This weck!s Gconomist carries what it calls an inquiry into Russia's economic performance in light of the CIA report. It poses the questions "Is the growth gap really widening?" and answers slong the following lines:
",,..The centrepiece of the CIA's revelations is that Soviet natio~ nal income grew by only 22% in each of the last two years. This seoms incredibly low for 1962, 2nd too low also for 1963, compared not only with Soviet official data but also with past estimates made by independ~ ent western analysts, including those understood to emanate from the CIA itself. The official Soviet version does admit a drop in the rate of growth of national income: from 8% in 1960, to 7% in 1961, and 6% in 1962, It is true that these figures relate to the Soviet definition of national income, excluding so-called unproductive services; but it is hard to see why this should have contributed to the dramatic drop in growth rates that the CIA claims to have observed. It is not surprising that virtually all experts on the Soviet economy, including even Mre . Warren Nutter, who usually produces tho lowest estimate of Soviet growtl, are sceptical,...It is difficult to judge the CIA figuros in the absence of detailed supporting evidence - which it has not provided; our own gusss at the growth rato for the past two years would be nearer 5%, or double the CIA figure.
"Soviet statistics are known to bo ofton exaggerated; but if the official growth rates are to be adjusted, one mist know spscifically whether the exaggeration has beon larger than before, Has CIA the secret information required? It may well reccive many items of specific economic intolligonce, casting new light on porformanco in particular industries and particular places; but this kind of information can suroly not be built up into aggregate figuresfor total national product or investment as a whole, For the CIA to get hold of these, one must suppose not only that it has a spy inside tho Moscow statistical office itself but also that there is in fact some second set of "correct" information which the top Soviet planners keep side by side with phoney figures rather in the manner of a Bloomsbury hotelier,
"Statistically the most difficult comparison is always between total national products themselves, The CIA puts Russia's at only 47% of that of the U.S. in 1962. Unfortunately it does not say whether its woighting has been based on rouble or dollar prices; and as the work of Me Bornstein has shown, the Soviet figure is much higher if dollar prices re used. The reason is illustrated by the following, foirly relevant, example, The U.S. is far ahead in production of cars, the Soviet Union in production of bread. ielatively speaking, cars are cheap and bread dear in American prices, and the opposite in itussia, Consequently, Soviet output of a given combination of bread and cars looks relatively higher if measured in dollars, In fact, recent Soviet computations place national income at 62% of that of the U.S. in 1962, od this would be exactly consistent with Dornstein's dollar-weight calculation,
",..Total Soviet investment in "new plant and equipment" is said to be nearly as largo as that of the U.S., with a national product of under half...One suspects that so high a figure..was arrived at by revaluing it in dollar terms - in which case comparisons of nitional products shoulid also shave been in dollars...."