Dr. Pasour is professor of agricultural and resource economics at North Carolina State University, Raleigh.
Mark Kramer, on assignment for the New York Times Magazine, visited the Soviet Union several times, beginning in 1987, to explore its well-known agricultural problems. This account of Kramer’s journeys shows why neither perestroika nor privatization efforts following the breakup of the Soviet Union have worked.
Agricultural productivity in the former Soviet Union was (and continues to be) stymied by the political and economic system—not by lack of fertilizer, modern machinery, or other technology. Managers of collective farms could not even make key decisions like when to plant or which crops and livestock to produce—these decisions were made in Moscow. Central planners, however, do not have and cannot obtain much of the highly specialized information relating to time and place conveyed through price and profit signals in a market economy. This book is a case study of the problems that arise when this lesson is ignored.
Gorbachev’s perestroika reforms were fundamentally flawed—the missing ingredient was private property. Meaningful reforms were precluded because he had stipulated that all reforms were to be fully based on the principle of more socialism!
Perhaps just as importantly, use of economic incentives that led to increased output and wages for some workers inspired fierce envy in many people. Two generations of communist doctrine emphasizing fair ownership of wealth had elevated envy to a patriotic motive. Kramer found that keeping down the Ivanovs in that collectivist regime was what keeping up with the Joneses is in the West.
The output of peasants’ private gardens on the collective farms, however, shows the power of economic incentives. A third of the nation’s milk, meat, eggs, and vegetables, and sixty percent of potatoes and fruit came from the two percent of farmland in private plots. Despite the popularity and productivity of private plots, innovative but basic market activity, such as hiring labor to work in the private gardens, inspired envy and vandalism.
Moreover, envy continued to stymie economic reform following the breakup of the Soviet Union. Traders obtaining goods from corrupt clerks at controlled state prices increased the already pervasive antipathy toward middlemen. In this climate, Yeltsin’s privatization decrees in agriculture proved to be unenforceable. Aspiring independent farmers were unable to obtain land, equipment, and supplies except through the state distribution system still largely controlled by the chairmen of the collective farms.
The trials of converting the Soviet collectivist system to a market economy are far from over. Kramer, in an afterword written in 1995, points out that farm output is down by one-fourth since the demise of the Soviet Union and that large state-owned collectives still control more than 90 percent of Russian farmland.
Travels with a Hungry Bear is a highly readable account of the pernicious economic and cultural effects of collectivism in the former Soviet Union and the destructive nature of its legacy. Widespread adherence to collectivist dogma, instilled and nurtured by the state over several generations, makes the always difficult transition to a market economy even more problematic.