The tenth flaw of system lies in the rigid control of the Russian economy. The provision of food and clothing is at present government responsibility, and so are industry and foreign trade. Because, Russia was industrially backward, it is not possible to assess the country’s real economic progress. Nevertheless, one thing is quite clear even now. As long as the products of Russian industry remain shielded from foreign competition and barely meet domestic requirements, it would not be known whether the factories make profits or run at a loss.
What would happen to those industries when the home market gets saturated? Would production be reduced thereafter? Or would the expansion continue? If a limit on production were imposed, industry would sooner or later start to feel the crippling effect; continued expansion, on the other hand, would require foreign markets that could absorb the surplus at prices still profitable for Russian manufacturers. When that stage is reached, Russian industry would have to withstand the full force of foreign competition, and its success or failure would depend on how it performs. In any case, Russia from that point onward would end up behaving like any other imperialist country, bent on securing and controlling foreign markets — thereby belying its claim of freedom of choice.
To reiterate, there is at present little incentive to produce at the lowest cost because of the absence of international competition — and this could continue for some time. This situation is similar to the one where a woman grinds five kilos of grain manually, which makes her household happy at the amount of work she puts in. But it is only when she goes out to work that she comes to realise the true worth of her work, because she earns considerably more money. Similarly, so long as the Russians consume all that is produced within the country, they would not know whether the economy was progressing or declining. The country appears to be making economic progress right now, but the reality would dawn only when its industry reaches the limits of its expansion. If it manages to survive that dire situation, there would follow another consequence that I describe below.