Rosa Luxemburg
The Industrial Development of Poland

Part I:
The History and Present State of Polish Industry

1.4 Poland’s Main Industrial Districts

Now that we have given a general summary of the development of Polish industry, it remains for us to illustrate this in detail in the individual histories of the most important branches of industry, and to sketch the outward local grouping of factory production.

If we disregard the scattered, insignificant factories to the right of the Vistula and along the Prussian border, the industry of the Kingdom of Poland is concentrated in three districts with strongly stamped physiognomies, different characters, and different histories.

The most important among them is the Lodz district. It includes the city of Lodz and its region, the cities of Pabianice, Tomaszow, and some districts of the Kalisch Gubernia. The production of this district amounted to 49 million rubles in 1885, and today at least 120 million. This is the real textile industry district. The history of its main center, Lodz, is extremely typical for all of Polish industry.

It would be difficult to imagine a less favorable place for the founding of an industrial city than Lodz. It lies in a treeless, waterless plain, in the midst of bogs that only about ten years ago lay on both sides of the main street here and there, so that in these places the city was barely 200 paces wide. The tiny Lodka River is completely fouled by factory waste, and all necessary water comes to the factories from artesian wells and ponds. In the year 1821 Lodz had only 112 houses with 800 inhabitants, But in 1823 colonization began, Silesian and Saxon clothmakers settled down, and by 1827 Lodz counted 2,840 inhabitants, among them 322 manufacturing workers. In 1837 it had more than 10,000, in 1840 18,600 inhabitants and over 1.1 million rubles’ production annually.

As a result of the increase of the Russian customs tariff in 1831, however, and the crisis which therefore occurred in cloth-making, the growth of the city was curbed, and the number of inhabitants even declined in 1850 to 15,600. But since the 1860s, as a result of the causes described above, which together amounted to the opening up of the Russian market, there begins for Lodz an epoch of rapid development that has become torrential since the 1870s. For in Lodz we see:

In the last 25 years, production in Lodz was also transformed. Up until the 1870s, cotton goods were made for a limited market, primarily for the well-to-do classes. But when the Russian market was opened to Polish industry and gradually a new class of customers, the working population, began to play the leading role in demand, the textile industry in Lodz had to adjust itself to the new customers. So the Lodz factories went over to the production of cheaper and simpler cotton goods, such as tricot and other crudely printed material, but above all to the production of fustian. Fabrication of this cloth was first transplanted from Saxony to the city of Pabianice in 1873. Today it dominates the entire production of the district, as the following figures show. Lodz manufactured:

The sudden turn in the tariff policy in 1877 also called to life a new branch of the cotton industry in the Lodz district, namely the fabrication of so-called mixed yarn from cotton and wool (vignone). Until that time massively imported to Russia from Werdau and Crimmitschau, this product found its entry into Russia closed shortly after the introduction of the gold tariff. To circumvent this tariff wall, several factories were now transferred directly from Saxony to Lodz by German entrepreneurs, and by 1886 over 39,000 spindles of mixed yarn were manufactured here.

In this way the current configuration of the large cotton industry in the Lodz district appears as a product of the opening of the Russian market and of Russian customs policy in the 1870s.

The district’s wool industry is dominated no less by the same factors. The powerful jump in production from 4 millions in 1870 to 22 millions in 1880 shows what influence the Russian market exerted on this Polish industrial branch. As for wool spinning in particular, it owes its current development quite particularly to Russia’s customs policy. The introduction of the gold tariff in 1877 had the transplantation of many foreign spinning mills to Lodz as an immediate consequence; the largest, with 22,000 spindles, was founded in 1879 by Allart Rousseau Fils and is today still an affiliate of this firm in Roubaix, where it also obtains its half-finished goods. Since the 1870s, Poland became the source of supply of yarn for Russia, and its production in this branch surpasses the Russian by more than 217 per cent; in Poland it amounted to 18,749,000 rubles in 1890, in Russia 5,909,000 rubles. In the most recent periods, the customs policy has helped two other branches of the textile industry in Lodz – stocking and knitting mills – to blossom.

A still more interesting illustration of the effect of Russian customs policy on Polish industry is offered by the history of the second district, Sosnowiec.

This includes the southwestern part of the Piotrkov Gubernia, lying close to the Prussian border, and the cities of Czestochova, Bedzin, Zaviercie, Sielce, and Sosnowiec. While the Lodz district began its industrial development in the 1820s, the industry of the Sosnowiec district, as was mentioned, represents a phenomenon of quite recent date.

Up until the 1860s there was nothing to be seen here but miles of thick pine forests, but within 15 years this forest region transformed itself into a lively industrial area whose textile industry is already beginning to give serious competition to that of old Lodz.

Two important circumstances greatly favored the rapid development of industry in the Sosnowiec district. First, the cheapness of fuel. The southern part of the Piotrkov Gubernia forms the coal basin of Poland, and its nearness put young Sosnowiec industry in an outstandingly advantageous position in comparison with not only Russia but also the other parts of Poland. The average price of one pood of coal in the districts concerned, by place, amounts to:

Second, the cheapness of labor. From the outset, this coal industry placed a contingent of “free” female labor power at the disposal of the factories of the district, in the persons of the members of the miners’ families. Here too the Sosnowiec district finds itself in a significantly more advantageous position than the Lodz district. Specifically, wages per month in rubles amount to:

The difference for the textile industry in Lodz in comparison with Sosnowiec amounts to + 21.5 per cent for men, for women + 61.9 per cent, for children + 4.7 per cent.

The real reason for the rise of industry in the Sosnowiec district, however, was the new era in Russian customs policy. Right after 1877 a whole series of Prussian and Saxon factories were simply moved from Germany to Poland. Considerable industry was soon concentrated in one zone of three Russian miles along the border. Of the 27 most significant factories that could be counted here in the vicinity of the border in 1886, five had been founded before 1877, 22 in 1877-1886 (81.5 per cent). The production of the factories in Sosnowiec amounted to half a million rubles in 1879, 13 million rubles in 1886, making an increase of 2,500 per cent in seven years.

The development of factory production in the Sosnowiec district went hand in hand with a surprising growth of the coal industry. Supported and, in the 1830s (1833-1842), even directly run by the Polish Bank, this industry developed quite slowly up until the 1860s and in 1860 produced a yield of 3.6 million poods of coal. Since this time, three important factors have come into play one after the other, which powerfully furthered the development of mining: first, the construction of railroads in the 1860s and 1870s; second, the development of factory industry; and third, the prohibitive tariff system. The upswing is expressed in the following figures:

Coal production, in millions of poods, was:

Thus, during the 20 years from 1870 to 1890, production increased by 993 per cent.

The railroads form one of the most important buyers of coal. The Polish as well as the South Russian coal basins supply Russia’s railways with fuel. The consumption of the latter amounted to:

But factory industry is a still more important buyer of coal. In 1890 the Lodz district alone used 30.6 million poods of coal, the Warsaw district 26 million, and the Sosnowiec district 40 million poods, in which the iron works played a great role. In 1893, coal consumption in Warsaw came to 35.5 million poods, in Lodz in the same year 36.2 million, and in the year 1896 41 million poods.

A new epoch in the Polish coal industry begins with the extension of the protective tariff policy to this branch of production in 1884, which hit the until then duty-free import of foreign coal with a tariff of one-half to two kopeks in gold per pood. The immediate result was a great “coal crisis” in Russia, i.e., a great coal shortage as a result of the backward methods of the Russian coal works and their inability to take the place of English coal with their own, relative to growing demand.

This was turned to the advantage of the Polish coal works, which rapidly expanded their activity and in a few years conquered all the important markets in Russia: Odessa, Moscow, St. Petersburg, even South Russia. Although the crisis has long since been overcome, Polish coal has since then beaten South Russian coal stepbystep out of the field in Russia, on the Moscow-Kursk, Moscow-Brest, Kiev-Voronesh, Fastow, St. Petersburg-Warsaw railway lines and in part on the southwestern lines. In 1894, 5,824,000 poods of coal came to Odessa from Poland, as against 5,300,000 from the South Russian basin.

It still remains to cast a glance at the district’s iron industry. This has a longer history behind it, for already in the Duchy of Warsaw in the year 1814 there were 46 blast furnaces for iron ore. Development proceeded so slowly, however, that up to the 1880s Poland had not brought this industry beyond a production of 2.5 million poods of raw iron, 1.4 million poods of iron, and 3.9 million poods of steel.

A new page in the history of the Polish iron industry begins with the turn in Russian customs policy. The brief free-trade period after the Crimean War lasted somewhat longer for iron than for other commodities, since the Russian iron works could not have satisfied the enormous demand created by railway construction even with the strongest protective tariff policy. But since 1881 the protective tariff has taken the place of free trade here, too, and after a gradual increase the customs rate was set in 1887 at 25 and 30 kopeks in gold per pood of raw iron, at 50 kopeks to 1.10 rubles for iron, and at 70 kopeks for steel; the tariff of 1891 brought a new increase in customs. As the immediate effect of the revision of the tariff we see the import of foreign metals to Russia decline in the following way:

Correspondingly, metal production in Russia and Poland grew – in the latter, as follows:

The third industrial district, the Warsaw district, does not have so strongly stamped a physiognomy as the two already described. Here we find a great diversity of industrial branches, but the most important are machine production and the sugar industry. The history of the first is completely told in the following simple comparison. While until 1860 only nine factories producing agricultural machines existed in Poland, in 1860-1885 42 new ones were established. Here, as in all earlier cases, we see the same upswing as a result of the transformation of the market in the 1860s and 1870s.

Finally, let’s take a look at the history of the sugar industry. It had already made its start in the 1820s but until the 1850s was only a subsidiary branch of agriculture, of small dimensions and often run by the landowners themselves. The production of the 31 plants in operation in 1848 did not exceed 177,500 poods, amounting to no more than 5,000 to 6,000 poods per factory. The year 1854 shows the greatest number of sugar factories, when there were 55. Since the abolition of serfdom and the revolution in agriculture, sugar production severed itself from agriculture and became an independent branch of industry. The number of establishments gradually decreased through the simultaneous concentration of production. In 1870 we find still only 41 sugar factories with 1.2 million poods’ annual production.

But a true revolution was brought about in the sugar industry by the tax and customs policy of the Russian government. Namely, in 1867 the singular system of sugar taxation that had applied in Poland until then was annulled and replaced by that of the Russian Empire. The latter was based on taxation not of the finished product actually produced, but on the amount of finished product which was assumed to be produced in every factory, measured by the fixed standard productivity of the press apparatus.

In this form the sugar tax naturally became the spur to the improvement of production; it soon moved all sugar factories to introduce the diffusion method, which pushed productivity above the norm taken as the basis for the tax, making the nominal tax of 80 kopeks per pood in reality only 35 or even 20. In 1876, to encourage sugar exports, the rebate on the excise on exported sugar was ordered, which in view of the above circumstances came to the same thing as a colossal export subsidy. This was yet another spur to a feverish improvement of production methods and to expansion of production.

In a few years the sugar industry in Russia and in Poland transformed themselves into large-scale industry. While Russia had only exported 4 poods of sugar in 1874, sugar exports in 1877 already amounted to 3,896,902 poods, for which the government had to “refund” roughly 3 million rubles – half of the entire sugar excise levied in the Empire. In 1881 the government took steps toward thorough reform of taxation of the sugar industry, but in the meantime the industry had reached very high levels of technological development. In Poland there were:

From this feverish expansion of production there followed a crisis in 1885, which brought in its wake the establishment of a sugar cartel embracing all of Russia and Poland and so imprinted this branch of production with the clearest stamp of a large-scale industry. One fruit of this cartel is the fact that Russian sugar, whose production cost amounts to one and five-sixths d per pound, is bought outside the Empire for one and two-thirds d, but in Kiev for four d per pound. No wonder that with such monopoly prices the sugar factories are able to yield enormous dividends.

The foregoing picture of industry in Poland would not be complete if it were not at least supplemented with some information about the role of this industry in the economy of the Russian Empire in general and, in particular, in comparison with other important industrial districts. The significance of Poland and the two capitals of Russian factory production – St. Petersburg and Moscow – in terms of industrial activity can be generally represented by the following:

As can be seen, Polish industry takes third place in the Empire, in absolute as well as in relative terms, while Moscow in absolute terms and Petersburg in relative terms claims first place. If we single out the two most important branches of production, textiles and mining, we obtain the following comparison:

Of the total production of the Empire (without Finland), which amounted to 82.0 million poods of raw iron, 25.7 million of iron, 34.5 million of steel, and 550 million of coal, the share falling to:

Specifically, in metal and coal production the Donets (South Russian) basin and the Urals are the most important Russian districts, and Poland is in competition with primarily the former but in part also with the latter for the Russian market. As we see, Poland stands in second place in the Empire in mining, right behind the Donets district, excluding the production of raw iron, where it takes third place. Although Poland has only 7.3 per cent of the Empire’s total population, it has a quarter of the Russian Empire’s steel production and two-fifths of its coal production.

Similarly, in the Empire’s textile industry Poland plays a very significant role quite out of proportion with the size of its population. The share of the total number of spindles and looms in the Empire’s cotton industry, which in 1886 amounted to 3,913,000 and 84,500 respectively, fell to:

Here, too, Poland stands in third place. In the other branches it has a much greater significance, as is seen from the following: Of the total textile industry in the Empire, whose value of production amounted to 580.9 million rubles in 1892, 19.5 per cent fell to Poland; its share in individual branches, however, amounted in cotton spinning to 15.6 per cent, in cotton weaving to 16 per cent, in linen making to 42 per cent, in wool weaving and cloth making to 29.6 per cent, in wool spinning to 77 per cent, and in knitting to 78 per cent.

If Poland is on the whole outstripped by the industries of the central and Petersburg areas, nevertheless it leads all the other parts of the Empire in certain important branches of the economy. In particular, Poland’s great significance in these branches points to a far-reaching division of labor between Polish and Russian industry.

<<< Last Chapter    |    Next Chapter >>>

The Industrial Development of Poland

Last updated on: 28.11.2008