Collapse of an Empire

Collapse of an Empire: Lessons for Modern Russia

YEGOR GAIDAR
TRANSLATED BY ANTONINA W. BOUIS
Copyright Date: 2007
Pages: 332
https://www.jstor.org/stable/10.7864/j.ctt4cg7d6
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  • Book Info
    Collapse of an Empire
    Book Description:

    "My goal is to show the reader that the Soviet political and economic system was unstable by its very nature. It was just a question of when and how it would collapse...." -From the Introduction to Collapse of an Empire The Soviet Union was an empire in many senses of the word-a vast mix of far-flung regions and accidental citizens by way of conquest or annexation. Typical of such empires, it was built on shaky foundations. That instability made its demise inevitable, asserts Yegor Gaidar, former prime minister of Russia and architect of the "shock therapy" economic reforms of the 1990s. Yet a growing desire to return to the glory days of empire is pushing today's Russia backward into many of the same traps that made the Soviet Union untenable. In this important new book, Gaidar clearly illustrates why Russian nostalgia for empire is dangerous and ill-fated: "Dreams of returning to another era are illusory. Attempts to do so will lead to defeat." Gaidar uses world history, the Soviet experience, and economic analysis to demonstrate why swimming against this tide of history would be a huge mistake. The USSR sowed the seeds of its own economic destruction, and Gaidar worries that Russia is repeating some of those mistakes. Once again, for example, the nation is putting too many eggs into one basket, leaving the nation vulnerable to fluctuations in the energy market. The Soviets had used revenues from energy sales to prop up struggling sectors such as agriculture, which was so thoroughly ravaged by hyperindustrialization that the Soviet Union became a net importer of food. When oil prices dropped in the 1980s, that revenue stream diminished, and dependent sectors suffered heavily. Although strategies requiring austerity or sacrifice can be politically difficult, Russia needs to prepare for such downturns and restrain spending during prosperous times. Collapse of an Empire shows why it is imperative to fix the roof before it starts to rain, and why sometimes the past should be left in the past.

    eISBN: 978-0-8157-3115-3
    Subjects: Political Science

Table of Contents

  1. Front Matter
    (pp. i-iv)
  2. Table of Contents
    (pp. v-viii)
  3. INTRODUCTION
    (pp. ix-xviii)

    WE ARE NOT THE FIRST to suffer post-empire nostalgia, which permeates the Russian consciousness today. It has occurred in history more than once. The Soviet Union was not the first empire to collapse in the twentieth century, but it was the last. Not a single state formation that called itself an empire at the start of the twentieth century remains. In a number of key characteristics our country did not resemble the traditional colonial empire with overseas territories. The argument over whether it was in fact an empire will continue for a long time. There will be works proving Russia...

  4. CHAPTER I THE GRANDEUR AND THE FALL OF EMPIRES
    (pp. 1-25)

    IN THE FIRST CENTURY B.C. , the formation of a professional army and the resulting decline of the system of universal military service for free peasants undermined the republican institutions of ancient Rome and prepared the way for a regime in which the army served the ruler in power. The new state structure was called an empire (the term comes from the Latinimperium, power). Since Rome’s power in those days extended over most of the known world, another meaning of the word developed: in Europe “empire” came to mean a multiethnic state created through conquest. After the fall of...

  5. CHAPTER II AUTHORITARIAN REGIMES: THE CAUSES OF INSTABILITY
    (pp. 26-38)

    AUTHORITARIAN REGIMES are political structures that are not based on traditional legitimacy or on a publicly accepted process of forming the government and parliament after competitive elections. Their leaders, having removed political rivals, suppressed the opposition, and taken control of mass media, often believe that they will be in power forever. They think that the means of oppression available to them will be enough to guarantee the stability of their regimes. This is an illusion that cost many dearly. Such forms of power are innately unstable. Their instability is not caused by attendant circumstances or accidents, but by their very...

  6. CHAPTER III THE OIL CURSE
    (pp. 39-70)

    IN 1985–86, WORLD OIL PRICES dropped precipitously. But the USSR collapsed for other reasons, not because of speculation that oil prices would fall. The bard Bulat Okudzhava put it well in his last public appearance in Paris on June 23, 1995. He read this brief poem:

    Universal experience tells us

    That kingdoms perish

    Not because the life is hard

    Or the suffering great

    They perish because

    And the longer it takes, the more painful it is

    People no longer respect

    Their kingdoms.

    The crisis in the Soviet economy that led to the collapse of the USSR was closely connected...

  7. CHAPTER IV CRACKS IN THE FOUNDATION: THE SOVIET UNION IN THE EARLY 1980s
    (pp. 71-114)

    AT THE END OF THE LEONID BREZHNEV era, the great majority of Western observers who analyzed the unfolding situation in the USSR were certain that the Soviet economic and sociopolitical system had lost its dynamism and was inefficient but stable. Kremlinologists assumed that it would continue to exist for a long time. The ability of Soviet analysts to discuss these issues was limited, for obvious reasons. But they, who knew better than Westerners how the country’s economy functioned, also agreed that it was inefficient but enduring.

    The regime’s power depended on an efficient secret police. Moreover, the hallmark of the...

  8. CHAPTER V THE POLITICAL ECONOMY OF EXTERNAL SHOCKS
    (pp. 115-161)

    MUCH HAS BEEN WRITTEN ABOUT the economic and political development of the USSR on the eve of the crash—that is, in the years 1985 to 1991. People at the center of the decisionmaking process have described a policy of accelerating all reforms and the strategy ofperestroika, the unfolding of the anti-alcohol campaign, the development of civilian machine-building capabilities, the expansion of economic independence for enterprises, and the legalization of a private sector in the form of cooperatives; they have also discussed the ties between the development of market relations relations and political liberalization. The debate over what was...

  9. CHAPTER VI DEVELOPMENT OF THE CRISIS IN THE SOCIALIST SYSTEM
    (pp. 162-200)

    THE SITUATION IN THE OIL INDUSTRY described in the previous chapter was one of the determining factors that pushed the economic crisis into a catastrophe (see table 6-1). Archival documents allow us to examine it more closely.

    At a meeting on September 17, 1990, Chairman of the Council of Ministers Nikolai Ryzhkov said that oil production in the period from 1975 to 1990 fluctuated within the range of 500–600 million tons, while capital investments grew from 3.8 billion rubles to 17 billion rubles in 1991 [this was in a discussion of the plan for 1991—author]. The number of...

  10. CHAPTER VII ON THE PATH TO STATE BANKRUPTCY
    (pp. 201-219)

    WHAT CANNOT BE PREVENTED eventually comes to pass. In the second half of 1990, the USSR, having exhausted its hard currency reserves and unable to obtain foreign loans, had to cut back sharply on imports. In 1991 the import volume fell from 82.1 to 44.7 billion convertible rubles. The dynamic of imports for two esxtremely important commodities in the first half of 1991 is shown in table 7-1. By then, the economic authorities understood the role the currency crisis was playing. Chairman of the Cabinet of Ministers Valentin Pavlov spoke at the Presidium of the Supreme Soviet on February 19,...

  11. CHAPTER VIII THE FALL
    (pp. 220-249)

    ON JUNE 17, 1991, Mikhail Gorbachev signed the draft agreement “On the Union of Sovereign States” and sent it on to the Supreme Soviet of the USSR and the Supreme Soviets of the republics. After major changes, the final version was discussed in Novo-Ogarevo on June 23, 1991. Gorbachev, Russian president Boris Yeltsin, and Kazakh president Nursultan Nazarbayev decided in a meeting on June 29–30 that it would be signed by the heads of the Union republics on August 20.

    On the eve of signing the agreement that outlined a peaceful and regulated dissolution of the empire, the vice...

  12. AFTERWORD
    (pp. 250-256)

    AS I HAVE DEMONSTRATED, in the mid-1980s the USSR faced a crisis in its balance of payments and accounting system that developed into a broader economic crisis and led to a steep decline in production and the standard of living, political destabilization, and finally the collapse of the political regime and the Soviet Empire.

    By the end of the 1990s, Russia, the successor state of the USSR, had formed a fundamentally new and open economic system. It included a number of flawed but functioning market institutions: private property, convertible currency, a banking system, a system for regulationg the stock market...

  13. NOTES
    (pp. 257-316)
  14. INDEX
    (pp. 317-332)
  15. Back Matter
    (pp. 333-334)