Alexander III and the finance ministers

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  • Created on: 25-02-15 12:32

Alexander III

Alexander III was very traditional, and wanted to uphold the principals of an autocratic system. He once said, following his father's death, that "the voice of God orders us to stand firm at the helm of Government... with faith in strength and truth of great autocratic power which we are called to strengthen".

He was repressive and believed strongly in the autocracy. General Kireev noted that Alexander II said "that he despises the administration and had drunk a toast to its obliteration".

He wanted to reverse the actions of his father. He did, however, wanted to improve Russia's failing economy.

He had a childhood from his right-wing tutor, Konstantin Pobedonostev (1827-1907). Being the mentors of the final two Tsars of Russia, it is by surprise that they were very conservative and repressive. Konstantin actually tried to aid judicial reform in 1864, but soon saw the disadvantages, such as the "Trial of 197", and turned against them. He called local government "the great lie".

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Russian economy between 1881-1914

Problems with the Russian economy

  • Russia's labour force was static, with nearly every peasant tied to their land-owners land paying rent.
  • The basis of the agrarian economy was weak. The tools were practically useless, there wasn't much machinery and people didn't use fertiliser on land that they wouldn't own for a long time.
  • None of the peasants could afford domestic goods, which meant that Russia was bereft of domestic trade.
  • Communication was difficult in Russia because it was so big and the railroad was small and finite.

How they wanted to improve the economy

  • State capitalism, which was ownership of everything by the state.
  • Rouble would be stabilised.
  • Government finances should be controlled to develop large and regular surpluses.
  • Bureaucratic regulations that thwart industrial and economic growth would be removed.
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Finance Ministers (1)

Nikolai von Bunge (1881-1887)

  • Worked hard to rationalise government finances, balance income and balance expenditure.
  • Lifted regulations that restricted foreign trade and tried to control inflation to stabilise the value of the rouble.
  • Set up the Peasant Land Bank in 1883.
  • He encouraged the investment in railroads.

Ivan Vyshnegradsky (1887-1892)

  • Created a consistent budget surplus by cutting back government expenditure, increasing indirect taxation on the peasantry and renegotiating Russia's overseas debts.
  • He encouraged foreign investment by discouraging imports, exploiting the peasant's work (selling their grain at a higher price during the winter after buying it from the peasants cheaply during the summer) and by building up Russia's gold reserves by over 300 million roubles.
  • However, there was a crop failure in 1891.
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Vyshnegradsky's mistake of the Famine

17 provinces of European Russia were hit by a series of disasters. The winter was very cold and saw a lot of frost, the spring was dusty and had a lot of hurricanes and the summer was too hot and dry. Due to the bad weather, crops were ruined and wells dried up. 350,000 people died from the famine. 0.5 million died from outbreaks of cholera and typhus in 1892-93. Most people would argue that the famine was man-made, due to the heavy tax burden by Vyshnegradsky.

A major famine was evident by May 1891, but the government still refused that it existed. The finance minister even said that "even if (they) starve, (they) will export grain". In August, when things were at their worst, the government stopped grain export, and, on the 17th November, the government called for help. A committee on Famine relief was created to encourage private relief efforts, and calls for the Zemstva also increased, but they were hindered by the statute in 1889-1890, which limited the power of the Zemstva and devolved power to Land Captains. Howevever, the Zemstva gave food, medical supplies and jobs to those in need.

After the disaster of the famine, Tolstoy wrote essays discrediting the Tsar, Orthodox Church and the autocratic system. The recklessness of the famine by the government was highlighted, and the opposition increased as did the support of the Zemstva. Nicolas II rejected the need of a Zemstva as a "senseless dream".

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Finance Ministers (2)

Count Sergei Witte (1892-1903)

He knew that he had to boost the economy because of the result of the 1891 famine. Witte tackled three areas where he felt Russia was failing.

He tackled the insufficient capital by creating a new rouble backed by gold and by asking for loans from a few countries. He tackled the lack of technical expertise by encouraging foreign experts to help from France and Belgium and by hiring engineers from other countries. He tacked the insufficient manpower in places by cutting prices on peasant passports and loosening the mir.

He increased the government's revenue, by establishing a monopoly of vodka and increasing taxation in 1894He also established 100 new commerical schoolsHowever, Witte deliberately spent more than he gained.

Under his lead, 67% of railroads were owned by the state in 1904 and thus made the population more mobile. He put his time into work on the railroads because he needed to open Russia's interior for access to coalfields in Donbass and iron deposits in the Krivoi Rog Area, as well as to create more jobs and to link Russia and Moscow.

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Finance Minister (3)

In 1881-85, the amount of railroads built was 632 kilometres, while in 1886-90, the amount that was built was 914 kilometres. This increased again in 1891-95 to 1292 kilometres.

The Trans-Siberian Railway was the most famous and prestigious railway enterprise, which consisted of 3750 miles of track and was completed in 1904. Therefore, under Witte's power, there was an ease of communication of troops and news reporters and an increase of access to minerals in Siberia.

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Statistics regarding industrialisation after AII

The production of coal raises from 24.9 million tonnes in 1910, to 36.2 million tonnes in 1914. The railway mileage raised from 16 miles in 1837 to 43900 miles in 1913. The balance of trade went from -34 million roubles in 1871-80 to +186 million roubles in 1900-1910. Grain production improved from 34 million tonnes in 1880 to 90 million tonnes in 1913.

However, when compared to Britain, Russia still hadn't industrialised fully. The coal productions of 1914 of Russia was 36.2 million tonnes, while Britain's was 292 million tonnes. Iron production of the same year saw Russia lacking with only 3.6 million tonnes compared to Britain's 11 million tonnes. Steel production was at a low in that year compared to Britain too, with Russia having 4.1 million and Britain having 6.5 million. Foreign trade in 1913 was also behind of other countries. Russia's foreign trade was 190 million pounds, compared to France's 424, Germany's 1038 and Britain's 1223.

Due to Witte, 45% of industrial investment came from abroad, mainly from the Franco-Russian alliance in 1894. Industrial investment from abroad (foreign) tripled to 450.7 million roubles from 1893 to 1897. Therefore, Russia's economy was highly reliant on the state of other countries. The worldwide boom of the 1890s coincided with Witte's "great spurt" and the depression in the 1900s directly impacted their economy too.

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Impact of industrialisation (1)

... on the cities and workers

  • Some were paid with food, and even then it was really poor (black bread, think cabbage soup, and porridge made from wood shavings).
  • Population of St. Petersburg rose by 1500,000 between 1863 and 1914.
  • Houses were built quickly, because of the population boom and the increase in demand for houses in the cities.
  • On average, St Petersburg's apartments housed 16 people, with 6 people per room in 1904.
  • Housing was inadequate and unhygenic, with most houses infested with rodents.
  • 1/3 of houses had running water.
  • Only 60% of adult males were literate, and 11% of all workers were injured.
  • Wages were poor.
  • 90% of the peasantry that were recruited for the army in St Petersburg and Moscow were literate.
  • Peasants tried to go back to the country to help their connections harvest.
  • Deathrate rose to 35/1000 by 1900, while Britain's deathrate was at 21/1000.
  • Russia's working class doubled between 1865 and 1890.
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Impact of industrialisation (2)

  • A factory inspector once said that "these dwellings can be compared without exaggeration with the quarters of domestic animals" with their "unwashed and filthy condition".
  • Working hours were long. They were reduced by law to 11.5 hours a day, but was usually ignored.
  • Given that the world recession was in the 1900s, this really affected industrialisation. Some wages were reduced by 20%.

... on the peasantry?

  • In 1889, Alexander III introducted land captains to return to the traditional repression of peasants.
  • There was a daily struggle for survival conducted from verminous filled huts.
  • The Peasant Land Bank was set up in 1893, which helped develop better farming methods.
  • The land was still shared out equally in size, meaning that the growing population were less able to feed their families.
  • Redemption payments still restricted peasants from investing in agriculture.
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