Why Did The Soviet Union Fall Apart?

Over the past two decades, several inaccurate narratives have dominated public discourse about the former Soviet Union's demise.

The first narrative is that President Reagan ordered Mikhail Gorbachov to "tear down this wall" and the Berlin Wall came down. Kind of like Joshua's trumpet.

The second narrative is that the Soviet Union fell apart because of the failure of Central Planning, also known as the "Command Economy."

Both narratives appeal to widespread prejudices rather than objective evaluation of both the accomplishments and the failures of the Soviet system. Contributing to both successes and failures was the complexity of the "nationality question" during both the Soviet period and during the preexisting Russian Empire.

Following the Russian Civil War and the Polish invasion of Russia, Lenin introduced his "New Economic Policy" (NEP). NEP allowed a considerable amount of free enterprise, including farming. It apparently worked pretty well. But the leadership became rightfully concerned about increasing turmoil in Europe and began the collectivization campaign at least in part to support the Soviet Union's ability to mobilize its natural resources for war. Any examination of Soviet economic policy during that period has to address such questions as whether NEP could plausibly have prepared for war with Germany.

As for the larger issue of the Command Economy, economic historian Brad DeLong recently posted an essay of his from seventeen years ago, examining the corporation as a command economy. This is a good corrective to analyses that draw large distinctions between Western industry and Soviet Central Planning.

Many years ago, I attended a lecture by Alexander Kerensky, the second Prime Minister of the Russian Provisional Government of 1917, which was overthrown by the Bolshevik Revolution of October. Kerensky contended that the Soviet Union's economy was not a Socialist one, but an example of what he called "State Capitalism." He autographed a copy of his book, which is still in my library. It may be worth rereading.

It is time to take another look at the issues presented by seventy-five years of Soviet history.