The most striking fact in the economic life of present-day Russia is that it is overwhelmingly agricultural. More than three-fourths of her population are engaged in some form of agricultural labor. The vast majority are peasants living in villages. Towns are relatively few and sparsely populated. Agricultural products constitute 85 per cent of the annual exports. What a contrast does this agricultural state, this "peasant empire", present to the industrially and commercially developed countries of Western Europe and the United States!
The Russian peasant still practices a primitive system of agriculture. His method of extensive cultivation, the three-field system in vogue, his primitive implements, his domestic economy of half a century ago, with its home production for home consumption, which is still maintained in many parts of Russia to this day—all these present conditions not far removed from those of the middle ages of Western Europe.[3]
The existence to our day of this almost primitive economy finds its explanation in the fact that serfdom existed in Russia, in all its unmitigated cruelty, until comparatively recent times. Its abolition through the Emancipation Act of Alexander II—antedating our own Emancipation Proclamation by a few years—struck off the chains that bound twenty millions of peasants to the soil. The emancipation, however, was not complete. The land the peasants received was insufficient for their needs. Other conditions co-operated in the course of time with this primary one, to create a situation of chronic starvation for the great mass of the Russian peasants. Forced by the government to pay heavy taxes, in addition to redemption dues for the land, which they paid until recently, and receiving little help from either government or the nobility for the improvement of their position, they are virtually exploited almost as completely as before the emancipation.
Thus, though freed in person, the peasants are to a great extent bound by economic ties to their former masters, the nobles. These two social-economic classes maintain towards each other practically the same relative position held by them before the emancipation. The manor still controls the hut.
The former servile relations have persisted psychologically as well. The Russian peasant is still largely a serf in his mentality, in his feeling of dependence, in his inertia and lack of individual enterprise, and, above all, in the smallness of his demands upon life.[4] This fact permeates, as it serves to explain, many aspects of contemporary Russian life.
The industrial and commercial stage of Russian economy began with the emancipation, which set free a great supply of labor. The changes that have taken place have nevertheless not obliterated many of the landmarks of the feudal, pre-reformation period. The economic activities of the last half-century present a curious juxtaposition of old and new, medieval and modern. Cottage and village industries but little removed from the natural economy of the earlier period exist by the side of great factories and industrial establishments employing thousands of workmen. Fairs and markets still play a large part in supplying the needs of the peasants, rapidly as they are being supplanted by the commercial activities of the towns. The industrial laborers, recruited mainly from the country, retain largely their peasant interests, relations and characteristics. The payment of wages in kind, which is still in vogue in many parts, and the right of inflicting corporal punishment retained by the employers, give evidence of the strong impress of the servile conditions of the past.
Vast changes have nevertheless taken place since the emancipation. Capitalism has made rapid, if uneven, progress. Under the fostering care of the government, industry and commerce have made immense strides. The factory system has taken firm root and has been developing a specialized class of industrial laborers. Great industrial centers have sprung up; towns have grown rapidly. The middle class, hitherto insignificant, has increased in number, wealth and influence. Among the peasants as well, freedom has given birth to the spirit of individualism. The differentiation of the peasantry into wealthier peasants and landless agricultural laborers, the great mass of the peasantry occupying the middle ground, and the gradual dissolution of the two great forces of Russian agricultural life—the patriarchal family and the village community—have been the most important results.
Russia is clearly in a state of transition from the agricultural or medieval to the industrial and commercial or modern economic life. This transformation of the economic structure is being effected under great difficulties and the strong opposition of the ruling classes, whose privileges are threatened by the new order of things.
The Russian social and political order reflects the medieval background which formed the setting for her entrance upon the modern stage. The class distinctions, naturally obtaining, are hardened into rigidity by the law, which divides Russian society into a hierarchy of five classes or orders—the nobles, the clergy, the merchants, the townsmen and the peasants—each with separate legal status, rights and obligations.
The individual is thus not an independent unit, as in the legal codes of Western Europe or the United States. Accompanying the legal stratification there is an exceedingly strong, almost caste-like, sense of difference between the members of the different groups.