Lenin’s New Economic Policy


Lenin created the New Economic Policy or NEP due to the lack of food and other necessities that were the result of previous policies.  World War I had caused a lot of supply shortages and in order to try and solve this issue “War Communism” was introduced which only made the situation even worse.  The people were not interested in growing extra food if it meant that it was going to be taken away from them and given to others so as a result they only grew enough food for themselves.  However, the NEP helped remedy this problem by the new tax-in-kind which would allow peasants to sell their surplus food on the market rather than having it taken from them.  “In order to assure an efficient and stable economic life on the basis of a freer disposition by the farmer of the products of his labor and of his economic resources, in order to strengthen the peasant economy and raise its productivity and also in order to calculate precisely the obligation to the state which falls on the peasants, requisitioning, as a means of state collection of food supplies, raw material and fodder, is to be replaced by a tax in kind.”  It also worked to rid Russia of its feudal agricultural system which had proven to be ineffective over time.

While the NEP focused primarily on agriculture it also worked to stabilize Russia’s currency which had suffered from high inflation.  Lenin also wanted to improve free trade to help stabilize the economy.  However, due to the huge increase in agricultural production industry began to suffer.  The war had also taken its toll on the industry and as a result heavy industry could not keep up with the agriculture boom.  Products were being created much more slowly and because of this were very expensive.  Again to solve this problem the government got involved in would buy up the farmer’s extra crops at a much cheaper price than the farmers would have liked.  This in turn hurt the farmers who could now not afford the expensive industrial products which meant that the government would again need to get involved.  They did the same with industry by forcing down the prices so the farmers could afford their products.  This was done to avoid another famine which had devastated the population of the cities and forced many of them to migrate to the countryside.

While the NEP didn’t completely solve all of Russia’s economic problems it helped to revamp the agricultural system and helped out the peasants.

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2 thoughts on “Lenin’s New Economic Policy

  1. This all makes a lot of sense! Agriculture (especially as practiced in Russia in the early 20th-century) does recover more quickly from the disruptions of war and revolution than does the industrial sector. (Which makes sense if you think about what’s involved in both kinds of recovery.) The NEP’s success with the peasantry puts the Bolsheviks in the uncomfortable position of supporting a social class that it doesn’t see as its main constituency, and of backing economic relationships that are essentially capitalist. hmmmmm.

  2. I also found it interesting that a party with a communist agenda implemented capitalist like policies in order to help out the peasants. Maybe if they realized that capitalism actually works to a better degree than communism, Lenin and the Bolsheviks could have kept their power longer. I also found it ironic that their industry complex couldn’t keep up with the agriculture yet in decade or the circumstances would be switched. Great post.

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