Paul Samuelson 's Erroneous Prediction Of Soviet Growth

One can easily admit that the Party had failed to properly economically plan the needs of each state. The Soviet Union economy was complex and massive, it became an impossible task for the state planners to manage, as they did not want to grant and create more managerial levels that would proceed to the local level resulting in failed timely attempts to the constant changes the economy was going through. Since the Soviet economy was based on state planning, it failed in encouraging innovation and motivating productivity. Managers would also alter numbers in order to produce the quotas that they were required to meet. The growth of the Soviet economy had been in a constant decline since the 1950’s and this progressed to the 1980’s. This was a clear sign that the Soviet economy was in need of a complete economic overhaul. Gorbachev succeeded power in March, 1985 and became General Secretary of the Central Committee of the Communist party of the Soviet Union. His main goal was to revive the Soviet economy, and he strongly believed that success was tied to loosening the governments control and creating a system that included less government intervention and more freedom to allow private initiatives. This new market economy would allow for private enterprise, which what Gorbachev believed would create more innovation. For the first time since 1920’s, individuals were able to own and create businesses.

Stalin’s policy priorities were not building a ‘worker’s paradise’ or a classless society, but protecting Russia from war and invasion. In 1928, Stalin launched the first of two ambitious five-year plans to modernize and industrialize the Soviet economy. These programs brought rapid progress – but also significant death and suffering. Stalin’s decision to nationalize agricultural production dispossessed millions of peasants, forcing them from their land to labor on gigantic state-run collective farms. Grain was sold abroad to finance Soviet industrial projects, leading to food shortages and disastrous famines in the mid-1930s. Soviet Russia was dragged into the 20th century, transforming from a backward agrarian empire into a modern industrial superpower – but this came at extraordinary human cost.

The democratization, economic liberalization, and eventual collapse of the Soviet Union is commonly attributed to Mikhail Gorbachev's Perestroika and Glasnost reforms during the period of 1985-1991. This purpose of these reforms is still a trenchant question as the countries of the old Soviet Union, particular Russia, are being pressured to further liberalize their economies.

The Soviet Union, which was once a world superpower in the 19th century saw itself in chaos going into the 20th century. These chaoses were marked by the new ideas brought in by the new leaders who had emerged eventually into power. Almost every aspect of the Soviet Union was crumbling at this period both politically and socially, as well as the economy. There were underlying reasons for the collapse of communism in the Soviet Union and eventually Eastern Europe. The economy is the most significant aspect of every government. The soviet economy was highly centralized with a “command economy” (p.1. fsmitha.com), which had been broken down due to its complexity and centrally controlled with corruption involved in it. A strong government

The industrial expansion of the Soviet Union resulted in one of the greatest economic growths for a single country that the modern world has ever seen. This economic growth ultimately led to the USSR becoming one of the world’s only two superpowers in the post-WWII era. Much of the country’s economic growth occurred because of the USSR’s use of a command economy, which is “an economy in which production, investment, prices, and incomes are determined centrally by a government” [1]. Using a command economy, the USSR was able to force industrialization in certain sectors in which pre-Soviet Russia highly struggled. One of these sectors was the Nuclear Power sector. Ultimately, Soviet successes in the nuclear power industry were highly evident

The Soviet Union, a communist state whose more equal distribution of income and state-controlled economy had generated impressive growth with no unemployment in the 1930s,

While the liberal experienced emotional changes amid the 1970s, the Communist agreement experienced reduced rates of development yet not the sorts of amazing economic rebuilding that happened in the West. These improvements in the 1970s suggested the Cold War's determination in the 1980s. Arranged in similar connection, the changes of the liberal world economy during the 1970s uncovered – an in a few ways improved – the relative backwardness of the Soviet Union's charge economy, with final outcomes for the truth of the Communist administration. Universal fiscal change, in this view, encouraged the ideological and geopolitical improvements that would take the Cold War.

The people were in a state of famine, the political government was weak, and the economy was in shambles with inflation as high as can be. As Stalin rose in power, this would all change in both positive and negative aspects. One of Josef Stalin’s first methods of rebuilding broken Russia was through what he named to be the Five-Year economic Plans. Through these plans, Stalin would induct a Command, or a Socialist, Economy. This Command Economy would involve a society in which the government would make all economical decisions, controlling nearly all aspects of societal life. As seen in Document One, Stalin believed that implementing a “Socialist economy” would prevent from Russia “[lagging] behind the advanced countries by fifty to a hundred years.” It would bring them up to pace with the surrounding capitalist economies, keeping Russia as a world power. The Five-Year Plans also included the increase of quota in both industrial and agricultural positions. If quota were increased, industrial increase would soon follow. Seen in Document Eight, “the fulfillment of the first and second Five-Year Plans strengthened the U.S.S.R.’s economic position.” The Five-Year Plan would cause for Russia to rise to become a modern industrial society, as well as

Document B informs about that economical and social improvement of the Soviet union, which allows people to look at positive affects of the Soviet Union. In the literacy rate category of document B, Soviet Union had 25% literacy rate in 1915 and 99% literacy rate in 1980. This shows an enormous improvement in education. This also serves as an example that the formation of Soviet Union did not result in a complete negative outcome. Document B also states that in 1980 Soviet Union was the first or second in the world in the production of steel, cotton, wheat, sugar, aluminium, gold and oil. This shows a huge economical advancement both locally and internationally. The area category of the document also states that Soviet Union had 8649000 mi.² of land which portrays how big it actually was. Using that information, Soviet Union’s influence can be found. Therefore it is very important to include this information in textbook because it shows the growth of countries during the Soviets

Firstly, background to the rise of the Soviet Union is examined. Keenan states that the Communists rose to power on ideas which denounced capitalism and

A command economy is one in which the co-ordination of economic activity is controlled and undertaken through administrative means rather than through the market mechanism (Ericson, 2005). Many aspects of the Soviet economy fit this description such as its organisational structure, the methods by which aims and directives were carried out and its lack of a use of pricing within its financial mechanisms, thus it can be argued that the term command economy is an accurate description. However there are another of other aspects to consider such as the use of bargaining to develop a second ‘economy of agreement’ and the

Another repercussion of the Soviet Union’s collapse was the failure of the economies of almost every new post-Soviet country. Most of the economies of the new Republics were left in shambles after the collapse. In Russia, people were not ready for the new economic freedom that resulted from the fall of Communism. Their unpreparedness led to inflation. “Inflation caused prices to go up three hundred percent in the first month, and 2,591 percent by the end of 1992.”( Russian Economy in the Aftermath of the Collapse of the Soviet Union) Just three years after the Soviet Union’s fall, Russia’s inflation rate had skyrocketed to 2591 percent, evidencing that Russians were not prepared for such a rapid evolution, going from a communist economy into a capitalist economy. All post-Soviet countries had the same economic fate as Russia, plunging into worse economic conditions than the United States suffered during its Great Depression. For example, in 1992, the Ukraine had almost a fifteen percent drop in its gross domestic production and Latvia suffered a 33 percent drop. (GDP growth) Many of these countries’ economies are still suffering as a result of the rapid evolution

The many long-term internal causes of the collapse of the Soviet Union centralized around weaknesses in their economy. They had an inflexible central planning system, the inability to modernize, and the inefficiency in their agriculture production. Sometime around the 1970's the computer and automation revolution had emerged. This revolution took over the West, but practically missed the Soviet Union, except in the military sector (Baylis & Smith, 2001.) Gorbachev's goal in economic restructuring was to create a separation between the economic and the political. The major changes began with the legalization of private farming and business co-operatives, and the allowing of foreign company ownership over Soviet enterprises (Baylis &Smith, 2001) All of Gorbachev's ideas on economic restructuring backfired on him since the price levels were inconsistent, and a sense of social confusion about the future of their state was created.

The Russian state has been characterized by its strong heritage of powerful, autocratic leadership. This domination by small ruling elite has been seen throughout Russia's history and has transferred into its economic history. Throughout the Russian czarist period, to the legacy of seventy years of communism; Russia has been a country marked by strong central state planning, a strict command economy and an overall weak market infrastructure (Goldman, 2003). Self-interest, manipulation and corruption have all been present in the Russian economy, and have greatly helped the few as opposed to the many. To this day, Russia still struggles with creating a competitive and fair market.

Under Mikhail Gorbachev the Soviet Union underwent massive social, political and economic reform that drifted away from communist ideology and this ultimately lead to the collapse of the Soviet Union and failure of communism in Eastern Europe. This essay will focus on how the Perestroika reform and Glasnost policy programs as well as other external and internal pressures contributed to the failure of communism under Gorbachev. The aim of the Perestroika and Glasnost reforms was to restructure and strengthen the Soviet political and economic system and provide more freedom and democracy within the Soviet Union while strengthening Communism. However, these changes had achieved exactly what they aimed to prevent when they were first elaborated and led to the failure of communism and collapse of the Soviet Union. While focusing on the policies this essay will also focus on the major increase in nationalism that occurred in the Soviet Republics as a result of the Glasnost. External pressure from the western world was also a factor and the role that the United States and the Ronald Reagan administration played in the downfall of communism under Gorbachev will be examined. The essay will also discuss how the disintegration of Yugoslavia and the 1991 Coup d’état led to the failure of the policies and failure of communism.