Imperial Russia is the largest state territory on earth, with the largest population in Europe and the world's biggest army. It is Europe's chief source of agricultural exports, and with rich mineral resources, the chief recipient of foreign investment. After a decade of industrial recession, and with the restoration of stability following a nationwide peasants' revolt, Russia sees renewed growth.
During World War I, Germany invades Russia. Six million men are mobilized, and Russia's factories converted to a war footing. Nicholas II takes personal command of the army at the front, leaving his new government leaderless in the capital. With much of the land left untilled, cities go hungry. Essential services like the railway system threaten to collapse. By 1916 Russia has lost 3.5 million men.
Military incompetence, inflation, low wages, and food shortages add to growing dissatisfaction with the monarchy. Demonstrations in the capital lead to a general strike and Nicholas II's abdication. A provisional government fails to restore order. Led by Vladimir Lenin, the Bolsheviks seize power and establish an emergency dictatorship that aims to abolish private property and socialize the state.
Lenin unilaterally ends the war with Germany. Russia descends into a three-year civil war between the "red" Bolsheviks and the "white" counterrevolutionary armies for control of the former empire. The capital is moved to Moscow, and the Communist Party machine emerges from Bolshevik ranks. The siege economy and state monopoly leaves production at a virtual standstill and the cities without food.
The triumphant Bolsheviks set about transforming the tsarist empire into a quasi-federation of states, the Union of Soviet Socialist Republics (USSR), established in 1922. Lenin's New Economic Policy (NEP) restores certain aspects of a market economy and brings about a dramatic economic improvement. In 1922 Joseph Stalin is appointed general secretary, and Lenin dies two years later.
Stalin overturns the NEP and begins the collectivization of agriculture. Confiscation of private farms sparks widespread protests. The First Five-Year Plan is passed in a program to modernize the USSR through forced industrialization. Stalin uses terror backed by purges, show trials, executions, and mass deportations to the gulag to secure his rule. His cult of personality becomes all-pervasive.
During World War II, the Red Army successfully repulses Germany's invasion and itself marches west, annexing Poland, Romania, Hungary, and Eastern Germany. The USSR suffers an estimated 20 million deaths, but its part in the Allied victory helps consolidate the Communist Party's grip on power. After the war, the USSR emerges as Europe's greatest military power, and one of two global superpowers.
Stalin sets about reconstructing the Soviet economy. The Fourth Five-Year Plan aims to rebuild the industrial base and exceed prewar production levels. A xenophobic campaign, zhdanovschina, is launched to purify Soviet life of Western bourgeois influences. With the Red Army's blockade of occupied West Berlin, the Cold War begins. In 1949 the Soviet Union tests its first atomic bomb.
Nikita Khrushchev, named first secretary upon Stalin's death, begins a period of cultural thaw and de-Stalinization in an effort to decentralize the Soviet system of repression and secrecy, and to realize the "dream of socialism with a human face." The Virgin Lands Campaign aims to boost agricultural yields. The Warsaw Pact is created in 1955 to counter NATO, and in 1961 the Berlin Wall is erected.
Khrushchev is ousted, and Leonid Brezhnev is made first secretary. His regime focuses on recentralizing power and control. A timid reform of industry fails to alter the economic system's declining efficiency and productivity. But when world oil prices skyrocket during the 1973 oil crisis, Soviet coffers fill up with hard currency that will help to prop up the Soviet economy for more than a decade.
Several strokes leave Brezhnev critically ill, supported by an old-guard clique; he dies in 1982. The economy buckles under the burden of a renewed arms race with the U.S. and the Soviet invasion of Afghanistan. Stability turns into virtual paralysis as Brezhnev's successors, themselves ailing, argue the merits of reform and inaction. Yuri Andropov dies in 1984, Konstantin Chernenko a year later.
Following his appointment as leader, Mikhail Gorbachev begins a campaign of openness in public life (glasnost) and political and economic restructuring (perestroika), while committed to socialist ideals. Managers of state enterprises are given some independence, certain private businesses legalized. But an oil-price collapse and an anti-alcoholism campaign deprive the state of major revenues.
Gorbachev's relaxation of controls creates an economic halfway house. As output plummets, shortages, rationing, and queues grow increasingly severe. A desperate attempt to restore centralized planning proves unworkable. The Berlin Wall falls, and Eastern Europe breaks free from communism and Soviet control. The USSR is dissolved, and Boris Yeltsin is elected president of the Russian Federation.
Yeltsin tries to transform Russia's economic system and social structure into a democratic market economy. The abolishment of state subsidies results in huge price rises. Hyperinflation hits, reaching 2,323 percent. State industry is sold through voucher privatization. Corruption and profiteering run rampant. Yeltsin suppresses an armed uprising by the Supreme Soviet and reimposes rule by decree.
A second wave of privatization dubbed Loans for Shares sees strategic state assets sold to a few magnates, nicknamed "oligarchs." Their support helps Yeltsin overcome a resurgent Communist Party to be reelected president. His bankrupt government sells bonds at high interest rates to raise money, but the Asian financial crisis forces Russia to default on its debts, and in 1999 Yeltsin resigns.
With promises to reverse Russia's decline, Vladimir Putin is elected president. Maintaining market reforms and instituting a tax overhaul to boost revenue and business, he attempts to steer Russia toward World Trade Organization membership. The oil industry booms. Putin consolidates his grip on power, delivering stability but raising fears of authoritarianism. Russia opposes the U.S.-led war in Iraq.
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