Thirty years ago, the Soviet Union dissolved. On a superficial level, events vindicated the longtime American assertion that socialism “doesn’t work”–Soviet consumer goods lacked both quality and variety, Soviet agriculture was a continual disappointment, and, in the USSR’s later years, labor discipline grew very lax, and corruption flourished.
Yet Soviet socialism had more economic successes than failures. The US-USSR comparison used to demonstrate “capitalism good, socialism bad” was apples-to-oranges, and should never have been accepted.
British economist Angus Maddison estimates that in 1913 the US’ Gross Domestic Product per capita was the highest in the world at $5,301 (in 1990 dollars). That of the Russian Empire—the future USSR—was only $1,488–17th in world, less than Mexico. Sixty years later, the US figure had risen to $16,689 and the USSR’s to $6,059, the USSR narrowing the gap by 23%–a considerable achievement considering the extremely different circumstances faced by each nation.
The US entered World War I late and lost 115,000 men. By contrast, between WWI (1914-1918), the Russian Civil War (1918-1921), and the consequent famine, Russia/USSR lost over 10 million citizens. The country the communists inherited was so poor, wrecked, and starved that cannibalism was widespread. This is the starting point of Soviet socialism.
During World War II the USSR faced Nazi Germany’s Operation Barbarossa–the largest military action in human history–and suffered a staggering 27 million deaths, 70 times America’s WWII losses. The USSR lost 1/3 of its national wealth and ended the war with millions starving and 25 million homeless.
By contrast, the US came out of WWII physically unscathed with 6% of the world’s population and 50% of its GDP. To have expected the USSR to catch up–all the while matching the US in military spending and in aid to Cold War allies–was never realistic.
Nonetheless, what the Soviet economy did achieve was still considerable:
+ During the 1930s the USSR industrialized faster than any nation in history. This remarkably rapid transition from an agricultural to an industrial society was accomplished despite the destruction and chaos of Soviet dictator Joseph Stalin’s murderous purges and farm collectivization.
+ The USSR inflicted 85% of Germany’s wartime casualties and was principally responsible for Nazi Germany’s defeat.
+ Despite the massive loss of the young men critical for industrialization and heavy industry, the USSR re-industrialized rapidly during the 1940s and 1950s, and retained robust economic growth rates into the 1960s. It is only then that the Soviet economy–under the weight of bureaucracy and mismanagement–began to slow down. One study noted that while between 1950 and 1976 the advanced capitalist economies grew 4.4% annually and the poorer capitalist economies grew 5% annually, the centrally planned economies of the USSR and the Eastern bloc grew 7.7% annually—75% and 54% higher respectively (Scientific American, September 1980).
The USSR’s large Muslim regions, once as poor and backward as neighboring Afghanistan, saw tremendous progress in improving living standards, eliminating illiteracy, and reducing infant mortality. The Soviets also achieved a remarkable rise in the status of women, and women came to make up a significant portion of the region’s doctors, engineers, and teachers.
The USSR also managed to keep up with the US in both the nuclear arms race and the space race, as the comprehensive list of Soviet space “firsts” is as impressive as the US’.
The USSR’s main problem was not its economic system but the ruling bureaucracy’s mismanagement, corruption, parasitism, and cynicism, all of which sapped Soviet working people’s morale and work ethic. But what if the USSR in the 1970s and 1980s–during its “Era of Stagnation”–had been an open society such as ours?
Factory managers and political leaders responsible for the shoddy consumer goods offered to the Soviet people would’ve been skewered alive in the media, and they or their successors would quickly have whipped production into shape. Working people–benefitting from both an economy planned to meet people’s needs and from democratically controlling their workplace and their society–would have seen their creative energies unleashed.
Competing economic plans with varying priorities would have been debated and dissected, and passed democratically, instead of being imposed from above. With popular buy-in, there would have been much more popular commitment to meeting the targets and fulfilling such plans.
For decades the alleged failure of the Soviet economy has been used to shut down any substantive questioning of the necessity of the free market economic system. The performance of the USSR’s economy instead shows that a planned, socialist economy—if built in a free society with democratic institutions—is a viable alternative model.