15.2: Eastern Europe

While the politics and economics of Western Europe underwent a number of changes in the decades following World War II, they nevertheless represent an essential continuity (i.e. market economies, welfare states, democratic politics) in many ways right up to the present. The opposite is true of Eastern Europe: while the postwar order of command economy communism and single-party, authoritarian rule held true almost through the 1980s, that entire system imploded in the end, with lasting consequences for the region and for the world.

As of the 1970s, the economic stagnation of the east was far worse than that of the west. Real growth rates were lost in a haze of fudged statistics, and technology had failed to keep up with western standards. By the 1980s the only profitable industries in Russia were oil and vodka, and then oil prices began a decade-long decline. Politically, Eastern European governments were so corrupt that it was basically pointless to distinguish between normal "politics" and "corruption" - every political decision was governed by personal networks of corrupt politicians who traded political favors and controlled access to creature comforts (like the coveted dachas - vacation cottages - in the USSR). The USSR’s politburo, the apex of political power in which decisions of real consequence were made, was staffed by aging apparatchiks who had spent their entire lives working within this system.

Then, the old men of the order simply started dying off. Brezhnev died in 1982, then the next two leaders of the Soviet communist party died one after the other in 1984 and 1985. Mikhail Gorbachev, who took power in 1985, was a full generation younger, and he brought with him a profoundly different outlook on the best path forward for the USSR and its “allies.” Unlike the men of the older generation, Gorbachev was convinced that the status quo was increasingly untenable - the Soviet economy staggered along with meager or no growth, the entire educational system was predicated on propaganda masquerading as fact, and the state could barely keep up its spending on the arms race with the United States (especially after the American president Ronald Reagan came to office in 1980 and poured resources into the American military).

Gorbachev was convinced that the only way for the Soviet system to survive was through real, meaningful reforms - the kinds flirted with by Khrushchev in the 1950s but swiftly abandoned. To that end, Gorbachev introduced two reformist state policies: Glasnost and Perestroika. Glasnost means “openness” or “transparency” in information. It represented the relaxation of censorship within the Soviet system, one that was most dramatically demonstrated in 1986 when Gorbachev allowed an accurate appraisal in the press of a horrific nuclear accident at the Chernobyl nuclear plant. The idea behind Glasnost was to allow frank and honest discussion, to end the ban on truth, in an effort to win back the hearts and minds of Soviet people to their own government and social system.

Simultaneously, Gorbachev introduced Perestroika, meaning “restructuring.” This program was meant to reform the economy, mostly by modernizing industry and allowing limited market exchange. The two policies - openness and restructuring - were meant to work in tandem to improve the economy and create a dynamic, truthful political and social system. What Gorbachev had not anticipated, however, was that once Soviet citizens realized that they could publish views critical of the state, an explosion of pent-up anger and resentment swept across Soviet society. From merely reforming the structures of Soviet society, Glasnost in particular led to open calls to move away from Marxism-Leninism as the state’s official doctrine, for truly free and democratic elections, and for the national minorities to be able to assert their independence.

Figure 15.2.1: Mikhail Gorbachev in 1987.

Meanwhile, the Soviet economy continued to spiral downwards. Soviet finances were in such disarray by the second half of the 1980s that Gorbachev simply ended the arms race with the United States, conceding the the USSR could not match the US's gigantic arsenal. Starting cautiously in 1988, he also announced to the governments of Eastern Europe that they would be "allowed to go their own way" without Soviet interference. Never again would columns of tanks respond to protests against communism. This development caused considerable dismay to hard-line Communist leaders in countries like East Germany, where the threat of Soviet intervention had always been the bulwark against the threat of reform. When Gorbachev made good on his promises and protest movements against the communist states started to grow, it was the beginning of the end for the entire Soviet Bloc.

The result was a landslide of change across Eastern Europe. Over the course of 1989, one country after another held free elections and communists were expelled from governments. Rapidly, new constitutions were drawn up. The Berlin Wall fell in November of 1989 and Germany was reunified less than a year later. Likewise, the USSR itself fell apart by 1991, torn apart by nationalist movements within its borders as Latvians, Lithuanians, Ukrainians, Kazakhs, and other national minorities of the USSR demanded their independence from Russian dominance. An attempted counter-revolution led by Soviet hardliners failed in the face of mass protest in Moscow, and the first free elections since the February Revolution of 1917 were held in Russia.

Since the collapse of the USSR, some Eastern European countries (e.g. the Czech Republic, Poland) have enjoyed at least some success in modernizing their economies and keeping political corruption at bay. In Russia itself, the 1990s were an unmitigated economic and social disaster as the entire country tried to lurch into a market economy without the slightest bit of planning or oversight. Western consultants, generally associated with international banking firms, convinced Russian politicians in the infancy of its new democracy to institute “shock therapy,” dismantling social programs and government services. While foreign loans accompanied these steps, new industries did not suddenly materialize to fill the enormous gaps in the Russian economy that had been played by state agencies. Unemployment skyrocketed and the distinctions between legitimate business and illegal or extra-legal trade all but vanished.

The result was an economy that was often synonymous with the black market, gigantic and powerful organized crime syndicates, and the rise of a small number of "oligarchs" to stratospheric levels of wealth and power. One shocking statistic is that fewer than forty individuals controlled about 25% of the Russian economy by the late 1990s. Just as networks of contacts among the Soviet apparatchiks had once been the means of securing a job or accessing state resources, it now became imperative for regular Russian citizens to make connections with either the oligarch-controlled companies or organized crime organizations.

Stability only began to return because of a new political strongman. Vladimir Putin, a former agent of the Soviet secret police force (the KGB), was elected president of Russia in 2000. Since that time, Putin has proved a brilliant political strategist, playing on anti-western resentment and Russian nationalism to buoy popular support for his regime, run by “his” political party, United Russia. While opposition political parties are not illegal, and indeed consistently try to make headway in elections, United Russia has been in firm control of the entire Russian political apparatus since shortly after Putin’s election. Opposition figures are regularly harassed or imprisoned, and many opposition figures have also been murdered (although the state itself maintains a plausible deniability in cases of outright assassination). Some of the most egregious excesses of the oligarchs of the 1990s were also reined in, while some oligarchs were instead incorporated into the United Russia power structure.

Unlike many of the authoritarian rulers of Russia in the past, Putin was (and remains) hugely popular among Russians. Media control has played a large part in that popularity, of course, but much of Putin’s popularity is also tied to the wealth that flooded into Russia after 2000 as oil prices rose. While most of that wealth went to enrich the existing Russian elites (along with some of Putin’s personal friends, who made fortunes in businesses tied to the state), it also served as a source of pride even for many Russians who saw little direct benefit. Further boosts to his popularity came from Russia’s invasion of the small republic of Georgia in 2008 and, especially, its invasion and subsequent annexation of the Crimean Peninsula from the Ukraine in 2014. While the latter prompted western sanctions and protests, it was successful in supporting Putin’s power in Russia itself.