How frightened should we be?

John Lloyd

  • Russia 2010 by Daniel Yergin and Thane Gustafson
    Random House, 302 pp, $32.00, October 1993, ISBN 0 679 42995 6
  • What About the workers: Workers and the Transition to Capitalism in Russia by Simon Clarke
    Verso, 248 pp, £34.95, September 1993, ISBN 0 86091 650 2
  • After the Soviet Union: From Empire to Nation edited by Timothy Colton and Robert Levgold
    Norton, 208 pp, $24.95, November 1992, ISBN 0 393 03420 8

On the matter of Russia’s future there can be no such thing as idle speculation.

Now the Russian Prime Minister, Iosif Dozhdev, launches the New Economic Programme, eventually known to history as the Dozhdev line. The time is finally right for a currency reform, which at one blow eliminates state debt and converts enterprise and farm debt at a steep rate. Subsidies ... are sharply cut back and a tough bankruptcy law is enacted. Inflation falls to a moderate 20 per cent per annum ... economic growth responds sharply. By 2003 the Russian economy begins growing at an annual 9 per cent rate, fuelled by abundant manpower, resourceful private Russian management, high and rising personal incomes, natural resources and foreign capital. Some commentators note that it is the same kind of growth rate that Russia enjoyed in its economic miracle before the First World War, as Russian excellence in electronics, material science and applied mathematics, allied with Western partners, begins to achieve breakthroughs in world markets ... it is Russia’s path to the 21st century.

  Is such a story possible by 2010 or before?

Is it? At present it seems more of a joke than a piece of serious ‘scenario planning’ on the part of Daniel Yergin and Thane Gustafson, from whose book it comes. Though it may not, at first sight, appear any less plausible than a capitalist China ruled by the Chinese Communist Party would have seemed in the Sixties or Seventies, or a Japan producing high-quality, high-cost consumer goods for the world would have done in the Fifties, when the country was synonymous with tack and cut prices. Yet it is less plausible, because Russia, unlike China, is trying to enter the lists, in the global division of labour, as an industrialised economy, while lacking the malleable wage labour which is fundamental to China’s huge annual growth rates. Not only is Russia’s workforce one of the hardest in the world to discipline and motivate, but Russian industry, heartland of the Communist experiment, was modelled according to their own youthful fantasies by two of the century’s most ruthless and insouciant planners, Lenin and Stalin.

‘Stalin,’ Simon Clarke writes in the collection of neo-Marxist essays about the whirlwind which has hit Soviet workers,

sought to overcome the economic weakness of his regime by expanding heavy industry as rapidly as possible. He sought to broaden the social base of his regime by proletarianising the Soviet population as rapidly as possible. He sought to secure his own grip on power by embracing the whole economic system within a hierarchical system of command ... the Plan was essentially an ideological and political instrument, designed to extract an ever-increasing effort, and to provide an arbitrary measure of success and failure ... the system was economically irrational because it was not designed with economic rationality in mind ... [it] did not meet the needs of the Soviet people in the Eighties, but the system had not met the needs of people in the Thirties and it was never designed to meet their needs. The system was designed to meet the political needs of the nomenklatura.

The system, ‘totalitarianism harnessed to the task of economic growth’, as Robert Campbell described it twenty-five years ago, was considered something of a success around the world until the late Seventies – mainly because of its ability to reconstruct the economy after the war, on the basis of an industrial machine that was already in place. As we all now know, thanks to Mikhail Gorbachev who has told us so time and again in order to justify his extraordinary policies, it ran out of steam in the latter part of Leonid Brezhnev’s long reign – a period of economic contentment for the Soviet people. Reformers clustering around the Prime Minister, Alexei Kosygin, had tried to get Brezhnev to adopt a degree of flexibility in the system, using shadow prices to stimulate competition and allowing some freedom to the producers. These ideas, anticipating perestroika, were wisely rejected by Brezhnev in favour of an imperial leadership, behind which slow decline was more or less adequately concealed.

Mikhail Gorbachev, the most disastrous economic and political reformer the Soviet Union has seen, and the most advantageous to the West, set out with a faith in the reformability of the system that is now said to have shaken his entourage but from which no one, apparently, could dissuade him. An unknown aide tells a story, quoted by Yergin and Gustafson, of Gorbachev arguing vigorously to a foreign business delegation that socialism was alive and curable and, when they left, continuing his argument to his aides. ‘We couldn’t figure out why he kept making his case, since the Westerners were gone. Then after five minutes, we understood – he believed what he was saying.’ This is the kind of story that insiders like to tell outsiders; it nonetheless supports the view that Gorbachev did act as though he believed that people would do voluntarily what Communism had forced them to do for decades. He believed, in other words, that there was already a Soviet being, whose nature and reflexes were inherently socialist and would continue to be so in conditions of relative political freedom. He was right that Soviet citizens had acquired many of the reflexes that could be called ‘socialist’, but he failed to understand that none of these was capable of sustaining an economy without coercion.

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