Russia had been one of the great success stories of the capitalist world in the decade leading up to WWI. War and wartime inflation undermined the government's legitimacy, however, and led to power falling into the hands of increasingly leftist elements, ending up with Lenin.
The Bolshevik takeover led to the near paralysis of the Russian economy. In the midst of the world's largest forest, the Communists were soon running out of the paper to print their decrees, propaganda, and currency. What did they have to sell to buy imported weapons to help them stay in power?
Treasure. The gold, silver, and jewelry amassed over the generations. Lenin and Trotsky imposed a policy of looting on a mass scale. As Marx had prophesied: "The knell of private property sounds. The expropriators are expropriated."
This didn't prove as immediately successful as the Bolshevik braintrust had hoped. For example, "inventory shrinkage" proved a recurrent problem. When Lenin and Trotsky called for mobs to sack local landowners, bourgeois households, and churches and send the loot to them, the amount received wasn't as lucrative as expected. Rather a lot seemed to stick to the fingers of local Party operatives.
For instance, the murder of the deposed Czar and his family could have been a gold mine for the regime since the daughters had diamonds stuffed in their undergarments. But, not much got back to Party Headquarters. As late as the 1930s, Stalin would send the Cheka to the villages around where the Romanovs were murdered and the goon squads would find locals who had 100-carat diamonds stuffed away.
Just as it was hard for poor peasants to fence humongous diamonds, it was hard for the Bolsheviks to fence their robberies, of which the largest was the Russian government's huge central gold reserves. The French, in particular, were honorable about not fencing the stolen properties of their old allies, who had saved Paris in 1914 by launching the Russian Army on a kamikaze offensive into Eastern Prussia.
Germain Seligman, whose father Jacques had been one of France's leading dealers in Russian art before the revolution, was invited to Moscow by Mikoyan in fall 1927 to inspect items the Bolsheviks wished to sell in Paris. Taken on a tour of the Gokhran's jewelry storerooms, Seligman later recalled the impression that he had been ushered into "a great cave of ormolu and gilt bronze, with stalactites and stalagmites of gold and crystal. Hanging from the ceiling ... was an incredible array of chandeliers and candelabra." Although impressed by the sheer volume of gilt objects on display, Seligman informed Mikoyan that he was an art dealer, not a jewelry thief...
Although an enormous amount has been written about "Nazi gold" laundered through Switzerland, the much larger amount of "Bolshevik gold" laundered through Sweden in 1918-1923 has previously received little attention. Lenin's problem was that gold ingots stamped with the tsarist Russian seal were obviously stolen by the Bolsheviks, so they traded at a large discount. He found a capitalist, Stockholm bank Olof Aschberg, to sell him the rope. Aschberg would buy Russian gold in Estonia, ship it across the Baltic, and have the Swedish Royal Mint melt down the gold and put its own insignia on this. In return, Aschberg would sell the Soviets weapons needed for their civil war and subsequent 1922 war with their own peasantry.
On the political front, British PM David Lloyd George tired of blockading the Baltic, and legitimized Soviet trade representatives in order to get orders for British factories. The British signed a trade agreement with the Soviets in 1921 and the German Foreign Office, which had done so much to put Lenin in charge of Russia in 1917, signed a loan deal with the Bolsheviks at Rapallo in 1922, just as their gold stock was running out.
By the late 1920s, moral scruples like Seligman's seemed old-fashioned. U.S. Treasury Secretary Andrew Mellon bought dozens of Old Master paintings from the Hermitage in 1930-31, which helped Stalin finance his war on the Ukrainian peasants. Those fenced goods now form the heart of the collection of our National Gallery on the National Mall in Washington, D.C. McMeekin writes:
In one of the most grotesque ironies of Communisms, it was Western fat-cat capitalists like Mellon who inherited the great part of Russia's patrimony, while the Russian proletariat received only the lash. It is hard to imagine a better program for destroying a country's wealth than by robbing and murdering its most successful wealth-producers and shipping their riches out of the country. In this way the Russian people were robbed not only of their cultural past, but of their economic future as well.
History's Greatest Heist: The Looting of Russia by the Bolsheviks is available from Amazon.
P.S. Looking through the book's handy appendix summarizing its Dramatis Personae, it becomes evident that, yes, a lot of the figures involved were Jews, such as the key Swedish banker Olof Aschberg. With Aschberg, ethnocentrism doesn't seem to have played a large role: as well as all the help he provided Lenin and Trotsky, he had previously arranged loans for the Czar in 1916 and for Kerensky in 1917. In general, he was a man of the left (he remains a hero to Swedish Social Democrats), but mostly he'd seen his opportunities and he took them. On the other hand, some of the good guys in the book, such as Germain Seligman, were Jews, and many of the book's bad guys who helped the Bolsheviks cling to power, such as Lloyd George and the German diplomats and generals, were not.