War Communism SectionObjective The economic and social development of the Russian Empire prior to 1917 To specify what kind of economy the Bolsheviks would have to run in 1917-1921 Bolsheviks ‘s ideas on a road to socialism To identify their plans of how to run socialist economy Economic policy in October 1917- June 1918 To define the initial approaches to running economy Slide into War Communism and situations in the country June 1918-February 1921 To assess the effectiveness of War Communism The general analysis of War Communism To characterise this policy
Industrial development of Russia in 1861-1900 Red circles – metal processing industry Blue – textile industry Yellow – food- processing industry
Index of total output in the manufacturing and mining industries in Russia in 1860 -1913. 1900 = 100% A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 12.
18601910 Germany10.525.0 USA22.542.0 France14.517.0 UK20.023.5 Russia7.511.0 Millions of calories produced by average male agricultural worker A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 24.
RussiaUSAUK Electricity (milliard Kwhs) 2.025.84.7 Coal (million tons)29.2517.8292.0 Oil (million tons)10.334.0- Steel (million tons)4.331.87.8 Cotton textiles (milliard meters) 184.108.40.206 1913 Industry output A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 14.
Make profits of the capitalists public, arrest fifty or a hundred of the biggest millionaires. Just keep them in custody for a few weeks... for the simple purpose of making them reveal the hidden springs, the fraudulent practices, the filth and green which even under the new government are costing our country thousands and millions every day. That is the chief cause of our anarchy and ruin! Lenin June 1917 Speech to the First Congress of Soviets
Centralisation or nationalisation of banking system Nationalisations of syndicates, - main capitalist associations for sugar, oil, iron Abolition of commercial secrecy Compulsory ‘syndication’ of industry – independent firms should form part of syndicates Compulsory membership of consumer cooperatives - simplify rationing Lenin, September 1917 The impending catastrophe and how to combat it
Early measures (late 1917 – June 1918) Land decree of 8 November 1917 Decree of workers’ control of 27 November 1917 VSNKh (Supreme Council of National Economy, ) 15 December 1917 Slow nationalisation (mostly by local authorities ) around 487 enterprises Mixed economy – collaboration with capitalists
Slide into War Communism Agriculture Decline of productivity, Prodrazverstka (confiscation of food surpluses), Narkomprod (People’s Commissariat for Supplies) Political and military situation Shortages of agricultural and industrial goods. Needs of tougher state control over economy and nationalisation. Impossible to compel the factory owner and individual peasant to produce, while simultaneously ruining him by requisitions and restricting his links with the market. September 1919 – 3300 nationalised enterprises – only1375 were functioning. VSNVK tried to cope up with an impossible job. Industrial census taken in August 1920 - 37,000 nationalized enterprises. Black market Lack of goods to sell and problem of effective distribution. Decline of urban population. 60% illegal bread in cities. Monetary policy. Printing press - ‘machine gun which attacked the bourgeois regime in the rear’ (Eugene Preobrazhensky). Naturalisation of economy and virtual abolition of money. Wages in kind. Moneyless budget Militarisation of labour Abolishment of workers’ control, system of rationing according to classes
19131921 Gross output of all industry (index) 10031 Large-scale industry (index) 10021 Coal (million tons)299 Steel (million tons)4.30.2 Agricultural production (index) 10060 Source: A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 68.
Necessity over ideology Anarchy and chaos. Orders couldn’t be obeyed. Weak administration. Impact of war and civil war. Dispirited supplies. Losses of agricultural regions. Moving frontiers. Necessity it is naturally good in this situation to ban private trade in foodstuffs. End of War Communism Early 1920 – most territories returned. Resources available. The key problem remained the relationship with peasants and related problems of freedom of trade and of private small scale- industry. The state couldn’t cope up with running the all sectors of economy. February 1921 - rising in Kronstand. NEP
Nicolay Bukharin’s The Politics and Economics of the Transitional Period, 1920 Marx – “expanded reproduction” – intensive development of capitalist relation Bukharin – “negative expanded reproduction’ - economic disruption. The centralised apparatus of capitalism disintegrated and cannot be used as a basis for social order. Need of a long transitional period.
An attempt to ban private manufacture, nationalisation of all industry, allocation of all output by the state A ban on private trade, not completely effective but actively imposed Seizure of peasant surpluses The partial elimination of money Terror and arbitrariness, expropriation Effort to establish strict discipline Key characteristics of War Communism