Scissor Crisis on:
[Wikipedia]
[Google]
[Amazon]
The Scissors Crisis () was an incident in 1923 in the
1924: Scissors Crisis
- "
The Scissors Crisis () was an incident in 1923 in the economy of the Soviet Union
The economy of the Soviet Union was based on state ownership of the means of production, collective farming, and Industrial engineering, industrial manufacturing. An administrative-command system managed a Soviet-type economic planning, dis ...
during the New Economic Policy
The New Economic Policy (NEP) () was an economic policy of the Soviet Union proposed by Vladimir Lenin in 1921 as a temporary expedient. Lenin characterized the NEP in 1922 as an economic system that would include "a free market and capitalism, ...
(NEP), when there was a widening gap ("price scissors
"Price scissors" refers to an economic phenomenon when for a certain group or sector of productive population, the overall valuation from their production for sale outside this group drops below the valuation of the demand of this group for goods ...
") between industrial and agricultural
Agriculture encompasses crop and livestock production, aquaculture, and forestry for food and non-food products. Agriculture was a key factor in the rise of sedentary human civilization, whereby farming of domesticated species created f ...
prices. The term is now used to describe this economic circumstance in many periods of history.
History
Like the blades of a pair of open scissors, the prices of industrial and agricultural goods diverged, reaching a peak in October 1923 where industrial prices were 276 percent of their 1913 levels, while agricultural prices were only 89 percent. The name was coined byLeon Trotsky
Lev Davidovich Bronstein ( – 21 August 1940), better known as Leon Trotsky,; ; also transliterated ''Lyev'', ''Trotski'', ''Trockij'' and ''Trotzky'' was a Russian revolutionary, Soviet politician, and political theorist. He was a key figure ...
after the scissors-shaped price/time graph. This meant that peasants' incomes fell, and it became difficult for them to buy manufactured goods. As a result, peasants began to stop selling their produce and revert to subsistence farming
Subsistence agriculture occurs when farmers grow crops on smallholdings to meet the needs of themselves and their families. Subsistence agriculturalists target farm output for survival and for mostly local requirements. Planting decisions occ ...
, leading to fears of a famine.
The crisis happened because agricultural production had rebounded quickly from the famine of 1921–22 and the Russian Civil War
The Russian Civil War () was a multi-party civil war in the former Russian Empire sparked by the 1917 overthrowing of the Russian Provisional Government in the October Revolution, as many factions vied to determine Russia's political future. I ...
. In contrast, industry took longer to recover, due to the need to rebuild infrastructure
Infrastructure is the set of facilities and systems that serve a country, city, or other area, and encompasses the services and facilities necessary for its economy, households and firms to function. Infrastructure is composed of public and pri ...
. Furthermore, the problem was exacerbated by the government seeking to avoid another famine by keeping the bread grain prices at artificially low levels.
By August 1923 a wave of strikes spread across Russian industrial centres, sparked off by the crisis.When dissident communist groups, such as Workers' Truth and the Workers Group of the Russian Communist Party, tried to build support around these strikes, they were suppressed. Within the Communist Party, The Declaration of 46
''The'' is a grammatical article in English, denoting nouns that are already or about to be mentioned, under discussion, implied or otherwise presumed familiar to listeners, readers, or speakers. It is the definite article in English. ''The ...
was produced as a signed protest sent to the Central Committee of the RCP. To combat the crisis, the government reduced costs of industrial production by cutting staff, rationalizing production, controlling wages and benefits and reducing the influence of traders and middlemen ( NEPmen) by expanding the network of consumer cooperatives (such as the People's Commissariat
A People's Commissariat (; Narkomat) was a structure in the Soviet state (in the Russian Soviet Federative Socialist Republic, in other union and autonomous republics, in the Soviet Union) from 1917–1946 which functioned as the central executive ...
of Trade).
As a result of these actions, the imbalance started to decrease. By April 1924, the agricultural price index
A price index (''plural'': "price indices" or "price indexes") is a normalized average (typically a weighted average) of price relatives for a given class of goods or services in a specific region over a defined time period. It is a statistic ...
had reached 92 (compared to its 1913 level) and the industrial index had fallen to 131.
After the 1927 crisis, Soviet economist Lev Gatovsky
Lev Markovich Gatovsky (Russian: Лев Маркович Гатовский; 26 July 1903 – 18 April 1997) was a Soviet Union, Soviet economist, being one of the first who tried to create a theoretical framework in which to understand the natu ...
performed an analysis and actively participated in the planning for the state intervention that followed.
A similar crisis had occurred in 1916, when for example the price of rye
Rye (''Secale cereale'') is a grass grown extensively as a grain, a cover crop and a forage crop. It is grown principally in an area from Eastern and Northern Europe into Russia. It is much more tolerant of cold weather and poor soil than o ...
rose by 47% whereas that of a pair of boots rose by 334%.{{cite book, last1=Figes, first1=Orlando, title=A people's tragedy : the Russian Revolution, 1891-1924, date=1997, publisher=Pimlico, location=London, isbn=978-0712673273
See also
*Ural-Siberian method
The Ural-Siberian method was an extraordinary approach launched in the Soviet Union for the collection of grain from the countryside. It was introduced in the Urals and Siberia, hence the name.
Criticized by the Right Opposition for being a restor ...
* Industrialization in the Soviet Union
Industrialization in the Soviet Union was a process of accelerated building-up of the industrial potential of the Soviet Union to reduce the economy's lag behind the developed capitalist states, which was carried out from May 1929 to June 1941. ...
* Collectivization in the Soviet Union
The Soviet Union introduced collectivization () of its agricultural sector between 1928 and 1940. It began during and was part of the first five-year plan. The policy aimed to integrate individual landholdings and labour into nominally co ...
* Soviet grain procurement crisis of 1928 The Soviet grain procurement crisis of 1928, sometimes referred to as "the crisis of NEP," was a pivotal economic event which took place in the Soviet Union beginning in January 1928 during which the quantities of wheat, rye, and other cereal crops ...
* Monetary reform in the Soviet Union, 1922–24#Price scissors
References
External links
1924: Scissors Crisis
- "
Smychka
Smychka () was a popular political term in Russian Soviet Federative Socialist Republic, Soviet Russia and the Soviet Union. It can be roughly translated as "collaboration in society" "union", "alliance", "joining the ranks". The generic meaning ...
and the Scissors Crisis", at ''Seventeen Moments in Soviet History'', an essay by Lewis Siegelbaum
Lewis H. Siegelbaum is Jack and Margaret Sweet Professor Emeritus of History at Michigan State University (retired in 2018). His interests include 20th century Europe, Russia and Soviet Union. He has been with MSU since 1983.
1923 in the Soviet Union
Economic history of the Soviet Union
Marxian economics
Leon Trotsky