NEP

NEP

Main Features
1. Limited system of private enterprise was restored
2. Amount of requisitioned farm produce reduced
3. Peasants were allowed to sell produce
4. Govt. kept control of 'commanding heights' of the economy: heavy industry, banking and foreign trade
5. Veshenka (Supreme Council of National Economy) still exercised control over independent factories
6. Money restored as the principal means of exchange
7. 1922: newly valued rouble introduced
Failures
1. Industry failed to grow at the same rate as agriculture which led to the scissor crisis
2. High unemployment in industrial centres (outside NEPmen)
3. During scissor crisis peasants had to sell their grain at artificially low prices. Lenin was afraid the peasants would lose the incentive to produce excess food.
4. Production figures provided may have been distorted to highlight the successes of the scissor crisis.
5. NEP recreated the hated Kulak class
6. 1923: and industrial census of 165,000 enterprises showed 88.5% of them in private hands. But the state employed 85% of all workers, and, as Lenin put it, controlled the 'commanding heights' of the economy.
7. Communists complained the NEP was merely state capitalism & in no sense organised on the communist motto 'from each according to his ability, to each according to his needs'
8. Since 1920 an effort had been made to do without a banking system. At the end of 1921, a new state bank had to be created to provide finance for industry, but it was a long time before it could function adequately.
9. In this period heavy industry was neglected in favour of consumer goods of light industry. At the end of 1922 some mines were having to dismiss workers because they could no pay wages and could get no credit from the state bank.
10. Performance in heavy metallurgical industry was disastrous - less than 10% of what it had been before the war.
11. Prostitution flourished under the NEP men
Successes
1. Increase in both industrial & agricultural production within 3 years - by 1923 cereal production increased by 23%
2. More food was brought into cities
3. 1920 - 1923 factory output rose by 200%
4. The Scissors Crisis of 1923 did not last long, the govt took action to bring industrial prices down and started to take the peasant tax in cash rather than in kind
5. The peasants did well out of the NEP. After the famine, there was rapid recovery with trade between villages. Peasants could also make money through NEP men (by 1923 they handled 3/4 of all retail trade)
6. It seemed to the peasants that they had won back their villages - thy could farm their land without too much interference from the govt.
7. Took away main causes of discontent
8. Created a stable economy

Next up

Description

Resource summary

Similar

	Created by Faith Sproule over 6 years ago