Money, money, money, must be funny, in a Capitalist’s world. I thank you!

1. Explain industrial and agricultural changes.
2. Identify turning points.
3. Begin to assess social and economic impact.

• Fear of industrialisation, would create proletariat and revolts.
• New work discipline – rules and regulations for employees in factories.
• Did develop state involvement, particularly in railways, coal and iron production.
• Managed, with Mikhail Reuturn as Finance
Minister, to attract foreign investment (J.J.
Hughes – steel in Ekaterinoslav).
• New industries open up, including oil industry in
Baku and Caucasus.

• Used foreign expertise.
• Stimulated by British railways.
• Reutern helped increase railway 7x from 3532km to
22,498km by 1878.
• Boosted industry and cushioned from 1873-1882 depression.
• Did cause some corruption, i.e. government bonds, tax exemptions and monopoly concessions.
• By 1880 94% of railways in private hands.

• 1881 Bunge takes over as
FM.
• Abolished Salt Tax in 1881 and Poll Tax in 1886.
• Created Peasant Land
Bank 1883, started to allow railways to go into state hands.
• Bunge replaced by
Vyshnegradski, hardliner and balanced books, but responsible for 1891 famine.

You looking at me?
Ain’t no one else around, so you must be looking at me…
• Encouraged foreign investment.
• Sacrificed agriculture, some anger.
• Raised taxes, interest rates and foreign loans.
• Focussed on railways, iron and coal.
• 1897 rouble placed on the gold standard.
Results:
 Coal doubled and iron and steel increased 7x.
 52,612 km railways by 1901.
 Industrial income increased from
42m Roubles 1893 to 161R 1897.

• Witte dismissed 1903, ignored agriculture and railways costly and poorly built.
• Became PM in 1905,
Stolypin FM.
• 1909-1913 GNP increased by 3.5%p.a.
• BUT – population boomed, small scale producers still around and productivity not improved.
• Starvation still a real possibility.
• WWI killed economy.
• Inflation rampant, loans called in, food and fuel prices rocketed.
• Killed off Romanovs.

• Russia faced WWI hangover and Civil War.
• Introduced State Capitalism, reaction to situation
– nationalised economy until it could “safely” be passed back.
• Nov. 1918 – Land Decree, Nov.1918 Decree on
Workers Control (power to run factories).
• Dec. 1917 Supreme Economic Council, helped to nationalise over 30,000 entities. This was subservient to Council of Labour and Defence, chaired by Lenin.

• Nullified all gains from State Capitalism.
• Industrial output fell.
• Inflation rocketed.
• By Oct 1920 the rouble was worth 1/10 th of value from 1917.
• 90% of all wages were paid “in kind” due to worthless nature of money.

War Communism
• State capitalism saw Bol. take over economy.
• 1917 Decree on Land.
• 1917 Supreme Economic Council
(SEC) nationalised all enterprises,
1918 Decree on Workers Control
= “extra powers”,.
• 1920 30,000+ enterprises, SEC struggled to control.
• Labour militarised, nationalisation meant workers lost control of production and distribution and grain was forcibly requisitioned.
• By 1921 Party and people wanted change.
NEP
• Denationalisation of small scale enterprise and private ownership allowed, small workshops flourished.
• State control of heavy industry continued.
• Trade increased with less state restrictions, i.e. food sales.
• Rouble re-valued and introduced.
• Grain requisitioning ended and peasants able to sell surplus.

Economic Impact
• Initial results were strong.
• Market goods improved.
• Nepman were created, entrepreneurs who by 1920 were responsible for 60% of trade.
• Scissors crisis kicked in, food increased and outstripped demand, prices fell.
• Peasants reluctant to sell surpluses, but industrialists needed them to.
Political Impact
• “Temporary deviation, a tactical retreat”.
• Papered over by call for greater party unity, instigated by 1921
Kronstadt uprising.
• Lenin’s death in 1924 exacerbated divisions.
• Stalin remained ambivalent between rightists and leftists, pulled NEP in 1929.

• Two aims:
– Economic autarky for war footing.
– Improved value of workers.
• Based on strict control and centralised planning.
• Plans were set on often flimsy evidence and targets were often unrealistic.
• Gosplan set targets, passed on to regional commissariats then industrialists. Only guidelines on what was required, not instructions on how to do it!

• First set in 1929, but did not run full course, often exaggerated.
• Stalin even upgraded targets towards the end of each plan.
• Statistics are impressive, but unreliable.
• Khrushchev also centralised, but saw eventual slowdown in growth.

• Both Tsars and Commissars experienced similar problems.
• Most of the population was working on the land.
• Industry was always seen as more important to agriculture and peasants were always seen as second class citizens.
• Land was always problematic and no leaders managed to deal with it adequately. Peasant anger was always fuelled by resentment that they could not own land outright.

Impact
• Peasants freed, able to marry whoever and own land.
• Nobles compensated, payments over 49 years at
6% interest.
• Nobles allocated land to peasants.
• All redemption payments dealt with by the mir.
Unrest
• Peasants given poorer quality land and less than before Emancipation.
• Many couldn’t afford payments or earn enough from the land.
• Mir still in charge of what was grown.
• Subsistence farming kept so no motivation to farm more.

• Blamed on peasant attitudes and out-dated techniques.
• Land captains introduced to maintain control.
• Consumer taxes raised to encourage more grain to be sold, grain also continued to be exported.
• 500,000 died.

Stolypin’s Reforms
• Appointed PM in 1906 following peasant unrest that lasted 1905-
07.
• Hoped to improve land distribution and create stronger peasant class as role models
(wager on the strong).
• Peasant land bank had unused land made available.
• Consolidation of strip farms encouraged.
 Rich peasant class expanded, but remained angry over available land.
 2m peasants left land and created labour shortages, exacerbated by
WWI.

War Communism
• Showed lack of care for peasants.
• Grain requisitioning.
• 3 types of peasant, poor, middling and the kulak.
• Denounced by village poor
= Cheka class war.
• Peasants still looked down on by Bolsheviks.
NEP
• Wealthier peasants increased [kulaks].
• In 1925 they were defined as owning 3 cows, 1928 it was 6.
• Suffered from higher taxes, disenfranchised and children barred from secondary school.
• Were able to criticise
Bolsheviks = Bol. attacks.

• Small farm units into bigger collectives.
• Lenin wanted gradual approach, only 3% by 1929.
• Shortages believed to be part of hoarders during NEP.
• 1927-8 saw push for collectivisation – “socialism in the countryside”.
• Matched by de-kulakisation.

• Meant to be voluntary.
• Explained to peasants, komosols and poor peasants denounced
kulaks ad created fear.
• Kolkhozy (pure) or Sovkhozy
(state) collectives.
• 1930 58% claimed collectives, exaggerated.
• Opposition saw Bransk-oblast reject Komosols, migrationin
Kazakhstan saw 75% migrate.
• Opposition led to “Dizzy with
Success” paper and peasant allowed to leave collectives.

• 1937 = 98% of peasants re-collectivised.
• Now allowed to keep small plots of land (more productive than collectives).
• MTS stations set up, meant to distribute seed, collect grain and decide levels of payment.
• Disrupted by 1932-34 famine.
• Payments of kolkhozy farmers improved.
• 1941 98% collectivised, still disliked.
• Hated 1930 end of the
mir, wanted to make extra independence, realised famine not prevented by collectives.

• G. Hosking “[Khrushchev] never fully got to grips with the authoritarian and bureaucratic structure of agricultural administration”.
• Khrushchev believed himself to be an expert.
• Removed MTS stations and merged smaller collective farms, believed this would improve production.
• Tried to provide more incentives by reducing taxes, increasing electricity provision to rural areas and raised prices on state procurements.
• Changes angered urban workers over price rises.
• 1962-63 saw bad weather and harvests = riots, worst at Budyenni Locomotive
Works, 23 protesters shot by KGB.

• Designed to increase cereal production.
• Meant to be achieved through increase in cultivated land.
• 1950 96m acres allocated for wheat production,
1964 = 165m acres.
• Sense adequate food was being produced.
• Failures:
– Land overused and crops not rotated.
– Soil fertility fell and soil erosion made many areas too arid for cultivation.
– Largely cut corners due to speed of implementation.
– Productivity and production fell.
– Main reason Khrushchev fell?