Dmytro Ostapenkod.ostapenko@latrobe.edu.au

War Communism Section Objective

The economic and social development of the Russian Empire prior to 1917

To specify what kind of economy the Bolsheviks would have to run in 1917-1921

Bolsheviks ‘s ideas on a road to socialism

To identify their plans of how to run socialist economy

Economic policy in October 1917-June 1918

To define the initial approaches to running economy

Slide into War Communism and situations in the country June 1918-February 1921

To assess the effectiveness of War Communism

The general analysis of War Communism

To characterise this policy

Industrial development of Russia in 1861-1900

Red circles – metal processing industryBlue – textile industry Yellow – food-processing industry

Index of total output in the manufacturing and mining industries in Russia in 1860 -1913. 1900 = 100%

A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 12.

1860 1910

Germany 10.5 25.0

USA 22.5 42.0

France 14.5 17.0

UK 20.0 23.5

Russia 7.5 11.0

Millions of calories produced by average male agricultural worker

A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 24.

Russia USA UK

Electricity (milliard Kwhs)

2.0 25.8 4.7

Coal (million tons) 29.2 517.8 292.0

Oil (million tons) 10.3 34.0 -

Steel (million tons) 4.3 31.8 7.8

Cotton textiles (milliard meters)

1.9 5.7 4.4

1913 Industry output

A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 14.

Make profits of the capitalists public, arrest fifty or a

hundred of the biggest millionaires. Just keep them in

custody for a few weeks ... for the simple purpose of

making them reveal the hidden springs, the fraudulent

practices, the filth and green which even under the

new government are costing our country thousands

and millions every day. That is the chief cause of our

anarchy and ruin!

LeninJune 1917Speech to the First Congress of Soviets

Centralisation or nationalisation of banking systemNationalisations of syndicates, - main capitalist associations for

sugar, oil, ironAbolition of commercial secrecyCompulsory ‘syndication’ of industry – independent firms

should form part of syndicates Compulsory membership of consumer cooperatives - simplify

rationing

Lenin, September 1917The impending catastrophe and how to combat it

Early measures (late 1917 – June 1918)

Land decree of 8 November 1917Decree of workers’ control of 27 November 1917 VSNKh (Supreme Council of National Economy, ) 15 December

1917 Slow nationalisation (mostly by local authorities ) around 487

enterprisesMixed economy – collaboration with capitalists

Slide into War Communism Agriculture

Decline of productivity, Prodrazverstka (confiscation of food surpluses), Narkomprod (People’s Commissariat for Supplies)

Political and military situationShortages of agricultural and industrial goods. Needs of tougher state control over economy and nationalisation. Impossible to compel the factory owner and individual peasant to produce, while simultaneously ruining him by requisitions and restricting his links with the market. September 1919 – 3300 nationalised enterprises – only1375 were functioning. VSNVK tried to cope up with an impossible job. Industrial census taken in August 1920 - 37,000 nationalized enterprises.

Black marketLack of goods to sell and problem of effective distribution. Decline of urban population. 60% illegal bread in cities.

Monetary policy . Printing press - ‘machine gun which attacked the bourgeois regime in the rear’

(Eugene Preobrazhensky). Naturalisation of economy and virtual abolition of money. Wages in kind. Moneyless budget

Militarisation of labour Abolishment of workers’ control, system of rationing according to classes

Civil War in Russia, 1918-1920

1913 1921

Gross output of all industry (index)

100 31

Large-scale industry (index)

100 21

Coal (million tons) 29 9

Steel (million tons) 4.3 0.2

Agricultural production (index)

100 60

Source: A Nove, An Economic History of the USSR, Penguin Press, London, 1969, p. 68.

Necessity over ideology Anarchy and chaos. Orders couldn’t be obeyed. Weak administration. Impact of war and civil war. Dispirited supplies. Losses of agricultural

regions. Moving frontiers. Necessity it is naturally good in this situation to ban private trade in

foodstuffs.

End of War Communism

• Early 1920 – most territories returned. Resources available.

•The key problem remained the relationship with peasants and related problems of freedom of trade and of private small scale-industry. The state couldn’t cope up with running the all sectors of economy.

•February 1921 - rising in Kronstand.

•NEP

Nicolay Bukharin’s The Politics and Economics of the Transitional Period, 1920

Marx – “expanded reproduction” – intensive development of capitalist relation

Bukharin – “negative expanded reproduction’ - economic disruption. The centralised apparatus of capitalism disintegrated and cannot be used as a basis for social order. Need of a long transitional period.

An attempt to ban private manufacture, nationalisation of all industry,

allocation of all output by the state

A ban on private trade, not completely effective but actively imposed

Seizure of peasant surpluses

The partial elimination of money

Terror and arbitrariness, expropriation

Effort to establish strict discipline

Key characteristics of War Communism