Abstract
It has long been fashionable in the West, since at least the early 1930s, to predict the imminent collapse of the Soviet economy, yet Soviet economic achievements have been striking. In less than seventy years, what was ‘little more than a ramshackle and backward agrarian country’ has been transformed into a powerful industrial state and a nuclear superpower, second only to the US.2 According to Soviet statistics, the USSR’s national income has increased over fourteen times since 1940 and it more than doubled between 1965 and 1980.3 The Soviet Union claims that its share of global industrial output rose from 4 per cent in 1913 to 20 per cent in 1980,4 and it boasts that it now leads the world in the production of steel, pig-iron, coke, oil, machine tools, diesel and electric trains, cement, mineral fertilisers, tractors, textiles, shoes, and prefabricated concrete structures.5 Even by American calculations, which are designed to remove the inbuilt exaggerations of Soviet data, the Soviet record has been remarkable. According to the Central Intelligence Agency (CIA), the USSR’s GNP is now over four times what it was thirty years ago.6 During the period 1951–79, the Soviet economy grew at an annual average rate of 4.8 per cent, compared with 3.4 per cent for the US.7 As a result of these different growth rates, the Soviet economy has gained substantially on the American economy in relative terms. In 1955, with postwar recovery completed, the USSR’s GNP was 40 per cent of US GNP. By the late 1970s the gap had been closed so that Soviet GNP had reached 60 per cent of the US level.8
The Soviet Union is facing a very serious crisis. This crisis is the result of the Soviet Union’s failure to adapt its economic planning model to meet the country’s radically changed economic needs.1
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsPreview
Unable to display preview. Download preview PDF.
Notes
Marshall I. Goldman, USSR in Crisis: The Failure of an Economic System (New York: W. W. Norton, 1983) p. 1.
David Fewtrell, The Soviet Economic Crisis: Prospects for the Military and the Consumer, Adelphi Paper no. 186 (London: IISS, 1983) p. 2.
Narodnoe Khozyaistvo SSSR 1922–1982 (Moscow, 1982) pp. 55, 59.
Ibid, p. 89.
Ibid, p. 94.
Studies prepared for the use of JEC, Congress of the US, by the CIA, USSR: Measures of Economic Growth and Development, 1950–80 (Washington, DC: USGPO, 1982) p. 15.
Ibid, p. 20.
I. Edwards, M. Hughes and J. Noren, ‘US and USSR: Comparisons of GNP’, in Soviet Economy in a Time of Change, JEC, Congress of the US (Washington. DC: USGPO, 1979) vol. 1, p. 370.
See, for example, Soviet Economy in the 1980s: Problems and Prospects, selected papers presented to the JEC, Congress of the US (Washington, DC: USGPO, 1983); Soviet Economy in a Time of Change, vols 1,2; Abram Bergson and Herbert S. Levine (eds), The Soviet Economy: Toward the Year 2000 (London: George Allen & Unwin, 1983); Fewtrell, The Soviet Economic Crisis; Holland Hunter (ed.), The Future of the Soviet Economy: 1978–85 (Boulder, Colorado: Westview Press, 1978); Seweryn Bialer (ed.), The Domestic Context of Soviet Foreign Policy (Boulder, Colorado: Westview Press, 1981) esp. pp. 177–268; Seweryn Bialer and Thane Gustafson, Russia at the Crossroads: The 26th Congress of the CPSU (London: George Allen & Unwin, 1982).
See, for example, Goldman, USSR in Crisis; John P. Hardt and Kate S. Tomlinson, ‘Economic Factors in Soviet Foreign Policy’, in Roger E. Kanet, Soviet Foreign Policy in the 1980s (New York: Praeger, 1982) pp. 37–57; Thane Gustafson, The Soviet Economy in the 1980s (Santa Monica, California: The Rand Corporation, The Rand Paper Series, P 6755, 1982).
N. A. Tikhonov, Osnovnie Napravleniya Ekonomicheskovo i Sotsial ‘novo Razvitiya SSSR na 1981–1985 godi i na Period do 1990 goda’ (Moscow, 1981) p. 7.
Klaus Knorr, Power and Wealth (London: Macmillan, 1973), p. 75.
E. H. Carr, The Twenty Years’ Crisis 1919–1939 (London: Macmillan, 1981), p. 113.
Major-General Professor A. Gurov, ‘Effektivnost Material’novo Obespecheniya’, Krasnaya Zvezda, 9 December 1982, p. 2.
L. I. Brezhnev, Report of the Central Committee of the CPSU to the XXVIth Congress of the Communist Party of the Soviet Union and the Immediate Tasks of the Party in Home and Foreign Policy (Moscow, 1981) p. 11.
Jan S. Prybyla, ‘The Economic Crisis of State Socialism: Its Philosophical and Institutional Foundations’, Orbis, Winter 1983, p. 886.
Georges Sokoloff, ‘Sources of Soviet Power: Economy, Population, Resources’, in Christoph Bertram (ed.), Prospects of Soviet Power in the 1980s (London: Macmillan, 1980) p. 71.
Narodnoe Khozyaistvo SSSR za 60 let (Moscow, 1977) pp. 10–11.
Walter Rostow, Stages of Economic Growth, (Cambridge: Cambridge University Press, 1960); R. Nurkse, Problems of Capital Formation in Underdeveloped Countries, (New York: Oxford University Press, 1953).
Daniel L. Bond and Herbert S. Levine, The Soviet Domestic Economy in the 1980s, unpublished paper (Washington, DC, February 1983) pp. 2–3.
Office of Soviet Analysis, CIA, USSR: Economic Trends and Policy Developments, Hearings on the Allocation of Resources in the Soviet Union and China — 1983, JEC, Congress of the US, 20 September 1983, p. 62.
Ibid.
Department of Defense, Annual Report FY 1981 (Washington, DC, 1980).
Prospects for Soviet Oil Production, CIA, ER77-10270 (Washington, DC, 1977).
Security, (Lexington, Mass.: Lexington Books, 1983) pp. 7–29.
V. Krasovskii, ‘Technicheskoe perevooruzhenie proizvodstva i effektnivnost remonta’, Voprosy Ekonomiki, no. 7, 1981, pp. 31–41.
The Military Balance 1983–84 (London: IISS, 1983) p. 13; Fewtrell, The Soviet Economic Crisis, p. 8; World Armaments and Disarmament, SIPRI Yearbook 1980 (London: SIPRI, 1980) p. 7.
Donald F. Burton, ‘Estimating Soviet Defense Spending’, Problems of Communism, March–April, 1983, pp. 85–93.
Steven Rosefielde, False Science, Under-estimating the Soviet Arms Buildup (Brunswick, NJ: Transaction Books, 1982); W. T. Lee, The Estimation of Soviet Defense Expenditures: An Unconventional Approach, (New York: Praeger, 1977); Franklyn D. Holzman, ‘Are the Soviets Really Outspending the US on Defense?’, International Security, Spring 1980, and ‘Soviet Military Spending: Assessing the Numbers Game’, ibid, Spring, 1982; World Armaments and Disarmament, SIPRI Yearbook 1979, p. 24.
ACDA, World Military Expenditures and Arms Transfers, 1968–1977 (Washington, DC, October 1979) p. 13.
Allocation of Resources in the Soviet Union and China — 1977, JEC, Subcommittee on Priorities and Economy in Government (Washington, DC, 1977).
Abraham S. Becker, The Burden of Soviet Defense (Santa Monica, California: The Rand Corporation, R-2752-AF, October 1981) p. 1.
P. V. Sokolov (ed.), Politicheskaya Ekonomiya Sotsialism (Voenizdat, Moscow, 1974) p. 86.
N. S. Khrushchev, Khrushchev Remembers, (London: Andre Deutsch, 1971) p. 519.
Speech by L. I. Brezhnev on Victory Day, 12 May 1981 (Soviet News, Soviet Embassy London, no. 6070, 1981 p. 154).
Raymond L. Garthoff, ‘SALT and the Soviet Military’, Problems of Communism, January–February 1975, p. 26.
Becker, The Burden of Soviet Defense, p. 41; David Holloway, The Soviet Union and the Arms Race (London: Yale University Press, 1983) p. 130.
For example, Myron Rush, ‘Guns over Growth in Soviet Policy’, International Security, Winter 1982/83, pp. 167–79.
Ibid, 175.
Ibid, pp. 176–7; See also Myron Rush, ‘The Soviet Policy Favoring Arms over Investment since 1975’, in Soviet Economy in the 1980s: Problems and Prospects, part 1, pp. 328–30.
Ekonomicheskaya Gazeta, no. 32, August 1979, pp. 9–16; Pravda, 29 July 1979.
Abram Bergson, ‘Soviet Economic Slowdown and the 1981–85 Plan’, Problems of Communism, May–June 1981, p. 30.
Abram Bergson, Productivity and the Social System — The USSR and the West, (Cambridge, Mass.: Harvard University Press, 1978).
Washington Post, 2 August 1983, New York Times, 5 August 1983.
Oleg K. Antonov, article in the newspaper Trud, reproduced in Aviation Week & Space Technology, 11 April 1983, p. 67.
Pravda, 6 January 1984, p. 2; Kommunist, no. 5, 21 March 1984, p. 5, talks about ‘formalism and a hackneyed attitude in determining the prospects for growth are inadmissible’.
Joseph S. Berliner, ‘Managing the USSR Economy: Alternative Models’, Problems of Communism, January–February 1983, p. 40.
Boris Meissner, ‘Transition in the Kremlin’, Problems of Communism, January–February 1983, p. 14.
A. A. Makarov and A. G. Vigdorchik, Toplivno energeticheskii Kompleks (The Fuel and Energy Complex) (Moscow, 1979) p. 201.
Paul K. Cook, ‘The Political Setting’, in Soviet Economy in the 1980s: Problems and Prospects, pp. 10–29.
Centrally Planned Economies Longterm Projections (Washington, DC: Wharton Econometric Forecasting Associates, 1982–83); for the original model see Donald W. Green and Christopher I. Higgins, SOV-MOD I, A Macroeconometric Model of the Soviet Union (New York: Crane Russak, 1977).
William E. Odom, ‘Choice and Change in Soviet Politics’, Problems of Communism, May–June 1983, pp. 17–18; Fewtrell, The Soviet Economic Crisis, pp. 31–4; Gustafson, The Soviet Economy in the 1980s, pp. 27–33; Bond and Levine, The Soviet Domestic Economy, pp. 18–22.
Author information
Authors and Affiliations
Copyright information
© 1988 International Institute for Strategic Studies
About this chapter
Cite this chapter
Dibb, P. (1988). Economy in Crisis?. In: The Soviet Union. Studies in International Security. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-19349-3_3
Download citation
DOI: https://doi.org/10.1007/978-1-349-19349-3_3
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-0-333-47055-8
Online ISBN: 978-1-349-19349-3
eBook Packages: Palgrave Political & Intern. Studies CollectionPolitical Science and International Studies (R0)