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Books by Grigory Yavlinsky
ECONOMICS AND POLITICS IN RUSSIA DIAGNOSIS (Spring of 1992)
 
The Center for Economic and Political Research (EPIcenter)
Moscow, May 1992
 
III. AUTHORITIES - IMITATION

ON THE CONGRESS

The past Congress was conceived as a congress of reforms and the Constitution. It was presumed that as the highest body of state authority it had to find solutions to key issues of fundamental importance for the state, open up fresh possibilities for economic reform by deciding the questions on land and the federation, and adopt a new Constitution, at least in the first reading.

In fact the main problems were merely designated. The question of the economic reform boiled down to the question about the existence of the present government, whereas the new Constitution was approved as a general guidelines while deputies' attention was almost completely concentrated on amending the one now in force.

On the other hand, the attention of experts, analysts and commentators was focused on the government, rather on whatever was almost unanimously designated in the mass media as "a government crisis which broke out at the Congress and was favourably resolved right there". This proved to be the decisive result and main content of the Congress.

Indeed, this Congress and the government crisis are interrelated phenomena. But the Congress was neither the beginning nor the end, but a clear manifestation of aggravation. The crisis of the government rose not at the Congress, but much earlier, almost immediately after the formation of the government as such. Its visible hallmark is the constantly resounding question about pending resignation, which became topical from the very first days.

The main component of the current government crisis is the content and character of the government's so-called economic policy, which betrays a number of serious miscalculations:

- underestimation and insufficient understanding of the importance of keeping the economic space intact on the scale of the former USSR;

- non-comprehensive pursuit of the reform and overestimation of its separate components, especially the monetarist element;

- the loss of complete and watertight control over financial, monetary and credit flows;

- the supplanting of the liberalization of prices with the decentralization of control over them;

- gross mistakes in introducing the new taxation system;

- the actual failure of the deficit-free budgetary policy;

- actions and solutions leading towards Russia's disintegration;

- overestimation of the possibilities of Western aid complemented with different concealed, if not to say cunning, actions;

- extreme lack of organization in the government's work.

As a result the economy has found itself on the brink of hyperinflation, which naturally affects the standard of living, possibilities of management, the production recession, etc.

Instead of getting down to rectifying mistakes at once - upholding and ratifying the economic treaty; exerting maximum effort to accelerate privatization and the land reform; delivering a strike at the monopolies without any further delay; devising and implementing the strategy of a currency reform (in the shape of a parallel currency or the stabilization of the monetary unit); liberalizing foreign trade at the highest possible speed - the government began publicly demanding resignation.

It is gross politico-tactical blunders that led the government into the impasse of declarations, demonstrative gestures and conflicts.

WHEREIN OBVIOUS MISTAKES ARE SEEN:

- obstinacy and bravado; refusal to coordinate action with the Supreme Soviet as the body of legislative authority and with society, which must be the main participant in the changes and in the programme of reforms; depriving itself thereby of the minimum indispensable legitimacy;

- on the eve of the Congress - feverish, uncoordinated, incomprehensible actions in relation to the government's composition and status;

- later, at the Congress, in the speech by the head of government - retreat on many of the reform's positions (crediting; direct subsidies to agriculture; higher wages; proclamation and then freezing of action in relation to the prices of power resources, etc.).

It is quite natural that the retreat beaten by the government itself was aggravated by the Congress, as expressed in the proclamation of social charity and the statement concerning the question of parliament's control over the government's activities.

However, a careful analysis of the Congress draft resolution, which triggered so dramatic reaction from the government in the shape of a declaration on resignation, gives grounds for assuming that this document in itself is not an obstacle to continuation of it may compound the government's work.

One cannot but note, however, that all or nearly all the decisions whose fulfillment the Congress demanded have been adopted or signed by the chairman of the government (President) in the course of the past year. In drafting an action programme, if one really existed, the government ought at least to have taken full stock of its own, already existing decisions.

At the Congress there was a need not to retreat or vacillate but to firmly and persistently stand up for their position. Then it would really be possible to speak about a victory of the government which defended the reforms. Now, after all the emotions, ultimatums, injuries, apologies and assurances, the "victory won by the government" is seen in a totally different light. Particularly if one analyzes the situation which took shape at the Congress in connection with the government's resignation.

Detailed study has shown that the Congress resolution is fully consistent with the report of the President and hence the government. Moreover, estimates indicate that the President's report is "dearer" than the Congress resolution - in the sense that it injects more empty money into the national economy. What then did the government take up the cudgels against? it turns out that it resigned in reply to the speech made by the head of government and merely supported by the Congress in the shape of its resolution. But then it is an altogether different conflict and a different crisis. If one considers that the report of the head of government was prepared by the same government which sent in its resignation, it appears that the conflict or crisis occurred on its own. Then the Congress passed a Declaration which the government had insisted on, reaffirming its own decisions, it is true. Whereupon, having essentially achieved nothing since there was nothing to be achieved, the government changed its mind and decided not to resign.

Everything boiled down to a political game. It would not be worthy of such close attention were it not so inflammable.

In fact, in the name of saving the government, a question was posed and discussed in real earnest at the Congress about abolishing the representative state bodies - the Congress and the Supreme Soviet: the only bodies which politically bind all its parts (regions) together in conditions of the disintegration threatening Russia by bringing their representatives together. In the final analysis, the conflict between the executive and legislative bodies, sharply aggravated by the government at the Congress and reduced thereby to the state of a crisis of state authority, may have global consequences: a change in the state system and the political regime. As a result, the victory declared over conservative forces turned out in fact to be a sudden exacerbation of the government crisis, which sparked an even more dangerous crisis of state authority.