The Soviets were retouching images back in 1987, 3 years before PS 1.0 debuted.
First the Soviet Union beats us into outer space and now this!
Back in 1987, long before our beloved CS5 came out, in fact three years before Photoshop 1.0 even came out, the Soviets were utilizing high-tech machines like rotary scanners and magnetic tapes to scan damaged photographs into a computer for retouching. Once scanned, engineers would then "clone stamp" rips and imperfections out of the image and correct contrast, all by utilizing what appears to be a primitive track ball. Pretty impressive.