Changing economic priorities: industry Flashcards
What did Khrushchev want to do to Soviet industry?
Modernise it
What did Khrushchev propose investing in to produce more consumer goods?
Light industry
Khrushchev’s reforms led to some economic modernisation.
True or false?
True
In the long term, Khrushchev’s reforms were still successful.
True or false?
False.
In the long term, the Soviet economy went into decline
What was Khrushchev’s vision with Communism?
Wanted the Soviet Union to reach Communism by 1980.
Under Communism, he believed that housing, transport and food would all be available freely.
What were the Soviet Union’s 3 major industrial problems which hampered economic modernisation?
- Military spending
- Command economy
- Inefficiency
Why did military spending cause industrial problems?
In the context of the Cold War arms race the Soviet Union was committed to high levels of military spending.
Consequently, this limited the funds available for industrial investment.
What is an arms race?
Competition to develop and produce increasingly deadly weapons.
During the Cold War the arms race focused on nuclear missiles.
How did Stalin’s command economy cause industrial problems?
Was good at producing large quantities of basic goods such as steel and concrete.
However, it was not designed to create complex or sophisticated goods such as cars or radios
How did inefficiency create industrial problems?
The command economy was highly inefficient; therefore it wasted resources which could otherwise have been used to modernise the economy
When was Khrushchev’s Seven-Year Plan launched?
January 1959
What did Khrushchev’s Seven-Year Plan increase the investment in?
Light industry
What were Khrushchev’s Seven-Year Plan aims?
Increase production of consumer goods
Increase production of chemical fertilisers to support Khrushchev’s agricultural policies, such as Corn Campaign, an initiative to plant more corn
How was the Seven-Year Plan successful?
Boosted production of consumer goods and chemical fertilisers
How was the Seven-Year Plan a failure?
Delivered lower growth than Khrushchev had expected
How had the Seven-Year Plan delivered lower growth than Khrushchev had expected?
Production of consumer goods was 5% below target
Production of chemicals was around 20% below target
As a result of the Seven-Year Plan, ownership of what specific items increased?
Cars
Radios
Refrigerators
Washing machines
Television sets
By 1966, was the Soviet Union behind or ahead of other European nations?
Behind
In terms of car ownership, compare how many cars were owned in the Soviet Union vs the UK, Holland and West Germany in cars per 1000?
Soviet Union = 5
UK = 200
Holland = 166
West Germany = 207
What were the 2 main reasons the Seven-Year Plan underperformed?
- Khrushchev introduced contradictory reforms.
- Khrushchev changed targets of the plan in 1962
How did Khrushchev change the targets of the Seven-Year Plan?
Set more ambitious goals
How did Khrushchev introduce contradictory reforms?
In 1957 he decentralised (distributed) economic planning.
However, from 1958 to 1964 his reforms re-asserted central control
Describe economic growth under Khrushchev and Brezhnev?
Under Khrushchev growth rates slowed.
Trend continued under Brezhnev
By 1980, economic growth had almost stopped
What were the 2 main reasons economic decline came about?
- Refusal to change
- Brezhnev increased military investment, diverting resources away from economic growth
How did refusal to change lead to economic decline in Russia?
After 1964, major economic reforms stopped.
Therefore, long-term problems such as inefficiency and low productivity were never addressed
By 1980, what did Khrushchev abandon?
Khrushchev’s commitment to building Communism
Despite not having the commitment to build Communism, what did Khrushchev promise to provided?
A better standard of living
Between 1964-85, how was Brezhnev able to achieve his promise of providing the people with a better standard of living?
Subsiding prices
A second economy
How did Brezhnev achieve better standard of living by subsiding prices?
Government kept the prices of consumer goods low.
What happened as a result of the government keeping prices of consumer goods low?
There were shortages because demand for goods was higher than supply.
How did a second economy help Brezhnev achieve his promise of a better standard of living?
Tolerated growth of the black market or ‘second economy’.
Allowed Soviet citizens to buy consumer goods illegally
Through what did Andropov attempt to address long-term problems in the Soviet economy?
‘Operation Trawl’
What did ‘Operation Trawl’ do?
KGB officials cracked down on drunkenness and absenteeism in an attempt to boost productivity.
Was ‘Operation Trawl’ successful?
Was short-lived (short-term).
Did not solve underlying problems with the economy.
By what year was the Soviet economy stagnant (stationary)?
1985
Why was the Soviet economy stagnant by 1985?
Successive leaders failed to solve the problems of the command economy
