New Economic Policy

Question 1

Origins of the NEP

Answer 1

• Introduced Mar 10 1920
• Decided by Lenin in wake of the Kronstadt Rebellion and the unhappiness of the people
• Petrograd alone had lost 850,000 people to the countryside as a result of war communism and a way was needed of bringing them back

Question 2

Industrial Positives of the NEP

Answer 2

• 1920-23 - Factory output rises by 200%
• 1921 - 50 million tonnes of grain produced
• 1925 - 72.5 million tonnes of grain produced
• Small factories (with 20 workers or less) allowed to become privatised again

Question 3

Economic Positives of the NEP

Answer 3

• New currency - the “Chervonet” - is introduced in 1922
• Privately owned cafes, shops and banks reopen
• Results in high growth rates (about 20% a year even after the recovery ended in 1925)
• Peasants only had to give 10% of their grain to the government and could sell any surplus
• The NEP is overall the most successful period economically under the Bolshevik regime

Question 4

The Scissors Crisis

Answer 4

• To keep income high, industries made prices three times higher than that of agricultural prices - because of this, peasants had to produce three times as much wheat so as to purchase goods from industries
• Peasants decided not to sell their grain until agricultural prices rose, or, alternatively, sold them to Nepmen - they therefore began to hoard it again
• The government had to intervene and fix prices so as to prevent further inflation

Question 5

Ideological Negatives of the NEP

Answer 5

• Few Marxist ideas
• Many party members considered the policy to undermine the aims of the October Revolution
• The Nepmen were a symbol of capitalism and could pose a potential future threat
• Whilst some party members such as Bukharin backed it, others such as Trotsky argued in favour of state control instead
• 1921 - Lenin eventually has to introduce a ban on factions during the Tenth Party Congress. Anyone who was part of a faction from that point on would be expelled from the party

Question 6

Economic Negatives of the NEP

Answer 6

• Scissors Crisis
• Much like Stolypin’s reforms of 1906-7, the policy encouraged further class division by allowing some peasants to enrich themselves more so than others
• Collectivisation re-began under Stalin from 1929-30, meaning production in both sectors fell once again