Witte believed that heavy industry was the way forward, because he thought that light industry and agriculture could both benefit from this boost. It was important for this change to occur because Russia had massive resources of iron, coal, timber etc. but was not exploiting them. By encouraging heavy industries to tap into Russian resources, Witte was stimulating the Russian economy using Russian resources; self sufficiency. This can be seen in statistics that show Russian production of coal and iron multiply three and eightfold respectively.
How successful were Stalin’s economics policies from 1928-1941? In the late 1920’s Stalin succeeded in the power struggle. He wanted to speed up the economy; he wanted to bring about a complete economic revolution through collectivisation and industrialisation. To achieve this the Russian state would take over in order to run the economy. This was sometimes called ‘Revolution from above.
The Trans-Siberian railway was started in 1891; this was a massive improvement to the economy because it opened up the Eastern Empire and advanced the growth of new towns and cities, whilst connecting new industrial centres which helped to stimulate the growth of iron and coal industries. In the case of foreign investment, Witte put the rouble on the gold standard which encouraged other countries to invest heavily in Russian industry. These policies had some beneficial outcomes such as heavy industry saw massive increases in production, and the economy grew 8% per year in the 1890’s, however, arguably there were also negative impacts of Witte’s policies. The Trans-Siberian railway was only partially built and therefore only the major cities were interconnected. Also in order to provide money for industrial developments, taxes were raised which squeezed the peasants and therefore made them penniless to buy consumer goods, resulting in the economy of Russia itself to stagnate.
When Hitler came to power in 1933, the Germany economy was in a desperate state and still reeling from the effects of the 1919 Treaty of Versailles and the 1929 Wall Street Crash. Hitler decided that a revival of the economy was a necessity in order to achieve his ideological aims for the future of Germany. He even stated that ‘the needs of the state, varying according to time and circumstances are the crucial factor’, and Hitler believed that Germany was a great state, and therefore needed a strong economy in order to achieve her potential, which arguably Hitler perceived, as world power. There were four basic aims for the economy. Firstly, Hitler wished to tackle the depression which Germany was suffering from, and to generate employment, as unemployment was close to six billion in 1930.
Sergie Witte's aims included creating a bigger business class as that is what was driving other countries forward such as Britain and Germany. Witte felt that if he could increase the Russian economy’s working class and the same would happen for them. He tried to fulfil this aim by industrialising cities with factories so that the business class would grow, however the working class therefore also grew resulting in a massive growth in population and so living and working conditions decreased in quality. Although Witte's system was somewhat working, there were many problems which allowed revolution to evolve and grow stronger in the minds of the lower class. Another aim of Witte was to free the serfs.
In 1928, Joseph Stalin, now leader of the USSR, knew that the agricultural sector had to be made more efficient in order for it to feed the huge workforce which would take Russia through industrialisation. In his ascent to power, Stalin criticised Lenin's New Economic Policy for its Capitalistic features and so, through the Gosplan, a centrally controlled economy was created which subsequently gave birth to the five-year-plans and Collectivisation. By removing the Kulaks (wealthy peasants), combining numerous small holdings into one large farm and introducing modern equipment, collective farms were established. There is no doubt that this was a much more Socialist policy than the NEP, but whether it was successful is highly debatable: it would entirely depend on the interpretation of the word 'success' which, for this essay at least, will be that it has benefitted the majority of the people it has affected. However, it would be all too easy for one's opinion to be based entirely on the increase in agricultural output after 1928.
History Essay – Russia To what extent did Witte achieve economic modernisation in Russia? Russia saw a lot of changes in the years 1881-1903. A lot of these were due to Witte. The Russian empire wasn’t strong as it seemed and it was certainly not modern. Witte tried to change this with a series of projects, to help the economy and industry of Russia.
The 1880s saw an industrial expansion in Russia. Coal and oil exports rapidly increased meaning more money was being brought into the country. The government however, used it for increasing military power such as making new weapons and employing more soldiers rather than helping the structure of Russia. To help the structure of Russia they could have spent it on building new roads and railways, and investing in new agricultural equipment which would help the economical transformation of Russia a lot more. Sergei Witte was minister of finance from 1892 to 1903 and wanted to modernise Russia.
Sergei was a key member of the government under the rule of both Alexander III and Nicholas II. Witte’s largest project was to improve the transport across Russia; he did this by improving the Trans-Siberian Railway which was constructed between 1891 and 1902. The line stretched for over 6000 kilometres and was intended to open up the more remote parts of Russia, which would in turn make the production better all over Russia as the produce would be able to be transported quicker across the different industries. Obviously this factor improved the economy as it meant that the country would be able to produce more and quicker. This railway also opened up a range of different jobs, meaning that the unemployment of Russia plummeted.
Without communist allies Russia needed necessities for modern warfare. This is when Stalin’s elite obsession for iron, steel and oil began. Which is ironic, as Stalin’s name in Russian is the equivalent to ‘Man of Steel.’ In his mind, without these raw materials, war would become a certain loss if it was to break out. Stalin described these materials as ‘Decisive branches of industry’ and in order for Russia to advance and industrialise these would be needed of vast quantities. He then intended for a mass increase in resource production to take place, which in fact did occur over the coming plans.