Soviet Economic Policy

Policies in the early 1920s War Communism –Pure form of communism Grain Requistioning Banning of Private Trade Nationalisation Labour Discipline –Passports to prevent movement of workers Rationing Red Terror used to impose changes –Deeply alienated many – including potential supporters –Inefficient – disincentivised work –Peasants particularly alienated –Kronstadt Mutiny ‘Soviets without Communists’ rallying cry

Policies in the early 1920s NEP (New Economic Policy) –Lenin’s pragmatic about turn Trotsky hostile to deviation from communism –Features Grain Requisitioning abolished –Tax in kind –Could sell surpluses State maintained control of heavy industry But some small businesses allowed –To allow products for peasants to buy Private Trade allowed Rationing abandoned

Policies in the early 1920s NEP –General revival in economy Small businesses recovered faster than Heavy Industry Production increased across the board –Although unemployment increased in urban areas as profit motive meant that workers could be laid off Nepmen – the big winners –Speculators who bought up surpluses and sold them in towns –Controlled 75% of trade by 1925 –Corruption – bribes to local officials to allow goods to be obtained and sold Uneven distribution of success –Conspicuous displays of wealth by Nepmen speculators –Peasants did not get the full profit due –Urban workers jealous of peasants, Nepmen and of party workers »New Exploitation of the Proletariat

Policies in the early 1920s NEP becomes entangled with political power struggle –Death of Lenin Loss of unity behind Lenin’s pragmatic approach Industrialisation a goal of all –Needed an Urban proletariat to build Socialism –What was the most effective way of industrialising? »NEP »State control

Policies in the early 1920s NEP loses its appeal to the Communists –Lack of direction for industry Responding to market – not to strategic goals of USSR –Rich superclass developing Corruption Speculation Gambling and Prostitution –Hoarding by peasants Deliberately create shortages to maximise profits Food shortages –Urban unemployment Periods of Boom and bust

Policies in the early 1920s –Ideological struggle in Politburo Leftists –Trotsky, Zinoviev and Kamenev –Wanted a return to a purer form of State Controlled Communism »Fully organise workforce »Force peasants to produce more food to pay for industrialisation Rightists –Bukharin (Tomsky and Rykov) –Wanted NEP to continue »Allow peasants to become richer so that they can buy the products made in the urban centres »Avoids conflict with the peasant class (the majority) Stalin – Centre?

Stalin Shifting for Power! Portraying himself as the moderate voice –1925 Allies with Bukharin against Trotsky, Kamenev and Zinoviev Socialism in One Country appeals to rightists –Leftists identified with permanent revolution Uses Factionalism charges to isolate and expel Trotsky, Kamenev and Zinoviev from party –1927/8 Stalin turns against Bukharin and the Rightists –Uses support in Communist Bureaucracy and lack of rivals to isolate Bukharin, Rykov and Tomsky

Stalin’s Great Turn Reasons for –NEP not Communist enough for rank and file communists (who Stalin depended upon) –Peasantry becoming too powerful vis-à-vis Urban Proletariat –Conspicuous consumption by Nepmen –Unemployment Rising in the Worker’s Paradise –Speculative Hoarding –1928 War Scare – Not enough strategic materials –Allows Stalin to isolate Rightist rivals 15 th Party Congress - Stalin Declares –Collectivisation –First Five Year Plan –The 5YP depended upon the success of Collectivisation

Cash Crisis For 5YP Money was required –To invest in or purchase: Factories/Plant Machines Workers/Wages Raw Materials Possible sources of money –Tax Soviet citizens Not a rich society – hit by war, Civil war, exile, confiscations, war communism, hiding of assets from Communists –Borrow money from abroad Reneged on Tsarist loans Capitalists unlikely to lend to nationalising communists –Encourage greater grain production How?

Grain converted into Hard Cash –Encourage greater grain production Sell grain on open market –Collectives would allow: Access to expensive new machinery to improve efficiency Mechanisation would allow surplus workforce to migrate to towns Update farming techniques by learning from experts Economies of Scale –larger units of production brought efficiencies –Easier for State to collect Socialist answer to USSR’s problem Easier political control of hostile peasant classes

The Kolkhoz No wages –Holidays, board and lodging in return for labour –The collective’s profit would be shared out equitably at the end of the year Quotas Prices set by State –State would sell in cities as slight profit State Support –Machine and Tractor Stations –Had to pay 20% of produce to access machinery Private Plots –Once collective duties completed

Collectives Anyone? Few Peasants willing to move into collectives Conservative Peasants: –The NEP seemed to be working fine for them –Unfamiliar working practices –Suspicious of new machinery and techniques –Memories of War Communism and forced requisitioning –Little sympathy for plight of urban poor

The Pressure Builds 1928/9 Grain Procurement Crisis –Not enough grain to allow 5YP to proceed –Food shortages in Cities –Price rises – inflation Stalin’s Pressures –Credibility attached to success of 5YP –Urban workers support base for Stalin –Power struggle not yet complete –Urals –Siberian experiment –Long term goal of Industrialisation of Agriculture –Ideological distrust of peasant class Stalin’s Solution –Requisitioning –Forced Collectivisation

De-Kulakisation Class warfare declared on Kulaks Communist classification of peasants: –Kulaks – better off Peasants –hired help –Middle Peasants – moderate incomes –Poor Peasants - landless “We will hit the Kulaks so hard that the middle peasants will snap to attention before us” Molotov Ukraine targeted for being less reliable than Russian areas –Ukrainian nationalism

Forced Collectivisation Rural Communist parties resisted collectivisation quotas –Too unpopular Special Urban party activist task force created –25,000 attended special Two Week courses –Tactics Root out Kulaks? –Confiscate goods »Would become basis of new commune ‘Persuade’ remaining peasants to volunteer to join a collective –Tools used Propaganda –Controlled all sources of information Force –OGPU, Police, Military Terror –Denunciations, Executions of Kulaks, ‘Necessary Measures’ –10 Million deported Siberia and Labour camps –Quotas

Kulak Dispersal

Peasant Resistance Riots Armed Resistance Peasants destroyed own goods rather than hand them over to the State –Mass slaughter of livestock Raids on Collectives to liberate goods and livestock All women raids made troops reluctant to shoot to kill “Dizzy with Success” temporary climbdown by Stalin 1930 –Claims over eager officials getting carried away

Results of Collectivisation 23 Million tonnes of grain seized in 1931 (chart page 171) –Enough to feed urban areas –5 million tonnes of grain sold overseas However –Desolated rural areas –Famine 1932 – 1934 Millions died of starvation in rural areas –7 Million according to Robert Conquest Ukraine particularly hard hit –Fall in production Not enough livestock to do work Best farmers annihilated as Kulaks Pre-collective era grain production not reached until 1937 But –Stalin content to see the end of the ‘accursed problem’ of the peasant class –Demonstrates power of Communist Party –Confirms Stalin’s control of Communist Party –Gulag Labour increased massively –Migration of peasants to cities

Essay Title Collectivisation was a political success but an economic failure and a human disaster. Discuss.

Industrialisation Collectivisation was only a means to an end –The food grown could be sold on the world market to allow investment in industry –Soviet Industry was designed to provide for the State (not the consumer) Hence, very little produced that would be wanted by world market

Page 179First Five Year Plan Second Five Year Plan Third Five Year Plan Summary Successes Problems Conclusion

Industrialisation Speeds Up 1926/7 15 th Party Congress –Due to NEP, Manufacturing had recovered to 1914 levels But factories operating at full capacity –No excess capacity –Stalin strong enough to assert ‘leftist’ ideas of super-industrialisation Trotsky and Preobrazhenski removed –Foreign Policy concerns Britain broke off relations 1927, China debacle, Japan acting suspiciously, France and Poland allying –Agricultural productivity ‘seems’ to be improving Same techniques could be applied to industry?

The Socialist Offensive Industrialisation advertised as if it were a war –“Mobilising Forces” –“Offensives” –“Objectives” –“Breakthroughs” –“Ambushes” by “Class Enemies” Suited communists to recreate memories of sacrifices during Civil War Could blame Foreign Capitalists or Class Enemies for any setbacks

Unreal Targets 1928 – 1933 Goals –Communist Officials bidded with one another to prove their socialist credentials –Layers of Bureaucracy added their own hoped for targets –Shakhty Affair- Show Trial 55 Engineers arrested – 5 executed for ‘sabotage’ (Targets to low) –Ended up with plans to: Electrification of Entire Economy Pig Iron to Triple Coal to Double Light Industry ^ 70% National Income ^ 103% –Failure to meet targets was a crime that could be punished as sabotage.

New Industrial Areas

1932/3 Crisis Some successes in First 5YP but many problems were stored for the future (Few targets actually met) p179 Costs rising Bottlenecks –Infrastructure could not carry increased volume of goods/investment Consumer goods/workers needs not catered for –Eg housing did not keep pace with factory production Lack of skilled workforce –Many experts in exile –Russian workers changed jobs to try and find better conditions Lack of Coordination –Managers paranoid that they would be blamed for not fulfilling quotas Impact of collectivisation kicking in –Food shortages –Rationing –World wide depression Prices falling

Economic Overview 1919 – 1920 –War Communism 1921 – 1928 –NEP 1928 – 1932 –First 5 Year Plan –Collectivisation –Over-ambitious Targets 1932/3 –Economic Crisis 1934 – 1936 –Three Good Years 1937 – 1941 –Slump 1941 –Second World War

Magnitogorsk Magnitogorsk was a huge industrial combine created in Central Russia near to iron ore and coal mines Turnover rate –Page 186 Dealing with turnover rate –Wage differentials/incentives –Piece Rates –Training –Tough measures for ‘wrecking’ –Force Labour –Propaganda Use page 187 to give examples

Three Good Years –Initial investment in Plant coming on stream First 5 Year Plan starting from scratch! –Collectivisation Crisis and Famine Declining Peasant markets reintroduced –Stakhanovite Movement How did he break the record? –Page 191 –Increase focus on Consumer Products Footwear Food –Gulags have no shortage of labour Do the jobs that working class Russians do not want to do.

1937 – 1941 Slowdown followed by War Military Production Focus –Consumer needs fall down priority list –Heavy Industry –Strategic relocation of militarily sensitive industries East of Urals Difficult Winter –Fuel shortages, Transportation problems Stalin’s purges of ‘wreckers’ –Looking for scapegoats –Removed many genuine experts –Caused bureaucratic confusion as key individuals removed –Caused managers to lie, cheat and steal rather than be blamed for failing to meet targets World War Two doesn’t Help –But… USSR successfully rebuffs Nazi advance –Relocation of industrial base essential in ultimate victory!

Essay Titles “Life has become better comrades, life has become more joyous” Stalin, 1935 –How far would Russian workers agree with Stalin’s statement? Write an Introduction, list paragraph titles and a conclusion for this essay title. Find supporting and/or opposing quotes pages 189 & 194/5

Essay Titles The sacrifices of Russian workers in the 1930s allowed the Soviet Union to face the might of the German Army in How far do you agree with this statement? Write an Introduction, list paragraph titles and a conclusion for this essay title.