“It was necessary to give cooperators time to get over it”

Famous TV journalist of the 1980s Sergey Lomakin about the economic mistakes of perestroika. Part 1.

“It was necessary to give cooperators time to get over it”
Photo: press service of OTR Channel / bm24.ru

Realnoe Vremya continues a series of interviews dedicated to the 35th anniversary of the beginning of the revolutionary changes in Soviet society, better known as perestroika. Sergey Lomakin, a leading TV journalists of that time, tells us why Mikhail Gorbachev's economic reforms were being implemented so difficult.

“I am not sure that Gorbachev understood the state of the economy in the volume of the entire country”

Sergey Leonidovich, in the first 2 years since his election as General Secretary, Mikhail Gorbachev was mainly engaged in the economy, implementing a programme of acceleration, that is, technical modernization of the country's enterprises. We can say that the new secretary general, like Andropov, initially saw the country's problems only in its lagging (in particular, in technical terms) economy?

I don't think that Gorbachev understood the state of the economy in the whole country because before his election as General Secretary, as a member of the Politburo and Secretary of the Central Committee, he had been engaged only in agriculture. Agriculture in the Soviet years was always a failed industry, and people were put in charge of it clearly not for their future promotion, and soon these people inevitably left from their post. But Gorbachev was a pleasant and happy exception here because his immediate leaders, i.e. general secretaries, did not hold office for long due to illness and were practically not engaged in the economy.

However, it should be noted that Andropov tried to deal with the country's problems: he had correct and accurate ideas about what should be done in the country first. And Gorbachev, implementing these ideas, also did not discover an America in 1985. Yes, that year, during a trip to Leningrad, he spoke to the party activists of the city and region, met people on the streets and impressed the country with the knowledge of the problems and difficulties faced by ordinary people — with housing, food, queues, and so on. Thus Gorbachev caused an outburst of popular love: people saw that here he was 'a great Goodwin”, but, in fact, Gorbachev began to do what Andropov wanted to do.

Andropov, realising the problems of the economy, simply did not have time to do anything to solve them. Photo: RIA Novosti archive

Andropov, realising the problems of the economy, simply did not have time to do anything to solve them. Except for one thing: he appointed Nikolay Ryzhkov, the director of one of the largest factories in Sverdlovsk Oblast, whose task was to develop reforms for the Soviet economy, as head of the economic department of the Central Committee of the CPSU. Ryzhkov started working quite actively in this direction, and the specialists such as Leonid Abalkin and Abel Aganbegyan appeared in the Central Committee as consultants.

The Soviet economy in 1985 was in a precarious position, and here's why: its management system and the country's economic system itself were already unviable. Yes, the country had a huge social support for the population, the social burden of the Soviet state was much (if not much) higher than in modern Russia, but at the same time, labour productivity was the lowest, production was not kept at a very high level (although it did not fall), and what our heavy industry produced, with the exception of defense products, was not particularly necessary for the country.

Besides, there was a heavy dependence of enterprises on Gosplan, on figures, on plans that were determined in Moscow, not locally — it was Moscow that controlled everything, down to buttons and needles. But nevertheless, it was impossible to track all the necessary amount of production in Moscow, so there were waves of attributions, hack work, theft of budget funds, and so on. And when they say that the USSR, people did not steal, it is not true — they did, just in smaller volumes than now, and mainly due to attributions: directors of enterprises had to report according to the plan. And the plan was scarier than a gun to the temple, most often it was impossible to execute it for quite objective reasons.

Although it was difficult for the inhabitants of the large offices to understand what was happening — they were all right: they were well fed and received rations, but not all of them knew how people lived and how their families were fed, and Gorbachev understood this. But he also understood that economy was not the worst part: it was impossible to change the economic rules in the country without changing the political structure of the country, because everyone — politicians, economists, enterprise directors, journalists, workers, farmers, and even Bolshoi Theater artists — were hostages of ideology. And the ideology was simple — we were a socialist country, we did not have private property, competition, human exploitation.

But changing the ideology was fraught primarily for party functionaries, so Gorbachev had a virtually impossible task — to reform the economy through political reforms.

For the USSR, the raw materials industry played a significant role. Photo: udmurtneft.ru

“The law 'On cooperation' was a small, timid step, but it opened the floodgates in our economy”

Let's recall what the economy of the USSR could have been supported by at that time. By oil?

The economy of the country was based on manufactured products, and here, of course, the raw materials industry played a significant role for the USSR. Yes, the country also exported machine-building products, but only to fraternal social countries, and this was carried out more often in the form of an exchange: we gave them machines, and they gave us one or another of their products. But the Soviet Union rarely exported precision engineering and electronics products, so we inevitably fell behind and had no income.

The raw materials industry provided good exports and brought the USSR a “living” currency, which, in turn, was actively used to buy pipes for the same oil pipelines abroad (mainly in Germany) and to export another important natural product to the West — gas. Besides, the currency made it possible to buy abroad the necessary agricultural products for the USSR, which the country was not fully provided with. Almost from the war to the 1990s, agriculture was on the margins. Here, the main thing for the Soviet leaders was, first of all, the figures for grain. It was believed that a tonne of grain a year should account for per capita, that is, if the country has 300 million people, it should produce 300 million tonnes of grain. But the USSR never produced so much grain. There were 200-220 million tonnes, the rest was purchased abroad — in Canada, Australia, and other countries.

The economy was holding on, but the situation with consumer goods was difficult — the shortage of certain things was felt constantly, quality products were not enough.

Of course, this picture should have been changed, but how? It was possible to change through giving the Soviet economic system private-market relations, that is, it was necessary to withdraw part of the national economy from state ownership to private ownership. At those stages, it was assumed that this could be done with small-scale production, for example, to give up part of the household economy to private hands: shoemakers, hairdressers, bakeries, various small repair shops and small factories that produce consumer goods.

So, the policy of technical economy modernization from Andropov, which was implemented by Gorbachev, was just stupid?

Yes, the acceleration programme belonged to Andropov, who understood the problems in the economy, but none of the country's leaders at the time of its adoption had any thoughts of changing the economic and political relations in the country. But they demanded changes. In those years, the idea of private ownership should have already been introduced into the life of the country, and part of the national economy should have passed into the hands of owners and developed on a private, market basis. The 1988 law 'On cooperation' may have been a small step in this direction, but it opened the floodgates in our economy.

There was a heavy dependence of enterprises on the State Planning Committee, on figures, on plans that were determined in Moscow, not locally. Photo: pastvu.com

What was in the acceleration policy? Yes, this policy required increasing labour productivity, but at the expense of what? Through discipline, through a more accurate and more honest attitude to their duties. No wonder Andropov called for expelling people during working hours from baths, cinemas, and so on, but this was a purely mechanical story. Of course, the most important thing in the economy is labour productivity and technical modernization with increased discipline — one of the surest ways in Andropov's reforms, but her trouble was that it was carried out “in the old way”, if you like, according to the old patterns!

Look, Gosplan has planned to technically re-equip plant N, which produces, relatively speaking, sewing machines. They collect documentation for this, purchase new machines, and bring... and there is no one to work on these machines, workers have no skills, and machines begin to stand in the back yard of the plant in the pouring rain. If you were the owner of a factory as a private owner, you would first train workers, then bring in 150 machines, start working on them, understand that things have started, and start buying more. But the man from Gosplan did not think of such a thing, why should he think about it if there is an order from the government and the Central Committee? They have an order from the Central Committee and they implement it!

But such order was good only during the Great Patriotic War, but after the war, under the command and administrative system, much of the economy was suffocating, there was planning, campaigning, and that is where there was the demon.

“Gorbachev was not thinking to act as they did in the '90s, privatizing not a shoe factory, but the oil industry”

Gorbachev understood this quickly…

He realized this quickly because in the economic elite there were economists who began to say that we did not just manage incorrectly but that the very form of economy was wrong, that it should be changed, and by 180 degrees. Of course, it was impossible to make changes in the economy so quickly — it would be a huge change, not in the economy, but in the brain. The economists — Abalkin, Aganbegyan on the one hand, and Yavlinsky and Shatalin on the other — understood this.

The thing is that the party leadership of the mid-80's could not use such words as “private ownership of the means of production” or “market” — it was such a taboo. And uttering these words to General Secretary Gorbachev was akin to Khrushchev's appearance on the podium of the 20th Congress of the CPSU with a story about what a scoundrel and cannibal Stalin was. Khrushchev had the courage, but Gorbachev did not.

And uttering these words to General Secretary Gorbachev was akin to Khrushchev's appearance on the podium of the 20th Congress of the CPSU with a story about what a scoundrel and cannibal Stalin was. Khrushchev had the courage, but Gorbachev did not. Photo: RIA Novosti archive

This is why there were intermediate links of economic reform — khozraschyot, material interest of the collective, the law on state enterprises and cooperation, and so on. But even if they were intermediate links, they led to one thing — to the transition to the market, to all the laws of the market, and to getting property into the hands of private owners. After all, what is the law 'On individual labour activity'? This was an attempt to resolve the issue with private business, the law allowed a person to keep his business. And now it was only necessary to determine the time for all these laws to work normally in the market conditions.

Another thing is that two groups of economists spoke differently about the transition to the market. The platform was the same, the strategic direction was the same, but economists differed on the timing of the transition to the market. Abalkin and Aganbegyan said that it was to take 5-6 years to do this, while Yavlinsky and Shatalin (and partly Nechaev and Gaidar) argued that the transition to the market was possible within a year and a half — hence “the 500 days” programme.

But they hurried with the transition to the market — other factors began to interfere in the economic reform. There were demands from below, which means that the country was being pushed to an ill-considered transition to the market.

Maybe if there was more money in the country from the same “oil”, perhaps, the reforms would have resulted differently? Gorbachev often spoke about this later.

Undoubtedly, when there is a lot of money in the budget, you can do a lot, and when there is not enough, you need to get out somehow. But the thing is not so much in the price of oil. If you allow business to develop actively and freely in your country, let it grow fur, your economy will develop as it is. But businesses were not given the opportunity to develop. They had just passed the law 'On cooperation' when they said that cooperatives should not do this, they should not do that.

It was necessary to give a few years for the flourishing of cooperation and private entrepreneurship. Photo: oodrc.ru

But the cooperatives themselves did not all strive to produce consumer goods and provide the necessary services. Already by 1991, a considerable number of cooperatives were engaged in intermediary services and resales.

It was necessary to give cooperators time to get over it. If they do produce what they earn on, then thank God. It was necessary to give a few years for the flourishing of cooperation and private entrepreneurship. But alas — no one in the region in the late '80s would have allowed the cooperative to develop in front of the first secretary of the regional party committee, the chairman of the regional executive committee. Officials had their own idea of how the country should develop, and they were not ready to switch to these new forms. Entrepreneurship was taboo for them, and can you imagine the face of the first secretary of the regional committee who is given the command 'Give the opportunity to develop cooperators!'? He would answer Moscow yes, but in fact, he would strangle them on the root. That's the problem!

Therefore, in late 1988 — early 1989, the political leadership of the country realized one simple thing: to change the situation in the economy, they could only through changing the political situation, and first of all, getting rid of the leading role of the CPSU in the state. As the classics said, politics is a concentrated expression of economics. Politicians are always dictated by the economy how to govern the country. Remember, British merchants said in the parliament that, they say, the new law could not be adopted because it infringed on the interests of trade, but other laws were needed, and they were adopted. And the economy was developing.

But in our country, it is the opposite — only politicians determined what the economy should be, and, alas, nothing has changed so far. It is the power structures that determine how to develop the Russian economy, what it produces, how much and who to pay. Gorbachev understood that the economy must be freed from the rigid embrace of politicians, freed from the ideology that hinders the development. That only the largest mining and manufacturing industries, as well as the defense industry, should be left in the hands of the state. And Gorbachev was not thinking to do what Yeltsin did in the 1990s, allowing the privatization of not shoe factories and stores, but metallurgical plants and oil fields.

By Sergey Kochnev