Who Defeated The Soviet Union - Road to the Middle Class

IN HINDSIGHT, everyone knew that the Soviet Union was bound to collapse. Conservatives knew that it was the firmness of Ronald Reagan. Liberals suddenly discovered that the Soviet Union was bound to collapse anyway—although they had cleverly avoided telling anyone before 1991.

But Yegor Gaidar in his book, The Collapse of an Empire: Lessons for Modern Russia, has a different take. It all started when the Bolsheviks were deciding how to develop the Soviet Union in 1928-29. Should they allow peasant argiculture and the market system while still hanging onto political power? Or should they choose another way?

The solution preferred by Joseph Stalin was the expropriation of peasants� property, forced collectivization, and extraction of grain. Judging from the available documents, the essence of this decision was relatively simple. Bukharin and Rykov essentially told Stalin: "In a peasant country, it is impossible to extract grain by force. There will be civil war." Stalin answered, "I will do it nonetheless."

The problem was that the forced expropriation of grain to feed the industrialization of the cities (the strategy also used by Mao) resulted in widespread famine in the countryside.

That might be fine, temporarily, while the industrial sector got up to speed, but unfortunately, it never did. The industrial output of the Soviet Union never came up to world-class standards. As Nikolai Ryzhkov, chairman of the USSR Council of Ministers, put it

"No one will take our machinery production. That is why we are exporting mainly raw materials."

And nobody has ever argued that the Soviets had a clue when it came to consumer products.

Fortunately, the Soviets got a lucky break in the 1970s. The oil price explosion and oil discoveries in western Siberia enabled them to pay for grain imports by exporting oil. Then came the fateful day in 1985.

The timeline of the collapse of the Soviet Union can be traced to September 13, 1985. On this date, Sheikh Ahmed Zaki Yamani, the minister of oil of Saudi Arabia, declared that the monarchy had decided to alter its oil policy radically. The Saudis stopped protecting oil prices, and Saudi Arabia quickly regained its share in the world market. During the next six months, oil production in Saudi Arabia increased fourfold, while oil prices collapsed by approximately the same amount in real terms.

It cost the Soviet Union $20 billion a year that it needed by buy grain from abroad. For a few years the Soviets were able to stay afloat by borrowing money from the West. Then came the crunch. The banks refused to continue lending.

Anatoly Cherniayev described the situation in Moscow in March 1991:

If [the grain] cannot be obtained somewhere, famine may come by June. . . . Moscow has probably never seen anything like that throughout its history—even in its hungriest years.

And that was the end of the Soviet Union.

So maybe now we can understand why the United States has had such a chummy relationship with the Saudis. They threw the switch that ended the Soviet Union.

Now if only they would throw the switch on their Wahabi mosques and their poisonous imams.

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Christopher Chantrill blogs at www.roadtothemiddleclass.com. His Road to the Middle Class is forthcoming.