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  • Created on: 01-04-13 15:06

NEP Russia : For and Against


  • NEP was not permenant, it was a "half way house" between Capitalism and Socialism. Socialism would take a long time to establish as Russia wasn't industrialised
  • NEP was a mixture of private economy, small scale private ownership and state owned industry in major sectors
  • NEP allowed individuals oppurtunity to make money but it protected the interests of the population as a whole as production and distribution were in state hands

Against: (Many communists believed NEP was deeply flawed)

  • Private enterprise meant that some people were making money out of others labour
  • Economic divisions created by the NEP increased class differences.
  • NEP created "bourgeois" they were enemies of Socialism. USSR could not be socialist if not everyone shared the same vision of society
  • Class differences led to political divisions
  • Party members agreed NEP could not last forever
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NEP and Agriculture

Problems with Agriculture:

  • Agriculture was backwards, relied on traditional, less efficient farming methods
  • Peasant holdings were too small, produced less for more cost 
  • Farmers kept alot of their own produce for themselvs
  • Bad relations between the government and peasants, peasant complaints, they were unhappy with the regime 

This meant that grain was not reaching the market, peasants were not producing enough grain for the governments industrialisation plans. Grain exports were needed for industry invesment.

Previous Attempts:

  • The goverment tried to get peasants to put more grain on the market by making them pay a money tax, they would have to sell grain to the state at lower prices.
  • Worked initially but peasants then started to hold back grain
  • Stalin then began to seize grain (requistion campaign) this meant that the relationship between the goverment and peasants deteriorated 
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NEP and Industry

Workers benefited from the revolution. Wages had risen. Shorter working hours and other social benefits. Had some power as they were represented by Trade Unions.

Problems in Industry under NEP:

  • Enterprises lost money, production was cut which led to high unemployment
  • Many strikes in early 1920's, they hit key industries and led to inefficiency. Inefficiency meant shortages of consumer good which led to high prices
  • Women had been forced out of jobs or forced into unskilled work
  • Living standards were low, much overcrowding, crime problems in cities
  • Workers were enthusiastic about the regime, they did not believe that they were part of a new social order, many were annoyed at the high earning bourgeois
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Previous Attempts at Industrialisation

Previous Attempts:

  • In 1927-8 - there was a drive to increase efficiency. This was done poorly however as targets increased but wages didn't this led to more strikes which led to inflation. People could not afford to buy products so this made problems worse.
  • Shakty Trial, 1928 - goverment needed scapegoats for problems, manipulated by Stalin:

- group of engineers (from coal mines) = accused of sabotage and treason
- Central committee; "New forms & new methods of bourgeois counter-
   revolution against proletariat dictatorship industrialisation"
'Bourgeois' specialists were replaced  by 'reliable communists' in the drive for industrialisation.

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Stalins Motives for Rapid Industrialisation


  • NEP had helped the USSR recover from the Civil War but had only limited sucess in developing the economy. Under the NEP, heavy industry was inefficient and there was no surplus profit from industry or agriculture (grain exports) for investment
  • Industrial production was not sufficient to make the USSR an industrialised nation
  • USSR was still an agricultural country, economy relied on an inefficient agriculture, majority of national income was from agriculture
  • Living conditions were poor


  • NEP was not a socialist concept as it allowed private ownership and created class differences, so must be abolished 
  • Industrialisation would allow progress towards a socialist society in which class differences were abolished. Industrialisation would establish a socialist society.
  • Fear of invasion - USSR needed to become a stronger power (could do this by industrialisation) in order to defend itself

Industrialisation would lead to the growth of the proliteriat, build wealth and create a strong self sufficient state

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Stalins Aims

  • Increase Military StrengthAn unindustrialised state was a weak power. Stalin feared that USSR would be attacked so to fight a war USSR needed a strong industrial base( to manufacture munitions)
  • Achieve Self Suffciency - Stalin wanted to USSR to become less dependant on western manufactured goods
  • Increase Grain Supplies/ Less Reliance on AgricultureStalin wanted to end the dependance of the economy on a backwards agricultural system. He didnt want a socialist state at the mercy of the peasants (peasants would formerly hold back grain supplies) Increasing grain supplies (exports) would increase profit for investment
  • Move towards a Socialist SocietyAccording to Marxism, Socialism could only be achieved in an industrialised state with a proliteriat population. Industrialisation would remove bourgeois class that NEP had created
  • Establish His Credentials - To prove he was a true sucessor and equal of Lenin.
  • Improve Standards of Living - Industrialisation created wealth for society.
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Five Year Plans: A New Approach

Five Year Plans were a new method of industrialisation. Why was this the way to industrialise?

  • NEP had limited sucess as industry hadn't progressed and it allowed private ownership which was against socialism
  • centralised planning suited the mindset of a party which already had a tradition of authoritatianism
  • planning was seen as necessary if the economy were to develop quickly and in line with the States priorities
  • some central planning mechanisms were already in place
  • Five year plans were a quick and efficient way to strengthen the USSR and create a marxist workers state

The First Five Year Plan?

  • Was vital that the USSR focus on heavy industry (ignoring consumer demand) as this was the states priority as heavy industry would allow USSR to strengthen defence
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Central Planning

Plans would be a quick and efficient way to industrialise and therefore socialise


  • Goverment determined: what to be produced & when
  • Set targets for heavy industries
  • During a five year period
  • Plans replaced existing mechanism


  • State planning commision
  • Directed the drive for industrialisation
  • Planned how to meet targets
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Overview of Five Year Plans

The First: 1928-32:

  • Focused on the development of heavy industries (coal, steel etc.)

The Second: 1933-37:

  • Focused on consumer goods (but heavy industry remained the 1st priority)
  • Built on top of the first plan
  • Was a consolidation

The Third: 1938-41:

  • Focused on the needs of the defence sector (growing Nazi threat)
  • Disrupted by WWII in 1941

These plans formed the basic economic structure of the USSR & lasted until 1991


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First Five Year Plan 1928-32


  • Heavy industries ( accounted for 80% of total investment)


  • Electricity- production trebled
  • Coal & Iron - output doubled
  • Steel production - increase by 1/3
  • Engineering- developed
  • New industrial complexes -built (inc. new tractor works)


  • Decline in consumer industries/goods
  • Small workshops- gone
  • Chemical targets- not met
  • Lack of skilled workers - Bourgeois specialists removed - scapegoats 
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First Five Year Plan: Problems

  • High targets (unachievable) put enormous strain on the economy
  • High targets meant quantity rather than quality
  • Materials in short supply - intense competition to get hold of them, Bribery and Corruption rife- pulled strings to get resources
  • Factories competed with each other
  • Managers made illegal deals to fulfil their targets - hijacked lorries etc
  • Underproduction in some parts of the economy (due to shortages)
  • Overproduction in other parts of economy
  • Great deal of wastage: - created parts other industries didn't want
                                   - output was sub-standard (lorry tyres lasted few weeks!)
  • Few managers admitted there was anything wrong - covered mistakes
  • Not all mistakes covered up - Stalin used this as political tool
    (Industrial equivalent of kulak= 'bourgeois specialist'- identified as sabateurs who deliberately cased hold-ups etc- believed to be anti-socialist by Party)
  • Consumer goods industries were sacrificed to the needs of heavy industries
  • Lack of skills - due to removal of "bourgeois specialists"
  • Planning had not been detailed enough
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Second Five Year Plan 1933-1937


  • Communications -especially railways (Heavy industries still featured strongly)


  • Heavy industries benefited from plants
  • Electricity production- expanded rapidly
  • By 1937- USSR= virtually self-sufficient in machine-making & metal-working
  • Transport/communications - grew rapidly
  • Chemical industries- growing
  • Metallurgy- developed


  • Consumer industries still lagged (showed small signs of recovery)
  • Oil production didn't meet expectations
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Second Five Year Plan: Improvements

Second plan improvements:

  • Revised
  • Targets = scaled back
  • More consolidation
  • In greater detail/ more organised
  • Gave specific targets for enterprises
  • Gave estimates of costs, labour, prices etc.
  • Investment put into railway =  could carry more freight
  • New training schemes- encouraged worker to learn skills/techniques

'Three good years': 1934-36- achievements by 1937 = Impressive


  • Still shortages, wast and under/over-production issues (smaller scale though!)
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Third Five Year Plan 1938-1941


  • Heavy Industries- in particular ARMAMENTS


  • Heavy industries continued to grow
  • Defence and Armaments - grew rapidly (300% increase in production?)


  • Steel output- grew insignificantly
  • Oil production-failed
  • Consumer industries - took a backseat again
  • Factory shortages

Cut short by WWII

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Third Five Year Plan

Post- 1937 = economic slump:

  • Iron & steel stopped growing
  • Oil industry failed = fuel crisis
  • Resources channelled into armaments= shortages elsewhere
  • Purges in full swing- economy deprived of valuable personnel
    - planners also purged =  chaotic system


  • By 1941, USSR had industrial base for a powerful arms industry
  • Plans allowed USSR to be victorious in WWII
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Stakhanovite Movement

Alexei Stakhanovite was a coal miner. On the 30th August he set a huge record for the amount of coal cut. He was immediately hailed as a soviet hero and made a figurehead of propaganda.

Propaganda magnified Stakhanovites status and promoted the idea of forming "Stakhanovite" groups in an attempt to achieve similar goals and set new records. He was used as an example to encourage workers during the five year plans. It was an ideal propaganda for the USSR who were trying to create a society based on teamwork. 

The Movement was not actually popular at the time with workers. "Stakhanovites" were victimised by colleagues who were less enthusiastic and resented campaigns to get them to work even harder

Years later it was revealed that Stakhanovites work was a propaganda stunt which had been staged. 

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"Quicksand Society"

  • Almost 1/2 labour force by the end of the 1st FYP = peasants
    - moved from countryside- bewildered and looking for work, lodgings, food
  • Phenomenal turnover of labour - average worker moved jobs 3 times p/a
  • Peasants often lacked disciplines of time-keeping and punctuality
  • Found it difficult to adapt to the monotony of machine-based work
  • High rate of absenteeism
  • Skills were a premium- many lacked ability to work machines properly
  • Managers: competed for skilled workers by offering higher wages/ perks
  • Estimated less than 7% of workforce were skilled
       = lots of machinery damage
       = poor quality of products
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Impact of Five Year Plans on people


  • Many younger workers were enthusiastic about the industrialisation drive. Many workers benefited from education, and there was more oppurtunity for promotion due to the removal of specialists. Many experienced higher standards of living.
  • Skilled Workers were in high demand and well paid. They recieved special perks such as access to special shops and better housing. 
  • Unskilled Workers earned considerably less but were often put on new training programmes.
  • Less enthusiastic workers were punished


  • Many moved to the towns as they were forced off the land by collectivisation - this provided a workforce for industrialisation. Peasants were unhappy about the change

Women: - 10 million women entered the workforce

  • Vital for industrialisation. Paid less and given less oppurtunities than men.
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How the party responded to labour problems

  • Wage differentials and incentives - to reward those who stayed put and aquired skills. Bonuses were also introduced. Wage differentials were used to attract skilled workers. Other incentives included access to better housing and shops.
  • Piece work - Payment according to amount of work, used to drive up productivity
  • Training - Massive training programme in order to solve the skills shortage
  • Tough Measures - Punishments to deal with unenthusiastic workers and absentees. Included dismissal, eviction from homes or loss of various benefits.
  • Forced Labour - Criminals sent to labour camps (Gulag) to provide cheap labour, forced labour was especially used for jobs in the worst conditions (Siberia)
  • Propaganda - Used to encourage workers productivity. Most significant example is the Stakhanovite movement
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Use of Terror in Industrialisation

  • Administration of the economy was one of the first areas to experience the results of Stalins purges
  • Stalin assumed that old officials and experts were unreliable and might try to sabotage rapid industrialisation
  • Hundreds of officials were removed from gosplan and commisariats
  • Over half of trade union leaders and factory comittes were replaceed
  • Managers were afraid of making mistakes or not reaching targets, this is what led to many of the problems of the five year plans because mistakes were covered up and managers were desperate to reach targets.
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Did the Five Year Plans achieve Stalins aims?

FYPs - Sucessful

  • Largely increased heavy industry output
  • Created a strong industrial USSR 
  • USSR became self sufficient in some heavy industries
  • Largely increased military strength

The Five Year Plans prepared the USSR for war, it was no longer a backwards undeveloped state whose economy relied on agriculture

FYPs - Failure

  • The Plans were chaotic and badly organised this lead to shortages, wastage, bottle necks and bad quality goods.
  • There was also a large skills shortage after bourgeois specialists were removed
  • Peasants brought in from the land were unhappy - led to absenteeism
  • Large emphasis on heavy industrymeant that consumer good suffered.
  • Living conditions were very bad
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