KQ4: Bolshevik economic policy

when was state capitalism

Oct 1917 - Jul 1918

What did State Capitalism entail

• combinaiton of state control + private ownership

  • Vesenkna dec 1917 closely monitored

• Nov 1917 - Decree on land , legitimising land seizures, persuaded left SRs to join govt

• Decree on Workers’ control

• Nov 1917, pandered to industrial workers

  • did not authorise seizures of factories , but they happened

• limited program of nationalisation

  • banking state control + some individual factories

When was War communism, why was it introduced?

July 1918 - March 1921

• Workers commitees meant industry fell apart, compounded by CW shortages of raw materials

• industrial output fell in Bols. areas = inflation

• Feb 1918 bread rationing in Petrograd - 50g a day

• workers fleeing cities (big problemo, needed munitions)

• needed to feed workers

• whole economy geared towards needs of army

What did war communism involve?

Grain requisitioning

• May 1918 - Food Supplies Dictatorship = requisitioning standard policy (unpopular)

Banning private trade

• state trade chaotic

• not producing enough consumer goods

• black market evolved (most couldn’t survive w/o it)

Nationalisation of Industry

• all under state control, admin. by Vesenkna

• workers committees replaced by single managers, reported to central authorities (bourgeois)

• some not against it (desperate for job)

Labour discipline

• fines for lateness + absenteeism

• internal passports (fleeing)

• bonuses + ration books

Rationing

• class based, prioritised workers + soldiers

  • then civil servants, drs

    • then ‘Burzhui’, ‘former people’ middle class

Reaction to grain requisitioning (rural + urban)

many near starvation

By 1921 much of the countryside was in open revolt

• Tambov Rising (1920-21) – fiercest fighting in Tambov Province – 40,000 strong peasant force led by Alexander Antonov (former SR) waged guerrilla war against the Red Army.

• Uprisings brought the country close to paralysis, large parts of the country effectively out of the authorities’ control. Lenin forced to start thinking about concessions to the peasantry…

• urban protests fuelled by food shortages, demands for trade union rights and allegations of corruption amongst Bolsheviks

• E.g. Feb 1921 Moscow brought to a standstill. Days later, similar clash in Petrograd with striking workers from engineering factories – at least 30 killed or wounded.

What happened in Kronstadt mutiny

March 1921 – final straw– 10,000 sailors based at Kronstadt naval base mutinied in support of strikers in Petrograd. Produced a 15-point manifesto condemning Bolshevik abuses of power.

• Mutiny only lasted a fortnight and was suppressed easily and brutally by 50,000 Red Army troops (10,000 killed in process!). But a profoundly embarrassing episode for the Bolsheviks, as the sailors had been amongst the strongest Bolshevik supporters in 1917

what did transition to NEP look like

• march 1921

  • lenin announced end of compulsory grain requisitioning

  • other changes bit by bit over next 18 months

• transition completed 1922

what did NEP involve

1. tax in kind

• peasants had to hand in fixed proportion of grain

• surplus sold for progit

• total gained 1921 was ½ requisitioned 1920

• 1924 t.i.k replaced by monetary payments

2. \private trading + ownership of small scale industry legalised

3. ‘commanding heights’ of econ. = state controlled

• coal, steel, rail, banking, foreign trade - state monopoly

4. state run for profit

• industries under state control 1921-22 expected to run at profit = increased unemployment

Recovery of grain/industry due to NEP

• sov economy recovered strongly

• by L death in 1924, grain production had bounced back

• Industrial output rose sharply (remained below pre-1914 levels)

Limitations to grain/industry recovery

• grain production in 1924 was still much lower than pre-war levels.

• the NEP was not introduced soon enough to prevent a major famine.

• Summer 1921 – drought in the ‘Black Earth’ region → major crop failures.

• Famine affected 25 million people. Death toll around 5 million. Desperate people resorted to cannibalism.

What was the scissor crisis?

• Russia’s economic recovery was erratic and uncertain.

• Difficulties in 1923 because agriculture recovered more quickly than industry

• With plentiful food, prices fell. Prices of consumer and manufactured goods, relatively scarce, rose.

• The government acted to correct the imbalance, pushing industrial prices down.

Govt measures to restore stability + tackle inflation

• 1922 – change from ‘Imperial Ruble’ to ‘Chervonets’ backed by gold standard

• By 1923–1924, the government balanced its budget by levying excise taxes, enterprise and personal taxes on income and property, and a forced bond issue.

• tsarist vodka monopoly was reintroduced, to the dismay of many.

• Centralized expenditures, especially on education, were cut, and school fees introduced.

• All this allowed stabilization of the new currency (chervonets), which had replaced the ruined Ruble notes used before.

How did NEP help to bring political stablity

by ending grain requisitioning and by replacing with a tax in kind, the NEP helped to bring the peasants back on side, and bring an end to peasant uprisings, restoring political stability in Russia’s countryside.

What was ‘iron rule’

• 1921 – 5,000 allegedly counter-revolutionary Mensheviks arrested.

• 1922–34 prominent SRs on trial in Moscow. Accused of terrorist activities. 11 condemned to death.

• Cheka (rebranded in 1922 as the GPU [State Political Administration]) – enlarged its network of concentration camps for political detainees.

• Renewed onslaught on Orthodox Church. Had already been separated from state and stripped of privileges 1917–8. Now Soviets ordered to remove all precious items from churches in their localities.

• When priests and congregations resisted, there were clashes – up to 8,000 people killed.

Bolshevik party reaction to NEP

• angry

• partial restoration of capitalism

• ‘we felt as though the Revolution had been betrayed’

• reinforced after 1921 by emergence of ‘nepmen’ – a class of get-rich-quick private businessmen. They flaunted their new wealth in bars, casinos, nightclubs which were re-opened in Russia’s major cities.

• “New Exploitation of the Proletariat”.

When was the ban on factions, what did it involve

1921 - Tenth party congress

• Violations punishable by expulsion from party. Existing organised groups within party to be dissolved.

• Ended culture of reaching decisions by open and vigorous internal debate

Targets

• Democratic Centralists (against increasingly bureaucratised nature of Bolshevism)

• Workers’ Opposition (disliked the return to one-man management under War Communism).

Purge of Party membership

• Before NEP – 730,000 party members.

• Early 1923 – only 500,000.

By 1924, Soviet union = oligarchy