Return of Gorbachev's Men

January 30, 1994

An intriguing aspect in the tug-of-war over economic reform in Russia is the quiet re-emergence of two old Gorbachev advisers. After three years in the political wilderness, Leonid Abalkin, a former Soviet vice premier, and his right-hand man, Nikolai Petrakov, have been called back to advise the government on straightening out the economy.

Their return does not mean that Mikhail S. Gorbachev is on the way back. He is universally scorned in Russia. But now that Economics Chief Yegor Gaidar and Finance Minister Boris Fyodorov have been ousted and their radical Western advisers have resigned, the Russian government is unmistakably abandoning bold monetarist reform in favor of more cautious steps.

President Boris N. Yeltsin's personal preference is unclear. But Viktor Chernomyrdin, the increasingly powerful prime minister, has clearly signaled he wants to apply the brakes to slow the free market economic transition.

Mr. Abalkin conveniently calls for a "stabilizing period" during this year, followed by a "restructuring" over the next six-to-eight years and the creation of a "highly effective, innovation-responsible and socially-oriented economy" over three decades.

According to Mr. Abalkin, Russia has one choice: either the main socio-political forces achieve a compromise on the economic matters or a dictatorial regime is re-established in the country.

The kind of consensus Mr. Abalkin is preaching would unavoidably be a rather conservative one because it would have to satisfy parliament, labor unions, the powerful industrial managers and the military. "Our economy is so twisted and warped that there are no reasonable solutions in principle, if the current course is continued," he argues.

Mr. Abalkin has always been a go-slow advocate. But it is unlikely that his advice now will work any better than during the Gorbachev era, when he was the architect of Prime Minister Nikolai Ryzhkov's ill-fated economic measures.

Timidity did not work then. Today, after several years of fundamental changes, it will create only confusion about the government's intentions -- not only in the industrial and retail arena but in the all-important agricultural sector. That, in turn, may derail the widespread privatization and reorganization efforts of the past three years.

Russia's history is a saga of failed reforms. If we are witnessing another failure in the making, there is little America can do. Russia's leaders demonstrated that during President Clinton's recent visit to Moscow. They led him to believe reforms would continue -- while plotting to slow them down.

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