The blog provides a left-wing non-partisan perspective on socio-economic issues in Russia and throughout the world. The focus is on qualitative development of national economic systems and ensuring flexibility in economic policies to meet the challenges of the 21st century. Email: leftistobserver@gmail.com

HOW THE SOVIET ELITE EMBRACED WESTERN ECONOMICS

Russia and other so-called “countries in transition” from among the former Soviet bloc are undergoing a painful neoliberal experiment, in which entire sectors of their economies get dismantled under slogans of free market and democracy. Only the blind cannot see that the unrestricted chaos of economic interactions believed to be building up national economies does quite the opposite in reality. Among the blind folks are politicians, economists and media. Their reliance on corporate funding (from within the country as well as from abroad) makes them oblivious to the bacchanalia of economic liberalism and its consequences.

The nouveaux riches that have sprung out of circles close to the former Soviet nomenklatura see the national economy as nothing more than a hunting ground. Officially, they hide behind rhetoric à la Hayek and Friedman simply because it justifies their greed and other vices. Any other viewpoint on economic development is considered worthless and is held up to ridicule.

Even though neoclassical economics has been many times proven incapable of any meaningful systemic analysis, it turned out to be very much to the liking of those Soviet apparatchiks that had some kind of property under their control. First, as part of the Soviet system, they could only dream of benefiting from that property without any fear of losing it as a result of political infighting. Second, they were reluctant to engage in the building up of the economy. In other words, the very culprits of the Soviet economic demise were seeking a free ride on the backs of those who would suffer from that demise. The capital-controlling apparatchiks neither wanted to assume responsibility for the worsening of the Soviet people’s living conditions nor sought to trouble themselves with improving them. They preferred personal gain to overall economic development. As you can probably see by now, the Western neoliberal economics was a perfect ideology for them – it guaranteed international recognition of privatized property and relieved the new bourgeoisie of any responsibility for the consequences of their actions.

Thus, the ideology shift managed to conceal the fact that those who had property and political power to protect it have managed to preserve both. In other words, the bureaucratic state capitalism remained the essence of Russia’s economic system.

Boris Anisimov

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