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USSR's Economic and Political Decline

The document summarizes the economic, political, and social problems that led to the fall of the USSR, including an inefficient command economy, lack of consumer goods and necessities, corruption from black markets, a conservative and corrupt political system, financial strain from maintaining an empire and Cold War defense spending against the US. It then describes Mikhail Gorbachev's reforms of glasnost (openness) and perestroika (restructuring), including increasing freedoms, decentralizing the economy, political reforms towards democracy, and a hands-off approach to Eastern European countries.
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0% found this document useful (0 votes)
25 views9 pages

USSR's Economic and Political Decline

The document summarizes the economic, political, and social problems that led to the fall of the USSR, including an inefficient command economy, lack of consumer goods and necessities, corruption from black markets, a conservative and corrupt political system, financial strain from maintaining an empire and Cold War defense spending against the US. It then describes Mikhail Gorbachev's reforms of glasnost (openness) and perestroika (restructuring), including increasing freedoms, decentralizing the economy, political reforms towards democracy, and a hands-off approach to Eastern European countries.
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

HWA CHONG INSTITUTION (High School Section)

HUMANITIES ELECTIVE (HISTORY)


SECONDARY THREE
RISE AND FALL OF THE USSR

Name : ________________( )/3__ Date : ___________

Problems in the USSR

Economic

(a) Command Economy


 USSR was command economy where the central government decided on the
allocation of resources by deciding on what to produce, how much to produce and
what price to set for the goods and services
 However there were signs of inefficiency as the command economy made poor
economic decisions in allocating scarce resources as the central government were
made up of mostly officials and not experts
 Under central planning, production targets were set only for quantity and so quality
was compromised. This led to productive inefficiency as the goods produced by the
Union were of poor quality

(b) Lack of necessities

 As decisions had to be made by the central government, factory managers lacked the
autonomy to make decisions. As a result, the Soviet citizens had to wait a long while
to obtain goods and services, even for necessities.
 This situation was exacerbated by the inefficient transport and distribution system of
vast geographical consisting of 15 republics.
 Often raw materials meant for factories were delayed and bumper crops from the
farms were left to rot as they could not be transported to consumers due to this
inefficient infrastructural and distribution systems
 Central planning also allocated fewer budget for consumer goods like food, shoes and
clothes
 As a result, there was an acute shortage of consumer goods which led to black
markets

(c) Black Markets

 Black markets led to corruption as government officials who controlled the goods
were bribed so that these goods could be supplied to the ‘black market’ instead of the
legal consumer market
 Fewer consumer goods led to the consumers having to pay a high cost to obtain them
illegally

1
Government

(a) Communist Party


 Was inefficient, conservative and corrupt and resistant to change
 The central government (politburo) was staffed with hardline conservative communist
leaders who resisted change as they saw change the and infusion of new ideas a
challenge to their power
 Were convinced that there was only one way to administer the USSR and refused to
accept new ideas or criticism on the CPSU.
 The members of the politburo were picked not on basis of talent or ability but
favoritism and friendship (nepotism) and seniority
 This conservative and corrupt political system was an obstacle to introduce key
changes

(b) Lack of feedback

 According to the 1961 new constitution, the ordinary people could play a part in
making important decisions which was not true
 It was the Politburo that decided the things and the Politburo as not even mentioned in
the constitution
 The people could not elect their own leaders and there was strict control over what
they could do or say
 Being critical of the government resulted in long jail terms or even confining
dissidents in psychiatric hospitals or mental asylums
 In May 1970, the biologist and writer Zhores Medvedev was arrested and kept in a
mental hospital in Kaluga
 By the end of 1975, there were about 10,000 political and religious prisoners in labour
camps and innumerable dissidents in psychiatric institutions

Financial Strain

(a) Soviet Union


 The Soviet Union had to maintain an empire consisting of 15 republics that came
from diverse ethnic, religious, cultural and language background
 Nationalist feelings in these republics like Estonia, Latvia and Georgia were strong
and they resented being controlled by Moscow
 They had to be held by force and it was an expensive affair

2
(b) Brezhnev Doctrine

 Under the Brezhnev Doctrine, Soviet intervention in the internal affairs of any
communist state was justified if socialism was considered to be threatened
 In 1968, the Soviet and Warsaw Pact troops moved into Czechoslovakia when there
were signs of threat to socialism under Dubcek
 In 1979, the USSR also invaded Afghanistan to stop militant Islam from spreading to
the Soviet Republics of Tajikistan, Uzbekistan and Kazakhstan
 These were severe financial strain on the Soviet defence spending

(c) USA

 In the 1980s, the USSR was further affected by the heightening of the Cold War
 Under the Strategic Defence Initiatives (SDI), US President Ronald Reagan
deliberately increased the defence expenditure of the US with the intention of
breaking the Soviet economy

GORBACHEV’S REFORMS

Definition

Glasnost – openness or frankness

Perestroika – restructuring of the party, economy and government

Reforms

(a)
Glasnost in human rights
 Several well-known dissidents were released and allowed to return to Moscow
 Leaders like Bukharin were declared innocent of all crimes
 Pravda was allowed to print an article criticizing Brezhnev for over-reacting against
dissidents
 New law was introduced to prevent dissidents from being sent to mental institutions
in January 1988
 Important political events like the 19th Party Conference in 1988 and the first session
of the new Congress of People’s Deputies in May 1989 were televised

(b) Glasnost in cultural matters and media

 Aim of the new approach was to use the media to publicize the inefficiency and
corruption that existed
 Educate the public opinion and mobilize support for the new policies
 May 1986 both the Union of Soviet Film-makers and the Union of Writers were
allowed to sack their reactionary heads and elect more independent-minded leaders

3
 Long-banned anti-Stalin films and novels were shown and works of those accused of
being dissidents like Osip Mandelstam were published
 New freedom in new reporting, for example, in April 1986, the Chernobyl disaster in
Ukraine was discussed with unprecedented frankness

Perestroika in Economic Reforms

Law on State Enterprises June 1987

(a) Small-scale enterprise


 Aim was to provide competition for the slow and inefficient services provided by the
state in the hope of stimulating a rapid improvement
 Another aim was to provide alternative jobs as patterns of employment changed over
the following decade due to automation and computerization
 Small-scale private enterprise such as family restaurants, family businesses making
clothes or handicrafts or providing services like TV repairs, painting and decorating
and private tuition was to be allowed
 Workers’ co-operatives up to a maximum of 50 workers were allowed

(b) Decentralization

 To change the responsibility for quality control throughout industry whereby it was to
be taken over by independent state bodies rather than factory management in June
1987
 This removed the central planners’ total control over raw materials, production quotas
and trade and focused on decentralization and aimed to give more autonomy to
individual units
 Enterprises were allowed to engage in wholesale trade with each other and set their
own prices
 Manages were no longer allocated machinery and raw materials by the planners in
Moscow but had to negotiate for themselves
 Compulsory targets were no longer imposed from above; once the state had taken it
requirements, factories were allowed sell the remainder of the products on the open
market and make a profit
 Factories were even allowed to deal with foreign firms
 A new breed of managers began to develop – some were allowed to train at business
schools in the West, others at a new Institute of Management in Moscow

Perestroika in Political Reforms

 Began in January 1987 – aimed to move towards democracy within the Party
 Instead of members of local soviets being appointed by the local Communist Party,
they were to be elected by the people

4
 There were to be secret elections for top party positions and elections in factories to
choose managers

(a) Central Government

 In 1988, there were dramatic changes in central government


 The old parliament (Supreme Soviet) of around 1450 deputies was replaced by a
Congress of People’s Deputies whose duty was to elect a new much smaller Supreme
Soviet of about 450 representatives
 This was to become a proper working parliament which sat for about 8 months a year
and the chairman of the Supreme Soviet would be the head of state
 The first Congress of People’s Deputies met in May 1989 and amongst them were
Roy Medvedev, Andrei Sakharov and Boris Yeltsin
 In the 2nd session in December 1989, it was decided that the reserved seats for the
Communist Party would be abolished. This meant that the Communist Party was on
the verge of losing its privileged position
 March 1990, Gorbachev was elected as the President of Soviet Union
 But in the next election, due in 1994, even Gorbachev would have to stand and put
himself to a popular vote

(b) Policies towards Eastern Europe

 He made clear to the satellite states that the USSR would no longer interfere in
internal affairs although his policies were confusing
 One theory is that he expected the Eastern European communists to be impressed with
his Soviet model of reformed communism that they would voluntarily imitate it, so
intervention by force would not be necessary
 As the Cold War drew to an end, Soviet control over eastern Europe was no longer
vital, provided there could be a new type of genuinely co-operative relationship
between the Soviet Union and the independent states of eastern Europe, it did not
matter if the governments were communists or not

SUCCESS OF GORBACHEV’S REFORMS

End of the repressive communist system

 End of the Communist Party


 Elements of democratization – Congress of People’s Deputies. This was the attempt
to transfer the basis of authority within the country from the party to the state
 The elections of the Congress in 1989 gave the reformers an opportunity to stage a
come-back

5
 The debates were televised live and the ordinary people could watch the criticisms
and challenges made by the radicals
 As a result of glasnost and extensive coverage, people knew communism was being
successfully challenged

Freedom and Independence

 Allowed the Eastern European countries to achieve freedom and independence


 His promise of not interfering in the internal affairs of the Eastern European countries
allowed the countries to overthrow the communist government
 The regimes in these countries had existed because they had the USSR behind them
through the use of force or threat
 In Poland, General Jaruzelski decided to work together with the non-communist
elements in 1989 as he had no backing from Moscow
 This resulted in the elections of June 1989 where the new government was made up of
the Solidarity and the Communists
 In East Germany, as there would be no backing from Moscow, the communists could
not suppress an opposition to their rule. As a result, the communist party abdicated its
leading role and forced the leader Krenz to resign
 On 30 January 1990, Hans Modrow the new East German Prime Minister informed
Gorbachev that the majority of East Germans wanted reunification with West
Germany. Gorbachev informed him that it was for the Germans to decide for
themselves
 Germany was officially reunited on 3 October 1990

Freedom of speech / press

REASONS FOR FAILURE OF REFORMS

Economic reforms

 Rate of economic growth in 1988 and 1989 stayed the same as it had been in the
previous years
 In 1990, the national income actually fell
 People became disillusioned with Gorbachev as shortages set in and blamed him for
the problems
 Early 1990, it was estimated that about a quarter of the population was living below
poverty line

(a) Law on State Enterprise

 Wages was dependent on output. As a result, factories focused on more expensive


goods and reduce output of cheaper goods. This led to higher wages, forcing the
government to print more money and resulted in inflation soaring and the government
budget deficit to increase

6
 Instead of setting up small manufacturing industries, most of them went into retail and
supply business where they bought up much of the available stocks which they sold at
higher prices. This gave the co-operatives a bad reputation. This resulted in
resentment especially the poorer people like pensioners and lowest paid workers
 The focus on more expensive goods also resulted in shortage of necessities like soap,
washing-powder, razor-blades, cups and saucers, for example.

(b) Sabotage

 In some areas, the officials sabotaged Gorbachev policies


 For example, in Leningrad the hard-line communist authorities ordered the supply of
sausages to be taken from the storage fridges
 By the closing months of 1989, basic items like tea, coffee, milk and soap were
nowhere to be seen in the state shops

(c)Coalminers’ Strike July 1989

 Some coalminers in Siberia found that they had no soap to wash themselves
 They decided to go on strike and soon were joined by others in Siberia, Kazakhstan
and Ukraine. There were about half a million miners who went on strike
 The miners were well disciplined and organized, holding mass meetings outside party
headquarters and put forward their detailed demands which included better living and
working conditions, better supplies of food and wanted for independent trade unions
 Government gave in and granted many of the demands

Political

(a) Opposition from radicals and conservatives


 Some party members like Boris Yeltsin was more radical than Gorbachev and felt that
the reforms were not drastic enough
 They wanted a change to western-style market economy as quickly as possible
 He was also disillusioned with the Communist Party and the way it had treated him
 He felt that the Party no longer deserved it privileged position in the state
 Conservatives, on the other hand, like Yegor Ligachev, felt that the changes were too
drastic and the Party was in danger of losing control
 This caused a dangerous split in the Party and made it difficult for Gorbachev to
satisfy both parties and he could not support any
 Conservatives were in large majority and when the new Supreme Soviet was formed
in May 1989, it was packed with conservatives

7
Nationalist pressures

 The USSR was a federal state consisting of 15 separate republics each with its own
parliament
 The Russian republic was one of the 15, with its parliament in Moscow
 The republics had been kept under tight control since Stalin’s time but glasnost and
perestroika encouraged them to hope for more power for their parliaments and more
independence from Moscow
 In February 1988, Nagorno-Karabakh wanted to become part of Christian Armenia
but Gorbachev refused as he feared that the conservatives would oppose
 Demands went out of control, for example, the 3 Baltic soviet republics of Lithuania,
Latvia and Estonia.
 Encouraged by the satellite states of eastern Europe, Lithuania declared itself
independent and the other two soon followed, but Moscow refused to recognise the
independence
 May 1990, Boris Yeltsin was elected President of parliament of the Russian republic.
He believed that the union should be voluntary and that if any republic wanted to opt
out, it should be allowed to do so. But Gorbachev disagreed as it would cause
disintegration of the USSR

Events leading to the coup of 1991

 Gorbachev and Yeltsin tried to work together as the crisis deepened


 Gorbachev found himself pushed towards free multi-party elections but was attacked
by the conservatives
 July 1990, Yeltsin resigned from the Communist Party
 Many of the republics were demanding independence and Soviet troops were used
against Lithuania and Latvia
 April 1991, Georgia declared itself independent but the following month, Gorbachev
persuaded the 15 republics to form a voluntary union where they would be largely
independent of Moscow
 This was to be signed on 20 August 1991
 However, the hardliners decided to launch a coup and remove Gorbachev and reverse
his reforms on August 18
 Gorbachev was placed under house arrest and the coup went ahead in Moscow
 However the coup was poorly organized and Yeltsin was not arrested.
 Yeltsin took the opportunity to condemn the coup and rallies the people on his side

8
 By 20th August, thousands of people were on the streets and barricades were built
against the tanks that were sent
 August 21st, the coup leaders admitted defeat and they were eventually arrested
 Yeltsin emerged the hero
 As a result, the Communist Party was disgraced and discredited and banned in the
Russian Federation
 Yeltsin ruled Russian Federation as a separate republic and on 1 December 1991,
Ukraine voted to become independent
 Yeltsin formed a new union known as the Commonwealth of Independent States
(CIS) on 8 December 1991. The members were fully independent but agreed to work
together on economic and defence
 As the USSR did not exist anymore, Gorbachev resigned as the President of the
USSR on Christmas Day 1991

Common questions

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Gorbachev introduced Glasnost, which promoted openness and transparency, and aimed to reduce government repression by allowing freedom of speech and releasing dissidents. This policy also allowed the media to scrutinize government inefficiencies and corruption, increasing public awareness . Perestroika focused on the economic restructuring of the USSR. It sought to decentralize economic control, allowing enterprises more autonomy and introducing competitive small-scale enterprises to stimulate improvement . Politically, Perestroika promoted democratic reforms, including secret elections and creating the Congress of People’s Deputies . These reforms led to greater public participation and scrutiny of the government but also resulted in unrest as nationalist movements gained momentum, and economic growth stagnated, leading to disillusionment with Gorbachev .

Gorbachev's reforms failed due to several interconnected reasons. The economic reforms did not generate the expected growth; instead, national income fell in 1990, and shortages worsened, leading to public disillusionment . The Law on State Enterprises led to inflation and deficits, as factories focused on costlier goods over necessities, raising social tensions . Furthermore, Gorbachev faced significant political opposition from both radicals like Yeltsin, who demanded quicker reforms, and conservatives who feared losing control . Nationalist pressures intensified within the republics, with movements in the Baltic states and others seeking independence exacerbating the crisis . Ultimately, these factors weakened Gorbachev's position, leading to a failed coup and the eventual dissolution of the Soviet Union .

Gorbachev's legacy in Soviet history is complex and contentious. Domestically, his reforms of glasnost and perestroika aimed to revitalize the Soviet system but ultimately exposed its inefficiencies and contributed to its collapse. Glasnost opened public discourse, increased self-awareness in society, and undermined the communist party's control, while perestroika's economic restructuring failed to spur growth or address shortages . Internationally, Gorbachev's approach to non-intervention and detente de-escalated Cold War tensions, leading to the peaceful end of the Cold War and facilitating the independence of Eastern European countries . However, his inability to manage the ensuing domestic economic and nationalist challenges led to the dissolution of the USSR. Thus, he is seen as a pivotal figure in ending the Cold War peacefully, but also as inadvertently accelerating Soviet disintegration [synthesis of all relevant sources].

Gorbachev's non-interventionist policies towards Eastern Europe marked a significant shift from previous Soviet doctrine. By signaling that the USSR would not interfere in the internal affairs of satellite states, Gorbachev allowed these countries the autonomy to transition away from communist governance without fear of Soviet military intervention . This change empowered movements within Eastern Europe that aspired for independence and reform, leading to significant political changes as seen in Poland and East Germany . These transformations contributed to the collapse of communism across Central and Eastern Europe, effectively ending the ideological division of the Cold War and catalyzing the reunification of Germany .

Nationalist pressures played a critical role in the dissolution of the Soviet Union. The USSR, comprising 15 republics with distinct ethnic and cultural identities, saw growing demands for autonomy fueled by Gorbachev’s policies of glasnost and perestroika, which encouraged more open political discourse . These republics, particularly the Baltic states, began seeking independence, with Lithuania declaring it first in 1990 . As these movements gained momentum, the central government’s refusal to recognize their independence further strained relations. The election of Boris Yeltsin, who supported voluntary union rather than forced cohesion, signaled a shift in internal power dynamics . The political and nationalist pressures culminated in the attempted coup of 1991, ultimately leading to the dissolution of the USSR as republics declared independence or joined the Commonwealth of Independent States .

The command economy model centralized decision-making for production and distribution, which often resulted in misallocation of resources and inefficiencies in the production of consumer goods. Central planners favored industrial and military output over consumer goods, leading to chronic shortages of essential items like food and clothing . This prioritization and the lack of responsiveness to consumer needs created significant waiting times for goods, driving desperate consumers to black markets where goods were sold at inflated prices due to their scarcity . The black markets flourished as corruption among officials allowed goods controlled by the state to be illegally diverted, exacerbating official market shortages and highlighting the inefficiencies of the command economy .

The Chernobyl disaster in 1986 acted as a catalyst for greater media openness and governmental transparency under Gorbachev’s policy of glasnost. For the first time, the Soviet government allowed unprecedented public discussion about the disaster, breaking from the long-standing practice of state secrecy and suppression. This openness exposed the inefficiencies and shortcomings of the Soviet system to both its citizens and the international community . The event highlighted the need for reform and transparency in the Soviet political and economic systems, further propelling Gorbachev’s glasnost initiative, which aimed to foster a more open and accountable government .

The energy sector, particularly oil, was a crucial component of the Soviet economy, and fluctuations in oil prices significantly impacted its economic stability. The Soviet Union relied heavily on oil exports as a primary source of revenue. During periods of high oil prices, such as the oil crises of the 1970s, the USSR benefited from increased foreign exchange earnings, which temporarily masked deeper systemic problems [not explicitly in provided sources]. However, the collapse of oil prices in the 1980s sharply reduced income, exacerbating existing economic problems and contributing to financial strain [not explicitly in provided sources]. This dependency on oil revenue highlighted the vulnerabilities of the Soviet economic model and the consequences of under-diversification, intensifying the urgency for reforms like those attempted by Gorbachev [implied from Source 5].

The Brezhnev Doctrine significantly increased Soviet defense spending by justifying military interventions if socialism was perceived to be under threat. This policy exerted substantial financial pressure on the USSR as it required maintaining substantial military capabilities to intervene in countries like Czechoslovakia in 1968 and Afghanistan in 1979 . These interventions were costly and strained the economy, contributing to domestic pressures as resources were diverted from civilian needs to support military operations. Additionally, the doctrine's enforcement compounded the USSR's economic issues by requiring continuous, unsustainable investment in defense, adding to the financial strain amid an already struggling economy .

The command economy of the USSR was centralized, where the government made key decisions regarding the allocation of resources, production, and pricing. This system was criticized for several inefficiencies. Primarily, it led to poor economic decisions because the central planners were mostly officials rather than experts in economic planning, leading to productive inefficiency . Production targets were set based on quantity, not quality, resulting in poor-quality goods . Additionally, the lack of autonomy for factory managers meant Soviet citizens experienced long delays for goods and services, even basic necessities . The transport and distribution system was inefficient, often causing raw materials and crops to waste . These systemic issues contributed to an acute shortage of consumer goods, fostering black markets and corruption, as officials were bribed to supply these markets illegally .

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