860M.01/232: Telegram
The Chargé in the Soviet Union (Thurston) to the Secretary of State
[Received 12:35 p.m.]
1073. Pravda today reports the adoption by the extraordinary sessions of their respective Seimas of the new constitutions of the Lithuanian, Latvian and Estonian “Soviet Socialist Republics” and the formation of the new governments in Latvia and Estonia. The texts of the constitutions as adopted are not published but in its leading editorial Pravda states that “in conformity with the peculiarities of the young Soviet Republics the drafts of their constitutions now have their own distinguishing characteristics. Thus in the constitution of the Lithuanian Soviet Socialist Republic it is written that along with the socialist system of economy, private homesteads of individual[s], peasants, artisans and handicraft men and small private industrial and trading enterprises are to be permitted within the limits established [Page 430] by law. The fact refutes the inventions of the Smetona clique concerning the forcible collectivization and persecution of artisans and small manufacturers and traders”. From the foregoing it would appear that in the three Baltic States an economic regime will be instituted temporarily at least closely resembling that of the New Economic Policy29 in the Soviet Union. It would appear likely that so long as that system is in force the three Baltic countries will remain a special economic area and that communication or travel between the Baltic area and the Soviet Union proper will be strictly controlled.
- The New Economic Policy, or Nep, was introduced by Vladimir Ilyich Lenin during 1921, as a strategic retreat following the failure of the economic policies of “war” or militant communism. Certain concessions were granted to economic principles theoretically condemned by the leaders of the Bolshevik Revolution. This period lasted until 1928, when the first Five-Year Plan was put into operation.↩