Lenins Economy Flashcards
What were Lenin’s economic objectives?
Modernisation = Socialism required construction of a highly advanced economy
Consolidation = Needed Economic stability to retain his power
Military Victory = Needed to supply the Red Army During the Civil war
Destroy Capitalism = Wanted economy more efficient than capitalism and ended inequality
What happened to Lenin’s priorities?
He put immediate pragmatic goals above his long term ideological goals
What happened from March 1918
Lenin began nationalisation of industry - it was at he heart of Lenin’s economy policy
What happened March 1918
Lenin introduced State Capitalism - Economic phase between socialism and capitalism
State Capitalism based on nationalisation of large scale industry
What happened as a result of State Capitalism?
What were the Vesenkha?
Gov could employ experts to run the economy
Control of nationalised industries centralised by Vesenkha:
- Re-esatblish worker discipline = offering higher pay to productive workers
- Ensure factories were properly managed, under control of well paid specialists
- co-ordinate economic production to meet needs of new society
Why was war communism brought out?
State capitalism was temporary
start of civil war led to introduction to a series of emergency economic measures
Centralise Bolshevik control over economy
What measures did War communism contain?
- nationalisation of all industry
- food dictatorship = free market in food abolished = grain forcibly requisitioned from peasants = workers and soldiers got largest ration
- Labour discipline = Lenin introduced 11 hour working day and compulsory work for able bodied men aged 16 - 50
- abolition of market = money worthless due to hyperinflation and was formally abolished, private trade was made illegal
Consequences of War Communism
Led to military victory but economic ruin
Destroyed incentives to work, peasants & worker not rewarded for labour
- By 1920 famine in countryside = 1921 harvest was only 46% of 1913 harvest = DEATH OF 6MILLION PEOPLE
- Workers fled cities in search of food = industrial workers decline from 2.6M in 1917 to 1.2M in 1921
- In Kronstadt, soldiers who had supported the communists had turned against the government, demanding a return to free trade.
Why did Lenin introduce NEP?
To retain political power = Lenin described it as an economic retreat, designed to stop political defeat. Economical compromise to retain political power
Revive economy = Needed policy to stimulate grain production in order to end the famine
Build socialism = Hoped NEP would generate wealth that can be used to industrialise and modernise Soviet Economy
How was the NEP a compromise with capitalism?
- Farming led to free market = peasants could buy sell and produce freely, grain requisitioning ended, replaced by a tax in kind
- Small factories and workshops denationalised = allowed to trade freely, many returned to former capitalist owners
-Large factories remained industrialised - Cooperating with the West to increase foreign investment
Consequences of NEP
created a mixed economy = had both socialist and capitalist elements
- Large factories and major industries remained nationalised.
- did not lead to speedy industrial development and nor was it popular within the Party
- Did end famine because free trade encouraged peasants to grow more food after the abolition of grain requisitioning
How did NEP affect farming?
Ending grain requisition extremely popular among peasants
Free trade encouraged peasants to grow more food
Famine ended
How did NEP affect industry?
Industrial growth
Lenin authorised a major electrification campaign, revived an industry that had been destroyed by civil war
Industry recovery was slow
What was the “Scissors Crisis:”
- Agriculture recovered quickly, industry recovered much more slowly
- This imbalance led to fall in price of food and rise in price of industrial goods
- a gap opened between farmers incomes and industrial prices
- Trotsky nicknamed the crisis as scissors crisis
- gov forced to step in and impose price cuts on industrial goods
How did NEP affect equality?
- Led to re-emergence of inequality
- Large farms prospered, small farms did less well
‘NEPmen’, traders travelled the country selling highly desirable goods, grew rich.
Communists viewed NEPmen as parasites, sometimes arrested by Cheka for profiteering
Many communists horrified by emergence of inequality
