Russia, 25 years on: A personal reminiscence
Today marks the 25th anniversary of the formal dissolution of the Soviet Union. This is a personal reminiscence of our contributor who lived in Moscow and worked in the British embassy throughout these remarkable changes in the world order.
The explosion caused the windows of our central Moscow flat to shake violently, but mercifully the protected glass didn’t shatter. We always kept the heavy curtains closed in our bedroom for protection against showering glass as we slept, but on this occasion only shards of intense light, not glass, lit up the room through the narrow slits between the curtains, as the plume of flames erupted over the doomed Mercedes in the street below our apartment. Welcome to mafia Moscow in late 1992, or The Wild East as it was then sometimes called.
It wasn’t meant to be like this. When Boris Yeltsin bravely stood on the tank outside the White House just over a year earlier, there was huge optimism for the future. The troops had refused to fire on the population, thus reassuring the people around us that the hardliners had lost and better times were ahead. Mikhail Gorbachev was allowed to return from his dacha in the Crimea, only to be humiliated by Yeltsin in the Great Hall of the Kremlin, his dreams of reforming the Communist Party disintegrating before his eyes. Yeltsin was considered a hero for his courage against the coup. By contrast, Gorbachev was universally hated in the country, being held responsible for the rapidly falling living conditions. We took a break from our embassy Christmas Party to watch a defeated Gorbachev give his resignation speech on national television at 7.30 pm on 25 December 1991. We then watched the Soviet flag being lowered from the Kremlin, just across the river from the embassy, followed by the raising of the oncebanned Russian Federation tricolour flag. The following day the Supreme Soviet declared that the Soviet Union had formally ceased to exist, and thus died a country which had been born a mere 69 years earlier. Why?
For “Soviet watchers” around the world, it had been clear that the Soviet Union had been in deep trouble for a number of years prior to the events of 1991. Some 60 years earlier, Joseph Stalin had introduced the initially hugely successful Command Economy and system of fiveyear plans. This was the late 1920s, a time when the success of communism contrasted with the bread and dole queues of the then discredited capitalist Demand Economy in the United States. Seduced by what they saw, wave after wave of “celebrities” returned home to the West to extol the virtues of communism. Of course, they were not allowed to see the famine in the Ukraine or the gulags in Siberia, both needed to keep the system going. Over time, the rigidity, corruption and lack of incentives of communism began to hold back progress, despite the tinkering with the system by successive Politburo chiefs, who refused to accept that it was rotten to the core. With up to 75% of a failing economy going to the military industrial complex, there was little left for citizens, who found the shops increasingly empty, with long queues outside hoping to buy the basic essential such as bread and milk. This is what we saw on arrival in 1991 when my wife joined Russian wives in carrying around her “avoska”, a string bag. “Avoska” means “perhaps”— perhaps you might find something to buy.
So how did things change for us and the Russians after the 1991 Revolution? Once the euphoria of change had passed, the reality of the situation soon kicked in. The task given to the 35-year-old Deputy Prime Minister, Yegor Gaidar, was “simply” (sic) to change the economy from the world’s largest state controlled economy into a market economy. Economic historians call his method “shock therapy”. Shock it certainly was; therapy was questionable. The good news was that the rapidly rising prices brought some western goods into the shops. The bad news for the Russians was the dra- matic fall in the value of their roubles, which meant that they couldn’t afford to buy any of the new goods. We were OK, of course, using American dollars to change into roubles we could now buy some goods which we could recognise and not be restricted to low quality Russian products. In fact, it was quite common for the rouble to halve in value overnight on Sundays, so the secret was to go out and purchase highvalue goods, such as Afghan carpets, before they had the opportunity to change the price label. In this respect, Mondays were frequently half-price sale days. For most of our time in Moscow, I was able to buy two tickets for every “world class” concert during that week at the Moscow Conservatoire, just round the corner from our apartment, and still have change from a single dollar note. It was not music to the ears of the Russians, however, as they saw their hard-earned savings rapidly reduce to nothing. When we arrived in 1991, the official exchange rate was 3 roubles to the dollar; when we left in 1994 it had devalued to 10,000 to the dollar. The first visible signs of distress in January 1992 were the lines of middle-class ladies lining the exits of the metro stations desperately trying to sell any personal possessions they could in order to feed their families. Local “antique” shops bulged with items of both real and sentimental value that had been sold to buy food. Stories began to emerge of sick people unable to afford medical help; “it’s the market economy you know” came the reply from the doctors. Families could not afford coffins in which to bury the dead and had to resort to bin bags to contain the body of a loved one.
The other task of the new government was to sell off the vast Soviet state enterprises to the private sector. Again this proved to be disastrous. The method chosen was to issue every citizen with a “voucher”, a share certificate giving them a tiny part ownership in industry. This was fine in principle, but in practice after a lifetime of state ownership, nobody understood what “private ownership” actually meant. Both my driver and our housekeeper came to us in a confused state, with the letter containing the voucher asking us what they should do with it. The result was that the streets were full of men with boards around their necks saying “Ya Kuplu Voucherie”, or “I will buy your voucher”. These were middlemen who purchased thousands of vouchers to sell on to the next level. To be given a few dollars for a piece of meaningless paper was irresistible to most Russians, so massive industries were purchased for a mere fraction of their value and the much derided “Oligarch” was born. All perfectly legal. If you want to know how it came about that there are now 88 billionaires living in Moscow, this is how they all started.
Of course, where there was a huge amount of money to be made so easily there was corruption and extortion. There had always been state corruption within the communist system, but now corruption was privatised. It wasn’t long before gang culture filled the void left by the now discredited Communist Party. I met and dined with a large number of enthusiastic western entrepreneurs passing through the embassy hoping to set up business in the new world of Russia, only to see them appear again a year or so later leaving dejectedly having lost a huge amount of money. The reasons were always the same. Having set up the business, the entrepreneurs were visited by bulky “salesmen” assuring them that they would need “fire insurance”, or other forms of protection. There was no way that the business could prosper or even exist without it. Inter-gang warfare broke out on an industrial scale, with shootings and explosions a nightly occurrence. Ordinary Russian citizens were left bewildered. In a short space of time they had gone from the relative security of communism, albeit impoverished and with the minimum of freedom, to a situation where they had lost all their money, had seen valuable state industry taken over by the oligarchs and witnessed mafia inspired gang warfare on the streets. “Is this what you mean by capitalism, John?” a Russian friend asked me. Another tellingly said to me: “Everything they told us about communism was false, but everything they said about capitalism was true.”
Small wonder that they welcomed a strong leader in the form of Vladimir Putin when he arose without trace in 1999. Confirmed by the Duma as Yeltsin’s candidate for Prime Minister, Putin quickly established himself in public opinion, became acting President when Yeltsin resigned on 31 December 1999 and easily won the presidential election held on 26 March 2000. It had been a long and painful eight-year journey since the coup of 1991, but the Russian people now had a strong leader who promised prosperity and what the people wanted most of all, a return to stability. Former government employee John Dobson worked in UK Prime Minister John Major’s Office between 1995 and 1998 and is presently a consultant in the private sector.