Economic Policies Of Lenin And Stalin Essay, Research Paper

“Both Lenin and Stalin adopted well-structured economic policies in order to build their country into a well-established and powerful state”

Robin Ronne

Both Lenin and Stalin had enormous power to change Russia as the leaders of the ‘Dictatorship of the Proletariat’; the question is how did they succeed in giving economic power to Russian people.

The first solid economic policy instituted in Russia after the abdication of the Tsar and the overthrow of Kerensky’s Provisional Government was Lenin’s policy of War Communism. War Communism was not a policy designed to promote economic stability in Russia. Russia was in civil war and war communism was a policy designed to get food to the soldiers fighting the Whites (anti-Bolshevik soldiers) and then next in line for food were the workers who supplied the soldiers. One must keep in mind that Russia’s economy was in a bad state even before the institution of War Communism. In economic terms War Communism was an abysmal failure. The state was forced to pay wages in kind to workers because money was simply worthless. With the ban on private trade there was a break down of the currency system and rural communities reverted back to a barter economy. The Bolshevik party forcibly seized all surplus grain from the peasants causing resistance from peasants by hiding grain and not producing more than was needed for themselves – Russia had gone back to subsistence farming. This lead to a drop in production with some historians claiming that by 1921 there was more than a 60% percent drop in agricultural productivity since pre-war Russia. The peasant reaction is justified considering that some historians estimate well over 5 million peasants were killed during the grain requisitions. In the cities factories were taken over by the state and the state commissioned managers to run the factories – the Bolsheviks felt that loyalty to the Bolshevik party and Communism was more important than competency. As a result there were staggering drops in industrial production especially in fossil fuels. Oil production dropped from 9.2 million tons in 1913 to 3.8 million in 1921 under war communism. Coal production dropped a massive 67% from 29.1 million tons produced in 1913 to 9.5 million in 1921 (Statistics from Economic Systems in Action – Oxenfeldt and Holubnychy). A clear sign of economic catastrophe in Russia was the estimated depopulation of 60% of the population of the large centres of Moscow and Petrograd. The situation in Russia got so bad that 8 million children were left homeless and millions died in famine caused by inefficient peasant farming. Russia was under immense financial strain from the Civil War and the dissidence of the peasants, something had to collapse and it was the Rouble.

Once the Civil War was under control and Lenin saw citizens growing restless he decided that a new economic policy was in order and the policy was given the name New Economic Policy. The Policy was a drastic measure and I think it was just what Russia needed and it was just in time. Politically, Lenin stepped on the toes of a few hardcore Communist Party members (Bolsheviks) but economically the policy was sound. The policy was a hybrid Socialist-Capitalist economy and was called state capitalism by Lenin. Lenin said the New Economic Policy was a temporary measure and was going to slow down the transformation into communism to ensure that when the state ‘withered away’ (In Marxist theory) the withering would be as smooth as possible. I think that the New Economic Policy was Lenin putting the brakes on the communist revolution, even if only for a while. There were two things that needed to be done urgently in Russia. Firstly, the populous needed to be calmed down and made happy because not even the mighty Lenin would be able to stop the people of Russia if they had a third revolution. The policy was employed to ensure the survival of the Bolshevik Party. Secondly, the economy needed to recover to some extent if the Bolsheviks wanted to industrialise Russia, which I believe they did want to do in order to compete with the west and capitalism. The transition from a command economy to a slightly capitalist one had immediate and far-reaching benefits such as peasant farmers having their surplus grain taxed instead of requisitioned. The taxation along with the legalisation of free trade meant that farmers with excess grain could go and sell it at the market and earn money, this had a crucial spin-off – money became the medium of trade once again. The standard of life in Russia increased somewhat. The Bolsheviks gained more peasant support because of the new policy. There was a drawback that occurred as far as communism is concerned, some peasants became wealthy and were known as kulaks. Having wealth amongst the peasants was, however, positive for the economy in exactly the same way as an increase in middle class wealth is good for any developing economy today. Industrial sectors remained mostly under state control except small concerns (employing fewer than 20 workers). Capitalism still crept into industry in the form of bonuses for workers for incentive purposes. The results were astonishing, by 1928 the coal and oil production mentioned earlier had risen to above the 1913 levels with oil at 11.6 million tons and coal at 35.5 million tons. The New Economic Policy was an economic success.

By the end of Lenin’s life he had taken Russia through three and a half years of an economically and socially crippling policy of War Communism and then into the beginning of the prosperous New Economic Policy. Lenin’s impact on the economic situation in Russia in the period leading up to 1939 cannot be over emphasised. I think the War Communism adversely effected Russia and had as much negative influence on the economic growth of Russia as the positive influence of the New Economic Policy. The lack of cultivation of land during the period of war communism had a long-term adverse affect on Russia’s agricultural capacity. Russia is probably still feeling the effects of the millions of potentially healthy able workers killed in the Red Terror (Grain requisitions during War Communism), during the famine of 1921 and the Cholera and Scarlet fever epidemics.

Stalin contributed much to Russia’s economy and he has to be admired for taking an apparently backward (Some historians suggest Russia was not that backward) country and giving it economic power. Stalin’s decided that the New Economic Policy had run long enough and it was time to put Russia back on its path to Communism. Stalin ordered the State Planning Commission (Gosplan) to devise a series of five year plans which would set out exactly what the country’s goals were for the next five years. The goals were broken down into smaller and smaller goals until eventually every worker knew what he or she had to do for his or her specific shift at the factory. The five-year plans were the ultimate example of goal setting. Although the results of the five-year plan’s implementation were astounding, the percentage increases were not as convincing as the change from War Communism to the New Economic Policy under Lenin. Oil production, for instance, was 305% of its 1921 level by 1928 whereas it was only 184% of its 1928 level by the end of the first five-year plan. Obviously percentage increases drop as the amount of coal or steel produced increases so in order to keep the staggering increase in rate of production as I believe Stalin did to encourage emerging communist nations and boast to the capitalists, Stalin employed more and more women. Many facilities were built for women simply because the USSR needed more workers and the number of male workers unemployed was meaningless.

Stalin’s two main economic aims were Collectivisation and Industrialisation. Collectivisation was the combination of many peasants’ small farms into one large farm, which the peasants collectively ran. Collectivisation made more sense for the state because it was more economically viable to buy machinery to work the land once there was a substantial piece of land and the state needed effective, optimised farming with tools such as tractors. Industrialisation went hand in hand with the agriculture because Stalin realised that the growing population needed to be fed and the system of each farmer working a small piece of land was inefficient and did not fit in with his plans. Stalin’s goals were lofty; he wanted power production to go from 5 to 17 billion kilowatt-hours in the first five-year plan. When he tried to implement collectivisation he found resistance from the kulaks and other peasants. After trying to sell the idea by means of propaganda and failing, Stalin used the more direct approach and simply sent the kulaks to the concentration camps. Thousands of kulaks were sent to labour camps and many burnt their crops in protest and as a result there was a famine in 1932. Agriculture was virtually totally collectivised by 1941 (Modern World History – Ben Walsh p105).

Stalin had made enormous strides in the race to make Russia competitive with the rest of the world. Economically he was a godsend for Russia.

By 1940 the USSR had more doctors per head of population than Britain

Modern World History – Ben Walsh

One thing that we must remember though is that it was Stalin and the Stalinists who wrote the history of the USSR and the information I have presented may not be wholly accurate.

Lenin took Russia from a struggling country with few disgustingly wealthy and most unbelievably poor to a nation with a budding economy. Lenin brought Russia through a civil war and out of an economic slump. Stalin took the budding economy and used force to make it blossom.