RE: Soviet collapse
There were many stages to the Soviet collapse. The military buildup diverted investment & R&D to wasteful activities -- like military and space spending -- which -- in contrast to the U.S. -- had few beneficial spinoffs. USSR was never able to build up profitable high-tech exports, but rather had to subsidize their allies -- who in turn -- were never able to build durable economies.
I believe that a tougher and more brutal boss that Gorbachev could have kept things going for a while longer, but any ultimate solution would have required economic reforms that were ideologically unacceptable and for which there existed no management cadre. The idea of pulling off an economic revolution in a country in which economic dogma was anti-revolutionary is absurd.
The collapse of the Russian economy (and of many of the other former USSR Republics) is attributable, I believe, to the lack of experienced entrepreneurial and managerial classes. Pre-collapse managers in Russia knew only about managing with coercion and fixing. They were rarely able to get worker commitment even when they controlled all rewards. With the inability even to feed workers or to discharge them, many enterprises collapsed. With the inability of government to pay for output, many others collapsed -- especially some of their most advanced (military) firms.
Few of the Republics managed to start to rebuild themselves despite many hangover problems (Estonia and, perhaps, Lithuania). The Eastern European countries did much better than Russia. Even after long lapses, there were strong cultural independence of communism and traditions of small business and even industrialism to help. Hungary and Poland are promising examples, as obviously is former East Germany.
What seems increasingly clear in this era is that small compact nations -- sharing history and cultural traditions -- can pull themselves together as long as they are left alone by ambitious neighbors. The best example of this is Slovenia. This kind of independence is safest and best when these small nations can be grouped together in free trade areas.
The possible amalgamation and reduction of national identity is potentially dangerous, but at the same time, peaceful reemergence of nations such as Scotland, Wales, Catalonia are now possible, which they hardly were before. Nationhood in EU doesn't mean as much as it once did. It is possible that EU will unify currencies without destroying the national identify that I believe is necessary for successful government. No one knows if different nations can share a single economy.
The United States is an argument for this proposition, but the States with few exceptions share more or less common cultures. We are hardly free of dissent, and who can say if Puerto Rico would work out as a State, should Congress offer it and they accept it. |
