta’s liking .

Frederich Lo Chapin, new U.S. am-
bassador to El Salvador, was former
Under Secretary for International Sec-
urity Affairs in Latin America and helped
Plan U.S. military aid to the junta, in-
Cluding training of junta officers and the
Sending of U.S. ‘“‘advisers’’. Chapin was
©xpelled from Ethiopia in August for
faerence in that country’s internal af-

PHOTO — APN

& BRE

being solved since a large portion of their social development

Housing, once a major problem in the USSR has come close to Photo shows new village housing in Moldavia, in the western
USSR. The USSR's cost-of-living index has risen two points in 10

fund of $170-billion yearly has been earmarked for this purpose. years, incomes have gone up 40%.

This article, prepared especially for the
Tribune by Novosti Press Agency (APN),
examines some aspects of the Soviet
economy as the country discusses the new
draft economic plan for 1981-85.

* * *

No country is without oné or another
economic difficulty and the Soviet Union
is no exception. But, despite all its prob-
lems and financial limitations, the USSR
does not resort to budget cuts in its social
and cultural needs to obtain funds for
other sectors.

Almost 20 of the USSR’s 64 years have
been spent in defensive wars and recon-
struction. But throughout, it has consis-
tently raised its investments toward so-
cial and cultural requirements.

In 1940, 23.5% of the national budget
was devoted to this sector while in 1981
the figure stands at 34.2%. In fact the sum
grows in both relative and absolute terms
and stands this year at 102 billion roubles
(about $170-billion) — and that is only
from the state budget. If we add to that
monies from industrial enterprises, col-

‘lective farms, consumer cooperatives

and public organizations, the sum in-
creases to 127 billion roubles (compared
to 58 billion in 1970).

* * *

The main aim of the five year plan now

- under discussion is the continued growth

in this area. This is shown in the draft

‘ guidelines under discussion for the

USSR’s economic and social develop-
ment (1981-1985) and for the period up to
1990, which are being considered at the
26th Congress of the Communist Party of
the Soviet Union which opened Feb. 23°
in Moscow.

The first thing you notice in this well-

- detailed plan is that the Soviet economy

will continue to grow, overcoming the
twin evils faced by Western indus-
trialized nations — inflation and un-
employment. ;
The Soviet economy creates two mill-
ion jobs each year. The basic assets of
the economy have increased by 40%
over the past five years stimulated by an
investment of 635 billion roubles and the
building of 1,200 large-scale industrial
plants. 3
A feature of the new draft economic
plan is that it seriously tackles existing
problems and drawbacks, especially
concerning efficiency and the economy's
capacity to supply food and consumer
goods. It shows that'a rather paradoxical
situation has arisen in the Soviet market.
The consumer has considerable sums
to spend on the one hand and there are

plenty of goods to buy on the other. But
many of these goods are not in demand,
creating not a general shortage, but a
shortage of goods in demand — new,
fashionable goods which meet individual
tastes.

* * *

Following the destruction during
World War Two, the USSR suffered
acute shortages making it necessary to
produce goods at the highest rates
possible. Today, the USSR has surpass-
ed the U.S. in over 50 categories and
pulled even in many more.

But the quality of many items is below
that of foreign goods and thus fail to
satisfy the consumer. The new draft plan
calls for a rapid upgrading in quality to
meet these demands.

* * *

The food program is another priority.

Between 1976 and 1980 the USSR pro- -

duced 200 million tons of grian annually
(compared to 130 million per year in

1961-65). Per capita meat consumption
for the same period rose from 48 to 58
kilograms and milk from 307 to 319 kilo-
grams.

However, the relative growth in food
production, given the potential of Soviet
farming, is inadequate, the draft report
says, and cites unacceptable losses of
grains, meat, milk, fruit and vegetables
during storage and transportation.

* * *

Wages in the USSR have risen each
year over the past 20 years, and this must
be seen against the background of the
maintenance of stable retail food and
manufactured goods prices. The new
plan sees the average monthly earnings
of factory and office workers rising by 13
to 16% reaching between 190-195 roubles
— about $340. -

If officially converted to Canadian dol-
lars, Soviet earnings may seem low. But
to obtain a true picture, you must take
into account the actual purchasing power
and entire structure of the Soviet fami-
ly’s budget.

For example: taxes for an ordinary
family run at an average of 8% (the high-
est rate is 13%). There are no social in-
surance payments — the entire sum
being covered by the state. :

Rents remain at the 1928 level and av-
erage $20-30 per month. (And this despite
increased construction and material
costs).

‘Public transport is incredibly cheap
(and plentiful); all medical and educa-
tional costs are free.

In total, social benefits enjoyed by

Soviet citizens add an average of 23% to
their income and are scheduled to rise
sharply in the next five years.

The ‘‘public consumptionfund’’ comes
mainly from industrial profits which are
ploughed not only into economic expan-
sion, but to provide such social needs as
medicare, free education, pensions, day-
care, cultural and recreational centres
and-a mass sports system. One example
of the costs invalved can be seen in uni-
versity training. The average cost to the
State of a five-year training course is ap-
proximately $8,500 per student — and
today there are over five million univer-
sity students enrolled, among them some
70,000 foreign students.

* * *

Last year, 95% of foodstuffs and over
90% of non-food products continued to
be sold at 1970 prices — in itself a unique
achievement. But the crisis in the
capitalist world does have a partial effect

- on the Soviet economy. Prices for pro-

ducts purchased abroad (such as coffee,
cocoa, etc.) were raised. The USSR was
also forced to raise the price of gold, al-
though not as sharply as in the West.

‘Other price fluctuations were in-
creases in the cost of furs, alcoholic
drinks, furniture units and several other
items. And ir 1978 gasoline rose by 50%.
On the other side, prices dropped for
products such as TV sets, radios, tape
recorders, clothing, footwear, and
household chemicals.

With offsetting price movements, the
overall cost index in the country stands
only two points higher than in 1970, while
average incomes have risen 40% over the
same 10 years.

- * * *

Many necessities of life — meat, milk,
footwear, clothing, fish and vegetables
— are sold well below production costs
and the losses coveréd by an annual state
subsidy of some $50-billion.

This money comes from sales of spe-
cialty and fancy goods sold at prices
much higher than their costs. The USSR
believes such redistribution serves the
interests of the majority. Gas, electricity,

telephone charges and public transit ©

fares (except taxis) have not increased
since 1948. : :

State regulation of prices, especially
on life’s necessities, means that today as

_in the future, every citizen is assured of

what he or she needs to live well. When
we add to this the steadily rising incomes
— wages, pensions, allowances — we
can see the 17% hike in the citizens’ liv-
ing standard over the past five years will
continue and accelerate. ;

PACIFIC TRIBUNE—FEB. 27, 1981—Page 7