SOCIAL STUDIES 30

USSR ECONOMIC PLANNING

SOVIET ECONOMICS• ARTICLE 2 OF SOVIET

CONSTITUTION – ‘THE ECONOMIC LIFE OF THE USSR IS DETERMINED & DIRECTED BY THE STATE ECONOMIC PLAN’

• STATE OWNED VIRTUALLY ALL LAND

• STATE A GIGANTIC GOVERNMENT MONOPOLY

• STATE CONTROLLED – TRANSPORTATION, – FINANCE, – INDUSTRIAL PRODUCTION, – INTERNATIONAL TRADE– 90% OF RETAIL STORES

ECONOMY POST 1917 REVOLUTION

• LENIN APPLY MANY OF MARX’S ECONOMIC PRINCIPLES

• WAR COMMUNISM

• NATIONALIZED PRIVATE PROPERTY, FACTORIES, NATURAL RESOURCES & LAND

• GAVE WORKERS CONTROL OVER FACTORIES

• PEASANTS GIVE UP SURPLUS FOOD TO WORKERS

LENIN’S NEW ECONOMIC POLICY• 1921- STATE RETAINED CONTROL OVER

IMPORTANT INDUSTRIES, BUT ALLOWED SMALL-SCALE PRIVATE ENTERPRISES & PEASANTS COULD SELL CROPS TO CONSUMERS

STALIN’S FIVE YEAR PLANS• TROTSKY VS. STALIN

• TROTSKY WANTED TO SPREAD COMMUNISM GLOBALLY & STALIN WANTED TO BUILD IT UP IN SOVIET UNION

• STALIN UNCHALLENGED LEADER BY 1928

• 25 MILLION FARMS

• ABOUT 1 MILLION KULAKS FIGHT WITH STALIN

FIRST FIVE-YEAR PLAN• FOCUSED ON

INDUSTRIALIZATION• EXPAND HEAVY

INDUSTRY SO COULD PROVIDE – INDUSTRIAL MACHINERY,– TRANSPORTATION

FACILITIES, – MILITARY WEAPONS– ELIMINATE PRIVATELY

OWNED FIRMS– CREATE STATE &

COOPERATIVE FARMS– ELIMINATE PRIVATE

ENTERPRISE– BECOME SELF-SUFFICIENT

IMPACTS OF FIRST FIVE YEAR PLAN• USSR RANKED 4TH IN WORLD IN

INDUSTRIAL OUTPUT• INDUSTRIAL WORKERS WENT FROM

3 TO 6 MILLION• PRODUCING MORE PIG IRON THAN

GB• OIL PRODUCTION X2• ELECTRIC POWER INCREASED 550 %• MACHINERY PRODUCTION GREW BY

400%• NEW INDUSTRIES EMERGED –

SYNTHETIC RUBBER, PLASTICS & AVIATION

• CONSUMER GOODS IGNORED• POOR FACTORY & HOUSING

CONDITIONS• FACTORY MANAGERS LIED ABOUT

QUOTAS• BUSINESSMEN DEPRIVED OF CIVIL

RIGHTS• INDOCTRINATED PEOPLE

COLLECTIVE & STATE FARMS

• COLLECTIVE FARMS- LG SCALE, GOVT MANAGED FARMS CREATED BY COMBINING SMALLER PEASANT HOLDINGS.

• PEASANTS LIVED ON FARM & WORKED TOGETHER

• STATE FARMS- GOVT OWNED MECHANIZED FARMS CREATED BY STALIN TO TEST NEW AGRICULTURAL METHODS

• (RIGHT) ‘KEEP KULAKS OUT OF COLLECTIVE FARMS’

GOVT PRICE CONTROLS• GOVT SET LOW PRICES

ON SCHOOLBOOKS, CHILDREN’S CLOTHES

• HIGH PRICES ON UNDESIRABLE ITEMS SUCH AS VODKA

• REDUCE INCOME GAP = LOW PRICES ON FOOD & CLOTHING

• HIGH PRICES ON LUXURY GOODS = CERTAIN FOODS & CARS

LONG TERM PLANNING• LONG RANGE PLANNING

UPTO 20 YRS• 5-7 YR PLANS SET MORE

SPECIFIC GOALS• COMMUNIST PARTY

DETERMINED GOALS• GOSPLAN – CENTRAL

PLANNING AGENCY THAT WAS RESPONSIBLE FOR INFORMING REGIONAL MINISTRIES ABOUT WHICH PRODUCTS WERE NEEDED & IN WHAT QUANTITIES

PROS & CONS OF CENTRAL PLANNING• PRO- GOVT DETERMINED

WHICH GOODS THE COUNTRY NEEDED – ALLOWED FOR MORE EQULITY IN DISTRIBUTION

• CON- IF MADE BAD DECISION, EFFECT COULD BE DISASTEROUS

• CON-SLOW TO RESPOND TO UNFORESEEN CHANGES = SURPLUS & SHORTAGES

• INDIVIDUAL INITIATIVE & INNOVATION LIMITED

• CON-DIFFICULT DECIDING WHAT TO PRODUCE – NO PROPER SURVEYS

kulaks• Scapegoats• 1930- ‘we must smash the Kulaks, eliminate them as a

class’-Stalin• Take the Kulak land, machinery and livestock• Food & clothing confiscated by military• Many kulaks destroyed what they had

– 1/3 of cattle gone– ½ of sheep and goats gone– ¼ of horses slaughtered– Agriculture production down

• 5 & 10 million dead

Keep kulaks out of collective farms

GLASNOST

• A policy of openness that allowed increased freedom of expression of political opinions within the Communist Party and the USSR under Gorbachev

PERESTROIKA• ECONOMY• AGRICULTURE• TECHNOLOGY• CONSUMPTION• INTERNATIONAL

TRADE• DEMOCRATIZATION• CULTURE

COUP - 1991• Gorbachev under

house arrest • Yeltsin want to

continue with capitalism but speed it up

• Helps Gorbachev

1991 COUP• REACTIONARIES• Communist hardliners want to go back to past• Take over white house