The Rise and Fall of Communism in the Soviet Union

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The command system, which is also described as Marxism, socialism, or communism, is both a political and economic philosophy. In a communist economy, the government owns most of the firms, subsequently controlling production and allocation of resources. One of the most well-known and well-documented cases of a communist government took place in the Soviet Union, beginning in 1917 and eventually falling in 1992. Idealistically, communism eliminates social classism and provides equal work for all in a particular society. The government appoints a central planning board to “determine production goals for each enterprise and to specify the amount of resources to be allocated to each enterprise so that it can reach its production goals.” In theory, communism attempts to create an egalitarian society. However, due to its detrimental effects on the economy and the quality of life of the working class, the Soviet Union’s communist government failed to prosper. Through the Russian Revolution of October 1917, the Bolsheviks rose to power. During this time, the Soviet Union was involved in the First World War, which had devastating effects on its economy. There were shortages on essential supplies including food, clothing, and fuel. Levels of agricultural and industrial production were down compared to levels in 1913. Economic breakdown, civil war and irrepressible inflation accompanied the Russian Revolution of October 1917. Due to these circumstances, the Bolsheviks moved to nationalize all economic property. They took control of industry and trade and declared all private enterprise illegal. In essence, money lost its value. Due to what is now known as War Communism, the majority of resources were allocated to the civil war fronts. In rural Russia, land was seized and redistributed to be worked using limited resources and equipment. Any surplus in production was seized by the state, completely eliminating incentive to produce any surplus at all. Subsequent rationing resulted in famine and despair. By 1920, levels of production in both the industrial and agricultural sectors dropped well below pre-war levels. People in the urban areas suffered from unemployment. The lack of bare necessities drove those in the urban areas out to rural areas where they could provide for their families through their own efforts. Leader of the Bolsheviks, Vladimir Ilyich Lenin, had somewhat idealistic plans for the economy. Under his rule, the Soviet Union changed dramatically. In 1921, he introduced the “New Economic Policy”. In the early stages, the focus of the policy was to create an incentive for peasant population to produce more food for the towns. Lenin’s hope was to eventually accomplish economic exchange between town and country as a means to promote industrial production. Lenin then proposed that only a portion of the surplus produced be surrendered to the state -- implying that the remainder could be freely marketed to the benefit of the producer. This free market system gave rise to the emergence of a class of wholesalers known as the “nepmen”. The “nepmen” soon controlled the majority of retail trade in Russia. This free trade activity resuscitated the economy in both urban and rural Russia. Though the economy was now striving in a pseudo-capitalist economy, the Bolsheviks retained control of large industrial plants, banking and foreign trade - reassuring communism supporters. Vladimir Lenin died in 1924, and by 1927 the government had nearly abandoned the New Economic Policy. Lenin’s successor, Joseph Stalin, was now the head of the Soviet Communist Party. His views were in direct opposition of Lenin’s. Stalin planned to move away from an agricultural economy to an industrial economy. He then initiated the First Five Year Plan. The First Five Year Plan called for rapid industrialization of the economy. Small-scale industries and services were nationalized, placing a strain on managers of the...
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