War Communism and The New Economic Policy
The period from the consolidation of the Bolshevik Revolution in 1917 until 1921 is known as the period of war communism. Land, all industry and small businesses were nationalized and the money economy was restricted. Strong opposition soon developed. The peasants wanted cash payments for their products and resented having to surrender their surplus grain to the government as a part of its civil war policies. Confronted with peasant opposition, Lenin began a strategic retreat from war communism known as the New Economic Policy (NEP). The peasants were freed from wholesale levies of grain and allowed to sell their surplus produce in the open market. Commerce was stimulated by permitting private retail trading. The state continued to be responsible for banking, transportation, heavy industry, and public utilities.
Although the left opposition among the Communists criticized the rich peasants or kulaks who benefited from the NEP, the program proved highly beneficial and the economy revived. The NEP would later come under increasing opposition from within the party following Lenin's death in early 1924.
Read more about this topic: 19th Century In Russia, Soviet Union
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