Commonwealth of Independent States
Soviet Union?
At the moment one cannot say that unmeasured historic importance. But
"positive" features are in the ascendant; on the contrary the dominant even now some of the main economic element is disintegration and this may last a long time.
The following interview with Marxist
In this situation, the governments do not all have the same approach.
Furthermore, the existence of differappeared in the Spanish review Viento ent political forces must also be taken
Sur no. 1, January-February 1992. It was into account. There are those that, could not be called while they
"reformists" of the old system, nonetheless are seeking to avoid a total break with it. What is presently happening in Serbia may provide a reference point for some republics in the former
USSR. Here we have a regime supported by a part of the former Stalinist apparatus.
Its programme is hard to define but it favours the restoration of capitalism and its ideology mixes nationalist elements, a strong dose of chauvinism, and forms of populism, and in some cases workerism.
A syndrome of the Yugoslav type is quite possible, even including some of its military aspects, involving political forces that combine Stalinism and reactionary nationalism, which are no longer able to base themselves on projects for the reform of the system, but which can, on the other hand, exploit territorial conflicts and control of natural resources, and out of which military forces can emerge caught up in an unstoppable dynamic towards conflict.
• The most serious problems are the economic problems. Is there already hyper-inflation in the CIS, as many Western observers insist?
Above all there is an economic war going on which is disorganizing not only production but all economic relations between the republics. In practice, the rouble no longer functions as a currency throughout the CIS. There is no common economic space, while a strong interdependence remains which, if it is not equally significant for every republic, affects them all.
The recent decision of the government of Ukraine to suppress the circulation of the rouble and replace it provisionally by coupons (which are in fact becoming a new currency; there is even an illicit exchange market) is a symptom of the internal distrust and conflict between Russia and the other republics in the CIS. An autarchic development of these republics could work, but only up to a certain point
20 and for a certain time, and only in epub-
Union and the formation of the (CIS) are events of an as yet tendencies can be analyzed. economist Catherine Verla first conducted by Miguel Romero.* lics that produce consumer goods or goods for export to the international market.
However, the republics with economies based on industrial production, the only market for which has been the other CIS countries, and which are, furthermore, usually the poorest, are in a dramatic situation and will be the hardest hit by the disruption of economic circuits. In such cases violent explosions cannot be ruled out. • The authorities claimed that the big price rises of January 1992 would immediately produce a substantial improvement in the supply of basic products. But this has not apparently been the case; severe shortages remain, for example of foodstuffs in the big cities.
We have to wait a bit before drawing the balance sheet on this, but it is true that until now there has been no significant improvement in supplies. This is easy enough to understand. The partisans of the January measures insisted that these steep price rises would result in the arrival in the shops of products stocked for speculative reasons or because existing prices were considered too low. They hoped, furthermore, that the measures would stimulate production - in 1991 the Gross Domestic Product (GDP) of the USSR fell by 15%.
It is true that to a large extent the shortages are the result of speculation, but nobody can foresee when the speculators will cease their activities, that is to say when they will consider prices sufficiently profitable to release their stocks onto the market rather than continue to wait for prices to rise further.
Furthermore, the holding back of agricultural products is not only due to prices but also to the demand by peasants and agricultural organizations for payment in hard currency. Yeltsin personally has made promises in this area, but has been
There are, moreover, production monopolies which are continuing to according to the traditional norms of the bureaucratic system: for them the price rises do not constitute in any way a stimulus to production; the new prices may even appear to them as a means of obtaining more producing the same. Finally, even if a will to step up production existed, the catastrophic state of transport and industrial supply networks make it difficult to achieve positive results. In any case, it will take time for prices to fall, while there is an enormous mass of money in circulation and colossal public deficits. There is a considerable possibility that hyper-inflation will be provoked without an improvement
To understand what is going on, we can look at the experience of economic "shock therapy" in Poland, without denying the many differences that exist between that country and the countries of the CIS.
In Poland inflation remains at two or descend below the threshold of hyperinflation. Supplies have improved in terms of the quantity of products arriving in the shops — many of them imported — but the ability of most of the population to buy them has hardly improved at all. Poland has seen an enormous increase in its debt without any accompanying restructuring of its economy. Finally, we should not forget that Polish governments could at the one of the reasons why until now there have not been social explosions.
In the case of the CIS, the authorities do not, in my view, have such political capital at their disposal. In particular, Yeltsin has already had serious conflicts with his own team ( see /Vs 220 and 221) and in the first place with Vice President Rutskoy. But. above all, in this case the "shock therapy" takes place against the background of the inter-republican economic war. Thus it is hard to see how the situation can be stabi• All these phenomena are often presented as the first steps on the road to capitalism, in which an "economic break" with the preceding system is being accomplished. Would you say that capitalism has already been restored in the CIS?
It is interesting in this respect to consider the views of experts from the international financial organisms. A little while ago,
February 17, 1992 • #222 International Viewpoint these would have replied to your question in the affirmative. But today they admit that they do not know what to do or where things are heading.
The clearest approach to this problem is to analyze the most important features of the privatization process. International and above all German capital is flowing into certain particularly profitable sectors in the countries considered the most stable, for example, Czechoslovakia.
In many cases, the multinationals' involvement amounts to no more than the transfer of production from their Western factories to take advantage of the cheaper labour in the East. In others, consortiums are aiming to get hold of the natural resources of this or that region. This is what Japanese and Korean capitalists are doing in the CIS' Asian republics.
Furthermore transport, supply, training of managers, financial services and so on are very bad in relation to the needs of the big investments that are hoped for from foreign capital. These investments, furthermore, will take the lion's share in the privatizations. It is calculated that, in the best of cases, internal disposable capital only amounts to 10 to 30% of the price of the goods to be privatized.
The situation can thus be summed up by saying that what could be called "capitalist markets" have been created — a sort of "free trade zone" in which investments are concentrated. But there has been no transformation of the system as a whole. And I do not think that there is a perspective of forming a different economic system. • There is then a contradiction between economics and politics: the governments are, in most cases, firm partisans of the restoration of capitalism and are trying to apply measures to that end as fast as possible.
This is true, but the first conclusion that one can draw from this contradiction is the instability of the governments, as is shown by experience. The second conclusion that can be drawn, and which can also be verified in practice, is the appearance of different strategies by the different political sectors which share the general objective of a capitalist restoration.
During the last Polish elections, most of the parties criticized the privatizations that had been carried out as "wild capitalism" and defended the need for a strong public sector. In Hungary there are currents that are strongly opposed to what they call the "cosmopolitan capitalism" promoted by other ultra-liberal sectors in the economic domain. These latter, however, can be defined as progressive at other levels, such as in the attitude to minority nationalities. Those promoting a "national" and more "social" capitalism on the other hand often espouse a strongly reactionary nationalism, when they are
In my opinion, one should not rule out a return to power by anti-liberal currents, probably marked by populism; a sort of combination of neo-Stalinism and chau• Lots of questions remain on the different strategies for capitalist
CIS restoration. For example, the main instrument for constructing a bourgeoisie seems today to be the state. At the moment this nascent bourgeoisie contains very diverse elements - the traditional mafia, the new businessmen from the nomenklatura and others. To take a concrete example, do you think that Yeltsin has coherent project in this respect?
In Russia, as well as in other countries, and above all in Hungary, there have been interesting debates on these problems. For example, Janos Kornai, a very influential Hungarian economist, has criticized what he calls a "Bolshevik" approach to capitalist restoration, by which he means an attempt to jump ahead of the process of an organic development of a national bourgeoisie.
The idea that this is a viable option today seems questionable to me, but in any case Kornai says that restoration must take place very slowly, resting on the support of new intermediate layers coming out of the underground economy. The corresponding state economic policy should encourage young "healthy" and "dynamic" entrepreneurs, while fighting against the former system and above all blocking the route to privatizations that benefit the old nomenklatura. According to Kornai, it is also necessary to take the legal steps and develop the material infrastructure that would allow this process to go ahead.
There is another debate going on in Hungary, where in my opinion, such discussions are most advanced and clearcut. 221 According to this hypothesis it is neces-
International Viewpoint #222 • February 17, 1992
CIS / MOROCCO sary to go as fast as possible towards capitalism, otherwise that aim will never be reached. The former economic system has smashed, even if to do this it is necessary to lean on a section of the former nomenklatura. Privatization must be done as fast as possible and at any price.
This is the line of Jeffrey Sachs, who has been an economic adviser in Bolivia, Poland, Slovenia and now in Russia. Sachs goes so far as to say that even if a privatization is not very efficient and favours unreliable sectors from an economic point of view in the medium term, it should be carried out; afterwards one can see what has to be done. He criticizes the Polish experience from this angle as too
Yeltsin has moved a long way in recent months. First of all he was a supporter of the Shatalin Plan [for passing to the market economy in "500 days"] which is in the Sachs mould; for him people had to buy the maximum of shares and housing as fast as possible. Now, Yeltsin seems more influenced by the plan that previously was opposed to Shatalin's. He is inclined towards shock therapy on prices, and a more rapid progress towards the commercialization of goods, even when they are produced by state enterprises, rather than a transformation in the form of ownership of the enterprises.
"Commercialize" has become his buzz word, in which relations between enterprises without state subsidies and on the basis of market criteria will be estab-
Thus to return to your question, I am not sure if there is a coherent project for the formation of a new bourgeoisie — there is a desire for this, but different people are working at cross purposes. • The ability of the CIS to continue as a framework for stable coexistence between different republics seems to be wilting even faster than imagined.
In my view this project was from the beginning marked with strong ambiguities. At the moment of the first meeting of the Slav republics most articles in the Kiev press defined it as a knife in the back of Ukrainian independence, which at the very least showed that there were problems in interpreting the nature of the CIS and sense of independence.
A significant part of the Ukrainian population considers "independence" to be compatible with confederal links with the other republics, while others believe that independence means a complete breaking of the links of the past and the search for a rapid insertion into Western Europe.
Such differences exist both inside the political currents and within the workers' movement and are exacerbated by the current conflicts between Russia and 22 ments intersery over Great Russian. Ukraine. Furthermore, the Yeltsin governattitude is sharpening the inter-republican conflicts, which are suspicious of a CIS dominated by "big brother". The conflict over what will happen to the strategic arms illustrates the problems. Some members of Yeltsin's team go further: Rutskoy has talked about the "Malvinas" to illustrate the attitude that Russia should have towards the territories that it is demanding from other republics.!
The other ambiguity in the birth of the CIS concerns the role of the Slav and nonSlav republics, the ties between rich and poor. There has always been, and still is, a political inequality between them which has led to a situation of potential contlict in the Muslim republics. • What is the pressure of Iran and Turkey on these republics?
As is logical, this pressure exists, but it is manifested unequally. The situations in Azerbaijan and Kazakhstan are very specific. The Azeri population is culturally homogeneous; it is Turkish-speaking and Shiite. Relations with Turkey are strained because the Turkish government maintains privileged ties to Armenia, while being prudent about it.
In Kazakhstan two alternatives confront each other. One is that of an alliance with the European republics, particularly Russia, which would permit the preservation of the unity of the republic by integrating the minorities of European origin.
which seems to be gaining ground, is that of a break, which could lead to the division of this republic. Some Slav currents, for example, are looking to a split to get rid of the Muslims and inte grate into the pan-Slav community led by Russia. This is Solzhenitsyn's position.
Finally there is the Central Asian bloc, which is Turkish-speaking with the exception of Persian-speaking Tadjikistan, which could become the first Islamic republic of the former USSR.
If the CIS collapses, Turkey and Iran may constitute poles of attraction, but for the moment it is the centrifugal tendencies that are prevailing. Coherent Islamic fundamentalist currents are weak. The Party of the Islamic Renaissance, for example, is small.
Very different decisions have been taken over the question of the alphabet. Azerbaijan has adopted the Latin alphabet and Uzbekistan the Arabic. 2* * Viento Sur is published by the Left Alternative (Spanish section of the Fourth Intemational) and the Spanish Communist Movement (MC). 1. In 1982 the Argentine dictatorship launched a miliLary attack to regain the Malvinas islands, situated in the South Atlantic, which were, and remain, under 2. In Stalinist times all the languages of the Soviet Union were written in the Cyrillic script used by Russian and other East and South Slav languages.