Economic developments

What were the impacts of the NEP?

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📌 How far did the NEP produce economic recovery?

• In 1922 the results were better than expected
• Life began to flow back into cities
• By 1923 cereal production increased by 23%
• By autumn there was so much food that the price of industrial goods rose
• This was called the Scissors Crisis (by Trotsky)
• Peasants became reluctant to sell food
• Only lasted until April
• Gov. brought down industrial prices
• They began taking the peasant tax in cash rather than in kind to encourage them to sell
• Recovery was fully underway by 1924
• Small-scale enterprises benefitted much more than heavy industry

Positive impact – NEPmen

• Middlemen, private traders
• Not the primary producers – would buy goods and sell for profits
• ¾ of consumer products were sold by individuals
• By 1923, 75% of all retail trade was handled by NEPmen
• Deals were made, corruption was rife and property speculators were back
• Russia became a get-rich-quick society
• NEPmen became a much more abrasive group than the old bourgeoisie
• This new bourgeoisie was brought about by accident
• Prostitution and crime flourished
• NEPmen crowded restaurants, clubs and brothels

• Moscow municipal gov got most of its income from taxes on gambling clubs
• The Party and its bureaucracy were too small to exert a great deal of control

Scissors Crisis

• Trotsky likened falling prices for agriculture and the rising prices for manufactured goods to the opening of scissor blades
• Trotsky and the Left opposition wanted to move from the NEP to rapid industrialisation
• By the late 1920s they favoured a permanent Scissors Crisis to squeeze more grain out of the peasants to pay for this industrialisation

Impacts of the NEP

Positive impacts for Urban Workers

• Social benefits
• 8-hour working day

Negative impacts for Urban Workers

• NEP unemployment rose steeply
• This was especially in large state-controlled trusts
• They cut their workforce to make profit
• Wages remained low
• Workers found little protection in the marketplace
• It seemed that peasants were doing well at their expense
• They objected the power of single managers and Bourgeoisie specialists
• Some workers called the NEP the New Exploitation of the Proletariat
• 1928 'real wages' (amount of goods and services that can be bought) had only just passed pre-war level
• Thousands of workers were unemployed
• Unemployment increased throughout the 1920s
• By the end of 1926 they were 14% of the employed population
• It was a reminder that the NEP was grounded in the economics of the market
• Most telling of Left Opposition's criticisms of official policies
• Workers complained about the pay gap
• They also complained about high prices charged by peasants
• Women were hit hard – many were pushed out of work after the Red Army was demobilised
• There were housing issues and crime increased
• Young people were becoming parentless and formed gangs
• It was not the workers' paradise promised in the revolution

Positive impacts for peasants

• NEPmen were buying and selling grain from the peasants at greater prices than the government
• The peasants had more money to buy products (but they were in short supply so there was little point)
• They withheld grain from the state due to the rising prices of goods

Negative impacts for peasants

• Not producing the quantities of grain the government needed for its industrialisation plans
• In 1913, Russia exported 12 million tons of grain – during the years of the NEP the amount never exceeded 3 million
• Grain was not reaching the market
• Agriculture was still very backward
• Relied on traditional methods of farming
• Over 5 million inefficient wooden ploughs were still in use
• After the revolution, peasant landholdings were much smaller than before 1917
• There was a gap in prices between grain (low) and peasant-desired manufactured goods (high)
• They couldn't buy the goods they wanted with grain money, so they withheld it and fed their animals
• The relationship between gov and the peasants deteriorated towards the end of the1920s

The Grain Crisis 1927-28

• Grain procured by the state at the end of 1927 was about three quarters of what it had been in 1926
• Stalin acted decisively – it was his first intervention in the economic sphere (was a calculated one)
• He sent out officials, backed by the police, to seize grain
• In Jan 1928 he himself went to the Urals and Western Siberia on a requisitioning campaign
• He got more grain but the relationship between the peasants and the gov was breaking down
• There was substantial resistance to Stalin's actions
• He told Siberian officials that Soviet agricultural development had come to a dead end
• Also said that the only way out was "the development of large-scale farms of a collective type"
• Saw the USSR as a Soviet country
• Wanted to implant a collective economy in agriculture as well as in industry
• There was resistance to his methods from Bukharin, Rykov and the right
• Despite this Stalin used them again the following year after the poor harvest in 1928 forced the gov to ration bread in the cities
• Was the death knell of the NEP

📌 Was the NEP a good basis on which to build an industrialised economy?

Changes during the mid-late 1920s changes weakened support for the NEP.

From 1925 onwards, two camps emerged:

• The Left: Trotsky, Zinoviev, Kamenev – wanted to end NEP and rapidly industrialise. Argued the peasants had too much control of the economy and must relieve them of as much grain as possible to fund industrialisation
• The Right: Bukharin, Rykov, Tomsky – wanted to keep the NEP and ensure peasants invest in consumer goods and the commercial economy
• Stalin did not engage in this debate
• He could not be accused of taking one side or another

Bureaucracy

• All of Stalin's opponents agreed the party had become too bureaucratised
• They blamed Stalin for killing the inner party democracy
• The majority of members did not play a meaningful role in influencing party or government policies
• Secretaries and ministers were appointed based on support for the Party, not on merit or skill

Revolution

• Trotsky promoted the Marxist view that the success of socialism in Russia depended on a world socialist revolution
• He felt that Russia should put their energy into supporting the much bigger working class of the West to ensure a successful Permanent Revolution
• Stalin argued there were no signs of a World Revolution therefore Russia should focus on building a socialist USSR
• It was a distortion of Lenin's views but came across as patriotic
• "Socialism in one Country" was shrewd and enabled Stalin to attack Trotsky for his lack of patriotism
• Trotsky later admitted that Stalin's message was very convincing for the lower ranks within the Party

The Great Turn: Collectivisation

📌 Why Stalin?

• Reinvented himself as Lenin's most faithful pupil
• Argued for Socialism in one country, discredited his rivals by making them seem unpatriotic and unrealistic in their aim for Permanent Revolution
• He held key positions: Politburo, Orgburo, Party General Secretary
• Kept out of the NEP debate until the last minute to argue for rapid industrialisation and taxation on the peasantry

The Great Turn

• Once in power Stalin made the Great Turn: the rapid collectivisation and industrialisation of the nation
• He saw these changes as a catalyst for cultural revolution: the creation of a new soviet person
• Envisaged society could be changed beyond recognition in 10 years
• Impact was devastating for the Russian people

📌 What impact did the Great Turn and Stalin's policies have on Russian society?

Collectivisation:

• The removal of private farms and land owning – replaced with large collectively owned farmland, the main type was Kolkhoz
• This was where all land was held in common and run by an elected committee
• Between 50 and 100 households were put together to form this
• All land, tools and livestock had to be pooled
• Peasants farmed the land as one unit under the direction of the committee
• Much larger areas are farmed more efficiently through the use of tractors and other machinery
• The state supplied these through huge machine and tractor stations (MTS)
• Experts helped peasants to farm in more modern ways using metal ploughs and fertilisers
• By the Kolkhoz model statute of 1935 each household was allowed to keep its own private plot of up to one acre
• Stalin implemented this to undercut the perceived power of the Kulaks over society
• He also wanted to increase the state's grain share, reduce prices and lead to a ready supply of labourers to be moved into areas of growing industrialisation
• In Nov 1929 the 25,000ers were recruited
• Sent to the countryside and ordered to organise collective farms
• By Feb 1930 roughly half the peasantry was forced into a collective farm
• There was a short-lived pause to ensure the harvest was not neglected
• Stalin pursued the policy once again from Sept 1930
• By the late 1930s around 25 million households were organised into 250,000 collective farms
• These were the Kolkhozy

The Offensive against the Kulaks

📌 When did it begin?

• Stalin called for a liquidation of the Kulaks as a class of Dec 27,1929
• Attack was central to the collectivisation policy

📌 Who were the Kulaks?

• Better off peasants
• Middle peasants on moderate incomes
• Poor peasants and landless labourers

Dekulakisation

• Number was exaggerated, definition of Kulak elastic
• Any peasant who opposed collectivisation was dubbed a Kulak
• Was to mask an offensive against the peasantry as a whole
• Minority of the poorer peasants at first supported and benefitted from dekulakisation
• There was no real class division in the villages
• No real class warfare
• Dekulakisation was a way of frightening peasants into submission
• Each region was given a number of Kulaks to find (whether they existed or not)
• Quotas filled exceedingly to show vigilance of the GPU (secret police)
• Divided into three categories
• Counter-revolutionaries were to be shot or sent to forced-labour settlements

📌 How did the peasants oppose collectivisation?

• Resisted bitterly despite mass deportations
• There were 13,754 outbreaks of mass unrest
• Demonstrations, riots, and full-scale uprisings involved over 2.5 million peasants
• Troops were sent in to deal with the unrest
• Acts of Kulak terrorism claimed 3155 victims among Bolshevik activists and Soviet officials
• Peasants burned crops, tools, and houses rather than handing them to the state
• They slaughtered animals and either ate or sold the meat rather than hand them to the Kolkhoz
• There was a wave of Women's Revolts in the North Caucasus in Feb 1930
• Protests were carefully organised with specific goals e.g. stopping grain requisitioning or retrieving collectivised horses
• It was more difficult for troops to act against all-women protests
• Gov found their tactics difficult to deal with

📌 How did collectivisation harm the peasantry's way of life?

• Deeply resented the attack on their traditions
• The Mir was abolished in 1930
• Thousands of churches were closed
• Church bells were melted down
• Priests persecuted
• 20 million peasants left for the towns and industrial areas between 1928 and 1941
• Towns were under intense strain
• Gov brought in internal passports to control the mass movement of people

The Ukraine Famine

• In 1932 and 1933 in the Ukraine (a major grain-producing area in the Soviet Union Union) famine raged
• State procurements in 1933 were more than double the level under the NEP
• Exports continued
• People were prevented from fleeing the famine area to conceal the extent of the crisis
• Robert Conquest was one of Stalin's sternest critics writing before the archives were open
• He stressed that 'the Soviet collectivisation terror took more lives than were lost by all countries on all fronts in the First World War'
• He emphasised Stalin's 'criminal responsibility' for the famine
• 7 million died of starvation
• Was seen as a campaign to smash Ukrainian nationalism
• Conquest's interpretation is rejected by Wheatcroft and Davies, but they accept that the famine was man-made
• It was caused by ruthless and excessive grain procurements
• Wheatcroft and Davies had access to the archives and their death figure is 5.7 million
• Hunger meant theft of grain rose drastically
• Most theft was carried out by the collective farmers themselves
• In August 1932, despite knowing there was a famine, Stalin drafted the 'law of five ears of corn'
• Kolkhozniks (inhabitants of the collective farms) were arrested for 'hairdressing'

This was the cutting of individual ears of corn in the fields

• By the end of 1933 one thousand people had been executed
• This was only four percent of those convicted
• Peasants formed the majority of those in Soviet Labour Camps throughout the 1930s

The Kolkhoz model statute and private plots

• In 1935 a special Party Congress was called to adopt a 'model statute' or charter for the Kolkhoz
• It remained the basis for collective farming organisation well into the 1960s
• Laid down rules for the payment of Kolkhozniks for work on the farms and for the relations between the Kolkhozy and the MTS
• Legalised private plots of up to one acre for each household
• Livestock limited to 1 cow and calves, 1 sow and piglets, 4 sheep, and any number of rabbits and poultry
• Livestock generally pastured on collective land
• Estimated that private plots provided 52% of veg, 57% of fruit, 70% of meat and 71% of milk, as well as butter, honey, and wool to Soviet consumers

Industrialisation and Stalin's Five-Year Plans

📌 How long did Stalin give for the Great Turn to take place?

10 years.

Identify one reason this process was 'needed' Stalin saw it as a catalyst for cultural revolution and wanted to change Russian society drastically.

📌 Who were the enemy of collectivisation?

The Kulaks and peasants – they could be arrested and sent to labour camps

📌 What was hairdressing?

The cutting of individual ears of corn in the fields Stalin introduced the Law of 'five ears of corn' – the worst punishment was Execution.

📌 Did collectivisation succeed?

It caused death, famine, and devastation to the majority of Russian society. The peasants' way of life was directly attacked, the Ukraine was destroyed by famine and thousands of people were arrested and sent to labour camps. Collectivisation was about control, and it failed to positively change Russia in the way Stalin outwardly suggested it would. The regime lead to many turning against Stalin and his leadership. This was not what he wanted. Socially and economically, collectivisation was a complete failure. However, Stalin's aims were still achieved – he wanted control.

• Ultimately collectivisation was economically devastating for Russia
• Lead to millions of deaths
• Farming productivity and yields went down
• For the gov it was a huge success
• Labour diverted to towns and cities
• They obtained control over the countryside

Industrialisation

• In a 1931 speech Stalin proclaimed Russia was still 50-100 years behind the advanced nations like Britain, Germany, and the USA
• He argued Russia either caught up or would be crushed by these nations
• He phrased this very patriotically
• This meant anyone who disagreed with him was an anti-Russian
• Hence the five-year plans
• Typified by massive and unrealistic targets, punitive measures, and criminalisation

Features of the plans

• Focused on heavy industry: iron, steel, coal
• Emphasised the need for autarky – self-sufficiency
• Massive targets that must be met
• Can and were regularly revised upwards
• Criminalisation for failing to reach targets
• Massive industrial centres: Magnitogorsk
• These were usually east of the Urals to protect them from western military attack
• Huge projects to demonstrate Russia's industrial might
• E.g. the Dnieprotoi Dam, Moscow to Volga canal, Moscow metro
• They were high-pressure, intense environments for workers and managers

First Five-Year Plan

Targets

• Emphasis on coal, oil, iron, steel, electricity, cement, metals, and timber
• Wanted to increase coal from 35 to 75 million tons, and iron ore from 6 to 19 million tons

Socialist offensive

• The feeling that the Soviet Union was on its way to socialism inspired Party members and urban workers
• Young people believed they were creating a far superior society to their capitalist neighbours
• They wanted to mobilise forces on all fronts
• Groups of enthusiasts became shock workers who strove to increase productivity
• They urged each other with socialist competition
• There were campaigns and ambushes by 'class enemies'
• People who criticised the regime's policies became guilty of treachery
• Bourgeois specialist-baiting and denunciation by workers was positively encouraged from 1928 as part of a cultural revolution
• Number of industrial workers doubled during the first plan
• Millions came from the countryside
• They lacked training and experience and were hard to form into a disciplined workforce
• Stalin therefore called a halt to specialist-baiting in 1931

Role of management

• Now supported
• Managers could sack unsatisfactory workers
• They could deprive them of social benefits, ration cards, and factory housing
• Managers needed workers however
• Workers could move on in search of better conditions
• Labour turnover was very high

Second Five-Year Plan

Alexei Stakhanov and the Stakhanovite Movement

• He was a pneumatic-pick operator
• Became known as the Soviet Hercules
• On the 30 of August 1935 he began a shift at 10 o'clock
• After five hours of uninterrupted work he had cut 102 tons of coal
• This was almost 16 times the normal 6.5 tons per shift
• He was given perfect conditions and a support team
• There was then a great deal of publicity afterwards
• The commissar for heavy industry had Stakhanov put on the front cover of Pravda
• In September Pravda used the term Stakhanovite movement
• Stalin called for Stakhanovism to spread 'widely and deeply' across the Soviet Union in Nov
• The movement was seen as a way of compelling management to adopt new production methods
• Also seen as a way to increase production rates
• Those reluctant to were branded as saboteurs and were warned they'd be removed
• There was great pressure from above on managers to reach increased targets

Historians' views

• Historians have differing views on the effectiveness of the Stakhanovite movement
• Lewis Siegelbaum argues bonuses and gifts were showered on a favoured few
• Ordinary workers responded with violence, demands and sabotage
• They were desperate to be classified as Stakhanovites
• John Barber thinks the movement fell well short of its objective in raising productivity
• However he also feels it may have elevated the status of some workers
• It reanimated the Bolshevik spirit of mass participation and proletarian creativity

Second half of 1936

• There was a terrible harvest
• Shortages and economic slowdown
• Dramatic industrial accidents e.g. Kemerovo mine disaster
• Imperatives of meeting production targets led regional Party and economic leaders into self-protective practices
• Managers bribed or stole from others to get raw materials
• Factories turned out substandard or useless products
• Figures were tampered with
• Local Party leadership often colluded with this
• They did not want to be held responsible for failing to reach the Five-Year-Plan targets

Regime's response to slowdown

• Explained the slowdown as due to criminal negligence and deliberate sabotage
• Blamed officials and managers
• Also blamed indiscipline by rank-and-file workers
• The regime responded with purges of officials and managers
• They put out tough Labour decrees in 1938 and 1940
• Both made the problem worse
• Labour decree of 1938 introduced a stricter system of work-record books
• Managers ordered to refuse employment unless employee produced a satisfactory work-book
• Had to contain details and explanation of their previous changes of employer

Labour decree of 1940:

• Working day of eight hours
• Working week 6 out of 7 days without additional pay
• Changing jobs without specific authorisation was a criminal offence and punishable by imprisonment.
• Absenteeism was to be punished by up to six months compulsory labour at 75% normal pay
• Employers who failed to report cases of these or took on workers like this were at risk of criminal prosecution.
• The decrees were almost universally detested, they were a part of the measures brought in to restrict budget expenditure