Eagle, I don't want to form an alliance anymore.

The comrades were all a bit behind and somewhat confused—which path was the Soviet Union ultimately choosing to take?

Several heads nodded. The Minister of the State Planning Commission nodded the deepest. After nodding, he reached for the bottle of mineral water in front of him, but after trying to open it for a long time, he couldn't, so he put it back.

“Think about it,” Ligachev continued, “we haven’t leased land to capitalists on such a large scale for over fifty years. Comrade Lenin’s concession system was a last resort when the country was impoverished after the civil war, and Lenin himself made it clear that it was a step back. What step back are we taking now? Our economy has been on the rise for the past two years!”

He paused for a moment.

"Besides, who did you bring in? The Japanese. The older comrades in this room all remember what the Kwantung Army did in the Far East! We still have territorial disputes with them, and now you're spreading rumors that the island is negotiable—"

He picked up the pencil again, the tip pointing towards the table.

"Comrade General Secretary, the Politburo believes in your loyalty to the Party, the cause of communism, and the line of the Mentor, but can you tell us your bottom line? We are very worried that the national interests of the alliance will be harmed."

The room fell silent. The stenographer's pen paused on the paper, and he glanced at the head of the table, unsure whether he should write down this sentence.

Slava wasn't angry; he waved his hand and took a sip of tea.

"Hey, Comrade Yegor Kuzmich, let's put this 'capitalist roader' label aside for now. Let me finish explaining this whole game. If you can still put this label on me after I've finished explaining, then I'll wear it."

He stood up and walked to the map shelf on the side wall. There stood a map of the Far East, which was hung for this agenda, with a few red-tipped thumbtacks stuck in the Primorsky Krai of the Soviet Union, and a circle drawn around the Nakhodka region.

"First question. Why are we leasing land to Japanese factories at such a low price?"

No one answered, and he didn't wait for anyone to answer.

"The goal is to get them to move. The yen is appreciating, and the higher it appreciates, the more expensive it is to manufacture things in Japan. The cost of manufacturing a VCR in Osaka is increasing year by year, so it's cheaper to manufacture it elsewhere. Their factories have no choice but to move out to survive—to the United States, to Thailand."

What I'm doing now is putting up a sign at the intersection where they're moving: "This land is free."

“If one is moved here, one of their own will be left empty.”

Prime Minister Ryzhkov interjected, "The factory is their factory, the equipment is their equipment, it's built on our land, and the meat is still their meat. What kind of account is this?"

Slava said, "Good question, I'll answer it right away."

“Let’s look at the other side first.” He pulled his hand away from the map. “What’s the money in Japan doing? The gentleman’s agreement in Toronto has stopped their central bank from raising interest rates, so rates can’t go up. Factories are all moving out of the country, and manufacturing is expensive and unprofitable. So where is all that money going?”

"Of course it's land speculation and stock speculation. The price of one square meter of land in Tokyo's Ginza district could buy an entire building in Novosibirsk!"

Slava returned to the table, resting his hands on the back of his chair: "Look at this situation. On one hand, the real economy is being driven out of the country by the exchange rate, while on the other hand, the bubble is being inflated even further with the brakes on. Real industries are flowing out every day, and the bubble is swelling every day. This country looks glittering and incredibly rich, but its roots are being pulled out one by one."

"The Americans and we have reached a consensus, which is to accelerate the relocation of Japanese physical assets overseas and then find ways to plunder these assets."

Ligachev's pencil spun halfway around.

Chebrikov suddenly asked, "But the final step of the plan you just mentioned was to wait for their bubble to burst and then take these factories into our hands. Okay, but the special economic zone isn't just for the Japanese."

Since we're going to attract foreign investment, we need to have credibility internationally. If we nationalize Japanese machine tools and engineers today, what will other foreign investors think tomorrow? The whole world can see that the biggest beneficiaries of Japan's collapse are the US and us. Will they calculate this—the Soviets have motives, the Soviets have appetites, and won't we be the next one to be swallowed up under some pretext?

He paused.

"Indians have done this before. In 1977, New Delhi used foreign exchange controls to force foreign companies to dilute their shares. IBM and Coca-Cola would rather pack up and leave than let the Indians take advantage. Ten years after they left, everyone can see what kind of people New Delhi beckoned to."

"Credit is something that, once broken, is very difficult to regain."

Slava tilted his head toward Ryzhkov: "Viktor Mikhailovich, this is your problem."

Ryzhkov, who was in charge of economics, knew more about economics than the KGB chairman. He tore a page from his notebook, drew a square on it with a pencil, drew three lines from the square, and then pushed the paper to the middle of the table.

"Comrade Chebrikov, look at this. This is a factory in Nakhodka in the Far East. Let's assume it's Panasonic, making picture tubes. The box represents the factory, and the three lines represent its entire contact with the Union."

"The first thing is rent. The land is leased for 20 years, and the rent is collected annually in Japanese yen. The second thing is raw materials. Copper, glass, and electricity are supplied by the foreign trade department under long-term contracts, with prices renewed every ten years. The third thing is wages. The workers are our workers, and their wages are paid through our bank."

Ryzhkov tapped the box with the tip of his pencil: "It has absolutely no connection to the Alliance anywhere else. Its orders come from Tokyo, half of its parts are shipped from Osaka, 70% of the picture tubes it produces are exported directly from the port of Nakhodka, and the remaining 30% are sold to the Ministry of Foreign Trade."

The alliance operates on a computerized planned economy centered on cybernetics. Our enterprises aim for production, not profit. Foreign companies' orders fluctuate with the free market and they can choose their own supply chains. Our production targets are adjusted according to demand. From raw material allocation to product distribution, everything is fully integrated into the computerized planning system. It's extremely difficult for foreign companies to integrate with our economy. They have no access to the domestic price system.

He put down the pencil and turned back to Chebrikov:

"Therefore, the incompatibility between our domestic system and the foreign-funded system is the reason why foreign companies are willing to come here. This factory lives on orders from Tokyo, on parts from Osaka, and on the process documents updated by the parent company every quarter."

If we confiscate it, those three things will be cut off that very day. What will we have left then? A bunch of machines that will be obsolete in three years, and a production line that we ourselves can't integrate into the planning system—its inventory and sales follow the free market, and it can't execute a single OGAS scheduling instruction. We've essentially slaughtered a goose that lays eggs, ending up with a chicken carcass that's neither tasty to eat nor worth throwing away, while the world's capitalists watch us devour it.

"India can absorb it because it's a market economy; factories seized can simply be rebranded and operate in the original market. We can't; our system can't digest it—"

Ryzhkov looked at Ligachev: "Now, what keeps capital up at night is no longer our communist ideology, but the unexpected! The goods we sell to them are precisely those without unexpected events—raw material prices are fixed for ten years, and orders are written into the plan. No one in the free market can legally promise these two things, but we can! This is the advantage of our plan."

At this point, Chebrikov stared at the piece of paper with the square drawn on it and asked, "What happens after the bubble bursts? Those machines and engineers that the General Secretary wants—something has to go through to us. Which way?"

"Bankruptcy," Ryzhkov said.

"When the bubble burst, the parent company in Tokyo went bankrupt. The Nakhodka factory owes us rent and payments for raw materials from foreign trade companies. A significant portion of the loans it took to build the factory were raised from the Tokyo bond market. How much of that was in yen raised by the Foreign Economic Bank through Samurai bonds? It's impossible for them to pay it back."

"The parent company is dead, and the factory is insolvent. The lease stipulates that if there is a breach of contract, the matter will be arbitrated in Stockholm, Sweden. We are the most patient creditors in the world. We will ensure that only our state-owned '705u.com-Reading Club First Release' enterprises participate in the auction at the Primorsky Krai auction."

After Slava and Ryzhkov finished speaking, he asked Ligachev, "Yegor Kuzmich, tell me, in the end, who betrayed whose country? Did I betray the Soviet Union, or were those capitalists betrayed by their own country?"

Ligachev opened his mouth but couldn't say anything, so he could only nod in agreement. After all, market economy, free competition, and finance were still too distant concepts for him, the party secretary who had been in charge of ideology for over a decade.

Since the professionals had no objections, he wouldn't object either.

"Alright, Comrade General Secretary, may the alliance prosper under your guidance—I agree to your proposal."

Laughter began to rise. The laughter echoed across the long table, and the oldest member, Gromyko, said, "Forty years ago, the Kwantung Army dreamed of land by the sea, and now they're lining up to deliver factories to our doorstep. They should be thanking us!"

The laughter grew louder.

"Alright, alright, next item." Slava switched to a different document. "Comrades, regarding the allocation of fertilizer for autumn planting, it seems the Alliance's production this year isn't keeping up with demand..."

...

After the meeting, Director Nian followed Slava back to his office.

“You’ve temporarily suppressed Ligachev and his group with your actions today,” Director Nian said. “But you know in your heart that what you’ve done—leasing land to capitalists, attracting foreign investment, and spreading rumors about territorial expansion—is crossing the red line in terms of dogma. You’ve convinced the Politburo now, but the old cadres and conservatives in the country will put pressure on you.”

If we constantly change the wind direction, it can easily make people feel uneasy.

Slava said, "The road is tortuous, but the future is bright. We must remain steadfast on the path of communism for ten thousand years, and this will never change in my lifetime."

Director Nian looked at him.

"But what is the path to communism? According to our mentor's thinking—when Lenin implemented the New Economic Policy, wasn't he also criticized by some as surrendering to capitalism? He took a step back. But by taking that step back, he was preparing to take two steps forward in the future. That's what we're doing now. We take a step back first, but we'll still take two steps forward later."

"I know that by leasing land to the Japanese and foreign investors at such low prices, enticing them to build factories, many people think that Ivanov has tasted the sweetness of playing the financial game and is about to lead the Soviet Union down the capitalist road."

He paused for a moment.

"But think about it, the collapse of the Japanese economy is inevitable. This bubble will burst sooner or later, even if we do nothing, it will collapse on its own."

"On the original path, after Japan collapsed, who took away its overseas physical industries? Most of them were taken by the United States and Southeast Asia. Its technology, factories, and capital all enriched others."

"Since it's destined to collapse, and its industries are destined to be divided up—why can't I go big? I'll make some sacrifices now, rent some land, spread the word, pretend to want to cooperate, and incidentally get the Americans to help me put pressure on Japan."

"Wouldn't it be great if I could just take back all these physical industries I'd moved here when the Japanese economy collapses?"

"As for the territorial dispute," Slava said casually, "don't worry, we've only expressed an intention to cooperate. The Japanese just want a way out that can offer some consolation."

Director Nian remained silent for a moment. She looked at Slava, unable to tell whether the person in front of her was a loyal believer who had used every means to prolong the life of the alliance, or a hunter who had mastered the art of imperialism under the banner of communism.

Perhaps, these two things are essentially the same thing in Slava's case.

Sigrún has taught at the Iceland University of the Arts as a part-time lecturer since and was Dean of the Department of Fine Art from -. In – she held a research position at Reykjavík Art Museum focusing on the role of women in Icelandic art. She studied fine art at the Icelandic College of Arts and Crafts and at Pratt Institute, New York, and holds BA and MA degrees in art history and philosophy from the University of Iceland. Sigrún lives and works in Iceland.

By August.

The pressure from both the Soviet Union and the United States was placed on Japan.

The Japanese business community is reaching its breaking point; caught between this double whammy of pressure and pressure, internal turmoil is beginning to set in.

That's right, the US is pressuring us, forcing us to appreciate our currency and make concessions. We are going to suffer losses and lose something in the US.

But look at the Soviet Union! They're opening their doors to us! The Far East's free economic zones have such low land prices, Sakhalin's oil and gas, and the northern territories that have been under negotiation for decades but are now suddenly being agreed upon.

The Soviet Union's new frontier is a brand new, virgin land brimming with gold! What the United States lost, we can earn back in the Soviet Union's new frontier!

This excuse acted like an anesthetic injected into the veins of the Japanese business community. It gave those Japanese who were being led by two hands a glimmer of sweetness, a glimmer of hope, and a glimmer of illusion that "we haven't lost, we've just won somewhere else."

This anesthetic is incredibly effective.

There were originally two factions within the Japanese business community. One faction was the resistance faction—they sensed something was wrong and advocated a hardline stance against the United States, insisting on protecting Japanese industries and not being led by the nose. The other faction was the cooperation faction—they were captivated by the new frontiers of the Soviet Union and advocated taking advantage of this momentum to expand their territory in the Soviet Union.

Now, the faction that cooperates with the Soviet Union has overwhelmed the faction that resists.

On August 22, at the Plaza Hotel in New York, the G7 signed the so-called "Global Reconstruction Agreement." This devilish pact, dubbed the "Second Plaza Accord" by Japanese media, officially ushered in the collapse of the empire.

Chapter 99: For the sake of the alliance's development, it's alright to be a capitalist roader again.

On August 20, the Soviet Union officially announced its intention to attract foreign investment and establish special economic zones in the Far East.

The news was reported in economic newspapers all over the world. But it was Tokyo that truly read the news over and over again, its mind in turmoil.

Because the terms offered by the Soviet Union this time were ridiculously favorable to Japan!

Land prices were driven down to a negligible level. The tax breaks were so long that one wondered if the Soviets hadn't learned arithmetic. Infrastructure was built by the Soviets, labor was provided by the Soviets, and import and export procedures were simplified—it was practically like giving away a whole tract of land, ready with water, electricity, roads, and workers, to the Japanese financial community for free.

This is what the leader said to the Soviet people in China: "Comrades, there are no free lunches; only through hard work can dreams come true."

The director told the Japanese conglomerates: "Gentlemen, smart money always gets there first."

Anyone with a discerning eye, seeing this price tag, would either think the Soviet Union had gone mad or that something was amiss. But at this moment, few in the Japanese business world possessed such discerning eyes. After a summer of American pressure and Soviet incentives, the narrative that "what America lost can be earned back on the new Soviet frontier" had blinded too many. What they saw wasn't a ghost, but gold.

Moscow, August 27th.

Slava chose a restaurant.

He didn't discuss the contract in a formal setting like the Kremlin, since what he was doing was likely to provoke conservatives and he could easily be accused of leading the Soviet Union down the capitalist path. So he chose a restaurant, where people could eat and drink together, making it easier for them to relax and talk more.

Before the Japanese arrived, Slava, Nian Dao, and Soviet Foreign Trade Minister Aristov sat down first.

Aristov was a little nervous. He was in charge of foreign trade, and the success or failure of this deal would affect his official position. He picked up the teacup in front of him and put it down, then picked it up again.

“Alas, Comrade General Secretary,” he finally said, “I am worried about something.”

What are you worried about?

“I’m worried that even if we open such a wide door, the Japanese will still refuse,” Aristov said. “After all… after all, we are the Soviet Union. They haven’t had much economic dealings with us for decades.”

The last time Japanese influence set foot on Soviet soil was during World War II, when we captured nearly a million Kwantung Army prisoners of war. Many of the Japanese prisoners of war returned in the 100s and 5060s became prominent figures in Japanese politics and business, such as Prime Minister Nobusuke Kishi.

Japan has too many war criminals it hasn't purged. They know how we purge the Nazis, so when they face us... well, the hostility of those older generations of Japanese towards us probably can't be overcome with just a few tax breaks.

"It's still due to the incomplete liquidation. If the United States didn't need Japan as a dog to contain us in East Asia, Japan would have been partitioned by us long ago according to the original UN plan," Slava said.

Director Nian chuckled beside him: "Comrade Aristov, don't worry. Capitalists, like the proletariat, have no homeland; their homeland is only capital."

As long as there's enough profit, they'll cooperate with us. Besides, the Soviet working people are hardworking, honest, and trustworthy. Japanese conglomerates investing here will definitely not lose out.

Aristov glanced at her; in fact, he was more worried about the in-laws than about the issue of integrity.

“I have another concern,” Aristov said. “It’s not that the Japanese are unwilling to come, it’s that our own people—our working people—are too revolutionary.”

Slava raised an eyebrow.

“The Japanese came to build factories and became bosses, managing our workers,” Aristov said. “But our workers—comrades, they grew up reading Marx, not to mention the influence of General Secretary Xi Jinping’s policies over the years. Their revolutionary spirit is not weak!”

If the Japanese exploit us too much—or if they manage us using their East Asian methods—our workers might resort to class struggle. If that happens, with strikes, demonstrations, and disturbances, the Japanese will be so frightened they'll run away, and our special economic zone will become an empty shell.

"Hey, Comrade Aristov is exaggerating. Japan is currently in its golden age, and their companies with lifetime employment systems are very stable."

Moreover, we are not the only ones developing in this world; capitalists have also learned a lot from us. Japanese companies developed participatory management in the 70s, such as the proposal system, lifetime employment, and seniority-based systems. They also extracted the part of "workers participating in management" that was beneficial to capital from the Anshan Iron and Steel Constitution in China, absorbed the advantages of "two participations, one reform, and three combinations," removed the socialist core of "politics in command" and "cadres participating in labor," and grafted it onto their own corporate system.

Those capitalists are shrewd! Especially since they're building factories on our Soviet soil, they certainly wouldn't dare exploit our working people.

Slava leaned back in his chair, a cigarette between his fingers—he rarely smoked in public, but today he had some free time while waiting for someone. He flicked the ash off his cigarette and then tapped the table with his finger.

"As for the potential class struggle that might arise from foreign investment in building factories—what are you afraid of!" Slava said. "I think we should have more of this kind of revolutionary spirit!"

Aristov and Director Nian were both looking at him.

"On the one hand, we can use this revolutionary momentum to scare away foreign investors who have already entered the market. We can lure them in to build factories, and once they have invested all their sunk costs, such as production lines and factory buildings, they won't be able to leave. Then we can give them a warning from time to time."

He flicked his cigarette ash.

Slava's tone held a hint of relief: "On the other hand, this shows that Marxism-Leninism has taken root in people's hearts and that the Party's education has been effective."

He paused for a moment: "Even if one day in the future, after I'm gone—"

Director Nian turned his gaze over.

"Even if the Party changes its nature, the people can still drive out the oppressors from the bottom up. This revolutionary spirit is the bottom line we leave for them, the last weapon our mentor gave them. We must pass on this weapon. If those demons and monsters we drove out come back in the future, then it will be up to the millions of working people to make their own choices."

Director Nian frowned. She reached over and took the cigarette from Slava's hand, then stubbed it out.

“Slava, don’t say things like that,” she said. “You’re still young and healthy.”

Slava smiled, looking at the portrait of her mentor on the wall. There was a hint of weariness in her smile, but also a hint of clarity.

"Forget it, forget it! Let's not talk about this. Forget about realizing my mentor's ideals. If I can live my life with complete honesty and integrity—"