From An Economic History of the USSR 3
War Communism
By Alec Nove
An Economic History of the USSR 1
An Economic History of the USSR 2




 The land decree of 8 November 1917 adopted by the Congress of Soviets and embodied in a law promulgated in February 1918, …Land was nationalized, the right to use it belonged to the peasants. None should have more than he alone could cultivate, since the hiring of labour was to be forbidden. ... Each village made its own arrangements, which varied widely between and within regions. Some of this better-off peasants grabbed more land. Others, including many who had consolidated their holdings under Stolypin, had their land taken away and put back into the common pool. The average size of holdings diminished, and the number of peasant households with land increased, as some very poor or landless peasants gained from the redistri­bution… Despite efforts to prevent it, the land seizures were accompanied by many acts of senseless violence: the landlords’ cattle were sometimes slaughtered, the landlords’ houses, barns or stables destroyed.


The land law of February 1918 did refer to productive efficiency, better technique, land reallocation and even to the development of a collective system of agriculture. But all this remained on paper. The Bolsheviks could not even attempt to impose a settlement. They had no administrative apparatus, they had practically no party members in the villages, They had come to power on the flood-tide of peasant revolt. All they could do in the first years was to try to keep themselves from being swept away. ..


 On 27 November 1917 came a decree on ‘workers’ control’. Factory committees, which existed  already under the Provisional government, were given stronger powers. They could ‘actively interfere …    in  all aspects of production and distribution of products. The organs of workers’ control were granted the right to supervise production, to lay down minimum output indicators for the enterprise, to obtain data on costs. ... The owners of enterprises had to make available to the organs of workers’ control all accounts and documents, Commercial secrecy was abolished. The decisions of workers’ control organs were binding on owners of enterprises’…The local leaders had neither the training nor the sense of responsibility to ‘supervise’ and ‘control’ production and distribution. They could and did sell off materials, pilfer, disobey instructions. Of course, discipline had to be reimposed, … the degree of control was sufficient to inhibit the management from effective action, and divided responsibility meant irresponsibility; indiscipline, and even violence towards technical staff, made work virtually impossible.


On 20 November 1917 the State Bank was seized  by armed detachments, because its employees had refused to issue money to what was, in their view, an illegal band of interlopers calling themselves the Council of People’s Commissars. On 27 December all private banks were nationalized, and, along with the State bank, amalgamated into the People’s Bank of the Russian Republic. In February 1918, all shareholders in banks were expropriated, and all foreign debts repudiated.


On   15 December 1917 the Supreme Council of National Economy was set up. This was known by its initial letters VSNKh (or Vesenkha). VSNKh’s task was defined as follows: The organization of the national economy and state finance. With this object VSNKh elaborates general norms and the plan for regulating the economic life of the country, reconciles and unites the activities of  central and local regulating agencies ...VSNKh was to have ‘the right of confiscation, requisition, sequestration, compulsory syndication of the various branches of industry, trade and other measures in the area of production, distribution and state finance’.


VSNKH was attached to the Council of People’s Commissars ..The full Council seldom met, and a bureau, initially of fifteen members, was responsible for day-to-day work. It had the power to issue orders on economic affairs, which were (in theory) binding on everyone, including the people’s commissariats whose functions it partially duplicated. Regional councils (SNKH or sovnarkhozy) administered and controlled the economy locally, under the guidance of VSNKH …. By May 1918 there were 7 zonal, 38 provincial and 69 district sovnarkhozy. Very soon VSNKh ‘sprouted’ departments (glavki) for controlling particular activities and sectors, …. With the progress of nationalization the various departments of VSNKH took com­mand of the nationalized sectors of the economy.




…in its first few months of existence the organs of VSNKu included some managers and even owners. …. Serious negotiations for collaboration were undertaken with a leading ‘capitalist’ magnate, Meshchersky. And in any case the various glavki  corresponded   closely with the analogous syndicates set up by private business before the war. The offices and much of the staff were the same.


Nationalization did indeed begin. The railways (already, in the main, in the hands of the state under the Tsars) and the merchant fleet were nationalized by January 1918, but, with these excep­tions, individual plants were .nationalized, not industries - at first. …The large majority (over two-thirds) of nationali­zations were local until June 1918 . These … could have been due to over-enthusiasm, or to real or imagined sabotage, or to the refusal of employers to accept orders from workers’ councils. In view of the prevailing chaos, it is only too likely that many employers found conditions intolerable and tried to get out,


Central authorities were alarmed by the extent of unauthorized nationalization and on 19 January 1918 it was decreed that no expropriation should take place without the specific authority of VSNKh. Clearly, no one took very much notice of this…Kritsman in his remarkable article on ‘The heroic period of the great Russian revolution ‘, refers to the pre-June period as one_of ‘elemental chaotic proletarian nationalization from bellow.’  By June 1918 there were still only 487 nationalized enterprises.’ The great leap into war communism must be dated from the end of Jully l918.




…. the peasants had seized the land and redivided it according to their own lights. The splitting up of farms had a disorganizing effect on production, as also did a struggle among the peasants themselves about who was to get what. … Already on  15 February 1918  Lenin was speaking of ‘ruthless war against the kulaks… All this was taking place under conditions of growing hunger, and ever-wilder inflation. The peasants, understandably, sought to obtain a better price for their food, Rationing had been introduced in towns in 1916…


. For Lenin, trade at free prices was equivalent to ‘monstrous speculation ‘ hoarding was considered sabotage. He informed the Petrograd Soviet on 27 January 1918 that there should be mass searches of stores and houses: ‘We can’t expect to get anywhere unless we resort to terrorism, speculators must be shot on the spot’. ..  The winter of 1917—18 was a terrible one. In Petrograd the bread ration fell early in 1918 to a mere 50 grams (2 oz.) a day…Many had to leave the city, and  factories closed for lack of labour. Hunger became a matter of the utmost gravity….




The slide into war communism was stimulated by the food shortages and the failure of efforts to procure food… from the peasants at official prices. …Lenin spoke on 24 May 1918 of a ‘crusade for bread’, and there developed a so-called ‘food dictatorship’ …seizing stocks held by alleged hoarders. …. the campaign against the so-called rich peasants, kulaks, …. The poor peasants, whom Lenin regarded as natural allies against the rural bourgeoisie, were urged to help in the task. On 11 June 1918 the decree on ‘committees of the poor’ (kombedy)  in the villages was issued. One of  their principal task was ‘the removal of surplus grain from the kulaks’. …. By stages, the compulsory. deliveries of food were systematized and given the name of prodrazverstka. … it came to mean a policy in which each peasant household was ordered to deliver its surplus to the state. In some cases this was outright confiscation, in others it was virtual confiscation, since the nominal prices paid were very low and there was practically nothing that could be bought with the money. 


Peasants resented prodrazverstka deeply, and numerous riots broke out. …so­ ca1led ‘greens’… stood for peasant rights. …. notably a powerful peasant anar­chist movement in the Ukraine led by  Nestor_Makhno, who was a major force in 1919. … the peasants could see little sense in producing farm surpluses which would be taken from them by requisition squads. Sowing were reduced. Production fell. It became ever more difficult to find surpluses.  …… There arose a class of people known as meshochniki, or men with sacks, who moved foodstuffs and dodged the guards who tried to stop illegal trade. Kritsman … estimated  that in January 1919 in the provincial (gubernskie) capitals — i.e. most large towns — only 19 per cent of all food came through official channels; the figure rose to 31 per cent in April 1919, and fluctuated thereafter; it was only 29 per cent in April 1920. This illustrates most clearly the limitations of the government’s ‘political’ grip, the extent to which it was struggling with forces it could not control.


Economic Collapse


... the rouble collapsed ... From March 1919 state enterprises were wholly financed from the budget, i.e. they obtained from the budget all money they needed, and paid their receipts into the budget....the "naturalization" of economic relations....Enterprises in fact made no payment for material and services obtained from other state lost its effective function within the state sector....In 1919-20 workers wages were largely paid in kind, the meagre ration being free.... by the middle of 1920 the view that the time was ripe  for the complete establishment of a moneyless system was almost universally accepted.....private trade was declared illegal and the nationalization of practically all  industrial enterprises was undertaken


.Shortage of food was perhaps the key problem.....Chaos and misery were unbearable .....statistical expression of collapse:
                                                                              1913             1921
      Gross output of all industry (index)               100                  31
      Large-scale industry (index)                          100                  21
      Agricultural production (index)                      100                  60
      Import  (1913 roubles)                                  1374                208
      Export  (1913 roubles)                                  1520                  20


   ... Chaos was increased by arbitrary arrests of real or alleged "bourgeois", including specialists....VSNKh was in a very real sense acting as a single state firm.....September 1919 about 80-90 percent of large-scale industry was nationalized...Lenin principle of "iron discipline"....Trotsky advocated the militarization of labour....




   ...characteristics of war communism:
   (1)  An attempt to ban private manufacture, the nationalization of nearly all industry.
   (2)  A ban on private trade...
   (3) Seizure of peasant surpluses..
   (4) The partial elimination of money...
   (5)...terror and arbitrariness, expropriations, requisitions...
  The final straw was Kronstadt rising..(28 February 1921) ...
  ........The NEP was born.





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