UNIT 2: HOW DID THE GOVERNMENT EXERCISE CONTROL OVER THE ECONOMY BETWEEN 1917 AND 1928? Flashcards
What was the state of the economy in 1917?
Damaged by WW1 and the Civil war.
Industrial and agricultural systems outdated and inefficient
What was State capitalism?
The transitional stage between the old bourgeoisie economy and the new proletarian one.
This was necessary because the means of production couldn’t be in the hands of the proletariat yet because they didn’t have the expertise and technical skills the bourgeoisie had.
This was until the bolshevik experts could take their place.
What were the key measures of Lenin’s initial economic policy?
1917
The land decree of October 1917 abolished private ownership of land - Agricultural production declined, contributed to famine 1921-22, removed incentives for efficient farming and investments in land improvements..
The decree on workers’ control of November 1917 placed control of the factories into the hands of industrial workers - In the short term, it was popular amongst industrial workers and helped consolidate Bolshevik support, industrial production quickly declined as many skilled managers left or were displaced by inexperienced workers’ committees.
On the 27th of December 1917 all private banks were nationalised and amalgamated into the People’s Bank of the Russian Republic - It achieved the Bolshevik goal of eliminating capitalist private banks and centralized financial control under the communist state, Russian banks faced greater difficulties obtaining credit from international banks now that they were state-run rather than private entities.
What were the results of Lenin’s initial economic policy?
1917
It gave power to workers and peasants but caused further damage to the economy.
The Workers Council gave themselves pay raises which did not improve production and resulted in inflation.
Those with industrial and technical expertise were dismissed by workers seeking revenge for the way they were treated.
The Supreme Council of the National Economy (Vesenka) setup in December 1917 to provide greater control and supervision over the economy.
Why was war communism introduced?
1918
To supply the Red Army with enough food and supplies to win the civil war.
Ideological - the Bolsheviks wanted to abolish private enterprise to implement communist ideology.
In response to economic collapse.
To fix the problems caused by early Bolshevik decrees such as giving workers control.
What were the key features of War communism?
1918
Nationalism - state ownership of all industry which was controlled through Vesenkha.
Workers’ council replaced by management to instil discipline in workers - The death penalty for all workers who went on strike.
Requisitioning of food from peasants to feed the army and urban population. - committees of the village poor made sure no peasants were hoarding food ~ led to rise in tension in the countryside and outbreaks of violence.
Private trading banned, bartering replaced money
Why was the NEP introduced?
1921
War communism failed to convert the communist ideology into policy, although it provided resources to win the civil war, it had a negative impact on the economy and the popularity of the Bolsheviks.
War communism was unpopular because of the rationing system - The size rations were dependent on a person’s social class therefore members of the Red Army and industrial proletariat received the most.
Food production 48% of 1913 figure, breakdown of transport and distribution systems resulted in famine which also caused diseases such as typhus and smallpox - 20 mill dead in the 1920s.
The return of hierarchical systems within the factories were disliked as workers felt that their opportunity for self-regulation was being undermined by the continuous dictates of the State.
What are examples of opposition that applied pressure on Lenin to change his initial economic policy?
The Tambov Rising - a violent reaction from peasants to the requisitioning of grain and plans to get rid of the mir(village commune)
The Kronstadt Mutiny - a revolt by sailors against the increase in the party power at the expense of the workers.
What are the key features the NEP in agriculture?
Requisitioning replaced by a taxation system which allowed peasants to sell any remaining food at market for profit.
No forced collectivisation and the mir would remain.
What are the key features of the NEP in industry?
Small scale industry was returned to private hands, but the state kept control of heavy industry, such as transport and banks, so the party had commanding heights of the economy.
In state-owned factories, piecework and bonuses were used to try and raise production. To some bolsheviks these techniques were seen as capitalist.
An introduction of private trading to stop the growth of black market.
The introduction of currency for paying wages.
Some left-wing bolsheviks was against the retreat back to capitalism but the economy was in desperate need so the NEP was a short term remedy.
What factors show that the New Economic Policy was successful?
Industrial output rose rapidly during the first three years due to the repairing of the roads and bridges damaged during the civil war, and putting factories back into production.
Better harvests in 1922 and 1923.
It helped Bolsheviks consolidate their power as it reduced the number of revolts which had been increased due to the effects of War Communism.
1924 - industrial production 45% of 1913 figure
1926 - much of pre-war economy restored
~ because food production was increased to support industrial workers and gain foreign exchange for new technology and machinery.
What factors show that the New Economic Policy was a failure?
The increase in corruption in the black market.
The policy failed to deliver substantial and sustained growth.
it widened income inequality
There was an imbalance between the provision of agricultural goods and industrial goods: as food prices fell, the price of industrial goods rose.
The low price of grain discouraged peasants from growing food for the market.
Why was there a move to a command economy?
In 1927, events occured that increased the fear of a foreign invasion - British government raid on the offices of the soviet trade mission in London. = peasants responded by hoarding food which restricted economic growth.
Soviet production figures still behind the modern industrial economies of the West. State control over the economy proposed by the 5YPs would ensure adequate production and distribution of essential resources which will bring about rapid industrialisation and advancement.
Launching the 5YP would remove the right and consolidate Stalin’s hold over the party.
Lenin’s declaration 1917 left the workers in charge of their factories - this was incompatible with industrial productivity
What were the results of war communism?
