New Economic Policy
This domain tests NEP from 1921 to 1928–29: what replaced War Communism, where the state kept control, what economic imbalances persisted, and why the party abandoned the retreat.
What NEP was
At the Tenth Party Congress in March 1921, with Kronstadt in revolt and the countryside exhausted, the party replaced grain requisitioning with a tax in kind (prodnalog, later converted to cash) and legalized private trade and small-scale enterprise. The state kept the "commanding heights": heavy industry, banking, transport, and the foreign trade monopoly. The same congress banned factions inside the party, closing the political route for critics of NEP. The result was a mixed economy without a mixed political system, in which NEPmen and private traders prospered in the cities while party control over public life tightened. Nationalities policy (korenizatsiya) promoted local languages and cadres within a unitary party.
Imbalance and the end of NEP
The scissors crisis of 1923 saw industrial prices rise faster than agricultural prices, squeezing peasants who then withheld grain. Debate over financing industrialization via the peasant economy sharpened, and "Socialism in One Country" (1925) gave the leadership an ideological frame for a self-contained drive. A grain procurement crisis in 1927–28 was met in 1928–29 with coercive requisitioning against kulaks and private traders, and NEP was effectively finished by 1929, when collectivization and the First Five-Year Plan began.
Worked example
Question: why did the leadership abandon a policy that was restoring output? Reasoning: recovery restored production to pre-war levels but did not solve the structural problem of getting cheap grain to feed and fund industry; peasants sold when prices suited them; the party's ideological distrust of the market and of a private trading class made coercion attractive; and the command methods of 1918–20 were still available. NEP ended because it was an unstable bargain, not because it had collapsed economically.
Traps
- NEP was a retreat within a state-controlled economy, not a restoration of capitalism; opposition parties stayed banned.
- Its practical end is 1928–29 requisitioning and collectivization, not a single declaration in 1927.
- The prodnalog replaced prodrazverstka; do not reverse them.
- The 1921 faction ban is a political feature of NEP, not separate from it.