The NEP: New Economic Policy (1921) The NEP represented a radical break with the party’s doctrine. There were those who were fundamentally opposed to it. The main opponent initially was Bukharin but even he ended up supporting it after Lenin’s threat of resignation.
Lenin argued that the only way the revolution could be saved was with the support and agreement of the peasants. Lenin argued that the direct transition to communism had been a mistake and that the first stage to communism had to be the acceptance of small-scale production with state capitalism. Lenin then believed that Russia would then proceed to socialism and then to communism. Lenin claimed that the peasants could not be converted overnight. It would take “generations but not centuries”. (Lenin) The harsh realities (and failings) of War Communism were abolished. Working conditions were improved as the idea of Labour Armies were scrapped. Most importantly, Grain Requisitioning was replaced with a taxation on grain. By 1922, with a tax limited to just 10%, the success of the NEP was obvious. In 1921, Russia had faced famine. By May 1922, this fear had subsided and by 1923, agricultural production was at a healthy 75% of the 1913 level. Light industry also benefited from the healthy situation found in agriculture. They had to produce goods for the peasants and the success of the peasants stimulated production in light industry. The NEP gave the Bolsheviks "breathing space." It managed to stop famine and discontent towards to Bolsheviks lowered. However, it caused an ideological problem for the Bolsheviks, as it was a clear backwards step from their goal of removing class struggle and reliance on an capitalist style economy. Indeed a monetary system was introduced and the NEP actually fostered a class divide rather than eliminate it. The Scissors Crisis (1923) However, heavy industry did not benefit from the success in agriculture. In 1922, 500,000 were unemployed in the heavy industry sector. With agricultural production increasing so rapidly it became more difficult to attract the industrial workforce back to the cities; as a result industry was much slower in recovering than agriculture. This led to the Scissors Crisis of 1923. With strict controls on the pricing of manufactured goods, cost cutting and efficency increased in factories this crisis was successfully averted by 1924. |
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