Georgy Pyatakov

"In the same directive he raised the question – this was in the middle of 1934 – that now that Hitler had come to power it was quite clear that his, Trotsky’s line on the impossibility of building up socialism in one country alone had been completely justified, that war was inevitable, and that if we Trotskyites wished to preserve ourselves as a political force of some sort, we must in advance, having adopted a defeatist position, not merely passively observe and contemplate, but actively prepare the way for this defeat. But in order to do so, cadres must be formed, and cadres could not be formed by talk alone. Therefore the necessary wrecking activities must be carried on now. I recall that Trotsky said in this directive that without the necessary support from foreign states, a government of the bloc could neither come to power nor hold power. It was therefore a question of arriving at the necessary preliminary agreement with the most aggressive foreign states, like Germany and Japan, and the he, Trotsky, on his part had already taken the necessary steps in establishing contacts both with the Japanese and the German governments."

"During the period while I was detached temporarily from the Gold Trust and assigned to work in copper mines, I had an opportunity to observe at first hand the actions of Yuri Pyatakov, the vice commissar executed in 1937, after he had confessed to leadership of a wrecking ring. I went to Berlin in the spring of 1931 with a large purchasing commission headed by Pyatakov; my job was to offer technical advice on purchases of mining machinery. Some things happened on that occasion which I never understood until I read Pyatakov's testimony at his trial in 1937."

"Among other things, the commission in Berlin was buying several dozen mine hoists, ranging from 100 to 1,000 horse-power. Ordinarily, these hoists consist of drums, shafting, bearings, gears, and so on, placed on a foundation of I or H beams. The commission asked for quotations on the basis of pfennigs per kilogram. After some discussion, the German concerns later mentioned in Pyatakov's confession reduced their prices between 5 and 6 pfennigs per kilogram. When I studied these proposals, I discovered that the firms had substituted cast-iron bases weighing several tons for the light steel provided in the specifications, which would reduce the cost of production per kilogram, but increase the weight, and therefore the cost to the purchaser."

"Naturally, I was pleased to make this discovery, and reported to the members of the commission with a sense of triumph. But these men were distinctly lukewarm; they even brought considerable pressure on me to persuade me to approve the deal. I couldn't figure out their attitude. I finally told the commission members flatly that they would have to make such purchases on their own responsibility, and that I would see that my own contrary advice got on the record. Only then did they drop the proposal."

"At the time I attributed their attitude to obstinate stupidity, or perhaps some personal graft. But this incident was fully explained by Pyatakov's subsequent confession. The matter was so arranged that Pyatakov could have gone back to Moscow and showed that he had been very successful in reducing prices, but at the same time would have paid out money for a lot of worthless cast iron and enabled the Germans to give him very substantial rebates. According to his own statement, he got away with the same trick on some other mines, although I blocked this one."