Coexistence of Private and Public Sectors

Topics: Vladimir Lenin, Soviet Union, Leon Trotsky Pages: 7 (1995 words) Published: January 23, 2012
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The New Economic Policy (NEP) (Russian: Новая экономическая политика, НЭП, Novaya Ekonomicheskaya Politika) was an economic policy proposed by Vladimir Lenin, who called it state capitalism. Allowing some private ventures, the NEP allowed small animal businesses or smoke shops, for instance, to reopen for private profit while the state continued to control banks, foreign trade, and large industries.[1] It was officially decided in the course of the 10th Congress of the All-Russian Communist Party. It was promulgated by decree on 21 March 1921, "On the Replacement of Prodrazvyorstka by Prodnalog" (i.e., on the replacement of foodstuffs requisitions by fixed foodstuffs tax). In essence, the decree required the farmers to give the government a specified amount of raw agricultural product as a tax in kind.[2] Further decrees refined the policy and expanded it to include some industries. The New Economic Policy was replaced by Stalin's First Five-Year Plan in 1928.

Contents [hide]
1 Beginnings
2 Policies
3 Disagreements in leadership
4 Results
5 End of NEP
6 See also
7 Multimedia
8 Further reading
9 Footnotes
10 External links

[edit] Beginnings This section requires expansion.

The NEP replaced the policies of War Communism. Whilst some leading Bolsheviks were opposed to it, it seemed necessary due to circumstances to allow limited private commercialism in the form of the NEP.

[edit] PoliciesThe laws sanctioned the coexistence of private and public sectors, which were incorporated in the NEP, which on the other hand was a state oriented "mixed economy." [3]

Rather than repossess all goods produced, the Soviet government took only a small percentage of goods. This left the peasants with a marketable surplus which could be sold privately.[4]

The state, after starting to use the NEP, migrated away from Communist ideals and started the modernizing of the economy, but this time, with a more free-minded way of doing things. The Soviet Union stopped upholding the idea of nationalizing certain parts of industries. Some kinds of foreign investments were expected by the Soviet Union under the NEP, in order...
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