The Penguin History of Modern Russia

with Western banks. Imports of grain and industrial consumer goods increased. Gorbachev refused to allow any factory or kolkhoz to go to the wall, and there were no bankruptcies. But the general economic condition was dire. Most Soviet citizens could hardly believe that so rapid a deterioration had taken place. Industry was on the verge of collapse. Inflation was rising; banking and commerce were in disorder.

They blamed Gorbachev. What counted for them was not that the economy had basically been in long-term decline long before 1985 but that they themselves were worse off than for decades. Even if they were unaware of the huge technical flaws in the Law on the State Enterprise, they knew from direct experience that the attempt at reform had not worked and that Gorbachev’s promises of economic regeneration had not been fulfilled. By 1990, people were wondering whether they would soon be starving. There had not been such fear about the popular living conditions since the end of the Second World War.

At this point of crisis there was danger to Gorbachev if he was cautious and danger if he was daring. He would have had a somewhat easier time if he had known his mind on the economy. Although he wanted some basic reform, he was unclear about exact measures and schedules. Nor did he recognize the need to dispense with the services of Ryzhkov as Chairman of the Council of Ministers. Ryzhkov had voiced his unhappiness about extensive de-nationalization and monetary reform in December 1989.⁹ By June 1990 Ryzhkov yielded somewhat, but still called in opaque terms for a ‘regulated market’; he also announced that he would soon be introducing an increase in food prices so as to correct the gross imbalance in the state budget. Ryzhkov’s position combined the worst of both worlds: a half-hearted, drawn-out privatization programme and a further rise in the cost of living. The most radical among Gorbachev’s advisers argued that the economy’s collapse was imminent. According to them, measures had to be deep, had to be rapid, had to be consistently imposed.

Even Gorbachev’s agile mind had failed to assimilate basic economic concepts, and he simply refused to accept that consensus was unobtainable. In August 1990 he got permission from the USSR Supreme Soviet to create a commission to elaborate a plan for industrial, agricultural and commercial recovery — and Yeltsin agreed to co-operate with the commission. The result was the ‘500 Days Plan’, composed chiefly by Stanislav Shatalin. Gorbachev supported it, but then vacillated under pressure from Ryzhkov. In September he ordered a reworking of the ‘500 Days Plan’ by Abel Aganbegyan to effect a compromise between the positions of Shatalin and Ryzhkov. This was like mating a rabbit with a donkey. Aganbegyan produced a predictably unworkable mixture of radical language and conservative ideas. But he had helped Gorbachev out of his political complications, and in October the Supreme Soviet gave its assent to the set of ‘Basic Guidelines’ he presented to it.

At the time his angriest adversaries were the conservatives in the Congress of People’s Deputies who formed their own Soyuz (‘Union’) organization in October 1990.¹⁰ Most Soyuz members were Russians, but otherwise they were a diverse group. They included not only communist party members but also Christian believers, nationalist writers and ecological activists, and some of them were simply Russian functionaries who lived outside the RSFSR and were terrified about their personal prospects if ever the Soviet Union fell apart. Soyuz’s unifying belief was that the Soviet Union was the legitimate successor state to the Russian Empire. Its members were proud of the USSR’s industrial and cultural achievements of their country; they gloried in the USSR’s defeat of Nazi Germany. For them, Gorbachev was the arch-destroyer of a great state, economy and society.

Gorbachev was more disturbed by Soyuz than by those of his own supporters who wanted him to be still more radical. He knew that Soyuz had many undeclared sympathizers and that these were even to be found among central political and economic post-holders. Having backed down over Shatalin’s ‘500 Days Plan’ for the economy, he was sufficiently worried to give ground also in politics. One by one, he dispensed with prominent reformers in his entourage.

Alexander Yakovlev ceased to be one of Gorbachev’s regular consultants after his bruising treatment at the Twenty-Eighth Party Congress. Yakovlev and Gorbachev ceased to appear publicly together. In November, Vadim Bakatin was asked by Gorbachev to step down as Minister of Internal Affairs. Gorbachev also lost his close party colleague Vadim Medvedev. Bakatin and Medvedev had been constant proponents of the need to take the reforms further and faster. Then, Eduard Shevardnadze followed. In his case he went without being pushed; but unlike the others he did not go quietly. In an emotional speech to the Congress of People’s Deputies on 20 December he declared that, unless Gorbachev changed his present course, the country was heading for dictatorship. Thereafter Nikolai Petrakov, Gorbachev’s economics adviser, also departed. Even Ryzhkov left the political stage, laid low by a heart condition.

Ryzhkov’s job as Chairman of the Cabinet of Ministers was taken by Valentin Pavlov, the Minister of Finances. Pavlov was even more suspicious of reform than Ryzhkov; and the new Minister of Internal Affairs was Boris Pugo, who was known as an advocate of repressive measures. Gorbachev’s choice of Gennadi Yanaev, who agreed with Pavlov and Pugo, as Vice-President of the USSR was another indication that Shevardnadze’s fears were not entirely misplaced. Furthermore, on 13 January 1991, Soviet special forces in Lithuania stormed the Vilnius television tower. Fifteen people were killed in this flagrant attempt to deter separatist movements throughout the USSR. Gorbachev disclaimed any knowledge of the decision to use force, and the blame was placed upon officials at the local level.

Yet Gorbachev retained his determination to protect the territorial integrity of the USSR. On 17 March he organized a referendum on the question: ‘Do you consider necessary the preservation of the Union of Soviet Socialist Republics as a renewed federation of equal sovereign republics in which the rights and freedom of the individual of any nationality will be guaranteed?’ Gorbachev’s phrasing made it difficult for reform-minded citizens to vote against sanctioning the Union. But in other aspects of public life Gorbachev was beset by trouble. Another Russian miners’ strike had broken out days earlier. In March, furthermore, supporters of Polozkov called an emergency session of the Russian Congress of People’s Deputies in a bid to oust Yeltsin; and Gorbachev, still leaning in the direction of Pavlov and Pugo, allowed 50,000 Ministry of Internal Affairs troops to be introduced to the capital to prevent a demonstration in Yeltsin’s favour. For a brief time Moscow seemed near to upheaval. But Gorbachev baulked at the potential violence needed to restore direct control. He was also impressed by the 200,000 Muscovites who took the risk of turning out for a rally in support of Yeltsin. At last — alas, far too late! — Gorbachev definitively reverted to the agenda of reform.

A rapprochement with Yeltsin ensued. Gorbachev and Yeltsin announced that they would work together with common purpose. On 23 April a meeting of nine republican leaders was arranged at Gorbachev’s dacha at Novo-Ogarevo to draft a new Union Treaty that would augment political and economic powers of the governments of the Soviet republics. The final version was to be signed on 20 August. This tried the patience of Polozkov and his supporters beyond their limits, and they vehemently criticized him at the Central Committee of the USSR Communist Party on 24–5 April. Their comments enraged Gorbachev in turn. At one point he handed in his resignation as General Secretary; only a petition in his favour organized by Bakatin and sixty-nine other Central Committee members persuaded him to stay in office. Polozkov lacked the nerve to push him out.¹¹ The result was victory for Gorbachev: the terms of the proposed Union Treaty were accepted in principle by the Central Committee. The date of signature was set for 20 August.

A delighted Yeltsin travelled around the RSFSR urging the autonomous republics to ‘take whatever helping of power that you can gobble up by yourselves’.¹² When submitting himself to a presidential election in Russia on 12 June, he won a massive majority. His running-mate Alexander Rutskoi, an army colonel, became Russian vice-president. Other prominent associates were Ivan Silaev and Ruslan Khasbulatov: Silaev was appointed the RSFSR Prime Minister and Khasbulatov the Speaker of the Russian Supreme Soviet. On 20 July Yeltsin pressed home his advantage by issuing a decree banning communist party organizations from keeping offices in administrative institutions and economic enterprises in Russia. This so-called ‘de-partization’ was not approved by Gorbachev; but even he was exasperated by his party’s resistance to self-reform, and he arranged for another Party Congress to be held to determine a permanent strategy.

But Gorbachev had scarcely any credit left with Soviet society. The economy was collapsing in every sector. Industrial output fell by eighteen per cent in 1991, agriculture by seventeen per cent. Even energy production, whose exports had supplied the backbone of state revenues in previous years, went down by ten per cent. The USSR budget deficit was between twelve and fourteen per cent of gross domestic product whereas it had been only four per cent in 1990. The result was a decline in the government’s ability to sustain the level of imports of consumer goods. The USSR’s towns and villages also experienced a shortage in fuel supplies. Consumers were further troubled by Pavlov’s decision at last to start raising the prices for food products in state shops. The result was highly unpleasant for a population unaccustomed to overt inflation. Across the year, it is reckoned, prices in