Magazine article The Wilson Quarterly

A Brighter View of Russia

Magazine article The Wilson Quarterly

A Brighter View of Russia

Article excerpt

"Russia" by Anders Aslund, in Foreign Policy (July-Aug. 2001), Carnegie Endowment for International Peace, 1779 Massachusetts Ave., N.W., Washington, D.C. 20036.

Mention Russia today, and an image of catastrophic decline may well come to mind. Shock therapy failed, the economy has collapsed, the infrastructure is crumbling, corruption is widespread, the population is shrinking. Russia, in this view, seems headed for Milton's "reign of Chaos and old Night." Get a grip, urges Aslund, author of How Russia Became a Market Economy (1995). The country's plight has been vastly exaggerated.

True, official data show that gross domestic product (GDP) shrank 44 percent between 1989 and 1998. But that's a statistical mirage. "Under communism," Aslund notes, "everybody padded output to reach targets in the planned economy, while nobody cared about the quality (or even the usefulness) of the items produced." The subsequent decline in production of shoddy or useless goods should be welcomed, he says. And the statistics miss the substantial output of the postcommunist underground economy.

A more accurate picture of Russia's economic development to 1998 would show stagnation, says Aslund. The problem is not excessive "shock therapy," but "too little shock and too much corrupt state therapy in the form of subsidies to the country's elite." And don't blame the plague of bribery on privatization, he says. It "is overwhelmingly connected with law enforcement, tax collection, and state intervention." Despite all its problems, Aslund points out, Russia since 1998 has achieved continued economic growth: The GDP increased 5. …

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