New Economic Policy (NEP), the economic policy of the Soviet state in conditions of the multi-structured economy of the period of transition from capitalism to socialism, aimed at the victory of socialism while commodity-money relations and private capital were permitted and used. NEP presupposed a concentration of the commanding heights of the national economy in the hands of the proletariat, direct social regulation of the socialist economic structure, planned state control of the market links between socialist industry and the small-scale peasant farming with the 250 use of state capitalism in order to build socialism, the existence of private capital within certain limits, a consistent struggle by socialist against capitalist elements and the victory of socialism in the USSR. NEP was a continuation and further development of the Party policy worked out by Lenin in the spring of 1918 and pursued before the Civil War and foreign military intervention began. The policy of War Communism, which is not a necessary stage in the development of a socialist revolution, was pursued under conditions of war, home and foreign counter-revolution. In 1921, after the end of the war and the transition to peaceful socialist construction, the Tenth Congress of the Communist Party adopted the New Economic Policy. Politically, the essence of NEP lay in the need to strengthen the alliance between the working class and the toiling peasantry. The fate of socialism in the USSR depended on the interrelations between these two main classes of Soviet society. "The essence of this [NEP policy],” Lenin said, "is the alliance of the proletariat and the peasantry, the union of the vanguard of the proletariat with the broad mass of the peasants" (V. I. Lenin, Collected Works, Vol. 33, p. 171). Economically, NEP was designed to secure the victory of the socialist relations of production. This task was fulfilled by the consistent struggle waged by socialist against capitalist elements, the gradual transformation of small-scale farming in the countryside into large-scale socialist farming. In the transition period, small scattered peasant farms, which remained the basis for the emergence of capitalism, opposed large-scale socialist industry. Yet, while landlords and capitalists could be expropriated, Lenin stressed, small producers in the village "cannot be ousted, or crushed; we must learn to live with them. They can (and must) be transformed and re-educated only by means of very prolonged, slow and cautious organisational work" (V. I. Lenin, Collected Works, Vol. 31, p. 44). In order to lead the peasant masses along the road to socialism, Lenin saw the need to make use of commodity forms of links between town and countryside, to make peasants interested in the development of agricultural production. The food surplus requisitioning system was replaced by a tax in kind and the peasant could now do what he wanted with his surplus output. The fact that trade turnover and commodity-money relations were allowed and the surplus requisitioning system replaced by a tax in kind created a stimulus for the development of agriculture, a speedy restoration and growth of large-scale socialist industry, and improvement of the life of the Soviet people. The cost accounting system, material incentives (see Material and Moral Incentives), and other economic levers began to be used on a broad scale in socialist enterprises. Thus, the implementation of the new economic policy provided the Soviet authorities with the necessary political and economic conditions for building socialism. The permission granted to engage in commodity production and free trade led to a certain revival and growth of capitalism, but, since all the commanding heights of the economy were concentrated in the hands of the state, state control over private capital kept the development of capitalism within certain limits. The policy of restricting and pushing capitalist elements out of town and countryside, as pursued by the Communist Party and the Soviet government, prepared the necessary socio-economic conditions for their complete elimination. The New Economic Policy was implemented during a fierce class struggle according to the principle "who will triumph over whom" and ended in the victory of socialism in the second half of the 1930s. After the transitional period, the building of socialism was completed in the main. Soviet society adopted a course of creating developed and mature socialism. The basic principles of the New Economic Policy were of great international significance. Fraternal countries that have embarked on building socialism have made successful use of the Soviet experience. The existence of the Soviet Union, the formation of the world socialist system and considerable weakening of imperialist positions as a result of the defeat of its most aggressive forces in World War II prevented civil war and foreign 251 intervention in the people’s democracies. This allowed them to avoid the policy of War Communism and, after establishing the power of the working class, to begin peaceful socialist construction.