Consequences of the NEP

Significance?

• Rapid recovery of industry: output in 1926 almost = 1913
• More rapid recovery of agriculture: agriculture 76.8m tons 1926 almost = 1913 levels
• Foreign trade agreements: Germany (1922); Britain (1924)
• Private trade flourished: 25,000 Nepmen in Moscow (1923) consumer goods, markets > shops

Limitations?

• Too late to avoid major famine: mid-1921 drought > famine affected 25 million; 5 million (?) dead.
• Agriculture recovered faster than industry > scissors crisis (1923)
• BUT this was quickly solved (introduced tax in cash, not in kind)
• Limited gains for workers (more later)
• Recovery stalled after 1926: peasants withholding grain/feeding to livestock; industry needed capital to grow…
•  …. grain exports never recovered (1913-12m tons, 1924 – 3m )
•  Still underlying problems: mirs, backwardness, subsistence farming (only grow for themselves, )

Significance

•  Fierce ideological opposition before introduction of NEP (Bukharin, Preobrazhensky, Trotsky)
•  Party members disliked market economy: Nepmen, Kulaks, Prostitution, crime, gambling, profiteering, corruption
• Lenin’s actions: Ban on factions (1921)
• Failure to set end date/ post-NEP plans became a key cause of division in long term (i.e. power struggle)

Limitations

• Bolshevik leaders accepted NEP after its introduction – temporary/necessary retreat: no serious challenge to Lenin.
• Bukharin became an enthusiastic support: “Peasants, enrich yourselves!” (Article 1925)
• Levels of divisions depended on economic success
• e.g. Scissors Crisis – Trotsky refused to serve on the Scissors Committee
• e..g. After 1926 – growing impatience for rapid industrialisation

Significance:

• Increased support from peasantry: kulaks thrived; unrest levels & rebellions dropped sharply
• Urban unrest decreased: consumer goods; inflation tamed (new currency); food supply secured; rationing ended
• Improved international relations: NEP seen abroad as ‘end’ of the Communist experiment.

Limitations:

• NEP had to be accompanied by fierce political repression: Ban on Mensheviks/SRs; Show Trial – SRs (1921); Union of Militant Godless (1921)- atheists taking action upon churches; Censorship & Glavlit (1922) – censor literature, Glavlit did pre-publication censorship; Creation of GPU (1922) – secret police force
• Worker dissatisfaction with NEP: resentment of peasantry; Nepmen/ bourgeois specialists; unemployment esp. Women; lack of housing; high prices; slow wage growth (1928= 1914 levels)
• Peasantry still capable of exerting political power: e.g. 1928 grain procurement crisis

‘New exploitation of proletariet' 

-        Stimulus to internal trade:

-        Denationalisation of small-scale enterprise

-        Continuation of central control of heavy industry

-        Stimulus to external (foreign) trade

-        An end to grain requestioning: Replaced by a ‘tax in kind’ -> fixed proportion to the state, anything else to sell on open market, incentive to sell: they can buy consumer goods

-        Encouragement of peasants to produce and sell surpluses: ^^^