What caused the NEP?
The Soviet's government's policy of War Communism during the Civil War created social distress and led to riots, strikes and demonstrations. In 1921, the sailors at the Kronstadt Naval Base mutinied.
They demanded free speech, free elections, free trade unions and an end to war communism. Trotsky’s Red Army put the mutiny down with great losses. The mutiny scared the Bolsheviks, because the Kronstadt sailors had been their greatest supporters! The Kronstadt Uprising reinforced the idea that the government was unpopular and accepted and had made a mistake "of deciding upon an immediate transition to communist production and distribution." Lenin came to the conclusion that "only by coming to an agreement with the peasants can we save the socialist revolution". March 1921: Lenin announced details of his New Economic Policy It was an emergency measure to rescue the economy and the communist regime itself from the growing unpopularity arising out of the civil war years The NEP wasn’t regarded by any communist as a permanent state of affairs Lenin tried to justify the NEP by arguing that it was a logical halfway house between the Capitalism that the revolution had tried to destroy and the future era of socialism. Russia was lacking in large-scale, modern industrial development, the NEP would try to improve this. It was a mixture between private and state-run enterprise.
The NEP allowed small privately owned businesses to start up again Large-scale industries remained under state control.
Coal, iron, steel and railways stayed nationalised, but the state brought in experts, on high wages, to increase production. The Government reduced the amount of produce they took from the peasants (stopped grain requisitioning) Instead, peasants had to pay tax, the more they food they produced the less they had to pay. Whereas War Communism had forced the peasants to hand over ALL their surplus grain, after they had paid...