I said, "Of course you have a double object in this, not only to lessen the dependence of the industrial districts on fuel that has to be brought from a distance, and of which you may be deprived, but also to lessen the strain on transport!" "Yes," he said. "Indeed at the present moment the latter is our greatest difficulty, hampering everything we would wish to do. And transport we cannot put right without help from abroad. Therefore we do everything we can to use local resources, and are even developing the coal deposits near Moscow, which are of inferior quality to the Donetz coal, and were in the old days purposely smothered by the Donetz coal-owners, who wished to preserve their monopoly." I asked him if in his opinion Russia could organize herself without help from abroad. He said, "I rather think she will have to. We want steam dredgers, steam excavators, and locomotives most of all, but we have small hope of getting them in the immediate future, because the effects of the war have been so serious in the disorganization of industry in the western countries that it is doubtful whether they will be in a position to supply even their own needs." While we were talking Berg, the secretary, came in. I asked him how his Soviet matches were progressing, and he said that the labels were being printed and that the first lot would soon be ready. They will be distributed on the card system, and he had calculated that they could sell them at twelve kopecks a packet. I paid a rouble for a box of ordinary matches at Bieloostrov, and a rouble and a half here. THE RACE WITH RUIN After leaving Rykov I went to see Krestinsky, the Commissar of Finance, the curious little optimist whose report on the Extraordinary Tax I had heard at the last meeting of the Executive Committee. I found him in the Ilyinka street, in the Chinese town. I began by telling him that I did not believe that they meant to pay the loans. He laughed and gave me precisely the answer I had expected:-- "Of course we hope there will be a revolution in other countries, in which case they will repudiate their debts and forgive us ours. But if that does not happen we know very well that we shall have to pay, and we are prepared to pay, and shall be able to pay, in concessions, in raw material which they need more than they need gold." Then, being myself neither an economist nor a theoretical socialist, I put before him what had been said to me in Stockholm by an Englishman who was both one and the other; namely, that, being isolated from European finance, the Soviet Government of Russia was bound to come to an end on economic and financial grounds alone.