TIME: Almanac 1995

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<text id=90TT2818> <link 91TT0654> <link 90TT3060> <title> Oct. 29, 1990: No Peace For The Prizewinner </title> <history> TIME--The Weekly Newsmagazine--1990 Oct. 29, 1990 Can America Still Compete? </history> <article> <source>Time Magazine</source> <hdr> WORLD, Page 57 SOVIET UNION No Peace for the Prizewinner </hdr> <body> Mikhail Gorbachev finally picks a reform program, and Boris Yeltsin promptly picks a fight over who can best end the economic chaos By JAMES WALSH--Reported by John Kohan/Moscow Fidgety and intent, Mikhail Gorbachev sat on the edge of his leather chair in the presidential box near the front of the Kremlin Hall of Meetings. He wiped his glasses, sipped tea and thumbed a scarlet folder while waiting to take center stage before the Supreme Soviet. Parliamentary Deputies had assembled last week to hear the contents of the revolution-red binder in Gorbachev's hands: nothing less than a plan to make over the system bequeathed by Lenin, salvage a once proud country from chaos and lead it to the semblance of a Western-style market economy. Even before Gorbachev began to speak, however, his proposal had become a lightning rod for protest from radical reformers. In a week in which the Soviet President had won the Nobel Peace Prize for changing the world, he was fated to be awarded criticism at home for not worrying enough about soap and bread. "Life itself has brought us to the transition," the new Nobel laureate told the parliamentary session, adding, "We must give back to the people their natural sense of being their own masters. Only a normal economy, a market, can do that." But the trouble, according to the radicals, was that his plan did not go far enough. When his stratagem was made public three days before the official presentation, thunderings of outrage rolled in from the Russian Federation, the Soviet Union's largest republic, which intends to begin its own 500-day crash conversion to a free market on Nov. 1. Calling the Gorbachev plan "deliberate deception" in its finances and a likely "catastrophe," Russian leader and maverick reformer Boris Yeltsin reaffirmed his commitment to more drastic measures. In a chilling allusion to last December's Romanian upheaval, Yeltsin wondered, "Do they intend to wait until the people take to the streets to have their say?" As it happened, more people than the usual unending queues of demoralized shoppers took to the streets last week--from Ukrainian-independence campaigners in Kiev to a procession behind a Russian Orthodox priest blessing Moscow's new commodities exchange, to U.S. film star and fitness diva Jane Fonda leading a troop of Soviet women on an athletic loop around the Kremlin. Yet as loudspeakers blared "Hoorah, hoorah!" for Fonda outside the old czarist citadel, inside no outright cheers greeted Gorbachev's shape-up course. Legislators adopted the program by a vote of 333 to 12 (with 34 abstentions) but remained unsure as to exactly what the plan would accomplish. Still, the scheme's preamble sets a clear objective. While making a token half-nod to Marx--"The transition to the market does not contradict the socialist choice of our people"--it recites a litany of woes and concludes, "The whole world experience has proved the vitality and efficiency of the market economy." The question remained: How to get there? Though the latest presidential plan is the first to bear Gorbachev's imprimatur, it capped a series of four previous Kremlin formulas to be brought out and then discarded since last December like so many bottles of vodka at a wild bash. What especially angered Yeltsin and other crash reformers was their feeling that Gorbachev had betrayed them, first by saying he approved of the 500-Day Plan devised by a team under presidential councilor and economist Stanislav Shatalin, then by opting for a much vaguer, slower schedule outlined by Gorbachev adviser Abel Aganbegyan. The compromise attempted to reconcile the imperatives of reform with the fears of many central-government leaders--army generals and KGB men not the least among them--of turbocharging a broken-down sleigh. How the two paths of reform chosen by Gorbachev and Yeltsin can avoid turning into a collision course is the country's biggest issue. As the situation was fuzzily sketched by Yeltsin, the Russian Republic has three options: go it alone entirely, with its own army, currency and customs system, which would mean, in effect, secession; enter into some new coalition with Gorbachev that edges out the U.S.S.R.'s most unpopular national leader, cautious Prime Minister Nikolai Ryzhkov; or go ahead with a modified Shatalin program on Nov. 1 and wait for Gorbachev's plan to fail--an outcome Yeltsin predicted would happen within six months at most. Carrying out Shatalin's full plan in Russia was evidently doomed by Gorbachev's decision to pull back from the proposal as long as the Kremlin would retain broad authority over the money supply, spending and other central controls. Yeltsin, looking weakened and puffy from a Moscow auto crash last month (having shown up for work three days after the accident, he discovered he had a concussion and still required another 10 days of convalescence), denounced Ryzhkov and "the sinking Union government." Nonetheless, he held out an olive twig to the President. Gorbachev, Yeltsin felt, remains "open to dialogue" even if the relationship between the two rivals is "unstable." Not so magnanimous was Grigori Yavlinsky, a young economist who helped draft the 500-Day Plan. He offered to quit on the spot, arguing that the federal government's higher prices for grain procurement would lead to an inflation spiral. Yeltsin phrased that concern more colorfully not long ago. Trying to reconcile Kremlin caution with the market zeal of the republics, he said, is like "mating a hedgehog with a snake." Ryzhkov, who had advocated an even slower, more eggshell-treading pace to reform until his blueprint was soundly rejected by legislators last month, signed up for the Gorbachev compromise. He pledged his commitment to the measures even though they would be tough and unpopular and would "not bring glory to those who fulfill them." Though Gorbachev's popularity has steadily been sinking, First Deputy Prime Minister Leonid Abalkin attempted to rally Soviets around the flag and national stability. "We are not witnessing a sporting event where it is important who crosses the finish line first and who loses," he said. "We are all in this process together." By his side was Stanislav Shatalin, a man who kept a very low profile earlier in the week when his forced-march scheme was dropped, but who ended up acquiescing in Gorbachev's plan. He might reasonably have felt, like Jane Fonda, that he had ended up running around in circles. POINTS OF DIFFERENCE YELTSIN PLAN Prices. Calls for price controls during the first stage, then gradual decontrol for categories of goods and services (though with a freeze on necessities through 1991) until free prices constitute up to 80% of the market. Private Ownership. Calls for up to 46,000 state-held industrial enterprises and about 760,000 trading agencies, worth altogther about 3 trillion rubles ($5.3 trillion), to be converted into stockholding and private ownership within 1 1/2 years--up to 1,500 of them within the first 100 days. Farms. Farm workers would be entitled to a share of state-owned and collective farms and would have recourse to law if their claims are refused. Foreign Investment. Envisions foreign ownership of Soviet companies and real estate and begins the process of making the ruble fully convertible on international markets. Power Sharing. Foresees the constituent Soviet republics as the driving force of reform, with autonomous budgets and wide latitude to make decisions without the Kremlin's approval. GORBACHEV PLAN Prices. Proposes a vaguer step-by-step approach to decontrol by 1992, after which only prices for essential commodities would still be controlled. Private Ownership. Promises conversion of factories, construction units and trade services to other forms of property--private ownership being only one option--under firm state guidance and a vague timetable that "may extend for a lengthy period." Farms. Proposes to give the governments of the republics the choice of breaking up and selling of their lands. Foreign Investment. Pledges to provide for a more open economy, but with no dates or details. Power Sharing. Fails to spell out the rights of republics except as members of an "interregional economic committee." Implicitly keeps primary authority in the Kremlin, which would continue running such strategic economic sectors as energy, banking, defense production, trade, transport and communications. </body> </article> </text>