The Sorcerer’s Stone

Abstract

This chapter assesses how Torgsin became a sorcerer's stone of Soviet industrialization. Torgsin did not sell anything abroad but nonetheless was considered an export organization because it turned the country's resources into gold and foreign currency. The terms and conditions under which Torgsin worked contributed to its hard-currency success. It saved on expenses related to export, but most important, Torgsin's sale prices were not affected by the world economic crisis and international competition because Torgsin sold at home, where shortages and famine raged and the state had a price monopoly. Torgsin's methods were predatory, but if the government, instead of opening Torgsin to Soviet people, had tried to gain more hard currency by further increasing food exports under the unfavorable world market conditions, the scope of the famine would have been even greater.