The NEP

At the end of the war, the people were demanding two different things from Lenin:

• share power
• reform the economy

Lenin wasn't prepared to share power, but he thought that if he reformed the economy it may make them less pushy about the power-sharing issue.

The economy was in a mess. Grain was not being produced, factories were not working efficiently, and money was practically worthless.

Lenin created the New Economic Policy (NEP) to sort it out. (1921-1928)

• state requisitioning (taking by force) of grain was ended

• peasants had to pay a set tax in grain, but they could sell their surplus and make a profit

• buying and selling of goods was allowed

• people could own their own business with a maximum of 25 employees

• money was restored and a new rouble was issued in 1922

• people were allowed to make a profit

• production figures rose

• electricity improved

• transport and communication improved

• harvests improved

• life began to return to normal

• standards of living rose

• new class of "Nep-men" formed -- middle class businessmen who had had a success by the NEP

• · not true Communism -- criticized by members of the Party

• · although harvest figures rose to start with, it began to level off towards the end. This is because the peasants wanted to hold onto their grain until they were offered a better price for it. However, many people couldn't afford to pay a better price, and so less was planted for the next year. Towards 1928, grain figures were beginning to drop.

• NEP was always designed to be a temporary measure, to reform the economy, after which the USSR would return to true Communism

• Lenin died, and Stalin took over. Stalin was not in favour of continuing the NEP.