The new economic policy
Many thousands of the Kronstadt sailors were killed. The mutiny was crushed. But Lenin recognized that changes were necessary. In march 1921, at the Party Congress, Lenin announced some startling new policies which he called the New Economic Policy (NEP). The NEP effectively brought back capitalism for some sections of Russian society. Peasants were allowed to sell surplus grain for profit and would pay tax on what they produces rather than giving some of it up to the government.
In the towns, small factories were handed back into private ownership and private trading of small good was allowed.
Lenin made it clear that the NEP was temporary and the vital heavy industries (coal-oil-iron-steel) would remain in state hands. Nevertheless, many Bolsheviks were horrified when the NEP was announced, seeing it as a betrayal of Communism. As always, Lenin won the argument and the NEP went into operation from 1921 onwards. By 1925 there seemed to be strong evidence that it was working , as food production in particular rose steeply. However, increases in production did not necessarily improve the situation of industrial workers.
Modernising the USSR
Once in power Stalin was determined to modernise the USSR so that it could meet the challenges which were to come. He took over a country in which almost all the industry was concentrated in just few cities and whose workers were unskilled and poorly educated. Many regions of the USSR were in the same backward state as they had been a hundred years earlier.
Industry and the Five-Years Plans
Stalin ended Lenin’s NEP and set about achieving modernization through a series of Five-Year plans. These plans were drawn up by GOSPLAN, the state planning organization that Lenin set up in 1921. they set ambitious targets for production in the vital heavy industries (coal-iron-oil-electricity). The plans were very complex but they were set out in such a way that in 1929 every worker knew what he or she had to achieve.
GOSPLAN set overall targets for industry.
Each region was told its target.
The region set targets for each mine, factory, etc.
The manager of each mine, factory, etc, set targets for each foreman.
The foremen set targets for each shift and even for individual workers.
The first Five-Year plan focused on the major industries and although most targets were not met, the achievements were still staggering. The USSR increased production and created a foundation on which to build the next Five-Year plans. The USSR was rich in natural resources, but many of them were in remote places such as Siberia. So whole cities were built from nothing and workers taken out to the new industrial centers. Foreign observers marvelled as huge new steel mills appeared at Magnitogorsk in the Urals and Sverdlovsk in central Siberia. New damns and hydroelectric power fed industry’s energy requirements. Russian experts flooded into the Muslim republics of central Asia such as Uzbekistan and Kazakhstan, creating industry from scratch in previously undeveloped areas.
The second Five Year plan (1933-37) built on the achievements of the first. Heavy industry was still a priority, but other areas were also developed. Mining for lead , tin, zinc and other minerals intensified as Stalin further exploited Siberia’s rich mineral resources. Transport and communications were also boosted, and the new railways and canal were built. The most spectacular showpiece project was the Moscow underground railway.
Stalin also wanted industrialisation to help improve Russia’s agriculture. The production of tractors and other farm machinery increased dramatically. In the third Five-Year plan, which was begun in 1938, some factories were to switch to the production of consumer goods. However this plan was disrupted by the Second World War.
