The Currency Reform of 1947: The Views from Above and Below
One of the early consequences of the war was the disruption of the financial system. Inflationary pressures, aggravated by the critical situation in the consumers' market and the growth of an economy of natural exchange, were manifested in the de facto devaluation of the ruble and threatened the program of economic reconstruction. Additional pressure was brought against the state budget by the gradual reduction of sources of revenue: the emergency wartime tax was abolished, voluntary contributions to the Red Army fund ceased, and employers' contributions to employees' savings accounts for unused vacation time were diminished.
The first effort to restore the financial position of the country was the state reconstruction and development bond issued in May 1946. The size of the issue was 20 billion rubles. 1 According to a letter of People's Commissar of Finance A.G. Zverev to the commissars of the union republics and their subdivisions, "Though it is desirable to float the loan quickly, superfluous haste is not advisable. . . . The tempo of the loan must be accompanied by a corresponding measure of organizational work and explanation." 2 Notwithstanding the warnings, however, as often happened at the grass roots when the state initiated major undertakings, the local authorities treated it as a forced loan. The psychology of administrative excess provoked its natural results. It usually began with the calling of a meeting of workers for "discussions" with party and government organs, after which "voluntary" subscriptions were encouraged in the form of a week's, a month's, and sometimes two months' wages. Of course, such methods