Word: liberman
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...Right Man. As early as 1956, Evsei Liberman had published an article in Kommunist suggesting that local plant efficiency and quality could be improved by greater emphasis on profitability. For Liberman, then still an obscure scholar in a provincial school, it was merely the modest proposal of a man who knew the day-to-day problems of a plant manager...
Born in the Ukraine's Volyn in 1897, Liberman attended a gymnasium and took a law degree at Kiev University, went on to study engineering in Kharkov. For some 15 years he worked in various factories near by, including six years as planning chief in a large farm machinery plant. After a wartime stint in a Moscow government job, Liberman went back to the Engineering Institute in Kharkov as a teacher and part-time factory consultant, earning his doctorate in economics in 1956 and the title of professor...
...provincial professor's 1956 essay went virtually unnoticed-except by some far more influential economists in Moscow who had already been rethinking the system. Perhaps the most important was Vasily Nemchinov, a mathematical eminence grise regarded as the dean of Soviet economists. He saw in Liberman a potential stalking horse for all the reformers, invited him to Moscow. When in 1962 the economy's growing malaise could no longer be ignored by the Kremlin, Nemchinov persuaded Khrushchev to give Liberman's theories a showcase in Pravda. On Sept. 9, 1962, Liberman's "The Plan, Profits...
What's Good for the Factory. Profits had long been used in Russia, but only as one among a dozen capriciously applied, yardsticks for determining plant efficiency. Liberman urged that profit be made the prime element, arguing that "the higher the profits, the greater the incentive" to quality and efficiency. "What is good for the factory is good for the society," Liberman insisted...
...Liberman admits as much. "It is clear that, at first, shortcomings will turn up in the course of practical application; that people will surely rail at the system and its authors, and that people will say it must be abolished and thrown out immediately," he told a group of fellow economists. "I foresee all this, but if we economists work together in a united front, go through the painful period of the introduction of the new system together and do not panic, we will be performing a good service in building the technical base of Communism...