Demise of the Soviet Union


Cameron Sawyer sent from Moscow news comments on the death of President Reagan. Randy Black, who lived in Omsk, comments: "Hurray for the positive bits and pieces of Russian opinion about Reagan! I, too, am surprised at the overwhelmingly positive nature of the posts from Russia. I also used to enjoy lunch at the Central House of Writers as the guest of a retired editor at Izvestia. On that note, it is interesting to see the opinion in the article by Bratersky of Izvestia regarding the effect of Star Wars on the Soviet budget/bankruptcy. It seems that many commentators offer an opinion that supports such a position. I support a slightly different position.

The USSR bankrupted itself over many issues, and over many years. Star Wars was only one facet of the equation. The myriad of causes of their demise included a corrupt, inefficient internal mechanism that sold goods to its people at a price that had no relationship to the cost of development, manufacture and distribution. I vividly remember purchasing a finely tooled hammer at a state shop in Omsk in 1993 for the equivalent in rubles price of three US pennies. Its origin was Czech, brought thousands of miles, made from the finest metal and wood and finished beautifully. That’s a lot to say about a simple hammer, I know, but it was typical of the goods I found in Siberia: Imported in many cases from great distances, finely made, yet cheaply packaged, if at all, and sold at ridiculously low prices for the benefit of her peoples who for the most part in those days, earned $15-$20 per month, if that much.

The USSR used hard currency revenues (US dollars) earned from international sales of its natural resources (oil, diamonds, timber and so forth) to subsidize such unprofitable operations and trade over many decades, and thus to keep the proletariat happy. Hard currency dollars from oil sales allowed the government to purchase other goods and materials needed in every facet of their life, goods and foods not available in sufficient numbers from their own factories and fields. When Reagan entered office, oil was trading above $35 per barrel, having been above $40 during the Carter administration. By 1986, it was below $10. Over the next several years, oil hovered in the $10-$20 range, give or take. The USSR was bankrupted soon thereafter as a result. While my Russian friends tell me that there were never enough goods on the shelves of stores in Russia, the problem grew much worse in the 80s. The lack of hard currency from oil exports certainly was a contributory factor. There are those among President Reagan’s entourage who believe that his administration caused the price of oil to dip and stay low over years as another element in the effort to bankrupt the USSR. In fact, Reagan did loosen controls on oil and gas production, thus resulting in a glut and the lower prices. Of course, there are many other reasons for the demise of the USSR, but a system of manufacturing and distribution that has no relationship to the cost of the goods seems like a good place to start".

RH. Randy's story of a hammer means that the problem with communism was not necessarily the quality of goods. The facile charge that the Communist bloc was incapable of manufacturing quality goods was as unfounded as the old dismissal of Japanese industry as being able only to copy Western goods stupidly. That talk faded away- My briefcase has a story comparable to Randy's hammer. At a store in Stanford's Shopping Center I bought an expensive American briefcase which kept falling open. I took it back and complained. The salesman, unperturbed, told me to choose another one. I selected a beautifully tooled leather one, and was surprised to learn that it was cheaper, so I got some money back. It has served me splendidly over the years. It was made in communist Romania.

Christopher Jones writes: "I agree that the Soviet Union collapsed of its own weight. I noticed that when Ronald Reagan died, he suddenly "won the cold war" and "defeated the Soviet Union." This of course is as ridiculous as the Americans winning the Battle of Britain. Communism was overthrown because it lost touch with its power base: the workers. Reagan had nothing at all to do with it. Probably the two men who could be most credited with the downfall of the Communist empire in eastern Europe was Pope John Paul II and Lech Walesa".

 

Ronald Hilton -


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