(3 of 3)
There are substantial areas of conflict among the various plans, including how much power and what share of tax revenues should be given to the centralized Soviet government. Another area of deep conflict concerns pricing. The government wants to bring about fiscal order through price hikes, offset by compensatory payments to the social groups hardest hit by the reforms.
But prices cannot stabilize as long as there are too many rubles chasing too few consumer goods. The Shatalin plan calls for absorbing excess rubles from the Soviet economy by selling back state-owned assets to the public. In addition, Gorbachev last week raised the idea of devaluing the official exchange rate for the ruble, from $1.66 all the way down to 50 cents. Economists for the Gorbachev-Yeltsin commission contend that once sufficient amounts of money have been pulled out of circulation, prices can be liberalized, since real market forces will operate to keep them stable. Unlike the Poles, argues Gorbachev economic adviser Nikolai Petrakov, "Soviet citizens would rather stand in long lines than confront a rise in prices."
After the stormy parliamentary session, Ryzhkov and a grim-looking Deputy Prime Minister Leonid Abalkin hinted that disaster would result if the Shatalin plan were approved without changes. Abalkin warned that trying an unsuccessful form of "shock treatment" might leave "the populace and the government allergic to the market idea for decades." Ryzhkov expressed concern that by giving free rein to market forces, the Gorbachev-Yeltsin group plan might set off a "staggering surge of prices, destabilize economic life and disorient enterprises."
Gorbachev has decided to throw the issues out for public debate, arguing that "the people must make their choice." There seems little doubt, however, that Shatalin's radical 500-day program, with some modifications, will prevail. The most telling vote came last week in the parliament of the Russian Republic, led by Yeltsin, where deputies approved the basic outlines of the Shatalin package by a lopsided count of 213 to 2. They also issued an appeal to other parliaments across the nation to follow their lead in approving the plan as quickly as possible. Yeltsin added a proviso: "The adoption of the program should go together with the resignation of the Ryzhkov government."
By now that refrain must sound all too familiar to Gorbachev, who still seems to prefer that Ryzhkov jump rather than be pushed. Even though Gorbachev has come out in support of the Shatalin program, his proposed changes in the text suggest he also has a certain ambivalence about taking the final grand leap into a market economy. With tensions mounting across the country, whether cigarette riots in provincial Russia or border skirmishes in the Caucasus, Gorbachev cannot help being concerned about what might result from added chaos in the economy. Last week he sent out a presidential telegram to regional leaders, warning that perestroika would amount only to "good intentions" unless governments at all levels took steps to strengthen "law, order and discipline." It was a signal to batten down the hatches. More change lies ahead.