Socialist Outlook

Socialist Viewpoint, International, Socialist Outlook and their supplements, 1984–2002

New bid to force through 'market' reforms Now it's Yeltsin's coup

· Socialist Outlook no. 50, October 9 1993 · 1,093 words

Russia and the USSR Economy

ON SEPTEMBER 21 Russia's 'pro-democracy' president Boris Yeltsin dissolved parliament and announced elections for December. Only the lower house of parliament is to be re-elected, while there will be no presidential elections until next Clearly, Yeltsin's aim is to use his powers over the media and his presidential position to ensure a docile legislature to push a stepped-up programme of free-market economic reforms. This will further worsen the already grave material situation of the Russian working class.

Thus far, the armed forces have stayed loyal to Yeltsin and there is no sign of mass opposition to his putsch despite dramatic appeals the president's opponents, headed by former Vice-President and Afghan war veteran Alexander Rutskoi.

Western leaders, including US president Bill Clinton, have greeted Yeltsin's coup. They see it, or claim to see it, as a definitive step towards fulfilling the promise of Yeltsin's defeat of the coup attempt of August 1991. Western democracy ANALYSIS This, commentators believe, would open the way to a rapid move to a Western-style liberal democratic system and would also mean 'an end to equivocation about moving towards a market system and privatising the economy. And this in turn would give a big boost to living standards and boost to western capitalism.

Unfortunately the whole scenario is a fairy-tale, excluded by the real nature of western capitalism and the actual and potential place of the former Soviet bloc countries in the world market.

Writing in Moscow News (22 August) Lilya Shetsova sees Yeltsin's 1991 victory as 'signalling the passage of power from one group of the nomenklatura to another'. The 'nomenklatura' were the holders of posts considered sufficiently sensitive or responsible under the Stalinist system to require political vetting and selection by higher party bodies.

Collapse

More precisely, Yeltsin's assumption of power marked the moment in the crisis of the system established by Stalin when the political unity of purpose of the nomenklatura collapsed in the face of economic failure, mass discontent and the temptations of pursuing individual wealth through access to the world market.

Thus one of Yeltsin's key initial measures was to outlaw the Communist Party, the forum through which the nomenklatura had collectively decided the fate of the Soviet Union.

However, the loss of unity did not abolish the rule of the nomenklatura. Instead each of its members and groups is striving to improve its own position using all the powers and privileges inherited from the past.

Enrichment does not pass through productive investment but through corruption, stealing and the use of monopoly control of vital resources. This process involves the opening up to the outside world and maintaining control of Russian productive forces in Russian hands. Thus nationalism is an integral part of the new ideological panorama. From the viewpoint of economic development. 'nomenklatura capitalism' is a disaster. As the president of the Russian parliament Khasbulatov has written: "The pyramid of power controlled by the state-party was a terrible thing. But one way or another it managed to govern. Nothing has replaced the It would be a tragedy if the left decided that defence of the rights of the non-Russian peoples of the former USSR can be sacrificed in the name of the 'higher goal' of defeating Yeltsin.

100,000 or so links of this mechanism's chain from the central Committee to the oblast committee, from the factory to the collective farm.' Russian finance minister Boris Fedorov has complained that: I basically do not have a single instrument of economic policy. The parliament makes the budget and the central bank has in its hand very powerful and concrete means to make deci sions'.

At the heart of this lament is the fact that the bank and the parliament outwit any attempt to control inflation - running at an estimated 1000 per cent in 1993 - by dishing out funds to any institutional claimant.

The effect of this combination of the 'worst of two worlds' can be seen in the energy sector. Plans to raise oil prices founder on the needs of enterprises for cheap fuel, while some of the recipients of this cheap fuel sell it on at world market prices -and salt the proceeds away in foreign bank accounts.

Meanwhile domestic production of oil had fallen from 516m tons in 1990 to an estimated 351m this year. Production has been plummeting for several years, inflation is thundering ahead and living standards for the majority are sliding. Social services are in crisis. Foreign investors meanwhile complain about the absence of the right conditions' for investment in Russia and often insist that their operations are underwritten by their own governments.

They too intend to pick what they can off the bones of the Soviet Union without risking their shirts.

Despite the enthusiasm of Western politicians for Yeltsin, business analysts see changes at the top as of only minor importance to investment attitudes.

Not surprisingly the notion of "strong government' is attracting more and more support in Russia. But any state resting on the shoulders of the predatory ruling layers - whether headed by Yeltsin, Rutskoi or another -will be an instrument for their aggrandizement.

The left have reacted to Yeltsin's coup with indignation and contempt for the free marketeers who identify democracy with their own right to rule by decree. However, the principle that 'my enemy's enemy is my friend, applied to the likes of Khasbulatov and Rutskoi, will be a poor guide if it goes beyond temporary agreement to denounce Yeltsin's coup.

Careers

All the parliamentary leaders have teamed up with Yeltsin when it suited their own careers; and Yeltsin's leading critics are tainted with aggressive Russian nationalism.

It would be a tragedy if the left decided that defence of the rights of the non-Russian peoples of the former USSR can be sacrificed in the name of the "higher goal' of defeating Yeltsin. Such cynicism lies at the heart of the 'crisis of socialism'.

At the turn of the century Russia's Marxists debated how their country could achieve the "tasks of the bourgeois demo cratic revolution', which I take to include stable constitutional government and the rule of law. Changes at this level were seen as inseparable from deep-going social and economic change.

Trotsky put forward the idea that the only class capable of leading modernisation in Russia was the working class - and only then with the conscious support of the workers' movement in the adyanced countries. This insight retains its validity today: the problem is to put some flesh on its bones.

SOCIALIST OUTLOOK No.50, October 9 1993, Page 5

← Yeltsin shoots down democracy · The Dictatorship of the 'Democrats' →

Something wrong on this page?