When the Soviet Union Paid Pepsi in Warships | Hacker News Reader

When the Soviet Union Paid Pepsi in Warships

atlasobscura.com

159 pointshelb61 comments

The Soviets also traded Lada cars for New Zealand dairy products (mainly butter) [1], and after the fall of the Soviet Union, Russia apparently even offered MiG fighter jets, a nuclear submarine, and tanks in an attempt to pay its $200mm debt it owed the New Zealand Dairy Board [2], which is particularly ironic as New Zealand was at the time (and still is) a nuclear free nation.

[1] http://www.hoonable.com/butter-for-cars-how-the-lada-came-to...

[2] https://www.theguardian.com/world/2013/oct/15/russia-offered...

Yeah, I was going to mention that. My dad worked for the NZ Dairy Corporation (which later merged with Kiwi Dairy to become the conglomerate known as Fonterra) at the time, and they had warehouses full of cars that they had no idea what to do with.

They should have taken the fighter jets and the nuclear submarine instead of cars...

In New Zealand territories all nuclear weapons are banned, which is why the US navy is banned from operating in NZ waters as they don't disclose what ships are nuclear powered or carrying weapons.

Also, what's a dairy company going to do with fighters? At least they could sell cars and sell / give tractors to their farmers.

> Also, what's a dairy company going to do with fighters?

Instead of a merger with Kiwi Dairy, they could have had a (very) hostile takeover.

"Also, what's a dairy company going to do with fighters?"

I was facetious but maybe they sell joyrides to tourists. Definitely more fun than Lada cars. I wonder what model they got.

Well, I don't know about the Dairy Board, but any sufficiently large merchant could probably find a legitimate use for a MiG-15, especially since at that point they were basically all adapted for air-to-ground attack.

That'd really keep the pirates off your milk.

> all nuclear weapons are banned

> US navy is banned from operating in NZ waters as they don't disclose what ships are nuclear powered or carrying weapons

One does not lead to the other. All of the US submarines and air craft carriers are nuclear powered (and no other ships). None of the aircraft carriers have nuclear weapons, and only the SSBN submarines can carry nuclear weapons on board. If your second statement is true (I don't know), then it is likely that NZ also is banning any nuclear powered ships; not just those with nuclear weapons.

Yes, the ban is on propulsion as well as weaponry.

Interesting that since the official stance of the US government is they won't disclose capabilities that this puts a wholesale ban on US Navy ships. I did not know about that. Although, it does seems to be 'thawing' [0].

[0] http://www.abc.net.au/news/2016-10-18/new-zealand-to-end-sta...

It is a ban on nuclear propulsion as well as weapons, so nuclear powered submarines and carriers are banned. There was a bit of controversy a few years ago as well, when the NZ government was considering utilising a Russian nuclear powered icebreaker in Antarctica. No US Navy ship entered New Zealand waters for 33 years from 1984, the US Coast Guard did, however.

The ban on US Navy vessels stemmed from the fact that technically, any US Navy ship could carry nuclear weapons, and the USA would neither confirm nor deny if a particular ship had nuclear weapons. It was a bit of a hangover from the Cold War. The USA wasn't very happy at all in 1984 when NZ declared itself nuclear free.

Not all US Navy ships are banned in NZ waters now, a US Navy destroyer (USS Sampson) visited in 2016 for the Royal New Zealand Navy's 75th birthday, and ended up helping in disaster recovery when the magnitude 7.8 Kaikoura earthquake happened at the same time, alongside the Canadian Navy, the Royal Australian Navy, and the Japanese Navy. To reciprocate the favour, the frigate HMNZS Te Kaha joined the Nimitz carrier group to replace the USS Fitzgerald after it collided with a container ship.

Military relations with the USA have improved markedly in the past decade. Due to the whole nuclear free thing, the NZ Navy wasn't allowed to dock in the military area in Pearl Harbour for years, they had to dock with all the civilian ships, but now they're allowed to dock in the military area. They've also participated in RIMPAC since 2012.

It's interesting how long lasting the reaction to french terrorism is in NZ.

> french terrorism

Could you expand on that? Is it about Rainbow Warrior (just a guess)?

Wouldn't be the first time they tried to barter. They also paid with t-80 tanks and other Soviet weaponry to pay off debt to a certain country.

https://en.wikipedia.org/wiki/T-80#South_Korea

> which is particularly ironic as New Zealand was at the time (and still is) a nuclear free nation.

Well nobody said it had to come to harbour in New Zealand.

> Nixon also led Khrushchev towards a display booth that dispensed nothing other than Pepsi-Cola. Symbolically, the booth offered two batches: one mixed with American water, the other with Russian.

Sheer genius!

That reminds me that the Russians and Americans drink different water on the International Space Station:

http://www.spacesafetymagazine.com/spaceflight/space-food/am...

In RAF ready-rooms there used to be photos of Soviet aircraft crews holding-up bottles of Pepsi to their intercepting NATO counterparts.

Now I know why.

After my uncle sold his chain of Byte Shop computer stores, he started a business selling Apple ][+ clones to the Soviet Union. He told me he traded them for lumber -- this was after the olympics and I guess the vodka boycott was stillin effect.

Lumber played an important role in computer development in the Eastern Block: Polish computer manufacturer Kowary(I believe somehow connected with ELWRO) had their own sawmill and would buy western components for profits made selling pallets. Insane.

Interesting in that the Soviets had their own homegrown Apple ][ clone, the Agat. https://en.wikipedia.org/wiki/Agat_(computer)

But maybe they couldn't make them in sufficient quantities?

It is amazing how long the USSR lasted as long as it did. I think in the end all communist regimes fell because of the failures of central planning(even though it bore gems like Linear Programming and Ukraine's then booming agriculture and the Space program). I think its failures were tied to economic failures, if you can make the economy work for the masses, people really don't care for much else it seems....

> if you can make the economy work for the masses, people really don't care for much else it seems....

"It's the economy, stupid"

China seems to have hit the sweet spot(?).

China does not have a communist regime, despite the name.

Most capitalistic country I've ever been to.

Neither did the Soviet Union to be honest. Like so many things, what it's called and what it is are different entities. The USSR was a communist-inspired totalitarian command economy. It was not as unprecedented an invention as many would imagine. It was similar to many systems of monarchic and aristocratic rule, the only difference was that the requirements for membership in the aristocracy were ideologically tinged rather than predominantly based on notions of hereditary nobility. It also would have seemed fairly familiar to anyone who had lived under a Bronze age palatial city-state command economy. Modern China has also only ever had an ideologically tinged totalitarian command economy, though they loosened up in the '90s or so and became more of some variant of crony capitalism (just like us!).

I would argue China has moved away from Communism since Deng Xiaoping. Deng recongized in order for China to become a global superpower, China must embrace globalization and do trading with other countries. While the state still owns most of the wealth, the core Communism is more of a political basis and perhaps even just a symbol. The Chinese Communist Party now promote ehat’s known as “Chinese-style socialistic capitalism” (中國特色社會資本主義), which in its simplest interpretation means state-controlled capitalism. Chinese welcomes foreign investors, encourage Chinese private business to grow while the country remains single-party.

“In some emerging markets, the rich are allowed to stash their wealth offshore, which starves their country of investment funds. China kept its capital account firmly shut, trapping savings in the country. Its Party-controlled banks then directed these funds to state firms that built everything from highways to bullet trains, transforming a backward nation into a modern one.” [1]

Despite wealth is still controlled by the government and top executives (Alibaba, Tencent for example), Chinese’s middle class and grass-root can still enjoy a relatively good life. The challenges the government now face are (1) undeveloped frontier, (2) boiling housing market, and (3) stablize growth. The government is fear of a slowdown and a market bubble).

It’s amazing how the Chinese government is effective in growing the country. I don’t like its dictorial regime, but when our American state, local and federal governments are so indecisive and constantly arguing over a budget to fix our fragile physical infrastructure like bridges and electricity, and how much relief aids we should provide to Puerto Rico, I ought to ask if there’s anything we can learn from Chinese...

For those living outside of the US, Congress hasn’t been able to approve our annual spending/budget bill... the next deadline is Jan 19, and if we do not pass this budget bill, we will face a “shutdown”. We have to deal woth this threat almost every year in the last several years...

[1]: http://www.scmp.com/comment/insight-opinion/article/1843949/...

The issue with trade though was a lack of foreign currency not a lack of resources, they bartered not because they had no money but because they had no international money because no one would buy from them because of an embargo.

So... the "cola wars" of the 1980's that Billy Joel sings about could have actually taken a much darker turn?

So it wasn't totally implausible to think they could deliver a jump jet in exchange for enough points. :)

For anyone who doesn't remember Pepsi ads from the mid-90's: https://www.cbsnews.com/news/1996-man-sues-pepsi-for-not-giv...

>The campaign was simple, reported CBS News correspondent John Blackstone. Buy Pepsi products, collect points from Pepsi labels and claim prizes like t-shirts, sunglasses, or - for 7 million points - a Harrier Jet.

>In the end, Leonard's lawsuit fizzled out. A court granted a summary judgment in favor of Pepsi and ruled that, "no objective person could reasonably have concluded that the commercial actually offered consumers a Harrier Jet."

Here's the legal case https://en.wikipedia.org/wiki/Leonard_v._Pepsico,_Inc.

So if there is no liability for lying in ads, then why should there be any recourse for lying in reporting "news" ?

Sadly, looking at the future from the the precedence of this 1999 case, it makes Benedict Arnold a joke comparing to what Judge Kimba Wood did to the future of this country.

There is liability for lying in ads, but the ruling was that no reasonable person could watch that ad and conclude they were seriously offering a Harrier Jet.

And there is liability for lying in reporting news.

Why not? $260MM for Jet versus $450MM winning in powerball lottery. I never heard Lottery officials saying "noone would reasonably request us to pay them $450 millions for a dollar worth ticket".

And who am I as a viewer of said advertise to decide or come to "reasonable" conclusion whether company can pay it out or not?? Clearly this man should win. Promise is a promise.

It's not unreasonable because of the price tag, it's unreasonable because depicts a child flying a Harrier jet to school, saying "sure beats the bus!". Here's the quote: "In light of the Harrier Jet's well-documented function in attacking and destroying surface and air targets, armed reconnaissance and air interdiction, and offensive and defensive anti-aircraft warfare, depiction of such a jet as a way to get to school in the morning is clearly not serious even if, as plaintiff contends, the jet is capable of being acquired 'in a form that eliminates [its] potential for military use."

It should also be noted civilians cannot even purchase a working Harrier Jet, for any price, legally.

Thanks. So once he lost his suit on those grounds, he should immediately file a lawsuit (possibly class-action) for fraud, false advertising and deceiving current and potential clients of Pepsi, since Pepsi lawyers admitted clearly that it is even impossible to deliver winning award to the winner, something they failed to reveal in the fine print. Unless of course Pepsi can prove that this commercial did not bring them any changes in profit.

Did you read the link? The suit WAS for fraud. And that quote was from the judge's ruling, not from Pepsi's lawyers. Here's a link to the actual decision, I suggest you read it: https://scholar.google.com/scholar_case?case=140108835179928... . It goes through the conclusions of the case and quite thoroughly explains why the claim of fraud is wrong.

It seems somewhat ridiculous that he managed to convince five people to "invest" in his idea. I'm surprised the article didn't touch on what seems to be the larger point: Don't advertise things you don't sell. The ad was dishonest not because people actually expected a harrier jet, but because it tried to make a non-existent association between something "cool" and its product.

This is of course something very hard to legislate, but it still feels dishonest to me, more so than almost any ad seen today.

> It seems somewhat ridiculous that he managed to convince five people to "invest" in his idea

I don’t know about that. Have you seen some of the startups that get funded?

Do you want to invest in my new Crypto Cola?

When's the Colacoin ICO and can I send you 10 million dollars?

For people lucky to not to be born in the Eastern bloc:

All that Pepsi was destined to closely guarded, party member only, soviet department stores stocked full of Western luxuries in the time when Soviet citizens were subsisting on bread and water.

I was born in "the Eastern bloc" and Pepsi (Pepsi-Cola, Mirinda) was present in stores in my region. One could buy Coke too but its availability was limited.

Yawn. When I was growing up in USSR of 1980s, Pepsi was _everywhere_, for the cost 0.35 of a rouble for 0.33L. Soviet soda was .25 for .5 liter. Nor our family (teachers) was "subsistent" in any way. I remember having meat everyday, every once in a while my parents would buy a chocolate cake. It was much poorer than US, true, but waaay more affluent than China, India, Africa and rather capitalist Latin America.

What part of the USSR did you grow up in? Was it a major city?

A big city in Central Asia.

What was the name of it? Or do you have to keep it a secret?

When I was living in Poland in the mid 1980's you were very lucky to be able to buy toilet paper, lightbulbs, bread, meat, fruit and a ton of other everyday stuff. Though lots of people knew someone who knew someone that had just slaughtered a pig which could get you some meat.

Hard currency bought you stuff from those stores the GP mentions, called Pewex, something like Pepsi was not seen in regular stores not operated by the government.

https://en.wikipedia.org/wiki/Pewex

The eastern block was obviously huge, some parts like the Baltic countries were relatively well off, others less so.

The same as anywhere else in the world.

TP had always been a problem in the USSR. But light bulbs and bread were not a problem even in the very late 1980s. Can't say much about the other countries of the Eastern Bloc.

There was no problem whatsoever with buying such things like bread or local fruit. Why? Because a great share of those was produced by private entrepreneurs and had the price set by an almost free market.

Actually you can have a look at the statistical data and you will see that there were more pigs, cows, milk etc. then than now.

The problem was with many products manufactured by the collectively/state owned enterprises, because the prices were set artificially low centrally. That caused lack of balance in the market. Of course you could buy those products paying market prices to the private entrepreneurs (called speculators by the government) in the free market (called gray or black market by the government).

And I can assure you that Pepsi was sold in regular (not Pewex or Baltona) stores and those stores were state owned or controlled by the state (cooperatives) because private stores were almost nonexistent.

True, but it sucked that Coke was so hard to find.

Coke was n/a - period. At least, in Ukraine. We were super confused when they begen selling it shortly before USSR dissolution.

One could get Coke in Leningrad. Along with other stuff smuggled from Finland.

Grew up in Kyiv. Pepsi was rare. I was probably 14 when I got a .33 bottle to myself, and not split 4 ways with my parents and brother.

Perhaps that's why people of Central and Eastern Europe don't miss Communism as Russians do. Comecon basically was a colonial system.

Well depends on a year but in Kiev at least Pepsi was often available. Which still does not make USSR a good place to live obviously.

> By the late 1980s, Russians were drinking approximately a billion servings of Pepsi a year

If what you say is true, the party elites must have been drinking a _ridiculous_ amount of it.

The 'eastern bloc' was a lot more than just Russians.

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