The past 18 months in the Soviet Union have witnessed an amazing juggling act by Mikhail Gorbachev as he manoeuvred between the forces pressing for the maintenance of central control and radicals bent on as rapid a transition as possible to a capitalist economy.
At times it has appeared that Gorbachev has personally embodied the contradictory pressures exerted on the Soviet bureaucracy - continued maintenance of its privileges deriving Trom nationalised economy or transformation into a class through the reintroduction of capitalism.
Worsening economic crisis Despite all the discussions over alternatives, the Soviet economy is effectively rudderless. Against a background of republics seking independence from the centre, bits of previous reforms have been implemented, elements of autonomy have been introduced, and Gosplan, OrmAN July 6, 1991 No.5 new Economics Ministry. The result has been institutional chaos.
According to official figures, Soviet industrial production declined 5.4 per cent between April 1990 and 1991, although many estimates put the figure at closer to 10 per cent. In the same period, coal production was down 20 per 'cent - hardly surprising given the coal strikes in March nd April this year - oil production, one ol the leading hard currency earners, was down 9 per cent, timber 13 per cent, and non-ferrous metals 18 per cent. Perhaps more alarmingly for the stability of the country, meat production fell by 13 per cent in the four months from January to April.
The level of Soviet foreign debt is also dramatically increasing. USSR has shifted from world's most secure, to being on a par with Mexico or Venezuela and is sinking fast. Hard currency liabilities were 124 per cent of exports in 1990, making the Union totally dependent on the west for hard currency. the State HAD MISSILES..
year ago his market economy. by the then Prime Minister, got under way. republics (Estonia, Latvia, approach nost developed economy to be achieved. Unlike the the short-term 'anti-crisis' measures have received the support of Yeltsin and the leaders of the As a risk, the eight other being one of the republics likely to sign the new Union Treaty. The measures Soviet aim to establish a Gorbachev's right to strike, new scheme enterprise autonomy.
Gorbachev laid out his stall more than a WHOM he talked about utilising newly gained Presidential powers to push through the 'formation of a normal fullImproved benefits known of these was Stanislav Shatalin's '500 days' programme which envisaged a staged transition over that period to a ine ouvaays programme was oppuser Nikola Ryzhkov, backed by the still powerful central ministerial bureaucracy, so Gorments e both hatalin's and kyzhkov's cobbling together ele plans - a move which led Yeltsin to compare such an operation as trying to 'mate a days'. redgehog and a snaké'. The resulting compromise bore a stronger resemblanceto the 500 days' but its implementation never Despite the undeniable personal antagonism between Gorbachev and Yeltsin, the basic compatibility of their views has become more apparent. In May they issued a joint declaration which constituted a step towards granting the six most critical Lithuania, Georgia, Armenia and Moldavia) inde pendence, while at the same time indicating that such a step would leave the republics open to paying world prices for all commodities, including energy.
The new plan involves a 'twin-track' of domestic 'anti-crisis' neasules and appais tost cuntries pr a capitalist countries for a massive injection of Western aid over five years, to enable the transition to a market 'Anti-Crisis' measures previous programme, the "the 'anti-crisis' measures have received the support of Yeltsin and the leaders of the eight other republics likely to sign the new Union Treaty..."
special regime' in key economic sectors 'his involves prosecuting strikers while providing comensation for loss of the improving management rights over the workforce and increasing The bureaucracy's inability to push through such a programme in the face of working-class resistance was almost immediately revealed however. Civil aviation personnel threatened to strike for better wages and conditions. The government only averted the action by almost immediately conceding a 60 per cent pay rise and sial. Gorbachev had to use all his political skill to defeat an attempt to transfer all his powers to Prime Minister, Valentin Pavov. As yet there is no agreement on the precise details of a reform programme, although such agreement will be crucial to obaining Western credit.
One programme to attract Western aid has been formulated by Grigory Yavlinsky, one of the main architects of the Russian Federation's version of the '500 'Buddy can you spare a dimé' Yavlinsky is currently ensconced in that bastion of socialist economicthought, Harvard University, with a number of leading US economists such as Jeffrey Sachs, who appears to be the inspiration for virtually every privatisation programme now being implemented in Eastern Europe, although he denies this whenever anything goes Yavlinsky's plan is a two-stage affair. It is envisaged that in the first stage the Soviet Union will become an associate member of the International Monetary Fund and the World Bank. Over the course of five years prices will be liberalised, there will be a transition from small-scale to large-scale privatisation, the rouble will become completely convertible. During the whole five years, Western aid from a combination of governments and commercial banks will run at $20-35 billion per year subject to negotiations.
The vacillations of Western governments over how much aid to give to the Soviet Union and under what conditions reveal a careful weighing up of different options. On the one hand is the desire to impose the most stringent conditions on the Soviet Union, so that Western capital can obtain the most favourable circumstances to take advantage of the comparatively cheap labour supply and potentially vas Soviet market. On the other is the danger if aid is too late in coming or is insufficient, of the emergence of an anti-Western regime which would once again close off the Soviet Union to capitalist penetration.
Another factor, not directly related to the Soviet Union, concerns the different interests of the competing imperialist powers over who controls the Sovie: market. Germany and France have beeGorbacher =