Russia - The New Economic Policy

• Russian economy was in meltdown
• industrial production was pre-first world war levels
• war Communism's policy of taking grain lead to peasant uprisings
• The Tambov uprising - So serious, large forces of red Army had to be diverted to the province to restore order
• First signs of major famines were appearing

• Developments caused unease among communist party members
• concerned about increasing central control of lenin's govt
• Trotsky's 'Solution' - to extend compulsory service beyond the Red Army to include a civilian work force
• By the End of 1920  mensheviks began increasing support in Local Soviets
• The Development of the Worker's Opposition movement

• When Lenin took over his most faithful supporters were the naval base at Kronstadt.
• These people had helped with the takeover of 25 October 1917 and the Civil war
• Became disillusioned with Lenin's rule
• These men were conscripted Ukrainians and were not happy with the situation
• They demanded an end to the special position of the communist party, relaxation of economic controls, and the Restoration of freedom of speech
• Lead to an Open rebellion of Lenin's regime
• TrotskyPut down this rebellion by attacking their naval base
• Rebels who were not killed were put in Gulags - forced labour camps

• It was a significant event
• Lenin announced the end to war communism - Was only a Temporary measure bought on by the needs of Civil War
• This was to be replaced by a 'New Economic Policy'
• Taking of foodstuffs was abandoned
• Peasants were now able to sell it on the open market
• Private trading was now allowed
• This lead to a New class called the 'Nepmen'
• A year after the NEP was introduced, 3/4 of all trade was conducted by this group
• In 1922 a new currency was introduced which helped bring an end to inflation
• Lenin said that it was a 'tactical retreat' in order to preserve Communism.And he was giving the Russian economy 'Breathing space'

• To many Communists the NEP was a betrayal of ideas
• Lenin was aware that this could split the party
• to prevent high levels of disagreement, Lenin put a ban on Factions within the Communist Party 
• This meant that under Lenin's leadership, independent groups were no longer allowed to be made
• This was supplemented by 'Democratic Centralism'. This meant that any decisions made by Leninor the politburo would be binding on all the other communists.   
• There was a tightening of Political control and a loosening of economic control
• This dictatorship saw more power and absolute than any other government

The NEP had an immediate Positive effect

• Markets appeared in Russian towns
• food shortages disappeared
• Famine of 1921 came to an end
• 85% of firms were back in private ownership
• Peasants began to cultivate more land - area of cultivation rising by half between 1921 and 1927
• Coal and Textile production Doubled over the same period  

Negative effects

• The 'Scissor crisis' - the gap between agricultural and industrial prices
• were accused by communists for encouraging greed, independence and self interest 
• after Lenin's death in 1924 the debate over the NEP became a serious debate.