Sergei Witte was a Russian Count and an influential policy-maker. He wanted to improve the Russian economy and to propel it to the level of the industrial European countries. At achieving his purposes, Witte suggested the “Witte System” that is “a series of opinions, decisions and processes concerning state management in the process of modernization.” Among his main ideas, there was procurement of foreign capital, increasing of taxes, and capitalistic way of Russian economic development.
For Witte, industrialization and economic development of Russia were inseparable. Quoting Witte, Polunov states, “In the history of the material culture of every state, the development of industry is rightly considered a vital factor in the economic life of the people.” First, Witte was sure that Russia’s industrialization could significantly decrease Russian dependence on import of materials and technologies from the West that had an adverse effect on economy those times. Second, an important part was assigned to the growth of military and strategic considerations. Finally, the industrial development could become a basis for general economic growth, which, in turn, could bring Russia to the level of European countries and increase social standards of living.
Witte highly encouraged foreign investments in Russia, and they were one of the main sources of money he came up with. He held a parley about huge loans, especially with France. Also, for cash flow, Witte established the gold standard, according to which ruble started to have a fixed gold equivalent and strength when being exchanged with other currencies. According to Harcave, the gold standard helped quicken achievement of the “Witte System” and turning the country into the industrial power. But, paying the interest profit margins to service foreign debts led to drain of sources.
However, the imperial family did not fully support Witte’s policies. Industrialization promoted by Witte and his advocacy of the spread of technical education led to the growth of the middle class, urbanization, and increasing of workforce educational level. All of that could create pressure for political changes, overthrow of the monarchy or limitation of its power, and establishing of democracy common to industrial countries. Witte’s policies were dangerous, and that caused conflicts between him and Tsar Nicholas II.
Talking about Witte, Wcislo writes that he was a man with spacious mind. During his life, Russian empire significantly expanded and developed. Definitely, he is one of the most crucial political leaders in Russian history.
Works Cited
Harcave, S. Count Sergei Witte and the Twilight of Imperial Russia: A Biography. New York, NY: Routledge, 2015.
Martynov S.D. “The Witte System.” Von Witte Association. Von Witte Association, n.d. Web. 23 Feb 2016.
Polunov A.I. Russia in the Nineteenth Century: Autocracy, Reform, and Social Change, 1814-1914. Trans. by Shatz M.S. New York, NY: Routledge, 2005.
Wcislo, F.W. Tales of Imperial Russia: The Life and Times of Sergei Witte, 1849-1915. New York, NY: OUP Oxford, 2011.
