By Amitabh Pal, November 12, 2009
A false note of triumphalism is marking the twentieth anniversary of the dismantling of the Berlin Wall. Certainly, the demise of the Stalinist system that ruled the Soviet Union and Eastern Europe was for the good. But it is wrong to assert—as many commentators are doing—that the people there lived happily ever after once they adopted the free market path. (Editor’s Note: Cyrano’s Editors do not subscribe to this knee-jerk anti-Stalinist/anti-Soviet Union posture utilized by many commentators to gain respectability in their criticisms of capitalism. Barring this flaw, we think the rest of the article is useful in conveying an important point about the ability of the “free market” to deliver.)
UNC-Chapel Hill Professor Steven Rosefielde estimates that there were three million excess deaths in Russia in the 1990s due to Yeltsin’s shock therapy program of a rapid transition to the free market. And Professor Stephen Cohen, one of the leading American experts on Russia, lays out the devastation that the market wrought on that country.
“Since 1991, Russia’s realities have included the worst peacetime industrial depression of the twentieth century; the degradation of agriculture and livestock herds even worse in some respects than occurred during Stalin’s catastrophic collectivization of the peasantry in the early 1930s; … the impoverishment or near-impoverishment of some 75 percent or more of the nation; more new orphans than resulted from Russia’s almost 30 million casualties in World War II; and the transformation of a superpower into a beggar state,” writes Cohen of the early record of the free market in Russia in “Failed Crusade: America and the Tragedy of Post-Communist Russia.”
Even Poland—the poster child for a successful changeover to capitalism in a recent NPR series—suffered terribly in the transition. Poland recovered to its pre-1989 level “after six very lean years, particularly the very early ones when, with subsidies abolished, prices rose sharply and the living standards dropped substantially,” wrote the late Daniel Singer of The Nation magazine in “After the Fall: 1989 and the Future of Freedom.”
It is anyway an odd moment to crow about the triumph of the free market, with the planetary meltdown caused by unfettered capitalism.
Today’s global economic crisis has revealed the organic defects of the present model of Western development that was imposed on the rest of the world as the only one possible,” comments (none other than) Mikhail Gorbachev in a piece distributed by the Progressive Media Project. “It has showed that not only bureaucratic socialism but also ultra-liberal capitalism was in need of profound democratic reform — in effect, its own kind of Perestroika.”
“The financial and economic crisis was made in the west, but has hit hardest in the east,” The Guardian reports. “After years of growth far outstripping rates in the west, governments in Hungary, Latvia, and Romania have fallen, economies have slumped, and leaders have had to call in the salvage squads from the International Monetary Fund.”
So, what’s been the free market’s legacy to Russia and Eastern Europe?
“1989 unleashed across the region and then the former Soviet Union free-market shock therapy, mass robbery as privatization, vast increases in inequality, and poverty and joblessness for tens of millions,” The Guardian reveals. Not surprisingly, “57 percent of eastern Germans believe the GDR had ‘more good sides than bad sides,’ and “only one in five Hungarians believes that the country has changed for the better since 1989, only 11 percent of Bulgarians think ordinary people have benefited from the changes and most Russians and Ukrainians regret the disintegration of the Soviet Union.”
Another claim that comes not only from conservatives is that Ronald Reagan deserves full credit for the breakdown of the Berlin Wall and, hence, the eventual implosion of communism. Commentators love to especially cite his line, “Mr. Gorbachev, tear down this Wall.”
But as James Mann points out in a really detailed examination of Reagan’s speech in the recently published “The Rebellion of Ronald Reagan,” this is a complete misinterpretation.
“The triumphal school fails to explain the connection between Reagan’s speech and the events of 1989,” Mann writes. “Even more problematically, the triumphal school ignores Reagan’s actual policies toward the Soviet Union at the time of the Berlin Wall speech.”
“What happened in the Soviet Union happened mainly for domestic reasons,” Gorbachev told me in an interview in 2003 in response to my question about whether Reagan’s hardline stance caused the death of communism. “When it became clear to us that the one-party model was mistaken, we rejected that model.”
Plus, to give Reagan the central role in this saga completely ignores the part that dissidents within the Eastern Bloc and the peace movement in the West played in bringing down the system.
“The cacophonous demand for an end to the nuclear madness resonated first throughout Europe and then quickly in the United States,” writes analyst John Tirman in “After the Fall.” “It found a soulmate of sorts in the new Soviet leader, who somehow opened his mind to new ideas for disarmament and cooperation. That the peace movement stood at both ends of this triumph, creating a loud and persistent echo from West to East and back again, is one of the great achievements of the twentieth century.”
Reagan had little to do with the collapse of communism. And the system that replaced it has caused severe problems of its own.