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New Economic Policy (1921-1924) - Coggle Diagram
New Economic Policy (1921-1924)
War Communism failed. By 1921, Russia was facing economic collapse. The Bolsheviks introduced new economic policies to try and fix these problems.
The failure of "war communism"
War communism failed.
Peasants destroyed their own crops so that the Cheka could not seize them.
There were large food shortages, particularly in rural areas.
There was a peasant uprising in Tambov Province.
The Bolshevik leaders did not give workers and active role in decision-making and this caused discontent.
New Economic Policy
The New Economic Policy tried to fix these problems.
Money was reintroduced and so were some other aspects of free markets (capitalism).
Small businesses flourished across Russia, and it was acceptable for private businesses to employ workers.
Peasants no longer had grain seized from them. They now had to pay taxes, first in goods, then in cash.
The peasants could then sell their grain and keep the money from this. Those who were successful were called the "NEPmen".
Opponents of NEP
Some Communists were disappointed with the NEP. They felt that it betrayed their principles.
Trotsky was one of these opponents.
There were more and more cases of suicide in the Bolshevik Party.
Effects of the NEP
There was growth in agriculture and industry (although it was slow)
The Scissors Crisis
Whilst food prices were affordable, the price of factory-made goods increased because of communist policies.
Inequality also increased. Some groups made more money than others from the new system and trade with other countries remained lower than 1913 levels.
As before, the "Commanding Heights" (banks and major industries) stayed nationalised. Russia also remained a one-party state.
Historical assessment
Robert Himmler (1994) argues that Stalin's receptiveness to the NEP in 1921 was staged:
"...Stalin delivered a blast against the NEP at the Twelfth Party Congress in April 1923, just a month after Lenin was incapacitated by strokes. Stalin charged that the two-year-old policy "exposed [the party] to the corrupting influence of NEP elements." Worse yet, it nurtured the growth of nationalistic and reactionary thinking, which has "acquired many supporters among Soviet officials" and "has penetrated even into some of out party institutions.""