After Kronstadt uprising, Lenin realised change of policy needed. The main points of the NEP: 1) Peasants could sell food for profit again. 2) Peasants who increased food production would pay less tax. 3) Factories with fewer than 20 workers were given back to owners. 4) People could use money again.
Reaction: Bolsheviks and supporters were shocked. Instead of moving towards communism they appeared to be moving back to capitalism.
Consequences: 1) Food and industrial output increased dramatically. 2) Nepmen new traders making high profits by buying food and goods cheaply and selling them more dearly. 3) Peasants still poor led to prices for manufactured goods were high and peasants couldn’t buy much with the money they made from farming. 4)Level of unemployment remained a serious problem and crime was increasing especially amongst the young.
