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You Can't Delay This Operation : Gorbachev sends a get-well card instead of a scalpel

October 21, 1990

The Soviet Union's collapsing economy is in desperate need of radical surgery. President Mikhail S. Gorbachev has sent it the equivalent of a get-well card.

The program he offers is a heavily diluted version of the 500-day plan for sweeping reform that some of the country's most astute--and most worried--economists urged on him. By delaying adoption of the painful measures that are needed to replace the failed command economy, Gorbachev hopes to keep a surly bureaucracy in line and to prevent a deprived populace from exploding out of control. But at best this is an effort to buy time, not to confront problems.

The Soviet Union's deepening winter of discontent, with its shortages of everything from potatoes to pharmaceuticals, won't end with the spring thaw. Every sign points to an economy that will go on contracting.

An International Monetary Fund official who has been looking at Soviet economic problems pronounces himself "horrified" by what he sees. Moscow economists anticipate a 7% decline in gross national product this year and as much as 20% in 1991. Inflation is now believed to be running at 5% a month. Basic crops rot in the fields for lack of harvest hands and transport, while store shelves are empty.

A state committee that tracks the availability of consumer goods reports that 996 out of 1,000 key products are in short supply or not to be had at all. This is the epitaph of a system that believed economic laws could be repealed and human aspirations denied.

Economist Stanislav S. Shatalin, main author of the controversial 500-day plan for transforming the Soviet economy, says "we have been living in a world of crooked mirrors, and their distortions have spread to all spheres of our life . . ." Huge state enterprises are grinding to a halt; more than 1,000 factories have shut down because they can no longer get raw materials. Internal trade is suddenly imperiled. The Parliament of the Ukraine, the country's bread-basket, has banned food shipments to other parts of the country, a move certain to inspire other republics to hoard their own products at home.

The prescription for trying to rescue the Soviet state from 70 years of economic mismanagement is necessarily radical, if only compared to what has gone before. The ambitious Shatalin plan, over about 18 months, would privatize most housing, land and industry, eliminate state subsidies to failing enterprises, decontrol most prices, make the ruble a convertable currency and open the domestic market to foreign investment. This changeover from communism to a market economy would inevitably boost unemployment, add to inflation and increase social tensions.

Would the Shatalin plan work? No one knows, but at this point it seems clearly preferable to the slower, more grudging process that Gorbachev has opted for. He still offers the prospect of an economy headed toward free enterprise, private ownership, prices set in the marketplace. But not all at once, not too soon and not--so he and his advisers hope--in ways that would put even more stress on the already badly strained social fabric.

This may be the kind of caution that's natural to any politician. What it fails to take into account is that time may simply have run out for the Soviet Union to achieve gradual and orderly change.

Things are falling apart with accelerating rapidity. Food riots have occurred in some areas. Ethnic and regional antagonisms grow sharper. As unemployment rises and scarce goods become unobtainable, civil disorders could grow and spread. Once, not too long ago, Washington and Western Europe might have taken comfort in seeing the Soviet Union wracked by domestic turmoil. No more. Now the real and growing prospect of internal strife is a cause for mounting concern and even alarm.

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