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For some shock is hell, for others it is a kindly mother. Part Three

26-06-2010, 21:30


"Spread this truth - the laws of economics are like the laws of engineering. The same set of laws works everywhere." This postulate is worthy of an inhabitant of a lunatic asylum, but belongs to a completely sane person named Lawrence Summers: Chief Economist of the World Bank in 1991. "Yes sir!"  Said the Russian version of the "Chicago boys", "spilling" all over the face of their native land. Exceptionally arrogant and unquestioning, unfamiliar with the basics of real economics, they assimilated two or three rules of the "shock therapy" theory, lacking even a basic understanding (like dressing up!). These "market Bolsheviks" started what Naomi Klein calls in her book "creative destruction."

They were in a hurry. The task required was "to make changes so quickly and suddenly, that resistance was impossible." Nobel laureate Joseph Stiglitz in his feature on "shock therapy" wrote: "Only a rush at the moment during the fog of the" transition period “opens “a window of opportunity," which allows changes to how people acquire the ability to defend their earlier, vital interests.” There is one prerequisite - the presence of a crisis. In Russia there was "plenty" of that. According to Jeffrey Sachs, the chief in charge of the reform process in Russia, the country was evidently, "a first-class macroeconomic crisis", and as "as intense and dangerous, as he had ever seen."

"In just one year,” says N. Klein, " shock therapy "devastated the country, millions of Russians from the middle class lost their savings in the devaluation of money ... The level of consumption of the average Russian in 1992 decreased by 40% ... And a third of the population lived below the poverty line.” When people began to sell their private belongings and family assets, "the economists of the Chicago school praised it as "entrepreneurship,” as a sign of the approaching capitalist revival." The program of "shock therapy" also included the rapid privatization of about 225,000 companies in the country belonging to the state. Many of us remember a time when factory workers, waking up in the morning, learned that their company had been sold. To who? Under what conditions? On the basis of whose interest? Most importantly - with no guarantees of employment or wages? All these questions remain unanswered.

The "impact" was massive throughout all Russia. Ordinary people found themselves in a new type of exploitation, which is vividly portrayed by one witness cited by the author: "For many years we lived under the communist dictatorship, and now we have discovered that life under the dictatorship of businessmen is no better. Few people are as contemptuous of the country as they are." At the time, an economist of Russian origin, who is absolutely anti-communist, noticed that the administrative pressure on the individual gave way to pressure on him from the so-called "business world", and the latter was "completely and utterly nasty."

I recall a conversation that took place while talking to E. V. Yakovlev -  a well known liberal from the sixties, on the tenth floor of the "Ostankino" TV complex, when he headed the State Television and Radio Company. At first the conversation was purely professional and conducted exclusively in a working manner, and even with the offer of a cup of tea at a table in the far corner of a long and uncomfortable office, there were no signs of any mutual revelations. We were not close, either by opinion or social circles, but kept a spark of empathy for each other.

At some point, the conversation took a surprise turn for me. With unconcealed annoyance, if not bitterness, Egor Vladiromivich lamented the fact that the expectations of the intellectuals of the sixties, who thought that after the communists the country could breathe freely, develop a truly democratic civil society, in which public debate would come to life, and with it the increased role of the intelligentsia - did not materialize. The crimson jackets that produced the first impressions of something revolutionary remained a third class political "raspberry", as the saying goes, "no gods, no inspiration, no tears, and no life without love ..."

Such a turn in the conversation puzzled me because I thought that, taking up such an important political position on the main TV channel, my companion had merged with the new political elite. I cautiously asked the question: "What did he expect, he and his associates, reformers and evolutionists by nature, when instead of the expected ideological revision, they observed the rapid and quite revolutionary collapse of the Soviet Union, and not only its government, but also its social structures?" The answer was."We expected anything, but not what is happening around us." At the same time, Egor Vladimorivich shrugged his shoulders.

The explanation for this "confusion" can be found in the extensive memoirs of U.S. diplomats who worked at that time in Moscow hand in hand with the "Chicago boys". Here is the testimony of one of them: "The U.S. government chose economics over politics. We chose price liberalization, privatization of industry and the creation of a form of capitalism truly free from regulation. And in general, we were hoping that the legitimacy, civil society and participatory democracy would automatically evolve  ... Unfortunately, this decision pushed us to ignore the wishes of the people in the implementation of the economic program. "

The engineered rationalism of "shock therapy" became hugely shameful. However, this could not serve as a comfort to the people who once cherished utopian hopes for the rapid construction of a "new society", a "new man", a "new state". Egor Vladimorivich showed his utopianism, in particular, in a lack of understanding of how people who branded the "utter rottenness of the previous regime," could suddenly bring back to life many of its worst features. Using this dialectical mishap allowed me to approach him with a fraction of healthy metaphysics. I asked Egor Vladimorivich, whether or not he had come across a curious observation by Fyodor Dostoevsky, who once uttered: "The low soul, freed from the yoke, does itself oppress others ..." - "How true, how true! Could you write that down for me right now? "Of course, I complied with his request.

This conversation took place shortly before the resignation of E. V. Yakovlev, which if he did not know about, he guessed, and that perhaps explains his frankness, as he had nothing to lose...

By this time a violent and brutal spring "shock revolution" had swept across the country. However, the apotheosis was in the future, and the soaring "Chicago boys", similar to the accursed days of the commissars, scoured the earth from end to end in search of new victims.

 

 

(To be continued)

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