The may need to be rewritten. Please discuss this issue on the article's. Use the to ensure the section follows Wikipedia's norms and to be inclusive of all essential details. July 2018 The New Economic Policy NEP, новая экономическая политика, НЭП was an of Soviet Russia proposed by in 1921 as a temporary expedient. The NEP represented a more -oriented economic policy deemed necessary after the of 1918 to 1922 to foster the economy of the country, which had suffered severely since 1914. The Soviet authorities partially revoked the complete nationalization of industry established during the period of of 1918 to 1921 and introduced a system of which allowed private individuals to own small enterprises, while the state continued to control banks, foreign trade, and large industries. In addition, the NEP abolished forced grain-requisition and introduced : a tax on farmers, payable in the form of raw agricultural product. Further decrees refined the policy. Other policies included and the. The NEP policy created a new category of people called нэпманы. In November 1917 the seized control of key centres in Russia. This led to the of 1917—1922, which pitted the Bolsheviks and their allies against the and other forces. During this period the Bolsheviks attempted to administer Russia's economy purely by decree, a policy of the. Farmers and factory workers were ordered to produce, and food and goods were seized and issued by decree. While this policy enabled the Bolshevik regime to overcome some initial difficulties, it soon caused economic disruptions and hardships. Producers who were not directly compensated for their labor often stopped working, leading to widespread shortages. Combined with the devastation of the war, these were major hardships for the Russian people and diminished popular support for the Bolsheviks. At the end of the Civil War, the Bolsheviks controlled Russian cities, but 80% of the Russian population were peasants. Although almost all the fighting had occurred outside urban areas, urban populations decreased substantially. The war disrupted transportation especially railroads , and basic public services. Infectious diseases thrived, especially typhus. Shipments of food and fuel by railroad and by water dramatically decreased. City residents first experienced a shortage of heating oil, then coal, until they resorted to wood. Populations in northern towns excluding capital cities declined an average of 24%. Northern towns received less food than towns in the agricultural south. Petrograd alone lost 850,000 people, half of the urban population decline during the Civil War. Hunger and poor conditions drove residents out of cities. Workers migrated south to get peasants' surpluses. Recent migrants to cities left because they still had ties to villages. Urban workers formed the core of Bolshevik support, so the exodus posed a serious problem. Factory production severely slowed or halted. Factories lacked 30,000 workers in 1919. To survive, city dwellers sold personal valuables, made artisan craft-goods for sale or barter, and planted gardens. The acute need for food drove them to obtain 50—60% of food through illegal trading see. The shortage of cash caused the to use a system, which was inefficient. Drought and frost led to the , in which millions starved to death, especially in the Volga region, and urban support for the Bolshevik party eroded. When no bread arrived in Moscow in 1921, workers became hungry and disillusioned. They organised demonstrations against the Bolshevik Party's policy of privileged rations, in which the Red Army, Party members, and students received rations first. The of soldiers and sailors broke out in March 1921, fueled by and. In 1921 Lenin replaced the policy with a tax, signaling the inauguration of the New Economic Policy. Reestablishment of a stable currency, the gold-backed chervonets, was an essential policy component of the Soviet state's return to a money-based economy. The NEP represented a move away from full nationalization of certain parts of industries. Some kinds of foreign investments were expected by the Soviet Union under the NEP, in order to fund industrial and developmental projects with foreign exchange or technology requirements. The NEP was primarily a new agricultural policy. The Bolsheviks viewed traditional village life as conservative and backward. It was reminiscent of the Tsarist Russia that had supposedly been overthrown by the. With the NEP, the state only allowed private landholdings because the idea of collectivized farming had met strong opposition. Lenin understood that economic conditions were dire, so he opened up markets to a greater degree of free trade, hoping to motivate the population to increase production. At first, this tax was paid in kind, but as the currency became more stable in 1924, it was changed to a cash payment. This increased the peasants' incentive to produce, and in response production jumped by 40% after the drought and famine of 1921—22. NEP economic reforms aimed to take a step back from central planning and allow the economy to become more independent. NEP labor reforms tied labor to productivity, incentivizing the reduction of costs and the redoubled efforts of labor. Labor unions became independent civic organizations. The NEP gave opportunities for the government to use engineers, specialists, and intelligentsia for cost accounting, equipment purchasing, efficiency procedures, railway construction, and industrial administration. These private traders opened up urban firms hiring up to 20 workers. NEPmen also included rural artisan craftsmen selling their wares on the private market. This section needs expansion. You can help by. January 2014 Lenin considered the NEP as a strategic retreat from socialism. Trotsky, supported by left-wing members of the Communist Party, believed that socialism in Russia would only survive if the state controlled the allocation of all output. Trotsky believed that the state should repossess all output to invest in capital formation. On the other hand, Stalin supported the more conservative members of the Communist Party and advocated for a state-run capitalist economy. Stalin managed to wrest control of the Communist Party from Trotsky. After defeating the Trotsky faction, Stalin reversed his opinions about economic policy and implemented the. After the NEP was instituted, agricultural production increased greatly. This incentive, coupled with the breakup of the quasi-feudal landed estates, surpassed pre-Revolution agricultural production. The agricultural sector became increasingly reliant on small family farms, while heavy industries, banks, and financial institutions remained owned and run by the state. This created an imbalance in the economy where the agricultural sector was growing much faster than heavy industry. To maintain their income, factories raised prices. Due to the rising cost of manufactured goods, peasants had to produce much more wheat to buy these consumer goods, which increased supply and thus lowered the price of these agricultural products. This fall in prices of agricultural goods and sharp rise in prices of industrial products was known as the due to the crossing of graphs of the prices of the two types of product. Many Communist Party members considered this an exploitation of urban consumers. To lower the price of consumer goods, the state took measures to decrease inflation and enact reforms on the internal practices of the factories. The government also , in an attempt to halt the scissor effect. By 1928, agricultural and industrial production had been restored to the 1913 pre-World War I level. By 1924, the year of Lenin's death, had become the foremost supporter of the New Economic Policy. The USSR abandoned NEP in 1928 after obtained a position of leadership during the. Stalin had initially supported the NEP against , but switched in favour of during the and saw the need to quickly accumulate capital for the vast industrialization programme introduced with the starting in 1928. The Bolsheviks hoped that the USSR's industrial base would reach the level of capitalist countries in the West, to avoid losing a future war. Accordingly, Stalin imposed collectivization to replace private farms. Collectivization included stripping of land from the kulaks to distribute it among agricultural cooperatives and. Lenin and his followers saw the NEP as an interim measure. However, it proved highly unpopular with the in the because of its compromise with some capitalist elements and the relinquishment of state control. The Left saw the NEP as a betrayal of Communist principles, and believed it would have a negative long-term economic effect, so they wanted a fully planned economy instead. Stalin's was his most notable departure from the NEP approach. Pantsov and Levine see many of the post- of leader in the during the 1980s as influenced by the NEP. He drew on ideas from NEP when he spoke of his own reforms. In 1985, he openly acknowledged that 'perhaps' the most correct model of socialism was the New Economic Policy of the USSR. Published in Pravda No. A History of the Soviet Union from the Beginning to the End. Cambridge: Cambridge University Press. World History; The Modern Era. A History of Twentieth-Century Russia. Cambridge, MA: Harvard University Press. Cambridge: Cambridge University Press published 1992. In the broad expanses of the countryside, peasants, who comprised upwards of 80 percent of the total population, hunkered down in their communes, having both economically and psychologically withdrawn from the state and its military and food detachments. Rosenberg, and Ronald Grigor Suny, ed. Party, State, and Society in the Russian Civil War Bloomington: Indiana University Press, 1989 , pp. A History of the Soviet Union from the Beginning to the End. Cambridge: Cambridge University Press. Timoshenko, Agricultural Russia and the Wheat Problem. Stanford, CA: Food Research Institute, Stanford University, 1932; p. Journal of Libertarian Studies: 93—94. Retrieved 12 July 2017. New York: Oxford University Press, 1984. Revolutionary Russia, 1891—1991: A History. New York: Oxford University Press. A History of the Soviet Union from the Beginning to the End. Cambridge: Cambridge University Press , 2006. S oviet State and Society: Between Revolutions, 1918—1929. Cambridge: Cambridge University Press , 1992. Agricultural Russia and the Wheat Problem. Russia's Last Capitalists: The NEPmen, 1921—1929. Berkeley, CA: University of California Press. From Tsarism to the New Economic Policy: Continuity and Change in the Economy of the USSR. Ithaca, NY: Cornell University Press. Russia in the Era of NEP. Bloomington, IN: Indiana University Press. Turin, Italy: International Center of Economic Research Working Paper No.
