The Online Library of Liberty

A project of Liberty Fund, Inc.

• Illustrations
• Foreword
• Preface
• Acknowledgments
• Part I: Family Life and Early Background
• Chapter 1: An American Family
• Chapter 2: Origins
• Chapter 3: Youth and Experience
• Chapter 4: Initiation Into Politics
• Chapter 5: The Early Years, 1894–1900
• Chapter 6: Entering the Business World
• Chapter 7: The Early Years, 1901–1916
• Part II: James P. Goodrich the Consummate Politician
• Chapter 8: The Political Years
• Chapter 9: The 1916 Campaign
• Chapter 10: Years As Governor, 1917–1921
• Chapter 11: The Middle Years, 1916–1923
• Chapter 12: The Great Russian Famine, 1921–1923
• Chapter 13: Emissary to Russia
• Chapter 14: Return to Russia, 1925
• Part III: Businessmen With the Midas Touch
• Chapter 15: The 1920s
• Chapter 16: The 1930s
• Chapter 17: Companies! Companies! Companies!
• Chapter 18: Ayrshire Collieries Corporation
• Chapter 19: The Ecologist
• Chapter 20: The Later Years, 1940–1960
• Chapter 21: The Later Years, 1960–1973
• Part IV: Pierre F. Goodrich Crusader and Philosopher
• Chapter 22: Associations and Causes
• Chapter 23: Wabash College
• Chapter 24: The Mont Pelerin Society
• Chapter 25: A Scholar’s Life
• Chapter 26: Education In a Free Society
• Chapter 27: Moral, Political, and Metaphysical Beliefs
• Chapter 28: Why Liberty?
• Chapter 29: Liberty Fund, Inc.
• Part V: The Goodriches Assayed
• Chapter 30: Who Was Pierre F. Goodrich?
• Chapter 31: Defining Influences
• Chapter 32: Why Did They Work So Hard? Work, Ideas, Citizenship, and Virtue
• Chapter 33: Epilogue
• Appendixes

Chapter 14

Return to Russia, 1925

At the end of August 1925, James Goodrich embarked upon his fourth and final trip to the Soviet Union.1 For five weeks, Goodrich and his wife Cora, Colonel William Haskell, and Frank Golder toured the Volga region and the cities that the former governor had first visited in 1921. What he found was “remarkable progress” in agriculture, railroads, banking, and manufacturing. At a personal level, the fourth trip was an opportunity for Goodrich to renew his own fondness for the Russian people. When he visited the commune of Schilling, Goodrich met a peasant woman who was selling vegetables and fruit. He told her who he was in his broken Russian, and the woman

Goodrich had returned with Golder to the Soviet Union at the invitation of the Russian Academy of Science, which was celebrating its twentieth anniversary. He held no official position and was simply attending as a representative of Indiana University. Golder represented Stanford University. The academy was holding an international conference for delegates from Europe as well as from the United States, China, India, and other countries. It was the first formal opportunity Russian intellectuals had had since 1914 to meet with their foreign counterparts. Goodrich and Golder were the only delegates from the United States.

Goodrich took every opportunity to learn about the progress the Soviet people had achieved since he had last visited in 1922. He met with a vast array of officials, both public and private. One of his first meetings was in Leningrad with Dr. Ivan Pavlov, the Nobel Prize–winning physiologist, who is perhaps best known in the West for his conditioned reflex experiments involving dogs. Pavlov was an outspoken critic of Communism. He constantly denounced Lenin to Goodrich and refused in 1922 to receive any special treatment during the famine. “These fellows have learned they cannot run a government according to their Marxian philosophy,” Pavlov told his visitor.3

On September 5, Goodrich met with Dr. Oldenburg, secretary of the Russian Academy of Science. Goodrich had first met Oldenburg in 1921. At that time, Goodrich and Golder had offered the eminent professor of modern Oriental languages, on behalf of the Rockefeller Foundation, $500,000 for the purpose of maintaining the operations of the Russian Academy of Science. Oldenburg had refused the generous offer because he was attempting to force the Russian government to support the academy. The maneuver had apparently worked, since the Communist government had contributed two million rubles (at that time about $1 million) in 1925 toward sustaining the academy. Oldenburg praised the Communist regime, and especially Lenin. He believed that the moderate faction of the Communist Party was gaining control and that the government would continue to move toward a fuller embrace of capitalism.4

Back in Moscow on September 7, Goodrich found the Russian capital abuzz with activity. Everywhere he went, Russians repeatedly asked him about the “Scopes Monkey Trial,” which was going on in Dayton, Tennessee, and about who or what was a “Ford”? Goodrich held two meetings with Maxim Litvinoff, who was still acting commissar of foreign affairs in the absence of Chitcherin. In a series of meetings with private citizens, Goodrich learned that there was a tremendous shortage of housing. Families of several members were forced to live in apartments of only two or three rooms. Because housing was first offered to workers at an artificially low rent (as little as three dollars a month) there was no incentive for investors to build any additional housing. The low rent was subsidized by the rest of the taxpayers.5 Goodrich subsequently met with the commissar of transportation, the head of the Textile Trust, and the assistant commissar of agriculture. From the latter, he learned that in 1925 Russia would have in excess of one billion poods (1.8 million tons) of foodstuffs, quite a different situation from the one that had existed in 1922.6

On the evening of Monday, September 14, Goodrich and Golder attended a meeting of the Moscow Soviet in the famous Bolshoi Theatre. While he claimed the meeting was pure “propaganda from start to finish,” he could not help but mention with pride the reception that the delegates attending the Academy of Science anniversary received from the thousands who attended the meeting. “When the names of the two American delegates [Goodrich and Golder] were read and we arose, the entire theatre stood up as one person and cheered again and again until we too were compelled to go to the front and cries of ‘America’ arose from all over the great building.”7

The following day, Goodrich attended a meeting of the economic research section of the Academy of Science, accompanied by the Soviet minister of finance Grigori Sokolnikoff. The featured speaker was the noted British economist John Maynard Keynes. According to Goodrich, Keynes’s address was not well received. It is little wonder, given that throughout the talk Keynes criticized Lenin and Leninism, attacked the gold standard, and advocated instead a monetary standard based upon the average value of certain basic products.8

A meeting the next day with a young Russian reinforced Goodrich’s belief that the Soviet Union under the Communists was on its way to economic prosperity.

On Friday, September 18, Goodrich, with a young interpreter, left for Saratov to retrace his previous journeys while on the famine relief missions in 1921 and 1922. Although the crop conditions were generally much improved, Goodrich found the appearance and plight of the Russian peasants little different. As he stated, “Men and women while strong and rugged physically are miserably dressed and have a pathetic, sad appearance as they stand along the railway in the little Communes through which we passed.”10 On September 20, Goodrich took the steamboat Leon Trotsky down the Volga River. He and his interpreter traveled to Tsaritzin, whose name had recently been changed to Stalingrad in honor of Joseph Stalin.11

While in the Ukraine, Goodrich met with President Petrofsky of the Ukraine Republic, who was one of six chairmen of the Central Executive Committee of the Soviet of Russian Republics. Petrofsky also asked about the Scopes trial and the question of recognition. Goodrich recounted again the conditions necessary for the Communist government to be recognized by America: recognition and payment of the debts contracted by the Kerensky government; restoration of American property in Russia nationalized by the Soviet government; and cessation of propaganda by sympathizers associated with the Third International Communist Party.12

On his return to Moscow, Goodrich met with the general manager of Amtorg, the Russian agency that conducted export and import business in America. Goodrich also had a lengthy discussion with Litvinoff on the afternoon of September 25 about Russian-American relations.13 Two days later, Litvinoff invited Goodrich to dinner to continue the discussions. Present at Litvinoff’s home opposite the Kremlin, besides Litvinoff, were Nikolay Bukharin, the editor of Pravda, and Karl Radek, director of propaganda. During the two-hour discussion, Litvinoff, Radek, and Bukharin emphatically denied that the government had any connection with the Third Internationale. On the issue of recognition, the Soviet leaders conveyed a sense of befuddlement. It was well known that the Weimar Republic of Germany had extended diplomatic recognition in April 1922 and Great Britain had in 1924. By 1925, the United States remained the major holdout.

On the afternoon of Tuesday, September 29, Goodrich met with Joseph Stalin. At the time, Stalin held the positions of secretary of the Politburo as well as secretary of the Communist Party. During a two-hour meeting, Stalin, who would become the most important and powerful figure in modern Russian history, covered much of the same ground with Goodrich as had been covered by Litvinoff, Radek, Krassin, Kamenev, and other Soviet leaders. Goodrich raised with Stalin the matter of the inflammatory anti-American speech he had heard Kamenev give before the Moscow Soviet on September 14. Stalin expressed disappointment over Kamenev’s remarks as well as those of Zinoviev, who espoused support for the Third Internationale. Stalin concluded the meeting by repeating “what was so often said to me in Russia,” wrote Goodrich, “that the Russian people liked the Americans and preferred closer cooperation with them than to any other country in the world.”14 Goodrich’s brief appraisal of the stolid Georgian was that he was “a man of rare good common sense, sound judgment, and in my opinion is easily the most powerful factor in Russia.”15

The following day, Goodrich met with Leon Trotsky in Trotsky’s Kremlin office. Trotsky tried to convince Goodrich that the Soviet Union deserved recognition. He detailed the government’s plan to attract foreign capital, reduce the costs of production in agriculture, and be competitive in the world markets. As for Trotsky’s proposal to continue the heavy subsidizing of workers’ rents, Goodrich called the plan “rotten economics.”16

When Goodrich departed Russia on October 7, his work was not finished. In Berlin, he met with Chitcherin, the Soviet foreign minister, at the Russian embassy. Chitcherin expressed outrage over the note he had received from the United States secretary of state C. E. Hughes in December 1923. Hughes’s note had followed President Coolidge’s speech to Congress, in which Coolidge had given a strong indication that American policy toward the Communists was softening. Given the capacity in which he was visiting the Soviet Union, Goodrich was clearly not in the position to speak for either Hughes or the president.17

Goodrich’s impressions on his fourth trip confirmed what he had begun to believe when he had visited in 1922: that Russia under the Communists was making great progress and that conditions, despite severe internal problems, were generally much better than they had been under the czars. The items he specifically mentioned in support of this assessment included the extension of voting rights to intellectuals, scientists, and technicians; the decentralization of power from Moscow in favor of local governments; the amendment of marriage laws to recognize church marriages and of the inheritance laws to remove the prohibition against inheritances of more than five thousand dollars; the reinstatement of private traders; the defeat of Zinoviev, Kamenev, and Sokolnikoff, who opposed addressing the issue of international debts on any terms; and the rise in power of Stalin and the movement toward the right. From his perspective, the government’s adoption of “State capitalism” was a step in the right direction, a step that would ultimately lead to the eradication of the last vestiges of Communism.18

When Goodrich returned to the United States in October 1925, he was more certain than ever that Russian recognition would be of benefit to both countries. In an attempt to convince President Coolidge of the changes he had seen, he traveled to Washington and met with both the secretary of state, Frank B. Kellogg, and Coolidge. Hoover had arranged the meetings. Kellogg was even more dogmatic than his predecessor had been in opposing recognition, while Coolidge, true to his cautious nature, “made no commitments and urged Goodrich to summarize his views on paper.”19

Disheartened by the tepid response, Goodrich nonetheless returned to Winchester and wrote to the president in November 1925: “It is safe to say today that the working classes of Russia are in better condition and better satisfied than they were under the Tsar.” He went on to state that recognition would promote world stability, renew American business ties with Russia, and “accelerate rather than retard the march now going on from communism to capitalism.”20

After spending five years stewing about the problem, Goodrich finally gave up lobbying for United States recognition of the Communists. It was not until eight years later, on November 16, 1933, that President Franklin D. Roosevelt finally granted recognition to the Soviet Union through an exchange of letters with Litvinoff.21 Goodrich believed that the many years of nonrecognition not only hurt the Soviet people but delayed a grand opportunity for American businesses to prosper in a vast country that could have benefited from American goods.

Goodrich’s opportunity to participate in the ARA famine-relief efforts in Russia is significant for several reasons. First, his investigations into the famine and his subsequent testimony before Congress gave credibility to earlier reports of the famine that the media had tended to sensationalize. Goodrich was a highly respected former governor. He had long served as a member of the Republican National Committee and was generally well known and highly regarded in Washington’s political circles. His firsthand experience of the famine, coupled with his business and political background, gave credibility to his testimony. In fact, during debate about famine-relief legislation on the House and Senate floors, members of Congress made repeated references to Goodrich’s testimony before the House Foreign Affairs Committee. Their faith in Goodrich’s views was summarized in an Associated Press article written in February 1922: “Goodrich is a man known to be, as one commentator expressed it, ‘a hard-boiled Republican, who thinks as the President does.’ Goodrich is a wealthy Indiana public utilities owner, long in politics, and high in his party’s counsel. When he came back from Russia, and made his report on Russia, the President believed it. The same was true of senators and representatives with whom the former governor has spoken.”22

Second, James Goodrich’s testimony made it clear that only immediate relief would prevent one of the worst famines in history. The ARA was not in a position to raise funds privately because of the general skepticism among the American people toward Communist Russia. Goodrich and Hoover, however, convinced Congress that public relief would not result in propping up the Bolshevik government. It would merely address starvation among the peasant class.

Third, Goodrich told the story of Communist Russia and, in a very real way, assisted in providing a more realistic perception of the Soviet Republic and its people to the American public. Goodrich addressed groups in large and small cities alike and gave interviews to many national newspapers.23 Major articles about his various trips were reported by the Independent, the New York Times, the New York Sun, the New York Herald, the Detroit Free Press, the Pittsburgh Times, the St. Louis Post-Dispatch, the Indianapolis Star, and other leading papers in the United States. Even the China Press of Shanghai reported on Goodrich’s investigation.24 Goodrich himself wrote articles in Outlook and Century magazines as well as a major article, “The True Communists of Russia,” for Current History.25

Fourth, Goodrich served as an important conduit for initiating relations between the United States and the new Soviet government. Formal diplomatic relations between the two countries had come to an abrupt halt in 1917 when the Bolsheviks took control of the government. Between 1917 and 1933, Goodrich was probably the highest-ranking American emissary to have direct and repeated contact with the Soviet leadership.

Goodrich’s analysis of the causes of Russia’s pathetic conditions and what it would take for Russia to become a self-sufficient and profitable nation were right on the mark. He correctly attributed Russia’s decline during the post–civil war era of the early 1920s to a totally inexperienced and idealistic group of radicals, among whom were Lenin, Trotsky, Rykov, and Krassin. He wrote in the last chapter of his manuscript about his trips to Russia:

Despite these pitfalls, Goodrich was optimistic that Russia’s leadership was gradually recognizing the foolishness of its earlier policies and would successfully transform modern Russia into greatness. He wrote:

If Goodrich was on target in diagnosing Russia’s illness and cure, he was significantly off the mark in predicting the timing of recovery and health. Not even to this day, more than seventy years after Goodrich’s last visit, can Russia lay claim to being the economic and world power that the former Indiana governor predicted it would become. In defense of Goodrich’s optimism, it must be remembered that when he completed his fourth and final trip, the Soviet government’s adoption of a new comprehensive economic-political policy had been in effect for more than four years. The New Economic Policy (NEP) was announced in March 1921 by Lenin. Its purpose was to retreat temporarily from the unattainable goal of Communism to state capitalism. Under the NEP, the monetary system and the market economy were restored. Peasants were allowed to dispose of their products for personal gain after meeting their tax obligations; most small-scale industries were denationalized to allow the rise of a new class of small-business owners. Many outside and inexperienced followers of Soviet policy, such as Goodrich, believed that the NEP was a sign of a broader acceptance of capitalism and not simply the aberration from Communism that it turned out to be.28

Part of Goodrich’s miscalculations may be explained by his understandable fondness for the Russian people and his deep desire to see the Soviet nation prosper. Goodrich knew the Russian people and their leaders personally. They were not faceless bureaucrats uniformly and fervently devoted to full-fledged Marxist Communism. They convinced him that they generally liked Americans and simply wanted to be treated as equals, which necessitated mutual recognition. Furthermore, unlike Washington’s “three H’s” (Harding, Hughes, and Hoover), who knew the Russian political leadership only by reputation, Goodrich had met with the highest echelon of the Communist leadership: Lenin, Stalin, Trotsky, Rykov, Kamenev, Chitcherin, Bukharin, Litvinoff, Radek, Sokolnikoff, and Krassin. He believed that he understood the fractious elements in the Communist Party, and he was convinced that the moderate-conservative wing would ultimately prevail. He believed that this powerful faction would be concerned with improving living conditions and would toss aside the leftists’ utopian dream of Marxist Communism.

In hindsight, however, it is clear that Goodrich did not fully appreciate the zealotry and ruthlessness that many of these same leaders would adopt in creating a totalitarian communist organization. Contrary to Goodrich’s appraisal, communist political ideology, not pragmatism, prevailed in the next several decades. The NEP, which was in full force when Goodrich visited the Soviet Union, was an aberrational concession. It was viewed by Lenin and later by Trotsky and Stalin as necessary to prevent a complete overthrow of the Bolsheviks, not as a long-term policy goal. Moreover, Stalin’s own calculating mind and personal ambitions caused him in 1928 to move away from the NEP in order to rid himself of rivals such as Kamenev, Trotsky, Zinoviev, and Bukharin. In a series of adroit political maneuvers, Stalin shifted to leftist policies that these rivals opposed. He, thus, was able to condemn them for creating factionalism and deviation from the Communist line. Stalin then either demoted them or eliminated them altogether. The playing out of this sort of personal ambition would have been nearly impossible for Goodrich to forecast.

Despite the political turn of events that Goodrich failed to foresee accurately, the first and primary purpose of his travels to Russia—to assist in famine relief—was a complete success. A total of 381 Americans served with the ARA in Russia at one time or other during the twenty-two months that the relief organization had a presence in the Soviet Union. A handful of this number were regular army officers; the majority were volunteers, like Goodrich, who saw an opportunity to play an important role in relieving suffering.29 Despite its small numbers, this group was responsible for feeding as many as ten million starving Russians. The ARA efforts undoubtedly prevented millions from dying. The ARA’s campaign is considered one of the greatest humanitarian undertakings in history. It is little wonder that James Goodrich considered it his greatest personal adventure.

III

Businessmen with the Midas Touch

[1. ]For a thorough examination of Goodrich’s fourth and final trip to the Soviet Union, see Benjamin D. Rhodes, James P. Goodrich, Indiana’s “Governor Strangelove,” pp. 140–55.

[2. ]Goodrich, “Russia Diary,” September 20, 1925, p. 85.

[3. ]Ibid., p. 9.

[4. ]Ibid., pp. 17–20.

[5. ]Ibid., pp. 51–52, 62.

[6. ]Ibid., pp. 40–50.

[7. ]Ibid., p. 69.

[8. ]Ibid., p. 74.

[9. ]Ibid., p. 78.

[10. ]Ibid., p. 80.

[11. ]Ibid., pp. 91–92.

[12. ]Ibid., pp. 102–3.

[13. ]Ibid., pp. 106–7.

[14. ]Ibid., pp. 120–22.

[15. ]Ibid., p. 120.

[16. ]Ibid., pp. 123–24.

[17. ]Ibid., pp. 126–27.

[18. ]Ibid., pp. 128–32.

[19. ]Rhodes, James P. Goodrich, Indiana’s “Governor Strangelove,” pp. 153–54.

[20. ]Letter from Goodrich to Coolidge, November 23, 1925, James P. Goodrich Papers, box 3.

[21. ]See Franklin D. Roosevelt Papers, vol. 2, pp. 471, 474–75; The Annals of America: 1929–1939, vol. 15 (Chicago: Encyclopaedia Britannica, 1976), pp. 219–20.

[22. ]Undated and unattributed article contained in James P. Goodrich Papers, box 15.

[23. ]Goodrich addressed the Foreign Policy Association at the Hotel Astor in New York City on January 26, 1922 (see “Goodrich Addresses Foreign Policy Association,” New York Times, January 27, 1922, sec. 2, p. 1, col. 7; “Former Governor of Indiana Tells of Conditions in Russia,” St. Louis Post-Dispatch, January 27, 1922) and the Brooklyn, New York, Chamber of Commerce on February 18, 1922 (see “Tells Brooklyn Chamber Country Requires Huge Loans to Restore Economic Conditions,” New York Times, February 19, 1922, p. 20, col. 8). Goodrich also spoke before several other groups. See “Ex-Governor Will Address Columbia Club on Sovietism,” Indianapolis Star, January 16, 1922, p. 1, col. 4; “Phone Association to Hold Annual Meeting,” Indianapolis News, September 19, 1922, p. 9, col. 1.

[24. ]Sidney Brooks, “Russia as a Hoosier Banker Sees Her,” The Independent, November 21, 1925, p. 583; “Soviet’s Fall Unlikely: Ex-Gov. Goodrich Tells Why He Thinks Russian Government Will Continue,” New York Times, January 29, 1922, sec. 7, p. 9, col. 1; “Tells President and Hoover of Economic Conditions and Result of Relief Work,” New York Times, April 21, 1922, p. 3, col. 1; “Relief for the Starving Millions of Russia Near,” New York Sun, January 28, 1922; Charles G. Ross, “Outlook for Recognition of Russia More Hopeful, U.S. Authorities Believe,” St. Louis Post-Dispatch, May 3, 1922; “Russians Weary of War and Revolution, but Better Off Than Under Czars, Says Hoover’s Emissary After Tour of Country,” St. Louis Post-Dispatch, May 6, 1922; “Lenin Dolls Up His Government,” Salem (Ore.) Statesman, March 24, 1922; “American Relief Memorial,” (San Antonio) Texas Express, April 24, 1922; “Goodrich Heads Mission,” China Press, August 23, 1922; “Goodrich Optimistic as to Russian Famine,” New York Times, April 12, 1922; “Lenine Note on Way to U.S.: Message Being Brought by Goodrich Expected to Help Shape Soviet Policy,” Detroit Free Press, April 17, 1922; “Relief for the Starving Millions of Russia Near,” New York Sun, January 28, 1922.

[25. ]J. P. Goodrich, “The True Communists of Russia,” Current History, September 1922, reviewed in The Freeman, October 18, 1922; James P. Goodrich, “Can Russia Come Back?” Outlook 130 (March 1, 1922): 341–44; James P. Goodrich, “Impressions of the Bolshevik Regime,” Century 104 (May 1922): 55–65; “As Goodrich Sees Russia” (review of Goodrich’s article in Century), Pittsburgh Times, May 14, 1922.

[26. ]Goodrich, “Russia Manuscript,” chap. Y, pp. 2–3.

[27. ]Ibid., p. 21.

[28. ]Goodrich writes about the NEP in “Russia Manuscript,” chap. Y, pp. 14–23. For more thorough discussions of the NEP, see Warren B. Walsh, Russia and the Soviet Union (Ann Arbor: University of Michigan Press, 1958), pp. 423–33; Edward Hallett Carr, The Bolshevik Revolution, 1917–1923, vol. 2 of A History of Soviet Russia (New York: Macmillan, 1951), pp. 280–383; George von Rauch, A History of Soviet Russia (New York: F. A. Praeger, 1967), pp. 124–31; and Adam B. Ulam, A History of Soviet Russia (New York: Praeger, 1976), pp. 59–87.

[29. ]See “American Relief Memorial,” (San Antonio) Texas Express, April 24, 1922.