Stalin - Economic AS LEVEL EDEXCEL

REASONS FOR THE DECISION TO MOVE INTO A COMMAND ECONOMY?

1. Industrial Weakness and the Need to Modernise

• By 1924, industrial output was only 45% of 1913 levels; despite recovery by 1926, growth under the NEP was slow and unreliable.

• The USSR remained 80% peasant-based, lacking the industrial base to defend itself or compete with advanced Western economies.

• Stalin believed central planning could rapidly direct resources into heavy industry — steel, coal, machinery — essential for defence and independence.

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2. Grain Crisis and Food Supply Problems (1927–28)

• In 1927, grain procurements fell 25% below 1926 levels, causing urban food shortages and threatening industrial expansion.

• Peasants, especially kulaks, were accused of hoarding grain instead of selling it to the state — the so-called “kulak grain strike.”

• Collectivisation allowed the state to control grain output, increase exports to buy machinery, and feed industrial workers more reliably.

FURTHER REASONS FOR THE DECISION TO MOVE INTO A COMMAND ECONOMY?

3⃣ Inefficiency and Limits of the NEP

• The NEP revived the economy after war but led to imbalanced growth — agriculture recovered faster than industry, causing the “Scissors Crisis” of 1923.

• Private traders (NEPmen) and wealthy peasants distorted markets, creating inflation and inequality, which limited industrial investment.

• Stalin saw the NEP as holding back modernisation — a planned economy would prioritise key sectors and remove profit-driven inefficiency.

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4⃣ Central Control for Economic Coordination

• Under NEP, factories and regions acted independently, leading to corruption, waste, and poor resource distribution.

• A command economy let the government set production targets, allocate labour and materials, and coordinate transport and supply chains.

• Central control meant the state could mobilise the whole economy for industrialisation — seen in the First Five-Year Plan (1928–32), with targets of coal +110%, iron +200%, and electricity +335%.

WHAT ARE THE DATES OF 1ST- 5TH FIVE YEAR PLAN?

• 1st Five-Year Plan: October 1928– December 1932

• 2nd Five-Year Plan: January 1933 – December 1937

• 3rd Five-Year Plan: January 1938 – June 1941

• 4th Five-Year Plan:  January 1946 – December 1950

• 5th Five-Year Plan : January 1951 – December 1955

GOALS/OBJECTIVES OF THE FIRST FIVE YEAR PLAN?

1⃣ Rapid Industrialisation & Heavy Industry Growth:

• Focused on developing coal, iron, steel, oil, and electricity to transform the USSR into a modern industrial state.

• Ambitious targets: coal output +110%, iron +200%, electricity +335% by 1932.

• New industrial complexes built — e.g., Magnitogorsk (steel city in the Urals) and Kuznetsk Basin (coal and iron production).

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2⃣ Development of Infrastructure and Transport:

• Expansion of railways, power stations, and new industrial cities to support heavy industry.

• Major projects: Dnieper (Dneprostroi) Hydroelectric Dam (opened 1932, one of the world’s largest at the time) and Turksib Railway (completed 1931, linking Siberia to Central Asia).

• These projects aimed to integrate remote regions and ensure efficient movement of raw materials.

 WHAT ARE THE MAIN GOALS/OBJECTIVES OF THE FIRST FIVE YEAR PLAN? (CONT. )

3⃣ Collectivisation of Agriculture (to Support Industry):

• Linked to the plan’s industrial aims — grain from collectivised farms would feed urban workers and be exported for machinery imports.

• By 1932, around 62% of peasant households were in collective farms.

• Although targets were met through force, it caused widespread famine (especially in Ukraine, 1932–33).

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4⃣ Elimination of Capitalist Elements & Centralised Control:

• Aimed to remove NEPmen (private traders) and kulaks (wealthier peasants) who were seen as obstacles to socialist industrialisation.

• All major industries nationalised — run by Gosplan (State Planning Committee) with strict production quotas.

• This created a fully planned, state-controlled economy, strengthening Stalin’s political control over workers and resources.

WHAT ARE FEATURES OF THE FIRST FIVE YEAR PLAN?

• Heavy Industry Focus:
  Aimed to transform the USSR into an industrial power — key targets included coal +110%, iron +200%, and electricity +335%.

• Creation of New Industrial Centres:
  Huge projects like Magnitogorsk (steel city) and the Kuznetsk Basin expanded heavy industry.
  The Dnieper Dam (1932) became one of the world’s largest hydroelectric stations, symbolising modernisation.

• Infrastructure Expansion:
  Major investment in railways, power stations, and engineering plants to connect remote regions.

• Collectivisation to Fund Industry:
  Grain from collective farms used to feed industrial workers and export for machinery imports.

• Centralised State Planning and Control:
  Managed by Gosplan, which set production quotas and directed all industry.
  Private trade and the NEP were effectively abolished — creating a fully command economy under Party control.

WHAT ARE THE POSTIVE IMPACTS OF FIRST FIVE YEAR PLAN?

• Rapid Heavy Industry Growth:
  Industrial output rose sharply — {coal : from 35.4 million tonnes (1928) to 64.3 million tonnes (1932)},                                                                                                                        {pig iron- from 3.3 million → 6.2 million tonnes,}                                                              {steel- from 4.0 million → 5.9 million tonnes.}
  {Electricity production:  — from 5 billion kWh → 13.5 billion kWh —}

• Major Infrastructure Projects Completed:
  Massive undertakings like the Dnieper Hydroelectric Dam (opened 1932), and  Magnitogorsk steelworks, boosted energy and transport networks.
    - These projects symbolised industrial modernisation and increased national production capacity.

• Expansion of the Industrial Workforce:
  Millions left agriculture for industry — the industrial labour force increased from approx. 11 million (1928) → 23 million (1932).
  New industrial cities such as Magnitogorsk and Gorky expanded rapidly.

• Move Toward Economic Independence:
  Increased domestic production reduced reliance on foreign machinery and goods.
  The USSR became more self-sufficient, especially in coal, steel, and electricity, vital for defence and growth.

• Propaganda and National Prestige:
  The Plan was celebrated as proof that socialism could modernise a backward nation.
  Stalin’s leadership gained legitimacy as the USSR emerged as a major industrial power by the early 1930s.

 WHAT ARE THE NEGATIVE CONSEQUENCES OF THE 1ST FIVE YEAR PLAN ?

• Human Cost and Famine:
  Forced collectivisation caused widespread famine, especially in Ukraine (Holodomor), killing an estimated 3–5 million peasants.

• Agricultural Disruption:
  Grain production fell in some regions due to resistance; by 1932, the USSR barely met its grain procurement target of 10.8 million tonnes, despite large quotas.

• Harsh Working Conditions and Labour Shortages:
  Workers faced long hours (up to 12–14 hours/day), poor housing, and unsafe conditions; many died from accidents or exhaustion, particularly in major projects like Magnitogorsk and the Dnieper Dam.

• Inefficiency and Unrealistic Targets:
  Many industrial targets were over-ambitious; some outputs were falsely reported (e.g., overstated steel/coal production) to meet quotas.
  Quality often suffered as factories focused on quantity over usability.

REASONS OF THE 2ND FIVE YEAR PLAN ? 

• Consolidate Industrial Growth from the First Plan:
  After rapid expansion 1928–1932, the USSR needed to improve efficiency, fix shortages, and complete unfinished projects.
  Focus shifted to coal, oil, steel, and machinery, building on First Plan gains like coal rising to 64 million tonnes by 1932.

• Expand Transport and Communication Networks:
  Industrialisation highlighted weak infrastructure; the Plan aimed to improve railways, roads, and canals to link industries and cities.
  Example: Completion of the Moscow Metro (opened 1935) and expansion of rail lines in Siberia and Ukraine.

• Increase Production of Consumer and Engineering Goods:
  The First Plan focused on heavy industry; the Second Plan aimed to balance the economy with more textiles, chemicals, and machinery for factories and agriculture.
  By 1937, machine-tool production had risen significantly to support industrial self-sufficiency.

• Prepare for Defence and Self-Sufficiency:
  Rising global tensions and fear of war meant the USSR needed strategic industries — armaments, oil, and coal.
  The Second Plan emphasised rearmament readiness alongside industrial expansion.

FEATURES OF THE 2ND FIVE YEAR PLAN?

• Focus on Heavy and Engineering Industry:
  Continued emphasis on coal, iron, steel, and oil, but more attention to machinery, machine-tools, and engineering for industry and agriculture.
  By 1937, coal production reached 128 million tonnes, and steel production rose to 18 million tonnes, showing strong growth.

• Expansion of Transport and Infrastructure:
  Major investment in railways, roads, and communication networks to connect industrial centres.
  Projects included the Moscow Metro (1935) and expansion of Siberian railways to improve logistics.

• Increased Consumer Goods Production:
  Unlike the First Plan, aimed to balance heavy industry with textiles, chemicals, and consumer goods.
  Textile production increased by around 60%, helping supply growing urban populations.

• Emphasis on Economic Self-Sufficiency:
  Reduced reliance on imports by developing domestic production of machinery, chemicals, and oil.
  The USSR was better prepared for future industrial and military needs

POSTIVE IMPACTS OF THE SECOND FIVE YEAR PLAN?

• Dramatic industrial output growth: By 1937, industrial output had more than doubled compared with 1932, reaching around 500% of 1913 levels.

• Heavy industry expansion: Coal output reached 127 million tonnes, pig iron 14.5 million tonnes, and steel 18.3 million tonnes, boosting USSR self-sufficiency.

• Improved consumer goods & infrastructure: Consumer goods production roughly doubled between 1933–1937; major projects included the Moscow Metro (1935) and Volga Canal (1937).

• Mechanisation of agriculture & support for industry: Collective farms had approximately  456,000 tractors and approximately 128,000 combines by 1937, improving grain procurement for urban workers.

• Urban workforce and skilled labour growth: Industrial workforce increased to  approximately 27 million by 1937, and technical education expanded, creating a more skilled workforce to sustain industrialisation.

NEGATIVE CONSEQUENCES OF THE SECOND FIVE YEAR PLAN?

• Agricultural difficulties persisted: Despite mechanisation, grain procurement was often short, and peasants resisted collectivisation.
  By 1936–37, grain production was slightly higher than 1932 (approx. 95–100 million tonnes) but still struggled to fully meet industrial and urban demand.

• Harsh working conditions in industry: Urban workers faced long hours (10–12 hours/day), low pay, and unsafe workplaces; serious industrial accidents were common.
  For example, projects like the Volga Canal saw thousands of worker deaths due to poor safety and forced labour.

• Use of forced labour (Gulag system): Millions were sent to labour camps to complete projects such as canals, railways, and construction, contributing to human suffering and inefficiency.
  By 1937, the Gulag population was over 1.5 million.

• Over-ambitious targets and inefficiency: Many industrial quotas were unrealistic, leading to falsified reports and poor-quality output; heavy industry often prioritised quantity over quality.
  For example, steel production sometimes met targets on paper, but much was unusable or low-grade.

• Urban strain and social problems: Rapid urbanisation caused housing shortages, poor sanitation, and overcrowding in cities like Moscow, Magnitogorsk, and Leningrad, increasing social tensions.

DEFINE COLLECTIVISATION AND KULAKS.

• Collectivisation:
  A policy introduced by Stalin from 1928 to merge individual peasant farms into large collective farms (kolkhozes).
  Its aim was to increase agricultural efficiency, secure grain for industrial workers, and fund industrialisation, often enforced by force.

• Kulaks:
  Wealthier peasants who owned larger farms or employed labour.
  They were blamed by Stalin for resisting collectivisation, leading to expropriation, deportation, or execution during the 1930s.

REASONS FOR COLLECTIVISATION

• Increase Grain Procurement for Industry:
  The USSR needed to feed the growing urban workforce and export grain for industrial machinery.
  By 1928, industrial growth under the First Five-Year Plan required millions of tonnes of grain for cities and export.

• Modernise Agriculture and Mechanisation:
  Large collective farms (kolkhozes) allowed tractors and combines to be used efficiently, replacing small-scale peasant farming.

• Eliminate Kulak Resistance:
  Wealthier peasants (kulaks) often hoarded grain or resisted quotas, slowing economic growth.
  Collectivisation aimed to remove them as a class, confiscate their land, and redistribute it to the state or poorer peasants.

• Fund Industrialisation:
  Grain exports from collectivised farms were crucial for earning foreign currency to buy machinery, tools, and technology for the Five-Year Plans.

WHAT ARE THE PROCESS/METHODS OF COLLECTIVISTATION ?

• Individual peasant farms were forced to merge into collective farms (kolkhozes) or state farms (sovkhozes), with resistance met by confiscation, deportation, or execution.

• The state introduced mechanisation, including approx. 422,700 tractors and appprox 44,000 combines by 1937, often supervised by officials to meet quotas; this allowed large-scale ploughing and harvests previously impossible on small farms.

• Propaganda and coercion were widely used: peasants were pressured with agitators, socialist competitions, and public denunciations; in some cases, armed groups forced villages to collectivise, and livestock was often seized or slaughtered in protest.

RESULTS OF COLLECTIVISATION?

• Grain procurement for cities and exports increased, helping fund industrialisation, with approximately 4–6 million tonnes of grain exported annually (1929–31).

• By 1937, 60% of peasant farms in the USSR had been collectivised into kolkhozes (collective farms).

• Around 25 million peasants were living and working on kolkhozes by 1937.

• Dekulakisation occurred mainly between 1929 and 1933, targeting wealthier peasants (kulaks) who resisted collectivisation.

• Widespread famine occurred due to forced grain requisitioning, resistance by peasants (including slaughtering of livestock), poor harvests, and harsh policies, notably causing the Holodomor in Ukraine (1932–33), killing 3–5 million people.

POSITIVE IMPACTS OF COLLECTIVISATION ?

• Increased mechanisation and modernisation of agriculture:
  By 1937, 422,700 tractors and appprox 44,000 combines were used on collective farms, improving efficiency and supporting industrialisation.

• Grain procurement for cities and exports:
  Collectivisation allowed the state to secure enough grain to feed the growing urban workforce and export for machinery.
  Between 1929–31, the USSR exported ~5–6 million tonnes of grain annually.

• Support for industrialisation:
  Grain sales helped fund the Second and subsequent Five-Year Plans, enabling investment in factories, transport, and heavy industry.

• Consolidation of state control over agriculture:
  The state controlled production and distribution, reducing reliance on private peasant decisions and aligning farming with national economic plans.

NEGATIVE CONSEQUENCES OF COLLECTIVISATION?

• Famine and mass deaths:
  Forced collectivisation contributed to the Holodomor in Ukraine (1932–33) and other famines, killing 3–5 million people.

• Resistance and repression of kulaks:
  Millions of kulaks were executed, deported, or exiled, causing social disruption and loss of experienced farmers.

• Drop in agricultural productivity initially:
  Grain and livestock production fell due to chaos, resistance, and slaughtering of animals; e.g., cattle numbers fell by one third between 1928–1933.

• Social turmoil and suffering:
  Peasants endured forced requisitions, long working hours, and harsh living conditions, causing widespread fear and resentment.

3RD FIVE YEAR PLAN  AIMS & FEATURES :

Aims:

• Continue industrialisation with a focus on armaments and military production, preparing the USSR for possible war.

• Expand heavy industry and machinery production to strengthen self-sufficiency.

• Increase defence infrastructure and transport networks to support rapid mobilisation.

Features:

• Emphasis on military and defence industries, including tanks, aircraft, and weapons.

• Heavy industries like steel, coal, and machinery continued to grow, though at a slower pace than the Second Five-Year Plan.

• Consumer goods were still limited, as resources were prioritised for armaments and state projects.

• Industrial workforce continued to expand; large factories were built in the Urals and Siberia to avoid potential invasion threats.

WHAT ARE THE POSITIVES AND NEGATIVES OF 3RD  FIVE YEAR PLAN?

Positive Impacts:

• Industrial base strengthened for war: by 1940, tank production reached approx. 3,000 per year, and aircraft production was significantly higher than in 1937.

• Heavy industry expansion increased steel, coal, and machinery output, improving long-term industrial capacity.

• Strategic relocation of factories to the east improved resilience against invasion.

• Skilled workforce grew due to ongoing technical training and industrial expansion.

Negative Consequences:

• Consumer goods remained scarce, and living standards for ordinary citizens stayed very low.

• Rapid militarisation caused resource shortages and inefficiencies in non-military sectors.

• Labour conditions were harsh, with long hours and continued use of forced or disciplinary  labour in some industries.

• The plan was interrupted in June 1941 by the German invasion, so many objectives were never fully completed.

IMPACTS OF WORLD WAR 2 ON THE ECONOMY - INDUSTRIALLY 

• War Production & Factory Relocation: Defence Committees coordinated local war production, and whole factories were moved east to avoid German capture, allowing continued industrial output.

• Massive Military Output: Between 1943–45, the USSR produced over 73,000 tanks and 94,000 planes, showing a huge focus on armaments despite wartime disruption.

• Severe Decline in Key Industrial Materials: By 1945, steel production fell from 18 million tons (1940) to 12 million tons, oil dropped by two-thirds, and wood by half, highlighting the strain on industrial resources.

• Destruction & Resource Shortages: Extensive damage included 1,700 towns and 70,000 villages destroyed, countryside resources seized by the army, and massive human losses (20 million dead, 25 million homeless), all reducing industrial and labour capacity.

IMPACTS OF WORLD WAR TWO ON THE ECONOMY- AGRICULTURALLY 

• Sharp Decline in Agricultural Output: Grain production fell from 95 million tons in 1940 to 30 million tons in 1942, showing massive disruption caused by war and the end of the Link system.

• Loss of Labour and Resources: Many men, horses, and machinery were requisitioned by the army, leaving villages staffed mostly by women and children by late 1950, reducing farming capacity.

• Destruction of Rural Infrastructure: 70,000 villages destroyed, with 25 million people homeless, devastating the countryside and slowing agricultural recovery.

• Peasant Incentives and Reforms: The government initially allowed peasants to sell surplus under the Link system, but by the end of WWII high taxes on private plots resumed. 

WHAT ARE THE FEATURES OF THE 4TH FIVE YEAR PLAN ( 1946-50)?

• Focused on rebuilding the USSR economy after WWII, including reconverting factories to civilian production and restoring heavy industry.

• Heavy industry over-fulfilled, especially steel and arms, while consumer goods and industries were largely neglected.

• Use of forced labour: around 2 million Gulag prisoners and POWs were employed to speed up reconstruction under a centralised government plan.

• Reliance on existing methods limited technological progress: training created basic skilled workers, but modern technologies,( e.g., plastics), were not widely adopted, and machinery from East Germany was seized as reparations.

POSITIVE IMPACTS OF 4TH FIVE YEAR PLAN?

• Heavy Industry Rebuilt and Expanded: Steel and armaments production exceeded targets, helping the USSR recover industrial capacity lost during WWII.

• Infrastructure and Factory Reconstruction: Destroyed factories and machinery were rebuilt, and additional machinery was obtained from East Germany as reparations, supporting rapid industrial recovery.

• Skilled Labour and Workforce Training: The plan created training for basic jobs, expanding the pool of semi-skilled and skilled workers for long-term industrial development.

• Rapid Post-War Economic Recovery: Centralised planning and use of 2 million Gulag prisoners allowed the USSR to restore its economy to pre-war production levels faster than expected.

NEGATIVE CONSEQUENCES OF 4TH FIVE YEAR PLAN?

• Consumer Industry Neglected: Focus on heavy industry meant that consumer goods and everyday items were scarce, keeping living standards low.

• Over-Reliance on Forced Labour: Around 2 million Gulag prisoners and Prisoners of war were used for reconstruction, raising ethical concerns and creating harsh working conditions.

• Limited Technological Innovation: The USSR largely used pre-war methods and did not adopt new technologies like plastics, which limited efficiency and modernization in some industries.

• Resource Exploitation of Satellites: Machinery and reparations from East Germany were exploited, showing reliance on external resources rather than internal technological progress.

WHAT ARE THE FEATURES OF 5TH FIVE YEAR PLAN?

• Focused on realistic economic growth, with priority given to arms and military investment, while other sectors grew little.

• Major construction projects, including huge buildings in Moscow and the Volga Canal/Dam, aimed at propaganda and prestige, though some had limited practical value.

• Limited investment in consumer goods: only 12% of total investment went into light industry, keeping everyday goods scarce.

• By 1948–1952, overall post-war economic recovery was notable, with living standards returning to pre-war levels and wages by 1952 equal to those in 1928.

POSITIVE IMPACTS OF 5TH FIVE YEAR PLAN?

• Economic Recovery Consolidated: Post-war economy stabilised, with living standards restored by 1948 and wages by 1952 returned to 1928 levels.

• Military and Defence Strengthened: Investment in arms and military industries increased, maintaining the USSR’s focus on military growth, though specific production figures are not available.

• Major Infrastructure Completed: Large-scale projects like the Volga Dam/Canal and monumental buildings in Moscow were finished, enhancing industrial capacity and national prestige, even if some projects had limited practical value.

• Sustained Growth but Limited Consumer Focus: Only 12% of investment went into light industry, but heavy industry and key sectors continued to expand steadily, supporting overall economic stability.

NEGATIVE CONSEQUENCES OF 5TH FIVE YEAR PLAN?

• Consumer Goods Neglected: Only 12% of total investment went into light industry, so everyday goods remained scarce and living standards were limited despite wage recovery.

• Focus on Military Over Other Sectors: Arms and defence spending increased, but other areas of the economy saw little growth, creating imbalances in industrial development.

• Propaganda-Driven Projects: Large buildings in Moscow and projects like the Volga Canal/Dam were often of limited practical use, serving prestige rather than economic efficiency.

• Uneven Development: Economic growth was mainly in heavy industry and military sectors, meaning regional and sectoral inequalities persisted, and some resources were wasted on symbolic projects.