Industrialization in the USSR and United States Compared

Introduction: The Industrial Revolution in Global Context

The political, economic, and cultural impacts of industrialization in North American and European countries are still widely evident today and have heavily affected international relations and global politics. The Industrial Revolution is generally considered to have originated in Great Britain in the mid-1700s, when Britain was the dominant empire in terms of trade, commerce, land ownership, and influence. Other countries with sophisticated economic systems — including Germany, France, and the United Kingdom — soon developed technology that allowed for the mass production of commodities, more efficient long-distance travel, and greater participation in formal economic activity for non-elite persons.

One of the hallmarks of technological innovation during the Industrial Revolution was undoubtedly the harnessing of steam power, fueled by coal and petroleum. Cities saw rapid growth throughout the 18th and 19th centuries as people moved closer to urban centers where manufacturing, processing, shipping, and construction jobs were plentiful and allowed people without land or titles to earn a steady, if modest, cash income. With the mass production of goods and the influx of money into populations that had not previously had regular access to it came a greater demand for commodities and a shift in political and philosophical beliefs pertaining to individual rights and property. The American and French Revolutions occurred within the general timeframe of the Industrial Revolution and are indicative of this greater emphasis on democratic rule of law, the abolishment of monarchy, and the legal enshrinement of the right to individual property.

When one thinks of industrial and technological development in relation to the former Soviet Union and the United States, one of the first images that comes to mind is the Cold War and the arms race between the two countries through the middle of the last century. Both countries were able to develop the industrial capacity and technological prowess to become major world powers, although neither economy has grown at the same vigorous rates as was once the case. The United States is only now beginning to feel the effects of becoming the first true post-industrial nation, as the economy has become more service- and information-based rather than industrial. China has become the industrial superpower, and more and more post-industrial countries have outsourced manufacturing to nations where workers can be paid less and government regulation is lighter (Kynge 2006).

Russia has both benefited and suffered from a turbulent modern history. The political upheaval that culminated in Stalin's rise to power enabled a rapid industrialization of the economy, but these efforts were brutal on the people and brought many negative consequences alongside the economic benefits. The collapse of the U.S.S.R. jeopardized the industrial growth that had been accomplished over the preceding decades, and the productive capacity that had been methodically developed since the 1920s lay fallow for a time as the economy collapsed (Stearns 1998).

A great deal can be learned through an examination of the factors leading to the industrialization of each country — by assessing the context in which industrialization occurred and why countries with ostensibly similar economic goals ended up engaged in a brutal détente for decades. The historical context of each industrialization effort also provides clues as to why the influence and success of each former superpower is waning in the 21st century as countries like India and China rapidly expand economically and politically (de Vries 1994).

Historical Context of Industrialization in the United States

Following the Revolutionary War, the technological developments that indicated proto-industrialization came quickly in the United States, due to many favorable factors: rich natural resources, numerous waterways suitable for commercial travel, arable land, and a spirit of innovation and optimism following the American victory over King George. The natural resources across the vast expanse of land in the Americas were key to energy production and construction. In under 200 years — between the late 18th and early 20th centuries — the young United States went from a primarily subsistence farming economy to the preeminent industrialized country in what was then being called the "developed world." American industrial output between 1790 and 1913 increased by over 450% (de Vries 1994).

On a macroeconomic scale, one of the incentives for centralizing and formalizing the nascent American economy around the time of the Revolution was the cost of that war — sixty-six million pieces of gold and silver. The first federal issue of paper money occurred in 1775 and was intended to be redeemed against state taxes, but this currency, as well as a second attempted issue to stabilize the new economy, depreciated rapidly. The paper money was valued at only 1% of its face value and functioned as a covert tax on the populace in order to help finance the war. Over the next several decades, considerable ambivalence persisted about the need for a national bank, until the War of 1812 demonstrated the necessity of such an institution for equipping a sufficient national defense.

The development of industrialization in the United States was also driven by the plentiful land and opportunity in the young nation. With Eli Whitney's invention of the cotton gin in 1793, cotton soon became a highly lucrative crop, and increasing numbers of people moved into the Midwest to take advantage of cheap land. Slavery was legal in the United States until 1865, when the Thirteenth Amendment banned it and the Civil War secured the authority of the federal government in Washington, D.C. over all states, including those that had seceded over the issue of slavery. The free labor performed by the estimated 12 million African people brought into the United States was a highly influential factor in the economic success that drove the exponential growth of the Industrial Era. Mills were built in northern towns such as Lowell and Lawrence, Massachusetts, to turn cotton produced on slave-owning Southern plantations into fabric for industrial and consumer goods.

Historical Context of Industrialization in Russia

The process of industrialization in the former Soviet Union occurred under drastically different circumstances and in a later time period than the industrialization of Western Europe and the United States. The first stirrings of the Industrial Revolution in Russia began around 1917, and industrialization was a catalytic factor in the Russian Revolution. Industrialization proceeded in a compressed time span between the first and second World Wars, beginning in the late 1920s. In approximately 15 years, the net change to the economy of the U.S.S.R. was remarkably similar to the changes that had occurred in the United States over more than 150 years: the agrarian subsistence culture was transformed into a prominent industrial economy.

The reasons for Russia's slow entry into the industrialization race were directly tied to the political structure of Imperial Russia through the beginning of the 20th century. Russia still functioned as a serfdom until 1861. Following the Crimean War, Tsar Alexander II declared the abolishment of serfdom throughout Russia — one of the most significant events in Russian history, as nearly one-third of the population were serfs at that time. Industrialization was not the immediate product of the abolishment of serfdom, however. Russia went through a period of Nihilism in which faith in public institutions collapsed and anarchy gained philosophical traction. Tsar Alexander II was assassinated in 1881. His son, Alexander III, assumed power with a reactionary leadership style, arguing that many of Russia's problems — particularly its drift toward revolution — were due to the destructive influence of the West (Gregory 2001).

The political parties in Russia during the early 20th century concerned themselves primarily with advocating for modern economic reform, though they disagreed over means and ends. The Socialist-Revolutionary Party wanted democratic distribution of land among former serfs; the Constitutional Democratic Party wanted peaceful reform, greater capitalist opportunity, and the preservation of a constitutional monarchy; and the Russian Social Democratic Labor Party wanted nothing less than a total Marxist revolution.

By World War I, the economic effects of industrialization in America and Western Europe were extraordinarily clear. These world powers could mass-produce weaponry, planes, and ships with a speed and precision that non-industrialized countries such as Russia could not match. The relationship between economic growth, industrial capacity, military capability, and political power was made obvious by the outcome of World War I, which left Russia severely weakened. Industrialization was indeed a catalyst in the revolution: it was during a strike on March 3, 1917, at a factory in St. Petersburg that the spark of discontent was fanned into a flame. By March 8 — International Women's Day — thousands of female textile workers had walked out of the factories to protest poor working conditions. By most accounts, the majority of the city's industrial workers joined them within a few days. Tsar Nicholas ordered the workers back, but by this point the soldiers — most of whom had family members in the factories — supported the strikers.

In what would be called the February Revolution, Nicholas abdicated the Russian throne, a provisional government was quickly established, and a hasty election was held to create power blocs representing factory workers' and soldiers' interests. By November, the October Revolution saw these soviet groups seizing control of the government. The Treaty of Brest, signed with Germany by Lenin to cede several territories including those captured from the Ottoman Empire during World War I, was cancelled by the new Soviet government in November 1918.

The Russian Civil War reshaped the map of Eastern Europe as many territories were annexed, seized, and ceded. By 1922, Russia had been renamed the Union of Soviet Socialist Republics — the Soviet Union. One of the primary goals of this new union was to achieve the economic modernization that had been desired for over a decade but had been impossible to pursue amid sustained internal and external conflicts. While the post-Civil War Communist Party was perhaps even more ardently committed to expanding communism to other nations — especially Germany, Poland, and Hungary — the goal of unilateral industrialization was more easily actualized and dominated the political rhetoric of the era.

Soviet dictator Joseph Stalin organized industrialization in the U.S.S.R. into five-year increments, with the first Five-Year Plan taking effect in 1928. This plan was designed to accomplish in the U.S.S.R. what had taken over a century in the countries that had been victorious in World War I. Soviet industrialization was not driven by consumer demand and was not focused on the production of commodities. Stalin insisted upon the vital need for the Soviet Bloc to be self-sufficient — not to accept assistance from the West, but to surpass it in every possible domain as quickly as possible (Lenski 1978).

The focus of the first five years was land use and farming, as these were seen as the necessary building blocks of heavy industrialization. Heavy industry meant the production of the tools of war that had been used against Russia during World War I. The Communist description of heavy industry in this period was "production of the means of production," underscoring Stalin's determination to dramatically increase the country's productive capacity and ensure that Russia had armaments equal to those of the West, so that it would not be humiliated in any future conflict. The first phase of industrialization was completed in 1932 and succeeded in converting subsistence agricultural practices into farming collectives, through forced migration in many cases (Nove 1965).

The food cultivated on these collective farms was produced at a rate designed to feed an incoming urban industrial workforce that would be unable to grow its own food. Where informal market economies had once flourished in Russian villages, collective and state farms produced less and destroyed those informal markets — the latter outcome being an overt objective of the Communist Party, designed to prevent any form of capitalism from taking root among the people. The plan exceeded expectations: by 1940, over 97% of peasant households had been collectivized. Through this process, over five million kulaks — the wealthier members of the former serf class — were forcibly deported to make room for state and collective farms. Collective farming also resulted in a famine in Ukraine in 1932 that claimed millions of lives (McKenzie et al.).

Despite the loss of life and inhumane treatment of many groups under this dictatorial industrialization scheme, the plan moved forward. The second Five-Year Plan was completed in 1937, and the third was not completed until after 1945 due to World War II. The five-year industrial development plan model was used until the collapse of the Soviet Union.

Conclusion: Economic Decline and the 21st Century

In the United States, the economic decline over the past decade has been due to the cost of maintaining and expanding infrastructure and government responsibilities outpacing capital growth at local, state, and federal levels. Consumer debt, faulty bookkeeping in investment firms, and a general overreliance on credit at both individual and national levels have all contributed to this decline (Evans-Pritchard 2007). Spending outpaced income as expectations about social and economic status became increasingly difficult to meet, with more and more companies outsourcing jobs to countries with weaker economies. Russia experienced a steep but short recession in response to the broader global recession, a consequence of the pervasive role that the American economy plays in the developed world. Russia has largely avoided major financial distress since recovering from the collapse of the U.S.S.R., due to macroeconomic policies designed to minimize Russia's vulnerabilities in the international economy.

References

Evans-Pritchard, Ambrose (2007). "Dollar tumbles as huge credit crunch looms." The Daily Telegraph. London: Telegraph Media Group Limited.

Gregory, Paul R. and Robert C. Stuart. Russian and Soviet Economic Performance and Structure. 7th ed. Addison-Wesley, 2001.

Kynge, James (2006). China Shakes the World: The Rise of a Hungry Nation. Weidenfeld & Nicolson.

Lenski, Gerard (1978). "Marxist Experiments in Destratification: An Appraisal." Social Forces, Vol. 57, No. 2, pp. 364–383.

McKenzie, David and Michael W. Curran. A History of Russia, the Soviet Union, and Beyond. 6th ed. Belmont, CA: Wadsworth Publishing.

Moon, David (1977). "Military Reform in the Crimean War." In The Abolition of Serfdom in Russia, 1762–1907, pp. 49–55.

Nove, Alec (1965). The Soviet Economy: An Introduction. Revised ed. New York: Praeger.

Stearns, Peter N. (1998). The Industrial Revolution in World History. Westview Press.

de Vries, Jan (1994). "The Industrial Revolution and the Industrious Revolution." The Journal of Economic History, Vol. 54, Issue 2.