Why did the Soviet Union fall?

by on June 13, 2007 at 6:17 am in History | Permalink

In a simplified way, the story of the collapse of the Soviet Union could be told as a story about grain and oil.

That is from Yegor Gaidar.  In the 1980s it was necessary to import more and more grain, and Saudi Arabia was no longer supporting oil prices.  It worked like this:

The timeline of the collapse of the Soviet
Union can be traced to September 13, 1985. On this date, Sheikh Ahmed
Zaki Yamani, the minister of oil of Saudi Arabia, declared that the
monarchy had decided to alter its oil policy radically. The Saudis
stopped protecting oil prices, and Saudi Arabia quickly regained its
share in the world market. During the next six months, oil production
in Saudi Arabia increased fourfold, while oil prices collapsed by
approximately the same amount in real terms.

As a result, the Soviet Union lost approximately $20 billion per
year, money without which the country simply could not survive. The
Soviet leadership was confronted with a difficult decision on how to
adjust. There were three options–or a combination of three
options–available to the Soviet leadership.

First, dissolve the Eastern European empire and effectively stop
barter trade in oil and gas with the Socialist bloc countries, and
start charging hard currency for the hydrocarbons. This choice,
however, involved convincing the Soviet leadership in 1985 to negate
completely the results of World War II. In reality, the leader who
proposed this idea at the CPSU Central Committee meeting at that time
risked losing his position as general secretary.

Second, drastically reduce Soviet food imports by $20 billion, the
amount the Soviet Union lost when oil prices collapsed. But in
practical terms, this option meant the introduction of food rationing
at rates similar to those used during World War II. The Soviet
leadership understood the consequences: the Soviet system would not
survive for even one month. This idea was never seriously discussed.

Third, implement radical cuts in the military-industrial complex.
With this option, however, the Soviet leadership risked serious
conflict with regional and industrial elites, since a large number of
Soviet cities depended solely on the military-industrial complex. This
choice was also never seriously considered.

Unable to realize any of the above solutions, the Soviet leadership
decided to adopt a policy of effectively disregarding the problem in
hopes that it would somehow wither away.  Instead of implementing actual
reforms, the Soviet Union started to borrow money from abroad while its
international credit rating was still strong.  It borrowed heavily from
1985 to 1988, but in 1989 the Soviet economy stalled completely…

The money was suddenly gone. The Soviet Union
tried to create a consortium of 300 banks to provide a large loan for
the Soviet Union in 1989, but was informed that only five of them would
participate and, as a result, the loan would be twenty times smaller
than needed.  The Soviet Union then received a final warning from the
Deutsche Bank and from its international partners that the funds would
never come from commercial sources.  Instead, if the Soviet Union
urgently needed the money, it would have to start negotiations directly
with Western governments about so-called politically motivated credits.

In 1985 the idea that the Soviet Union would begin bargaining for
money in exchange for political concessions would have sounded
absolutely preposterous to the Soviet leadership.  In 1989 it became a
reality, and Gorbachev understood the need for at least $100 billion
from the West to prop up the oil-dependent Soviet economy.

Here is the full article.  The pointer is from VoxBaby.  Do you have further thoughts?

Sam June 13, 2007 at 7:49 am

From the article: “As a result, the Soviet Union lost approximately $20 billion per year, money without which the country simply could not survive.”

Although 20 Billion is a large amount of money, the whole system of corruption in the USSR and spending on war and space industry was probably a bigger drain on the economy. It probably had an impact, might even have been the drop that made the bucket flow over, but that doesn’t mean all the previous drops were of lesser impact or importance. The search for a single cause for a historical development as complicated of the Soviet implosian often underappreciates the complexity of it all.

Sergey Kurdakov June 13, 2007 at 8:18 am

Actually this idea not that new.
There is an article http://www.hubbertpeak.com/reynolds/SovietDecline.htm with the same idea.

Also CIA had online

CIA’s Analysis of the Soviet Union, 1947-1991 but not it seems gone. The book contained interesting views dated 1977 where almost all the propositions ( grain, peak oil etc ) were taken into consideration and were supposed to lead to Soviet Problems

spencer June 13, 2007 at 9:00 am

This is a somewhat dated analysis of the drop in Soviet oil output that should be of interest on this topic:
http://www.hubbertpeak.com/reynolds/SovietDecline.htm

The other point of importance omitted in this article is the way the Soviets used the “profits” from oil production to subsidize the military sector. Without oil the Soviets could not even afford the level of military spending they had, let alone expand spending in response to the Reagan military build up. To a great extent the Russian economy is just another OPEC type country with the correlation between real gdp growth and oil production well over 0.9.

Since this week is the anniversary of the Reagan tear down this wall speech
the importance of oil as the proximate cause of the collapse of the USSR in the 1980s-90s rather then the US military expansion is important to understand when trying to apply the lessons of the cold war to the modern world.

Person June 13, 2007 at 9:27 am

Sorry, I just gotta chuckle.

As I’m reading it, I’m thinking — “yeah, that’s it … the Soviet Union collapsed, not because of an
unsustainable economic system that punished anyone who was genuinely productive … it was the Arabs!
Yeah!!!!! The Arabs. If they just hadn’t increased oil output, why, the Soviet economy could have
run at full steam indefinitely. Man, just that *one, tiny, unpredictable* little shock. It was just that
*one* possibility that the Soviet economy couldn’t withstand.”

Some people can’t see the forest because of all the damn trees in the way.

cb June 13, 2007 at 9:40 am

The soviets had been limping along with a completely disfunctional monetary system for decades. Their power was maintained by gunpoint, not money.

I attribute their collapse to three reasons.
1) The military defeat in Afganistan was both costly and demoralizing for the Soviet Union.

2) The inability to technologically compete with the West. The US, Europe and Japan were moving into the computer age. Manufacturing chips, computers and software required a greater degree of economic freedom and competition.
The inability to keep up technologically forced both the Soviets and China to either open up or fall technologically behind.

3) Chernobyl. This disaster revealed Gorbachev’s newly instituted policy of peristroka and glastnost to be a fraud. Sweden had to inform the world that this disaster had occurred while the Soviets were trying to cover it up. I think this was the pivitol point that lead gorbachev to institute a real version of glastnost resulting in the breakup of the soviet union.

Nathan Zook June 13, 2007 at 9:45 am

I’m also chuckling, but at a different joke: A fat man sits on a weak stool. The stool breaks. Afterwards, a bunch of engineers come by, and describe the evident failure of the stool–without making any reference to the imposed weight!

Both the USSR & Spain had subtaintial external forces being applied. These outside forces had a very great deal to do placing strain on a poorly designed economy. The article presumes that the West was going to put stringent restrictions on the credits, but we’ve seen over & over that this isn’t necessarily the case. The article takes the size of the M-I complex for granted, and ignores the extent of its justification due to the likelihood of western military intervention.

Reagan amped up the pressure on the Soviets every way that he could. The entire idea was to push the Soviet leadership into a position from whence collapse was inevidable. I would say that he succeeded.

In fairness, the point of the article seems to me to be that high oil prices are not guaranteed, and assuming that they are will cause your oil-based economy to collapse (again), so don’t do it. As such, the omissions are probably forgivable.

Matthew June 13, 2007 at 10:01 am

Fascinating article Tyler. Thanks for the quotes and the link!

Fundamentalist June 13, 2007 at 10:16 am

I have a hard time accepting the economic reasons for the collapse of the USSR. After all, who has worse economies than Cuba or North Korea and they show no signs of abandoning communism? I still prefer the story in a biography of Gorbachev that Kruschev had a lot to do with it. Kruschev tried to reverse a lot of Stalin’s evil, reform the USSR and even denounced Stalin. Gorby was in college at the time and admired Kruschev greatly. Gorby became very bitter when Kruschev was kicked out, so he and many friends decided to pretend to support the revived Stalinism under Kruschev’s successor until they could get into positions of power and restore Kruschev’s reforms.

Person June 13, 2007 at 10:24 am

Barkley_Rosser: The point I was making about oil was that it was not “the” cause, but just one of many possibilities for how the collapse would play out.

Regarding SS, what aspect is false? Is it false that the SSA has actually run out of assets, and is in effect running an unfunded plan whereby it can only pay benefits by taxing current workers? Is it false that it is predicated on a certain dependency ratio? Is it false that it is vulnerable to a positive feedback loop whereby younger workers increasinly remove themselves from the taxable US labor pool as the deal SS offers gets worse and worse? It it false that it has numerous times had to raise taxes and cut benefits?

Sergey Kurdakov June 13, 2007 at 11:04 am

BTW this article is based on a book published in russian by Gaidar.
The story why the book appeared in my eyes is following.

As you might know Kremlin organized antiliberal (antidemocratic ) Nashi movement. And at some point at Nashi forum I crossed with Gaidar’s daughter which leads the opposing youth movement. That time nashi put their story why USSR collapsed and that story depicted liberal (democratic ) forces as corrupt pro american spies. During discussion of that event I stressed on Gorbachev confessions that drop of oil prices
made decisions for him to be tought I also made reference to CIA analysis of the soviet union. In next year Gaidar published his book and told that he started it at about the time of those discussions at nashi forum.

Maybe my view is wrong, still if I’m it is intresting how it is possible to influence flow of events on internet.

Chris Durnell June 13, 2007 at 11:34 am

The disagreements on the comments are merely between discussing the root and proximate causes of Soviet collapse. The root cause, of course, was the command economy of the USSR and its inherent disincentives for growth and incentives for corruption. But it was able to meander for a long while. The longer it went on, the weaker it got – at least relatively to the West – but it still needed some sort of shock to produce collapse.

The role of oil prices is something to consider. Especially as high oil prices now is what’s precisely providing the Putin regime with the resources it needs to assert Russian interests.

Person June 13, 2007 at 11:59 am

indiana_jim: I heard the same story, except substituting “jeans” for “Sony walkman”.

Bernard Guerrero June 13, 2007 at 1:23 pm

I recall being in Leningrad in ’88 and having cleaning ladies begging me and my buddies for a Walkman. I could have made a killing if I’d stocked up on Levis before the trip. The desire for Western goods was palpable.

spencer June 13, 2007 at 2:40 pm

happyjuggler0 — they expanded around the world? Where besides Afghanistan?
My sense of history is that the Soviets expanded into Eastern Europe after WW II, did not have any real success with their attempts to spread their influence in India and the Mideast, had Cuba dropped in their lap as essentially a gift and messed around in Africa some with nothing really to show for it.

Yes, Carter cut military spending when he took office, but he quickly reversed that position and was expanding the budget again in his last two years.

Moreover, there is exactly zero evidence that the soviets responded to the Reagan build up with greater military spending. Remember, as a share of gdp the Reagan military budget was smaller then every other cold war administration but Carter.

dearieme June 13, 2007 at 3:47 pm

Ah, if only they’d tried proper socialism.

spencer June 13, 2007 at 4:07 pm

John Mann of Johns Hopkins had a well balanced article in the Sunday NYT.

DURING the spring of 1987, American conservatives were becoming disenchanted with Ronald Reagan’s increasingly conciliatory approach to Mikhail Gorbachev. Inside the White House, Mr. Reagan’s aides began to bicker over a speech the president was planning to give on a trip overseas. That June, the president would travel to Venice for the annual summit meeting of the seven largest industrialized nations. From there, plans called for him to stop briefly in Berlin, which was still divided between East and West. The question was what he should say while there.
The speech Mr. Reagan delivered 20 years ago this week is now remembered as one of the highlights of his presidency. The video images of that speech have been played and replayed. On June 12, 1987, Mr. Reagan, standing in front of the Brandenburg Gate and the Berlin Wall, issued his famous exhortation to Mikhail Gorbachev: “Mr. Gorbachev, tear down this wall.†

In the historical disputes over Ronald Reagan and his presidency, the Berlin Wall speech lies at the center. In the ensuing years, two fundamentally different perspectives have emerged. In one, the speech was the event that led to the end of the cold war. In the other, the speech was mere showmanship, without substance.

Both perspectives are wrong. Neither deals adequately with the underlying significance of the speech, which encapsulated Mr. Reagan’s successful but complex approach to dealing with the Soviet Union.

For many American conservatives, the Berlin Wall speech has taken on iconic status. This was Mr. Reagan’s ultimate challenge to the Soviet Union — and, so they believe, Mikhail Gorbachev simply capitulated when, in November 1989, he failed to respond with force as Germans suddenly began tearing down the wall.

Among Mr. Reagan’s most devoted followers, an entire mythology has developed. Theirs is what might be called the triumphal school of interpretation: the president spoke, the Soviets quaked, the wall came down.

Representative Dana Rohrabacher, a California Republican and former Reagan speechwriter, told me that American intelligence had reported that the day after the Berlin Wall speech, Mr. Gorbachev confided in his aides that Mr. Reagan wasn’t going to give up. “If he’s talking about this wall, he’s never going to let go unless we do something,† Mr. Rohrabacher quoted Mr. Gorbachev as saying. “So what we have to do is find a way to bring down the wall and save face at the same time.†

Though no evidence has turned up to corroborate the Rohrabacher account, the triumphal storyline has endured. What’s more, it has done so even though it runs counter to Mr. Reagan’s actual policies toward the Soviet Union at the time. From the autumn of 1986 through the end of his presidency in January 1989, Mr. Reagan was in fact moving steadily closer to a working accommodation with Mr. Gorbachev, conducting a series of summit meetings and signing a major arms control agreement — steps that were strongly opposed by the American right.

The opposing perspective on the Reagan speech is that it was nothing but a stunt. The adherents of this interpretation include not just Democrats or liberals but many veterans of the George H. W. Bush administration.

In a 1995 book about the end of the cold war, “Germany United and Europe Transformed,† two former officials of the first Bush administration, Condoleezza Rice and Philip Zelikow, minimized the significance of the Berlin Wall address and its role in the events leading up to the end of the cold war. They argued that after the speech was given there was no serious, practical follow-up. No one pursued any policy initiative with respect to the Berlin Wall. “American diplomats did not consider the matter part of the real policy agenda,† they wrote.

Others agreed. “I thought it was corny in the extreme,† Brent Scowcroft, national security adviser to George H. W. Bush, told me. “It was irrelevant, that statement at that time.†

Even some of Mr. Reagan’s own senior foreign-policy officials seem to think the speech was not particularly noteworthy. In his 1,184-page memoir, former Secretary of State George P. Shultz does not mention the speech at all. Similarly, Jack C. Matlock, who served as Mr. Reagan’s Soviet adviser and then as United States ambassador to Moscow, does not discuss the speech in his own book about Mr. Reagan’s relations with the Soviets.

But those who dismiss the speech as insignificant miss the point, too. They fail to see its role in helping the president line up public support for his foreign policy.

In the months leading up to his speech, Mr. Reagan had been under attack in the United States for having been beguiled by Mr. Gorbachev. Conservatives were particularly outraged. In September 1986, after the K.G.B. had seized Nicholas Daniloff, a journalist for U.S. News & World Report, in retaliation for the arrest of a Soviet agent in the United States, Mr. Reagan hadn’t taken a hard line, but had instead negotiated an exchange.

Later that fall, hawks in the national-security establishment were upset that at the Reykjavik summit meeting, Mr. Reagan had talked about the possibility of abolishing nuclear weapons.

And these events were merely prologue: there was considerably more business Mr. Reagan was seeking to conduct with the Soviets — business that he knew would be deeply unpopular with many conservatives. By the spring of 1987, he was well into quiet negotiations for two more summit meetings with the Soviet leader in Washington and Moscow. His administration was moving toward a landmark arms-control agreement with the Soviet Union — a treaty on intermediate-range nuclear forces, which would have to be ratified by the Senate. The idea of such a treaty was beginning to attract considerable opposition in Washington.

The Berlin Wall speech, then, offered cover for Mr. Reagan’s diplomacy. It was an anti-Communist speech that helped preserve support for a conservative president seeking to upgrade American relations with the Soviet Union. In political terms, it was the prerequisite for the president’s subsequent negotiations. These efforts, in turn, created the vastly more relaxed climate in which the Soviets sat on their hands when the wall came down.

Those who minimize the speech also ignore the message it sent the Soviets. It served notice that the United States was willing to reach accommodations with Mr. Gorbachev, but not at the expense of accepting the permanent division of Berlin (or of Europe).

Yes, on the surface the address seemed like a follow-on to earlier Reagan speeches — the one at Westminster in 1982, where he predicted that the spread of freedom would “leave Marxism-Leninism on the ash heap of history,† and the speech the following year in which the president had called the Soviet Union “the evil empire.†

Yet the speech reflected an important shift in Mr. Reagan’s thinking, one that put him at odds with the Washington establishment: it acknowledged that Mr. Gorbachev represented something significant and fundamentally different in Moscow; that he was not merely a new face for the same old Soviet policies.

So while the speech reasserted the anti-communism on which Mr. Reagan had based his entire political career, it also gave recognition to the idea that the Soviet system might be changing. “We hear much from Moscow about a new policy of reform and openness,† Mr. Reagan said. “Are these the beginnings of profound changes in the Soviet state?†

While the speech did not attempt to answer that question, it did go on to establish a new test for evaluating Mr. Gorbachev’s policies:

“There is one sign the Soviets can make that would be unmistakable, that would advance dramatically the cause of freedom and peace. General Secretary Gorbachev, if you seek peace, if you seek prosperity for the Soviet Union and Eastern Europe, if you seek liberalization: Come here to this gate! Mr. Gorbachev, open this gate! Mr. Gorbachev, tear down this wall!†

When viewed strictly as foreign policy doctrine, Mr. Reagan’s speech didn’t say anything overtly new. After all, it was a longstanding tenet of American policy that the wall should come down. Mr. Reagan himself had already said so before, on a visit to West Berlin in 1982 (“Why is that wall there?†) and on the 25th anniversary of the wall in 1986 (“I would like to see the wall come down today, and I call upon those responsible to dismantle it†). The new element in 1987 was not the idea that the wall should be torn down, but the direct appeal to Mr. Gorbachev to do it.

When Mr. Reagan’s speech was first drafted, senior officials at the State Department and National Security Council tried repeatedly to get the words out. They believed the statement might jeopardize Mr. Reagan’s developing relationship with the Soviet leader.

Like his latter-day interpreters, those officials misunderstood Mr. Reagan’s balancing act. He wasn’t trying to land a knockout blow on the Soviet regime, nor was he engaging in mere political theater. He was instead doing something else on that damp day in Berlin 20 years ago — he was helping to set the terms for the end of the cold war

Andy June 13, 2007 at 5:04 pm

The key part of the Gaidar excerpt is the paragraph in which he speaks of food rationing being unthinkable. Until around 1950, a move to rationing would have been quite thinkable, both for the regime and its subjects, and would not have been seen by either as delegitimizing the Soviet project. And if it did lead to popular unrest, the regime would have quickly brought in the security services to restore order, whatever the human cost.

This changed after the war. Previously, the regime had kept control through a combination of force, appeals to help build socialism, and rewards to those who made significant contributions to that effort. This was the ‘from each according to his ability, to each according to his work’ system. Now it sought to win, rather than compel, popular support, striking a sort of grand bargain with the population: we provide you with constant, measurable improvements in your standard of living, in exchange for your support, or at least your acquiescence.

Of course the regime still used force when it felt threatened, and open dissent was punished harshly. But keeping this bargain became the basis of its legitimacy, in the eyes of both the elite and the general population, and thus a key pillar of its continued hold on power.

Most likely the late Stalin-era leadership took this step for a combination of reasons. Certainly one key factor was its hope that doing so would raise labor productivity, which had been a chronic problem since the Soviet Union’s founding. But the grand bargain didn’t include much by way of incentives for people to work harder, and they were no longer forced to do so, either at the point of a gun or because shirking could cost them their jobs. So they didn’t work harder. Which meant that economic growth continued to lag, which in turn made the regime extremely vulnerable to shocks of the sort Gaidar describes.

Early on, it showed its willingness to resort to force to suppress popular discontent with its economic policies. But over time, as the ruling elite got younger, it came to be dominated by people who saw the Soviet system as legitimate because it could keep its side of the grand bargain—and who thus came to believe that if it couldn’t, and had to keep control by other means, it was illegitimate. Which made recourse to those means, as Gaidar states, unthinkable—and thus made the collapse of the Soviet system inevitable.

By the way, if anyone is interested, I have a paper on post-war Soviet housing policy that talks in more detail about this stuff. It’s a bit rough around the edges, but I’m happy to share it with anyone who contacts me via email. I’m also happy to share my 1997 Columbia History dissertation, which is on related issues in the area of urban planning.

For more on this subject, take a look at Elena Zubkova’s Russia After the War, Vera Dunham’s In Stalin’s Time, and Julie Hessler’s A Social History of Soviet Trade. On the failure of the DDR’s version of the grand bargain, see Jeffrey Kopstein’s The Politics of Economic Decline in East Germany, 1945-1989.

Person June 13, 2007 at 5:21 pm

Barkley_Rosser:

“You could criticize social security for being predicated on a low,
stable, dependency ratio.” Nobody is prediating that, and all forecasts, both
those that are more pessimistic and those more optimistic, know that ratio will
change.

The term I used was “predicated”, and yes, it is *predicated* on dependency ratios saying within a limit.

(No, you didn’t just make a typo; you seem not to understand what word you’re using there.)

You said, “Is it false that the ss system has run out of assets and is running
an unfunded plan?” Yes, it is false. The fact that the system is running a
surplus means that it is accumulating assets

No, it doesn’t meant that; it means it has spent those assets and no longer has them. Imagine a
corporation saying that its pension plan is funded because “hey, we made enough profits to cover it
and will do so in the future!”

I thought someone in your position would understand what “funded” means in the context of a pension.

You said, “Is it false that younger workers will remove themsevles from the
system as its deal gets worse and worse?” Very unlikely. Actually, the real
payments to retirees will continue to rise. Do we have any evidence of
workers of any age right now removing themselves into the underground economy
because of social security taxes?

Did we have evidence that GM’s potential employees were working elsewhere, and potential
customers buying other cars because of its unfunded “legacy costs”? Remember, when GM
could assume no one would flee for the competition and didn’t have to put pension obligations
on its books, it looked pretty rosy too.

So, Person, I read your postings,

No, your comments before this last one were non-responsive.

Barkley Rosser June 13, 2007 at 6:24 pm

Andy,

It is mere assertion that “another crisis would have done so,” if the economic problems of the late 1980s and early 1990s had not caused the collapse of Soviet communism. Note, the systems and regimes in Belarus and Uzbekistan are largely unchanged and have not collapsed. What lies behind your assertion is the claim that if Grishin had taken power rather than Gorbachev in 1985, eventually “liberals” like Gaidar et al would have still come to power and done what was done. But there is no way to know that for sure. Of course, the exercise is all abstract anyway, but my point is that there was a very important internal political element to it, movements by Gorbachev to reform and loosen. With a harder line leader it is very unclear what would have happened or if there would have been an actual collapse.

Person,

This will definitely be my last comment on this as it is an inappropriate issue for this thread, but, one last shot from my side…

You referrred to “stable, low” dependency ratio. Where has anybody ever made such a claim? Everybody knows the ratio is going up, and given the long lead times in the demography of this, we have a pretty good idea of the likely range that the ratio will get to, although not precisely. Again, that range is about where most of Western Europe is right now, about two workers per retiree rather than the current three per retiree (well, that is the reciprocal of the dependency ratio, but it is how this is usually stated by those who study the matter and know what they are talking about). Do you seriously deny this? Are you seriously proposing somehow that this ratio is going to be crashing to zero (or its inverse will be soaring to infinity)? Please.

I did a typo on “predicated,” but it makes no difference, as you noted.

I guess you do not know what the assets of the sytem are. They are what is owed to the system by the rest of the government, and as long as the current budget is running a surplus, those assets are rising. Now, you may wish to argue that somehow the US government will not honor its debts. Really? It is honoring them right now with regard to medicare, which is running a deficit and cashing in its assets, some of which are being paid for by the lending that the social security system is doing to the rest of the government. And, again, as long as the system runs a surplus, which looks very likely, with no increase in taxes or cuts in projected benefits (again, will only be needed if the economy slows down quite seriously from its historical performance, please, go check this out), it does not need to cash in any of its assets anyway. It will just keep accumulating them while lending to the rest of the government.

Your comparison with GM is nonsense. The only way to escape from the system and not pay social security taxes is to either leave the country and the economy entirely, or move into the underground economy (or not work, or get one of those few jobs that are not required to pay them). However, again, as long as the economy continues to grow at something like at least 2/3 of its historic rate, the system will be able to run a surplus without raising its taxes or cutting its projected benefits. I see zero evidence of anybody fleeing into the underground economy because of current high social security taxes. If these do not increase, why would we expect any increase in such nearly non-existent fleeing? The US has one of the lowest rates of underground economy in the world, and with no necessary or likely changes in social security taxes, this is not likely to change.

You are living in a fantasy nightmare, Person. I will be going out of town and will be off email, so will not respond, but if you wish to distract this thread with more of this stuff, please use some sources like the Social Security Trustees report, and do not just make half-baked assertions accompanied by half-baked insults.

Swopa June 13, 2007 at 7:09 pm

lso CIA had online CIA’s Analysis of the Soviet Union, 1947-1991 but now it seems gone. The book contained interesting views dated 1977 where almost all the propositions ( grain, peak oil etc ) were taken into consideration and were supposed to lead to Soviet Problems

Exactly right. A quick LexisNexis AlaCarte search turns up the following:

U.S. News & World Report – 8/15/1977
A new study by the Central Intelligence Agency predicts critical economic problems for the Soviet Union in the next decade. The result, according to analysts: The Kremlin will turn inward, pursue a less aggressive foreign policy – but react more strongly to challenges to compensate for any appearance of weakness….

Aviation Week & Space Technology – 8/22/1977
Soviet Union’s current and projected economic difficulties, fed by a slowdown in annual growth and a looming oil shortage, will have no immediate effect on its massive military enhancement program, according to a study conducted by the Central Intelligence Agency. The study, prepared for the Joint Economic Committee priorities…

SOVIET UNION: Outlook Bearish
Newsweek – 8/22/1977
The impending crisis sounded familiar. Faced with a “looming oil shortage,” an official report declared, the nation was in for “serious economic strains” – and the government had yet to make the “difficult choices” needed to deal with the problem. When the CIA released that finding last week, however, it…

TGGP June 14, 2007 at 10:08 pm

Regarding Afghanistan, everyone should read Who Is Responsible For the Taliban?

Edward Teyssier June 22, 2007 at 4:29 pm

My sense is that the Russians had been “eating at the trough” of the more productive satellite states and when that “trough” started to run dry, the entire Soviet system had to collapse as well.

I visited Russia and the baltic states back in 2001. I was very much impressed with the effect Soviet occupation had on Estonia, Lithuania and Latvia; I sensed that the productivity of those peoples were used to prop up the Soviet empire. I saw significant building and other evidence of “pent up” economic activity now that the Russians had been kicked out. I was told that none of this economic growth would have been possible under the Soviet regime. I conclude that the energy and industry of these people was “taxed” with the proceeds going to prop up Moscow.

I’m reminded by a collegue’s comment years ago, during the cold war, how East Germany was poor, while West Germany was the ecomomic power house of Europe…His point was that communism makes otherwise productive countries poor because here was really two halves of one country, each half pretty much identical in every way, except one half was under communism, the other free enterprise, and the differences were, in economic terms, stunning.

My conclusion is that when all the ‘can do’ spirit was taken out of all the Russian people and then out of all the peoples of their satellite states, there wasn’t any “horsepower” left to keep the Soviet machine working and so that’s why it collapsed.

Regards,

Edward

victoria April 28, 2008 at 10:40 pm

i beleive that if the soveit union would have simply come to a compromise with one of the oil providers, they might have never lost 100 million dollars. thats alot of money. they secis to make themselves known in the world.

Anonymous January 21, 2009 at 10:48 am

boo

Jesus June 15, 2009 at 10:02 am

All this bullshit, it was all that Vodka, they were too drunk to realize that their insecure economy lead to their downfall. Damn Soviets can’t even keep a fucking lemonade stand running, let alone a goddamn country… Fuckin Slavs…

chante rankins January 19, 2011 at 3:37 pm

this to much info it dont take dat long to explain yy the soviet union collasped!!!!!!!!!!!!:))))))

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