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Tsarist Industrialization

"Gorbachev Factor"

Despite the inconclusive character of the emancipation legislation, it did lead to irreversible changes in all spheres of Russian life. It accelerated the process of the cleavage of the peasantry: more enterprising peasants increased their wealth and left the patriarchal commune, while others grew destitute and turned into dispossessed proletarians. As a result, mines and factories in rapidly developing industrial regions gained a steady flow of cheap wage labor.  

One of the first railways in Tsarist Russia

The natural economy was disintegrating, As a result, the Russian internal marketís capacity increased, providing a powerful boost to the growth of industrial production. By the early 1880s the industrial revolution in Russia had finally arrived. Alongside the older, traditional branches of industry, new ones were created: coal mining, oil extracting, and machine building; the country was covered by a network of railways. The new social classes of bourgeoisie and industrial proletariat were rapidly developing. All strata of society were experiencing change.

In the final decade of the nineteenth century Russiaís industrialization experienced remarkable acceleration under the guidance of Sergei Witte (1849Ė1915). He was an economic planner and manager of the type common in the governments of Western Europe and the United States, but rare in the high officialdom of imperial Russia. His background was unusual for a tsarist minister, because he was not a noble but had made his career in business and railway administration. Witte became the minister of finance under Alexander III and continued in that post under Nicholas II until 1903.

In 1897 he established a gold standard in Russia, thus fixing the value of the rouble against other currencies and against gold. This measure did much to add stability and prestige to Russian economic development and to attract foreign capital. Witte put into effect a massive state-sponsored program of railway building, including the construction of the Trans-Siberian Railway. The rapid growth of railways depended on government orders for iron, coal, locomotives, and equipment. All this boosted the development of Russian heavy industry and engineering. In the final decade of the nineteenth century the Russian governmentís strategy of economic development yielded spectacular rates of industrial growth: about 8 percent a year.

The state in Russia had always kept most important branches of industry under its control, and it continued to exercise control in the new conditions. In the early twentieth century special bodies were set up that reflected the close relationship between the government and leading capitalists, such as the Shipbuilding Council and the Congress of Transport Affairs. These organizations were comprised of industrialists and government officials. They oversaw the allocation of government orders, gave subsidies and tax benefits, and so on.

For these reasons, the emerging Russian bourgeoisie had an ambivalent attitude toward the autocratic-bureaucratic regime. On the one hand, as its wealth increased, it began to crave political power and found itself in opposition to the autocracy. On the other hand, the continual financial support from the ruling bureaucracy and the dependence on government orders and other benefits made the bourgeoisieís opposition fairly weak and inconsistent. Because of its political servility, the bourgeoisie commanded little respect in Russian society.

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The Economic Structure


Soviet Russia

Understanding the Soviet Period
Russian Political Culture
Soviet Ideology
The Soviet System
Soviet Nationalities
The Economic Structure
The Socialist Experiment
"Great Leap" to Socialism
The USSR in World War II
Stalin's Legacy
Brezhnev's Stagnation
The Economy in Crisis
Political Reform
The USSR's Collapse

Models of Soviet Power

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