Cashless Rubles: Gorbachev’s Economic Reforms and the End of the USSR

• In Event: "New Thinking” in the Glasnost Years: Opportunity and Disillusionment

Abstract

This paper refocuses attention on Mikhail Gorbachev’s early years in power and his economic reforms. Initiating the Cold War’s end in fall 1985 meant embarking on uncensored space-bridges and peace walks with an increasingly disinterested America, where an emergent neoliberal attitude towards society left ordinary Soviet viewers facing an identity crisis. Gorbachev confirmed his serious intentions as a reformist autocrat by unleashing an entrepreneurial Komsomol armed with cash to reinvigorate a stagnating economy and using youthful groups of in-formal organizations backed by a reformist press to cudgel unreconstructed Party bureaucrats in spring 1986. When the Law on State Enterprise granted independence to economic actors across the USSR in summer 1987, the monetization of rubles that previously existed only on accounting ledgers symbolized the rush to new wealth and possessions and resulted in galloping inflation and the bankruptcy of central planning by fall 1989. Ukrainians—particularly the Communist leaders who understood their future was uncertain—took advantage of these Kremlin-led developments. They recognized the necessity for independence and the end of the USSR in summer 1991 after conservatives in Moscow tried to turn Gorbachev’s reforms around.

Author

• Martin J. Blackwell, Stetson U