All-Russian Ruin

All-Russian Ruin

An eyewitness report by Alan Woods

I stepped outside the door of the metro station and saw him. A corpse, half-covered with a white plastic sheet, stretched out on the muddy pavement. It was clearly a man, probably in his mid-forties, although, as his face was covered, it was impossible to say. Who was he? An alcoholic whose liver had just given up? One of the many homeless, dead from malnutrition and exposure? Did anyone know? Did anyone care? A couple of bored-looking cops stood around the body. Three paces away, the myriad of little stalls that have sprung up alongside all such stations carried on with its usual bustling activities. At every step one comes face to face with mind-numbing poverty. Beggars line the streets and metro stations, many old people, particularly women, whose pensions and life-savings have been rendered worthless in the process of 'market reform'.

Particularly tragic are the crippled people who must get along as best they can. A common sight is that of a man with no legs propelling himself on his knuckles on a couple of planks with skates underneath. In the entry of one of the metro stations near Red Square a middle-aged man is comforting his wife. She is wrapped in a sleeping bag, a huddled faceless heap. The sheer mass of human misery is overpowering. One vision sticks in my mind. It is ten past midnight and raining hard. In the street, a woman in her late thirties, a plastic bag tied on her head and a basket under her arm, tries desperately to sell bread to passers-by:

'Do you need any bread?' 'No, thank you.'

She persists: 'I have cakes and chocolate too.' 'I don't need any.'

'But I have children to feed and there's no father..For the love of god!'

The general collapse is shown by falling health standards and a rising death rate. Diseases like tuberculosis (associated with poverty) are rapidly increasing. As the following report from the Moscow Times (17/10/97) makes clear:

'About 2.2 million people are ill with tuberculosis in Russia and the disease is steadily spreading, a health official said Thursday. Last year, 24,700 people died of tuberculosis and 98,000 people were recorded as having contracted the disease, Interfax reported, citing the first deputy health minister, Gennady Inishchenko.

Overall, the number of tuberculosis cases has risen nearly 4 percent during the past year, while the number of children suffering from the disease has gone up about 11 percent.

This is the real face of market reform in Russia.

Moscow's artificial 'boom'

A Western tourist coming to Moscow for a few days might get the impression of a booming economy. But this is completely untypical of Russia, since over 80% of foreign investment comes here, giving a superficial sense of prosperity. All the big banks and finance houses are based in Moscow. There is a large service sector, as well as all the government offices as well as the stock exchange, tourism, hotels etc. On the basis of this, there has been a construction boom. On every street corner there seems to be a building site. A host of small businesses have mushroomed: shops, restaurants, bars, and the like. A large section of the population depends to one degree or another on servicing the needs of the nascent bourgeoisie. There is a large number of waiters, domestic servants, shopkeepers, prostitutes, bodyguards, taxi drivers and so on. Many of these are on low wages, but somehow identify themselves with capitalism and 'the market'. At least they feel that they are relatively better off than the people in the provinces, and are under the influence of the avalanche of capitalist consumer propaganda on the television. For the vast majority, of course, this is an empty illusion.

A handful of super-rich parasites enjoy the kind of life-style reserved for the billionaire class in the West. In the old days the television screens carried mind-numbing coverage of Party Congresses with four hour speeches by the General Secretary. Now they full of American movies, game shows and advertisements for everything from Wriggley's chewing gum to electrical massage machines complete with scantily-clothed young ladies with no apparent reason for investing in the latest remedy for cellulitis. As I write these lines, the financial programme has just finished. After the stock-exchange report, they are showing scenes from the latest exhibition of top-of-the-range Western goods to hit town. An elegantly-attired Italian gentleman is extolling the virtues of his new collection which, he assures his audience, 'represents the latest avant-garde models.' One can only guess at the price of this fancy footwear. In the same way, a TV interviewer asks Moscow motorists stuck in a traffic jam if they could guess the price of a metro ticket. Very few got it right.

October in Moscow was grey and rainy, though not particularly cold. The meteorologists (those who have not been laid off, that is) are predicting a bitterly cold winter. And many people are already trembling. The economic collapse has begun to undermine the very fabric of social life. In the Maritime Region of Russia's Far East there are reports of regular and prolonged power-cuts. In freezing conditions, the people of Vladivostok have endured 24-hour cuts with no light, no heating, no cooking facilities, and sometimes no water. Last Spring this sparked off riots in which people clashed with the police on the streets. Now the authorities in Moscow are anxiously looking out for signs of more serious social unrest. Terrified that an open clash with any significant group of workers might lead to an explosion, the government has been forced to retreat on a number of occasions. The miners at a major open-cast mine in the Maritime Region went on strike for two weeks to protest against unpaid wages. The strike was immediately supported by other miners who refused to load coal. The strike ended in victory, as the government caved in and sent the wages. Something similar occurred with the air controllers, a group with a lot of industrial muscle.

Unfortunately, not all Russian workers wield similar industrial clout. Faced with the problem of bankrupt companies and huge amounts of unpaid wages, they see little point in taking industrial action, although they find other ways of expressing their protests. There has been a large number of demonstrations, pickets, hunger strikes etc.

Under conditions of such absolute collapse, people many families find it difficult even to get the basic necessities of life. Millions of workers have not been paid for three, six or even twelve months. But now the accumulated anger, bitterness and discontent is erupting to the surface. Although not publicised in the press, there has been a sharp upturn in the strike movement in recent months. The number of strikes in Russia during the first half of 1997 increased five times as against the same period last year, while the number of workers participating increased three times. There was a total of 15,000 strikes in this period.

Rural disaffection

The general mood of disaffection spreads far beyond the industrial working class. On the 15th of October, Pravda carried an article which reveals the explosive situation in Russian countryside. 'When a government oppresses its own people, everyone has a duty to fight for his life.' With these words, Alexander Seymyonovich Davydov, head of the Russian trade union of agricultural workers expressed the indignation of the rural workers against proposals to privatise the land, a proposal which is now being openly discussed. Using the pretext of a good harvest, Chernomyrdin argues that this success is due to 'reform' and that the next logical step is privatisation. But this is strongly disputed by Davydov, who points a bleak picture of conditions in the Russian villages:

'How can you talk about 'achievements,' when the villages are practically left without chemical fertilisers, more than 50% of the machinery is clapped-out, and there is a chronic shortage of oil and fuel? Doesn't the prime minister know about this?

'ÉLast year about 80% of agricultural enterprises ended up with losses. And that's not surprising, because the productivity of labour in the years of reform fell by 40%. The collapse of production is causing a rapid increase in unemployment -- one and a half times higher than the Russian average. About 26% of the unemployed have higher and medium education, more than a third are young people. Structural unemployment shows that our villages have neither a present nor a future

'Those who attend village technical colleges get a miserable grant. With such money today you can't even buy a crust of bread. Are their parents supposed to be sitting on sacks of gold? Wages in the countryside are 2.6 times lower than the average for the rest of the economy, and they do not get much support. To date the total overdue debts amount to 7 trillion roubles. A more sombre picture than that presented by our countryside now, in my view, cannot be seen anywhere.'

The figure for the fall of agricultural productivity is particularly important, since in Soviet times, the rate of agricultural productivity was already very low. A further collapse of 40% spells an absolute calamity for the production of food in Russia, which is rapidly being undermined by a flood of imports. A country which could potentially feed the whole of Europe and more has become a net importer of food.

Meanwhile, the crisis in the countryside has provoked a mood of disaffection which led to the calling of a national day of protest on the 15th of October. The seriousness of the position is shown by the declining rate of birth in the countryside -- down 25% in relation to 1991, while the death rate has risen by almost the same amount. The figure for state aid to agriculture has fallen from 19% of the budget in 1991 to a miserable 2.4% this year. And next year they plan to cut it further to only 1%.

Davydov comments: 'The government is cutting the village to the bone and depriving it of life itself.' In the last six years, agricultural production has actually dropped by about one half. Scandalously, about 70% of agricultural produce is purchased abroad. A shocking picture of waste and decline.

The pro-capitalist elements argue that Russian goods are too expensive to compete with imports. The farmers must reduce their prices! But everyone knows that both the US and the EU heavily subsidise their farmers. The USA subsidise meat prices by 64%, grain by 38%. In Germany the equivalent prices are 60 and 52%. In the case of Finland and Japan, subsidies can amount to up to 70%. Yet, according to the wisdom of the so-called 'free market,' Russian agriculture is deliberately allowed to collapse and the market opened up to an avalanche of subsidised western products. No wonder the words 'liberalism' and 'market reform' stink in the nostrils of the Russian agricultural population. They spell only ruin and poverty. Thus, paradoxically, the rural areas of Russia are among the most hostile to market reform, something which could not have been anticipated fifty years ago.

Already about half of the beef cattle, 60% of pigs and about the same of chickens has been lost. All animal raising, except chickens is running at a loss. Before the so-called 'reform,' only 2% of agriculture was loss-making. Now it is anything up to 80%, according to Davydov. This destruction of agriculture means that, if the West were to interrupt its supply of meat, Russia would only be capable of supplying 50% of demand. This fact alone shows the criminal irresponsibility of the nascent Russian bourgeoisie. Incidentally, this so-called 'free marketeering' does not apply in other cases. American rice is considerably cheaper than Japanese rice, but Tokyo makes sure that its farmers are protected and cheaper foreign rice is kept out. But Washington feels free to put pressure in Moscow to let its products flow freely in the name of 'liberalisation.' And the Yeltsin clique, which are really degenerate agents of world imperialism, and particularly US imperialism, grovel abjectly like servants expecting a tip which never comes.

Most of the minerals which provide chemical fertiliser are shipped to more profitable markets abroad, leaving Russian agriculture with a miserable 20% of the total. This short-sighted policy will eventually inevitably mean an exhaustion of the soil, with even more calamitous consequences. Symptoms of this already exist in the form of lower yields of grain per hectare. At the same time, cuts in social spending means the closure of village clinics, clubs, libraries, schools and hospitals which made life a bit more bearable for the rural population.

Conflict in the Duma

The general mood of discontent finds a distorted expression in the struggle at the parliamentary level. The presentation of the draft budget for 1998 immediately gave rise to a new conflict in the State Duma where the CPRF and its allies (the Agrarians and the People's Power groups) has a majority. Reporting on the balance sheet of the current budget, Chernomyrdin painted the course of the last nine months in glowing colours. He claimed that for the first time since the 'reform' began, the GDP has not fallen, and that industrial production has actually risen -- by 1.5%! (Pravda 9th October 1997) Chubais, the main spokesman for the 'reformers' also pointed to success, but was forced to admit that the general appraisal was 'unsatisfactory.' A more sombre picture was presented by the chairman of the state budget committee, Mikhail Zadornov. He underlined that about half the taxes went uncollected and that many branches were completely running at a deficit. The figure for tax collection is not really surprising since the Mafia is not renowned for its fiscal probity.

However, the official estimates for next year's growth are disputed. According to figures cited by the Chairman of economic policy, Yuri Maslyukov, this year there was a reduction in the growth of investment in production by 9.3% and that the investment programme had collapsed. In general the economic situation was aggravating social tensions. The point was made to me very forcibly in a conversation I had with Boris Slavin, Pravda's leading political columnist. Slavin asks the question 'Do we need a government that is ruining the country?' He paints a black picture of economic and social collapse in complete contrast to the official propaganda: unemployment has already reached the 10 million mark: 'People await the winter with trepidation': as in the days of the Civil War, millions of homeless children and beggars wander the streets of Russian provincial cities. Hundreds of factories staid idle and indebtedness increases.

On this basis, Slavin points out what is self-evident -- that there is ample basis for a vote of no-confidence in the Duma. 'Shock therapy' has led to a catastrophic situation. Yet the Yeltsin government persists in dishing out more of the same medicine. Yet all the main parties in the Duma -- including the CPRF -- are trying to avoid a vote of no-confidence (also Yabloko and Ryzhkov's 'People's Power'). Instead of returning the budget to the government (i.e., rejecting it), they referred it to a three-party commission (with representatives of the government, the Duma and the Federal Soviet). This was proposed by Zyuganov himself, who said that if the commission did not come up with a solution the people's discontent would 'spill over onto the streets and it will all end up in a big fight,' which most people did not want.

Thus, the CPRF leaders are acting like the old Russian liberals trying to frighten the autocracy with giving concessions by the threat of revolution. It appears that Zyuganov originally agreed with other opposition leaders (Ryzhkov) to go ahead with a no-confidence vote, but changed his mind. The last thing these people want is a election, let alone a revolution! They are desperately clinging to their parliamentary seats. They are fatally stricken with the disease of parliamentary cretinism. The reference to a commission was a sell-out because, as Chubais remarked in private, the Duma can only change the small print of the budget, not the 'macroeconomic aspects.' In other words, a farce.

Within days, the No Confidence motion was withdrawn in exchange for a few minor concessions. The hopes placed by millions of CP voters in their elected representatives were dashed. The bourgeois-controlled mass media lost no time in praising the CPRF Duma faction for their 'realism.' Slavin comments: 'So that's how the leaders betray the interest of the working people, of all the poor and those people humiliated by the powers-that-be, who naively believed that the slogan launched by the 4th Congress of the CPRF 'No Confidence in the Government!' would be carried into practice.'

Cracks in the CP

The CPRF leaders are terrified of new elections in which they might lose their seats, with all the perks and privileges associated with them. Yeltsin, a skilful gambler, played his ace card when he threatened to dissolve parliament and call elections. Zyuganov moved swiftly to prevent this and accept a so-called 'compromise' which was really a sell-out. The very next day the press openly speculated that a rotten deal had been struck between the Yeltsin government and the 'Opposition' in parliament: 'Analysts also suggest that a secret arrangement may be in the works between the opposition and its closest government supporter, Prime Minister Viktor Chernomyrdin,' writes The Moscow Times (17/10/97.)

However, Zyuganov's shameful capitulation in the Duma will not solve anything. The terrible social contradictions will grow. Ultimately they will find an expression even in the CPRF, where a growing section is bitterly critical of the leadership. On CP Duma deputy openly voiced his anger against Zyuganov in a private conversation with me just after the climb-down: 'He (Zyuganov) is not a Communist. He's not even a Social Democrat. He's a social-chauvinist.' The same man confessed to me that 'The CP does not advocate Communist ideas any more. Where does the Party advocate nationalisation and the state monopoly of foreign trade? Nowhere! There are more Communists outside the Communist Party than inside! Just look at how radical the workers are!'

Some of the (well-informed) people I spoke to thought the CPRF would eventually split. Certainly the bourgeois elements seem to be aware of this possibility and openly back the 'moderate' wing around Zyuganov. The same article goes on: 'The government is trying to bolster the position of the Communists moderate leader, Gennady Zyuganov. It was Zyuganov who withdrew the no-confidence motion this week after he received a conciliatory personal phone call from Yeltsin, but he is coming under intense pressure from more radical elements in the opposition.' And the article concluded:

'The government should make an effort to support these particular Communists, because the ones on the outside looking in are much more angry and dangerous.'

But weakness invites aggression. The 'statesmanlike' conduct of Zyuganov and co. earned them no thanks from the government, but only new and well-deserved kicks. Showing his complete lack of concern for Zyuganov and co., Yeltsin announced that there would be no presidential elections in 2,000 and that the next president would be a 'young democrat' -- a phrase which has aroused a good deal of speculation. Who can it be? Not Chubais, who is generally hated and will almost certainly be got rid of. Maybe Nemtsev, who is now Yeltsin's favourite protégéÉ

But all these plans and intrigues will come to nothing once the working class begin to move. And that cannot be far off. Paradoxically, if the economy does pick up just a little (and that is possible), that will be the signal for a big movement on the industrial front. Even this year, as we have seen, there was a big increase in the number of strikes (teachers and miners in the main). At the present time there is a movement of the engineering workers which has not been reported. If the heavy battalions of industry get on the move, the entire position can be rapidly transformed. Even a small upturn would encourage such a development. Once it starts, it can assume tremendous dimensions. Then Yeltsin and his 'young democrat' would quickly be swept aside.

Until that time, the present situation of parliamentary deadlock, manoeuvres and re-shuffles will continue to grind on tediously, altering nothing except the careers of various individuals. There is still plenty of combustible material -- the threat to cheap housing and social services -- all could spark off an explosion. At a certain point quantity will turn into quality. When they least expect it, this sleeping volcano will erupt.

London, September 27, 1997