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The Past, Present and Future of Russias Economy

March 31, 2014

The Tsar Reign

During the Tsar reign, the Russians never really caught up to the western ways of life until Tsar Nicholas. It was a goal of the two Romanov Tsars to begin to westernize Russia. Nicholas altogether failed to modernize Russia. Alexander had an inability to lay down a clear economic policy. He lightened the Tax load on the peasants hoping that it would increase the buying of industrial products. After the minister of France opened Alexanders eyes to oil reserves and budgetary surpluses it sparked the domestic and foreign investment in the Russian industry. This caused Alexander to increase indirect taxation, raise tariffs and press for other forms of taxing. It resulted in the peasant population failing because of lack of food reservations and lack of money, which lead to crop failures in the 1890s. Soon after the French Prime Minister lost his post. But, soon after Russia began to rebuild itself and made one of the longest railroads the TransSiberian railroad.

plan, there were no social classes anymore, everyone was

equal and it was supposed to give everyone the same

wealth. Within the first couple of years the planned showed that it wasnt going to work and that the country was failing miserably. Over 5 million people died because of famine.

In 1928, the Five Year Plan was constructed and put into effect. The plan was designed to build up their industrial base and their economy. Every five years the leaders would come up with new objectives and solutions. The first plan didnt last for too long. It started to fail and not give the

The Soviet Control

In 1921 the Soviet Union government signed the New Economic Policy. It was designed to make everyone equal with their income. Its plan was to help the economy by having everyone give their earnings to the government so it could be distributed evenly

benefits the Soviets were expecting. Another famine occurred causing the loss of another couple million people. This caused the termination of this first Great plan.

In 1933 the Second five year plan was created,

its main focus was on steel production. During this plan the also improved infrastructure, railroads, and communication. Coal and oil production also started, but shortly the outcomes werent what they expected. In 1941 Germany declares war on the Soviet Union. The war caused nothing but destruction and devastation in Soviet Russia. Farms, hospitals, railroads, and buildings were destroyed. The war left a large impact on them, there was 25 million people homeless and 20 million casualties.

throughout the country. Farmers

and agricultural workers were targeted the most. Everyone now worked for their country not themselves, and individual profit was not allowed. With this new

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Current Day Economy After being released from the Soviet chokehold, Russia had its first election in 1990. Boris Yeltsin was elected because of his plans for a drastic market reform through shock therapy because Poland had done it earlier and had success with it. The end of the Cold War brought the end of the extreme military budget that took up 20% of all of Russias funds. Russia went through a lot of back and forth until they finally found a way to make

Capitalism work. When the Asian financial crisis hit, Russia was hit too. The ruble lost a large amount of value and the government couldnt pay off. The economy has since come back from the economic downfall but there is an upcoming war that could threaten the security of the economy. If they do go into war then their economy could crumble.

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