Ussr

The political act of seizure of power was conceived as a sudden revolutionary act. The subsequent economic change was to be more or less gradual according to conditions and according as the new State was able to build the necessary machinery to run the economic system on socialist lines. The ultimate goal was the attainment of a classless society, where a privileged class based on property ownership ceased to exist and all stood on an equal footing as workers in an economic system which was com munally owned and run.

In accordance with this theory, nationalisation in the early months of the Bolshevik revolution was only carried so far as was considered necessary from the political standpoint of class power. From this point of view the control of the banks, the transport system, the grain trade and electrical stations was considered to be as much a part of the holding of "key positions" as was the control of the police and the military, of the State departments and of the Press. The major part of industry, as for instance the textile industry, was still left in private hands; and it was apparently intended that for a time, at any rate, large spheres of industry should continue under private control, subject to certain measures of State control such as the British Ministry of Muni tions exercised during the war, and to fairly considerable measures of control exercised by factory committees in the various enter prises. In agriculture no immediate nationalisation was achieved or intended. One of the basic principles of Lenin's policy was that in an agrarian country where the urban proletariat con stituted a minority of the population (in Russia they constituted less than Io per cent of the population) the workers could only hold power if they cemented a firm alliance with the poorer sec tions of the peasantry, securing at least their passive political support and their economic goodwill as food producers. Conse quently, while the land was nominally nationalised, one of the first acts of the Soviet Government was the Land Decree, which directed the village committees to organise the distribution of the landlords' estates among the poorer peasantry. Only such of the estates as had been farmed on model intensive lines were to be reserved from this distribution and organised as State farms. As a result some 97-98 per cent of the cultivated land in European Russia and 96 per cent in the Ukraine came into the hands of the peasantry (as against 76 and 55 per cent respectively before), while some 3 per cent remained in the hands of state or co operative farms.

"War Communism..

But the rallying of the anti-Bolshevik forces in the Caucasus, in Siberia and in Murmansk, and the re crudescence of civil war precipitated certain sweeping changes in the economic sphere, and led to the system which has come to be known as "war communism." With civil war on the horizon the attempt to run industry on the basis of the continuance of the private entrepreneur, subject to control by the Soviet State, was almost bound to break down. In many cases the owner refused to continue production under the new conditions. In other cases the factory committees or the local Soviet, in defiance of the central authorities, took over factories into their own hands and ran them independently on syndicalist lines. As an attempt to deal with the resulting chaos the pace of nationalisation was consider ably accelerated, until even quite small workshops were swallowed up in the nationalisation decree; and State administrative organs, called Glavki, including technical experts and representatives of the trade unions, were set up in each industry to take over the control of industry and to appoint the factory management. Hasty improvisation and the pressure of urgent war needs tended to produce an increasing centralisation of control, even in matters of executive detail, in the hands of these Glavki—a centralisation which, by the end of the civil war produced serious administrative congestion and paralysed initiative.

At the same time the continuance of inflation produced a rapid depreciation of the currency, in face of which the various State organs came more and more to conduct their transactions by direct barter, without the intervention of money. It became customary for the Glavki directly to hand over supplies of fuel, materials, and often food rations to the enterprises under their control, debiting them with the value of these things assessed at arbitrarily fixed prices. In return the enterprises handed over their products to the Glavki, which then arranged the distribution of them through the State Commissariat of Supplies or the co operatives. In 192o-21 about nine-tenths of the worker's wage was paid in direct rations or in orders on the co-operative store, and not in money.