NEP Flashcards
When was the NEP announced
10th Party Congress, 1921
What does NEP stand for
New Economic Plan
What was set up to coordinate economic development
Gosplan (a decree set up by the Sovnarkom)
its HQ was in Moscow but it had branches in each Soviet republic
It clashed with Veshenka
Gosplan
Job was to advise on a NEP
Supported by Bukharin, Zinoviev and most of the leadership
HOWEVER
many members saw it as an ideological betrayal by allowing private trade
What was to be under state control according to the NEP
transport, banking and heavy industry
what were ‘commanding heights’
To pay workers from their profits (to make increased productivity
What was also allowed to reopen
Private ownership of smaller industries was now allowed and private trade.
Small workshops and factories making goods such as shoes, nails and clothes were allowed to reopen
Private trade
Food and goods could flow more easily between the countryside and towns.
Privately owned ships re-opened, rationing abolished and people were now able to buy food and goods from their own income.
(Money came back into circulation)
Key element of the NEP
To end grain requisitioning
Control of grain
Peasants were now to give a fixed proportion of their grain to the State, this was significantly lower than under War Communism.
Any surplus produced, the peasants were allowed to sell.
Crisis of 1923
“Scissor crisis” named by Trotsky.
A huge increase in grain supplies brought food prices down in the towns but because there were few industrial goods to buy by the peasants, they held back their supplies.
The government capped the prices of industrial goods (made them cheaper) and replaced peasant grain quotas with money taxes from 1923.
This would force the peasants to sell their grain (to pay their taxes).
1926
Production levels were at 1913 levels and people enjoyed a better standard of living.
Who were trade agreements signed with in 1926
GB and Germany
What type of economy returned by 1926
A money economy and private wealth returned
Which two social groups flourished
Nepmen traders (they bought grain and sold industrial goods) Kulak class re-emerged
