Gorbachev’s ‘New Thinking’

what did Gorbachev’s first major reform target

alcohol to deal with individual productivity and absenteeism

what was Gorbachev’s first major reform

Prices were restricted on wine, beer and vodka and places & times for selling alcohol were restricted. People were arrested for public drunkenness & for being intoxicated at work.

what was Perestroika

The restructuring of & major social, political and economic reforms

Perestroika was key to Gorbachev’s

economic reforms

Gorbachev’s economic reforms were designed to…

improve the performance of the economy by amending the existing economic & production systems

Planning was…

decentralised

some degree of…was permitted

self-management

some degree of self-management was permitted without the loss of…

state ownership of factories & other business enterprises

some degree of self-management was permitted without the loss of state ownership of factories & other business enterprises allowing…

managers to implement economic changes without having to wait for the Soviet planning agency GOSPLAN to make decisions at a local level

what was the Soviet planning agency?

GOSPLAN

Gorbachev ended…

state price controls

Gorbachev gave…

state-owned enterprises a budget to be used however deemed necessary

some…was allowed

foreign investment

when was the necessity of reform apparent?

in the Chernobyl disaster (1986) which was initially suppressed according to Soviet censorship policies. However, the scale of the disaster & Swedish reports of high radiation forced the Soviets to make the accident public

what incidents led to criticisms of government actions?

Chernobyl & upon release from internal exile, a Soviet physicist travelled the USSR & world sharing information on repression of Soviet citizens and the conditions of Soviet prison camps. 

what was Glasnost?

the official recognition & acceptance of the need for openness in Soviet policy past & present

when was Glasnost

1988

when was Perestroika

1985

The economy was seen as the…

crux of the problems in the USSR

Gorbachev hoped that his policies would…

lead to long-desired improvement

why was oil important to the USSR

Oil was one of two major exports of the USSR. The Soviet Union had only ever experienced sporadic unsustained periods of economic growth - this was due to exportation of oil. When oil prices dropped in the 1980s the USSR was seriously affected.

why was grain important to the USSR?

Issues arose in the 1970s and continued in Gorbachev’s era because of the Soviet economy’s dependence on foreign grain. Grain production in the USSR was increased in the 1970s & 1980s however the demand for grain in cities was rising due to increased population growth.

how did Gorbachev tackle the USSRs dependence on grain?

encouraged foreign investment to stimulate the struggling economy

how did Reagan’s actions allow Gorbachev’s reforms to work?

Reagan did not impose embargos & allowed the continuation of Soviet trade with American businesses

what was the problem with Afghanistan

The war in Afghanistan was extremely costly - the USSR could not afford the war any longer.

why was there resentment to perestroika?

the general public saw a decreased standard of living & was suffering hardships whilst a small entrepreneurial class was benefiting from the relaxations

most Soviet citizens were…

government employees who had a static wage that did not match the pace of inflation

Perestroika meant Soviets made agreements with…

Western companies in 1988 which brought capital and technological developments to the USSR

Perestroika’’s impact on agricultural policies that stopped…

collectivisation were beginning to yield increases in efficiency and production

Perestroika meant that … had been eliminated

redundant & corrupt components of GOSPLAN

The transition to a market economy was…

very difficult & costly

The policies that were made to eliminate the Soviet budget deficit were…

not functioning (by 1988 the Soviet deficit was 13% of national GNP)

Consumer goods prices…

increased with inflation

what was the impact of Gorbachev’s alcohol policies?

did not have the desired effect & cost the Soviet state 100 billion rubles in tax lost due to a drop in official consumption. It contributed to economic distress as official vineyards & distilleries were forced to close. Unofficially alcohol remained available through the black market

how did Glasnost change people's attitude to the role of the government?

economic problems led to a further questioning of socialist economic policies & a collectivisation of agriculture which the gov rejected. This paved the way for agricultural reform & wider economic changes.

The Gorbachev era saw an end to…

collectivisation & a transition to privatisation whereby the state was still the owner of the land, but farmers paid for their leases and were taxed on the product

how was the cost of the the cost of the large & corrupt bureaucracy a problem?

Gorbachev needed to remove the apparatchiks who benefited from the system entailing a transformation of the government & an election system

what was the overall impact of Gorbachev’s policies?

At the end of the 1980s the USSR was still solvent due its vast natural resources & summits held by Gorbachev & Reagan/Bush. The USSRs economic problems remained severe and the impact of Gorbachev’s ‘New Thinking’ served to further undermine the communist system.