Russia

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Full Report: Russia

Overview

1910-1913: Imperial Russia is the largest state territory on earth, with the largest population in Europe and the world's biggest army. It is Europe's chief source of agricultural exports, and with rich mineral resources, the chief recipient of foreign investment. After a decade of industrial recession, and with the restoration of stability following a nationwide peasants' revolt, Russia sees renewed growth.

1914-1916: During World War I, Germany invades Russia. Six million men are mobilized, and Russia's factories converted to a war footing. Nicholas II takes personal command of the army at the front, leaving his new government leaderless in the capital. With much of the land left untilled, cities go hungry. Essential services like the railway system threaten to collapse. By 1916 Russia has lost 3.5 million men.

1917: Military incompetence, inflation, low wages, and food shortages add to growing dissatisfaction with the monarchy. Demonstrations in the capital lead to a general strike and Nicholas II's abdication. A provisional government fails to restore order. Led by Vladimir Lenin, the Bolsheviks seize power and establish an emergency dictatorship that aims to abolish private property and socialize the state.

1918-1920: Lenin unilaterally ends the war with Germany. Russia descends into a three-year civil war between the "red" Bolsheviks and the "white" counterrevolutionary armies for control of the former empire. The capital is moved to Moscow, and the Communist Party machine emerges from Bolshevik ranks. The siege economy and state monopoly leaves production at a virtual standstill and the cities without food.

1921-1928: The triumphant Bolsheviks set about transforming the tsarist empire into a quasi-federation of states, the Union of Soviet Socialist Republics (USSR), established in 1922. Lenin's New Economic Policy (NEP) restores certain aspects of a market economy and brings about a dramatic economic improvement. In 1922 Joseph Stalin is appointed general secretary, and Lenin dies two years later.

1929-1940: Stalin overturns the NEP and begins the collectivization of agriculture. Confiscation of private farms sparks widespread protests. The First Five-Year Plan is passed in a program to modernize the USSR through forced industrialization. Stalin uses terror backed by purges, show trials, executions, and mass deportations to the gulag to secure his rule. His cult of personality becomes all-pervasive.

1941-1945: During World War II, the Red Army successfully repulses Germany's invasion and itself marches west, annexing Poland, Romania, Hungary, and Eastern Germany. The USSR suffers an estimated 20 million deaths, but its part in the Allied victory helps consolidate the Communist Party's grip on power. After the war, the USSR emerges as Europe's greatest military power, and one of two global superpowers.

1946-1952: Stalin sets about reconstructing the Soviet economy. The Fourth Five-Year Plan aims to rebuild the industrial base and exceed prewar production levels. A xenophobic campaign, zhdanovschina, is launched to purify Soviet life of Western bourgeois influences. With the Red Army's blockade of occupied West Berlin, the Cold War begins. In 1949 the Soviet Union tests its first atomic bomb.

1953-1963: Nikita Khrushchev, named first secretary upon Stalin's death, begins a period of cultural thaw and de-Stalinization in an effort to decentralize the Soviet system of repression and secrecy, and to realize the "dream of socialism with a human face." The Virgin Lands Campaign aims to boost agricultural yields. The Warsaw Pact is created in 1955 to counter NATO, and in 1961 the Berlin Wall is erected.

1964-1975: Khrushchev is ousted, and Leonid Brezhnev is made first secretary. His regime focuses on recentralizing power and control. A timid reform of industry fails to alter the economic system's declining efficiency and productivity. But when world oil prices skyrocket during the 1973 oil crisis, Soviet coffers fill up with hard currency that will help to prop up the Soviet economy for more than a decade.

1976-1985: Several strokes leave Brezhnev critically ill, supported by an old-guard clique; he dies in 1982. The economy buckles under the burden of a renewed arms race with the U.S. and the Soviet invasion of Afghanistan. Stability turns into virtual paralysis as Brezhnev's successors, themselves ailing, argue the merits of reform and inaction. Yuri Andropov dies in 1984, Konstantin Chernenko a year later.

1986-1988: Following his appointment as leader, Mikhail Gorbachev begins a campaign of openness in public life (glasnost) and political and economic restructuring (perestroika), while committed to socialist ideals. Managers of state enterprises are given some independence, certain private businesses legalized. But an oil-price collapse and an anti-alcoholism campaign deprive the state of major revenues.

1989-1991: Gorbachev's relaxation of controls creates an economic halfway house. As output plummets, shortages, rationing, and queues grow increasingly severe. A desperate attempt to restore centralized planning proves unworkable. The Berlin Wall falls, and Eastern Europe breaks free from communism and Soviet control. The USSR is dissolved, and Boris Yeltsin is elected president of the Russian Federation.

1992-1995: Yeltsin tries to transform Russia's economic system and social structure into a democratic market economy. The abolishment of state subsidies results in huge price rises. Hyperinflation hits, reaching 2,323 percent. State industry is sold through voucher privatization. Corruption and profiteering run rampant. Yeltsin suppresses an armed uprising by the Supreme Soviet and reimposes rule by decree.

1996-1999: A second wave of privatization dubbed Loans for Shares sees strategic state assets sold to a few magnates, nicknamed "oligarchs." Their support helps Yeltsin overcome a resurgent Communist Party to be reelected president. His bankrupt government sells bonds at high interest rates to raise money, but the Asian financial crisis forces Russia to default on its debts, and in 1999 Yeltsin resigns.

2000-2003: With promises to reverse Russia's decline, Vladimir Putin is elected president. Maintaining market reforms and instituting a tax overhaul to boost revenue and business, he attempts to steer Russia toward World Trade Organization membership. The oil industry booms. Putin consolidates his grip on power, delivering stability but raising fears of authoritarianism. Russia opposes the U.S.-led war in Iraq.

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Political

1910: Tsar Nicholas II heads an absolute monarchy that continues to resist the dilution of its power, despite recent constitutional reform, which for the first time legalize political parties and establish an elected parliament. His promise of civil rights goes unfulfilled, and growing public discontent is channeled into left-wing revolutionary associations which seek to overthrow the system.

1911-1916: A wave of workers' strikes gains momentum after the 1912 massacre of strikers at the Lena gold fields in Siberia. The Bolsheviks, a faction of the Russian Social Democratic Workers' Party, capitalize on the growing spirit of unrest and gain popular influence. Russia's entry into World War I leads to a surge in patriotism, which temporarily suspends public anger and disillusionment.

1917: A general strike, the "February revolution," forces Nicholas II's abdication and the monarchy's end. Power falls into two camps: a largely socialist provisional government and the Petrograd Soviet, a popularly elected assembly representing workers and soldiers in the capital. In October Vladimir Lenin and the Bolsheviks seize power, calling for the war's end and for a transfer of power to soviets.

1918-1920: The Bolsheviks allow countrywide elections for the Constituent Assembly, but close it down after winning only 20 percent of the vote. Based on the Central Committee and Politburo, the Communist Party becomes the Russian Soviet Federated Socialist Republic's political core. Promises of a new constitution are constantly delayed, but the imperial family's murder makes a return to monarchy impossible.

1921-1923: The USSR initially comprises the Soviets Russia, Byelorussia, Ukraine, and Caucasus, each with its own political organization but without real independence from the center. The civil war has heightened the absolute centralization of power. After less than a decade of independence, the Communist Party has suppressed and subsumed Russia's trade unions. Joseph Stalin becomes secretary general in 1922.

1924-1940: Following Lenin's death, Stalin argues against the need for international revolution for the USSR's survival; instead he aims for "socialism in one country." He moves against rivals in the Party, and by his 50th birthday in 1929, his dictatorship and cult of personality is fully established. Central planning is instituted, and the party reorganized to secure its total domination of the state.

1941-1945: During the second world war, the Communist Party and its centralized political structures prove highly effective in running the country. To raise morale and rally the people to Russia's defense for the "Great Patriotic War," Stalin moderates Soviet policy. Class warfare is temporarily forgotten, and the terror of mass purges brought to an end.

1946-1952: With the USSR's annexation of the countries of Eastern Europe comes the introduction of single-party regimes and Soviet-style socioeconomic reforms there. The prewar hostility of communist and capitalist worlds resumes. At home, victory establishes the legitimacy of the Soviet state in the eyes of many Russians. But having loosened the reins of power during the war, Stalin resumes total control.

1953-1963: By the time of Stalin's death, the political dictatorship has reached maturity, backed by the world's largest secret police, the gulag, aggressive censorship, and a vast military. Nikita Khrushchev denounces Stalinism, but the dictatorial machine remains intact, and his own cult of personality begins. His aggressive foreign policy results in the Berlin Wall's erection and the Cuban missile crisis.

1964-1984: On Khrushchev's death, the new regime revives the oligarchic principle of collective rule, but Leonid Brezhnev soon emerges as the most powerful leader. Brezhnev aims for stability on the international and domestic scene, but the brutal military suppression enforced after Czechoslovakia's uprising in 1968 offers stark proof of the limits of political reform possible within the USSR.

1985-1987: With perestroika, Gorbachev aims to restructure and improve the Soviet system without building a new one. Article 6 of the constitution, enshrining the Party's leading force in society, is removed. Gorbachev seeks to identify and end corruption endemic in political ranks. Internationally, he begins the retreat from the USSR's imperial ambitions as well as a policy of warm relations with the West.

1988-1990: Gorbachev's push to democratize the Soviet system leads to the creation of a Congress of People's Deputies. For the first time, real elections within the Party system take place with alternative candidates. The dramatic change in Soviet politics is marked by the lack of military response and the Party's impotence in the face of Poland's free elections and the fall of the Berlin Wall.

1991: Boris Yeltsin becomes president of the Russian Republic in the first-ever election for a Russian leader. After a political struggle, Gorbachev resigns as general secretary of the Communist Party of the USSR (CPSU), and the CPSU is subsequently made illegal. A loose Commonwealth of Independent States replaced the USSR, which is fragmenting along nationalist and ethnic lines.

1992-1995: Yeltsin's battle with a Communist-dominated Congress over a referendum for a new constitution ends with his dissolution of parliament. Communist hard-liners occupy the "White House" (parliament), but Yeltsin reasserts his position in a military clash, and the new constitution gives him sweeping powers. As Yeltsin's popularity wanes in the face of economic problems, that of the Communist Party grows.

1996-1999: Backed by Russia's increasingly powerful business tycoons, Yeltsin defeats Communist Gennadii Zyuganov and is reelected president of Russia in 1996. But Kremlin politics remain turbulent and unstable, especially when Yeltsin becomes seriously ill. His regime struggles to build an effective political administration and maintain control over local government.

2000-2001: Following Yeltsin's resignation, Vladimir Putin is elected president. He vows to strengthen Russia's standing in the world and increase the state's authority at home, while continuing to move toward a market economy. His authoritarian and reformist intentions raise questions, and his long-awaited government reform turns out to be little more than a Cabinet shuffle.

2002-2003: Vladimir Putin's consolidated power brings some political stability to Russia, but new anti-terror laws and measures to control the media raise fears of authoritarianism. Communists, splintered among several parties, attempt to reorganize to provide stronger opposition. Putin cements his alliance with the United States but stands firm with France and Germany in opposing the U.S. invasion of Iraq.

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Economic

1910: Russia is an inseparable part of the capitalist world economy. While her economy resumes growth, it remains dominated by peasant agricultural production. The speed of its earlier industrialization omitted the development of an intermediate industrial and consumer-oriented sector, leaving a major imbalance, with little existing between cottage and heavy industry.

1911-1916: Despite the workers' strikes, the years before World War I see renewed growth, aided by rising world wheat prices. But Russia's backwardness, low labor productivity, and high material costs contribute to its low rank in industrial output. The tsar fails to organize an effective war economy and responds to a collapse in international trade and domestic revenues by printing money fueling inflation.

1917: The Russian economy is devastated by the chaos of a world war, two domestic revolutions, and a breakdown in food supplies brought on by a terrible winter. The economy's militarization assists the takeover by the Bolshevik dictatorship and the institution of "war communism." Private land and the free market are abolished, and a state monopoly on prices and the food trade imposed.

1918-1920: Russia's postwar industrial output is less than 20 percent of the prewar level, with whole sectors of the economy destroyed. Lenin aims to rebuild the shattered economy. As core industries are nationalized, debates rage about the optimum extent of state planning. Russia's colossal debt, owed to international creditors, is wiped out when the regime refuses to recognize the debts of the tsar.

1921-1928: The future core of the Soviet command economy, Gosplan (General Commission on State Planning), is established in 1921. Faced with economic crisis, Lenin introduces a tactical compromise with capitalism to incentivize production and trade. His 1921 National Economic Plan, which allows private agriculture and limited small trade, results in an immediate and dramatic improvement.

1929-1932: Stalin imposes the command economy. The First Five-Year Plan sets extravagant targets for heavy industry's expansion. Every enterprise and worker must meet dictated norms, to be fulfilled without discussion. As the Depression hits the rest of the world, the Soviet economy powers ahead. But as Soviet agriculture is forcibly collectivized, at significant human cost, production drops by 30 percent.

1933-1940: The Second Five-Year plan calls for still higher industrial growth. Steel, coal, power, chemicals, and the military are given absolute priority. Quantity reigns over quality, and falsified statistics are common. Victims of Stalin's mass arrests, forced to work as prisoner employees in prison camps, form a core of the Soviet economy. By 1939 the gulag is the largest employer in Europe.

1941-1945: The command economy forges ahead during WWII, with labor mobilized on an epic scale and productivity increased with forced overtime. Military output reaches staggering proportions, propped up by Allied aid under the lend-lease scheme. Rapid industrialization has turned the USSR into a power capable of defeating Hitler, but military strength gives a false impression of the nation, weakened by shortages.

1946-1953: The Fourth Five-Year Plan aims to restore and surpass prewar levels of production. The command economy goes into overdrive to achieve output miracles no matter what the cost and makes a rapid recovery. As the Cold War begins, resources are prioritized to heavy industry, nuclear weapons, and the space race. Agriculture and light industries lag, and food and essentials remain in short supply.

1954-1962: The command economy tries to increase output by adding input. Khrushchev aims to boost agriculture by cultivating an extra 35 million hectares of virgin lands. After short-term gains, food shortages return, and the USSR must import wheat. Attempting to reform central planning, Khrushchev replaces the central ministries with local councils better placed for practical economic decision-making.

1963-1965: Brezhnev continues to pour resources into the military industrial complex. Unbeknownst to the Soviet or world public, the military consumes more than 30 percent of Soviet GNP. Khrushchev's local councils are abolished, centralized industrial ministries restored. Prime Minister Aleksei Kosygin's economic reforms give enterprises slightly more freedom of practice, but not enough to alter the system.

1966-1972: The Eighth Five-Year Plan places greater emphasis on consumer goods. The USSR grows more dependent on the West for these and new technology, and establishes new partnerships with Western firms. In 1966 a Fiat-licensed Lada factory slowly starts to meet the public's growing desire for private cars, but there remains a stark absence of supporting services, including modern roads.

1973-1976: By the time of the '73 oil crisis, the USSR is the world's largest producer of oil and natural gas and the third largest of coal. Inefficient Soviet factories consume vast amounts of energy, but amid this plenty, the public continues to suffer chronic energy shortages. The oil windfall keeps the economy running, but by the mid-1970s the industrial economy ceases to grow and begins its slow decline.

1977-1985: Despite huge investment, the collectivized farm system still fails to deliver; 28 percent of gross agricultural output comes from the 1 percent of land cultivated on personal plots. A law enshrines the need for private plots and encourages enterprises and army units to develop auxiliary farming for their own purposes. Arms spending increases in answer to President Reagan's aggressive foreign policy.

1986-1991: In 1986, the year oil prices collapse, Mikhail Gorbachev aims to jump-start the economy by reforming the centrally planned system. Under perestroika, he legalizes individual and family enterprise along with the ownership of joint stock companies, and gives enterprises more control over their own budgets. But the decrepit economic structure remains, shortages increase, and the queues grow longer.

1992-1993: Led by Yegor Gaidar, Boris Yeltsin's reformist team institutes economic shock therapy: Military and welfare budgets are cut; many subsidized prices are liberalized; private trade is legalized. Soaring prices wipe out people's savings, but shortages and the black market disappear. An embryonic market economy begins. Citizens receive privatization vouchers, and the sell-off of state assets begins.

1994-1997: The reformers rush to privatize and make the move to the market irreversible. Corrupt officials and entrepreneurs alike exploit the chaotic transition to capitalism to profiteer and make vast fortunes. The oligarchs' seizure of state assets at bargain prices is seen by many as the theft of the century. Shops are filled with goods, but the gulf between rich and poor widens exponentially.

1998-1999: Spiraling debt driven by the lack of tax revenues and the highly speculative government bond market forces the devaluation of the ruble and Russia's default on debts. Banks collapse, and Russia sinks into further economic crisis.

2000-2001: President Putin makes it legal to buy and sell a limited amount of Russian land for the first time since pre-Soviet days. The Russian economy quickly bounces back from the crash, fueled by tough financial disciplines, the enduring resilience of the people, and high commodity prices. Putin continues market reforms, but the economy remains highly vulnerable to commodity price swings.

2002-2003: The economy is segmented: Some sectors, like heavy industry, are struggling while natural resources and the service sector prosper. Increased production, modernization, and high world prices boost Russia's oil sector. The U.S. and EU recognize Russia as a market economy, a step toward WTO membership. But foreign investment falls to a scant $1.1 billion in the first half of 2002.

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Social

1910: Much of Russian society remains feudal, with a landed nobility and a peasant class struggling for complete emancipation. The demand for workers' rights and a political voice has sparked increasing strikes and protests. The growth of industrial towns has led to urban migration and major social stress, as the old order with its traditional culture centered on the church undergoes dramatic change.

1911-1916: The tide of workers and peasants' protests escalates. During World War I, conscription, heavy loss of life, and hyperinflation lead to terrible social distress. As a result of Prime Minister Piotr Stolypin's earlier agrarian reforms, which freed peasant land from the village commune's control, some 2.5 million households have received title deeds to their land by 1916.

1917: Lenin begins to reconstruct almost every aspect of Russian life. The Bolsheviks' secret police, the Cheka (an acronym for All-Russian Extraordinary Commission for Combating Counterrevolution and Sabotage) work zealously to strike down "class" enemies, attacking civil institutions and shutting down nonsocialist newspapers. Private landownership is abolished, as are any privileged-class distinctions.

1918-1920: The civil war causes a massive breakdown of all the normal ties that link different groups of society. Merciless conscription, famine, and death complete the work of the 1917 revolution, shattering the old institutions and social classes. Traditional Russian society is virtually destroyed, providing a blank slate on which the new institutions of a new Soviet society are created.

1921-1928: A cultural revolution completes Russia's Sovietization. The Russian Orthodox religion is attacked: The state expropriates church land and property and outlaws religious education and most forms of religious activity. In 1925 it establishes the League of Godless to spread atheism. A new art style develops and becomes popular as part of the recasting of culture.

1929-1940: Stalin continues the cultural revolution, denying peasants internal passports and forcing them to endure a virtual second serfdom on new collective farms. The state casts the industrial worker in the heroic image of the new Soviet man. It steps up its attack on the church, purges undesirable intellectuals, and expands education to teach all Soviet citizens to read and write.

1941-1945: World War II sees a surge of patriotism. Stalin reopens churches in his drive to rally the faithful, calling for the defense of Holy Russia. Laws are enacted to mobilize labor, institute rationing, lengthen the working day, and criminalize absenteeism. During and after the war, as part of a Soviet nationality policy, millions of the country's smaller nationalities are deported to Siberia.

1946-1953: The loss of some 25 million people, especially young men, during the war, has profound social implications. In 1946 Stalin launches a policy of zhdanovschina, a cultural war against innovation, modernism, and Western sympathies. This severe disciplining of the intelligentsia against any deviation from the Soviet patriotic line helps produce its own cultural Cold War.

1954-1963: After a religious revival, Khrushchev resumes the attack on the church. Anti-religious propaganda intensifies, and huge numbers of churches are closed. But the general climate of fear is lightened, and Stalin's draconian labor laws are repealed. An informal social contract emerges, with workers accepting low pay and no right to strike for cheap food, social benefits, and more lenient work practices.

1964-1984: Brezhnev's rule is a time of relative plenty. The minimum wage is raised, and the standard of living improves significantly. The five-day work week is introduced and basic holiday entitlement raised. The 1977 constitution enshrines the right to a private land plot. Church closures and imprisonments cease. But compared with the West, living standards remain markedly low.

1985-1991: Gorbachev's reforms shatter the norms of Soviet society. For the first time in their lives, the Soviet people find themselves living without the threat of censorship and the secret police, but economic collapse leads to widespread protests for better pay and conditions, and the majority of the population sees its social benefits erode. Nationalist sentiment grows in the republics of the USSR.

1992-1993: The end of the USSR and Communist rule offers hope, freedom, and opportunity. For many, though, it means acute uncertainty. As prices skyrocket and welfare collapses, the number of Russians living in poverty soars. Illness, alcoholism, and mortality and suicide rates rise sharply. Russians are forced to find new ways of living and making money. Those that succeed find themselves much better off.

1994-1997: Continuing economic distress and a series of corruption scandals within the government lead to disappointment with the new system. Many blame democracy and market capitalism for the new inequality and the dramatic drop in living standards. The rebuilding of the Cathedral of Christ the Redeemer in Moscow, demolished by Stalin, epitomizes a revival in the church.

1998-2003: The 1998 default wipes out the savings of Russia's new middle class. Real wages fall by 40 percent, and the number living below the poverty line rises from 20 to 35 percent. The newfound freedoms and opportunities contrast with high inequalities, spiraling rates of drug use and HIV/AIDS, and ongoing corruption. But market economics and the cultural changes it has wrought appear firmly rooted.

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Environmental

1910-1928: The Bolsheviks declare all forests, waters, and minerals to be the property of the state, and so available for use. Faced with excessive logging, forests are divided into exploitable sectors and protected ones. In 1921 natural preserves, or zapovedniki, are established, where vast portions of the country are set aside for ecological study and commercial development, including tourism, is banned.

1929-1930: In Stalin's rush to modernize, factories and heavy industry are celebrated, but attention is paid exclusively to output, not ecological impact. The zapovedniki come under pressure as nature becomes viewed as an obstacle to be tamed, conquered, and overcome. The party argues it can control nature rationally through planning, and that pollution is a byproduct of capitalism.

1931-1939: Building projects are launched in previously pristine environments: dams, mines, and industrial cities -- the bigger the better. Millions of people are moved to the cities, with little consideration for the effects of urbanization. The command economy plans industrial activities in massive clusters which result in extraordinary concentrations of pollutants and with them ecological disaster zones.

1940-1949: The USSR passes some of the earliest laws on toxic substance levels, but all environmental laws bow to the agencies that run the military, utilities, mines, and chemical industries. Russia tests its first atomic device at Semipalatinsk, Kazakhstan, in 1949. Hundreds follow, here and at Novaya Zemlya, in the Arctic. The race for nuclear weapons results in significant localized contamination.

1950-1953: Radiation sickness appears at the Chelyabinsk nuclear reactor in the Urals. In 1951 waste is discovered to have contaminated the local water, and 10,000 people are evacuated, the area isolated. An explosion six years later forces officials to erase contaminated villages from the map. Total accumulated radiation in the region is pegged at one billion curies, 20 times that produced by Chernobyl.

1954-1962: To meet targets, planners increase inputs of land, energy, and labor, but do not use resources more efficiently. Khrushchev launches the Virgin Lands Campaign to cultivate Western Siberia and Kazakhstan's vast steppe, previously used by nomads for grazing. The wheat harvest soars, but overexploitation soon leads to soil erosion, and much of the land turns to huge dust bowls.

1963-1970: The Party mounts huge irrigation projects to support Central Asia's planned cotton monoculture, leading to the catastrophic drying up of the Aral Sea and desperate shortages of drinking water. Faced with increased pollution and the costs of large-scale waste, resolutions are passed outlining the protection of land, water, air, and wildlife, but the commitment exists almost entirely on paper.

1971-1980: To meet the oil boom, oil pipelines are built across the permafrost or acid peat soils of Siberia. They frequently corrode and discharge. In East Siberia alone, three to 10 million tons of crude oil are estimated to leak each year, damaging fragile ecosystems that have limited ability to purify themselves.

1981-1985: In 1981 a law is passed requiring all new enterprises or those that modernize to ensure air emissions comply with established norms. A lack of adequate and available technology and the reluctance of ministries to sacrifice output for pollution control hamper the effort. The start of a huge shift from coal and oil reliance to natural gas leads to a sharp drop in emissions.

1986: The explosion of a nuclear reactor at Chernobyl, the worst nuclear power disaster in history, bathes half of Europe in radioactive fallout. Gorbachev waits 18 days before addressing his nation. Before then, information about environmental pollution had been strictly classified, but with the advent of glasnost, Russia's ecology becomes a topic for open discussion. A new green movement begins.

1987-1988: Gorbachev goes further than any predecessor in acknowledging the environment and the need for a new approach. The numerous state commissions and ministries that had shared responsibility for the environment are consolidated into the State Committee for the Protection of Nature (Goskompriroda). Soviet environmental groups also concentrate their forces, uniting into the Socio-Ecological Union (SEU).

1989: Environmentalists' demands begin to have a significant impact. More than 1,000 production plants are closed or forced to scale back for violating environmental laws. But there is still little enforcement of regulations in the face of the Party's demand for growth. Penalty fines are paltry, and it remains cheaper and easier for enterprises to dump waste than use pricey purification equipment.

1990: Gorbachev and George H.W. Bush sign a treaty for the destruction of chemical weapons stocks. Russia announces it has 40,000 tons of poisonous substances, including 32,000 tons of phosphorous organic compounds. Arguments rage over the building of a factory on the Volga River to destroy these chemical weapons, and financing to this day remains beyond the reach of the state budget.

1991: President Yeltsin signs an ambitious environmental law that sets out the regulation of everything from electromagnetic radiation to the maintenance of health resorts. It sets out the standards of waste management and emissions and mandates criminal liability for environmental damage. But the environment remains a low priority in the face of severe political and economic problems.

1992-1999: Commonwealth of Independent States (CIS) members agree to cooperate on environmental protection, stating that because political borders do not coincide with natural ecological boundaries, economic activity in one state must not damage the environment or quality of life in other states. In 1993 former President Gorbachev founds the environmentally minded Green Cross International.

2000-2003: President Putin abolishes the State Committee for Environmental Protection and the Forestry Administration and gives their duties to the economic-minded Natural Resources Ministry. The municipal environmental police are eliminated. An official report finds that environmentally unsound conditions affect 60 percent of Russians and kill 300,000 per year. Drinking water is unsafe in half the country.

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Rule of Law

1910-1916: Following Nicholas II's 1905 October Manifesto, political parties and trade unions exist legally for the first time in Russian history. The representative assembly, the Duma, is empowered to make laws and monitor government, but the tsar's decree remains all powerful. The emergency laws of 1881 remain largely in place: Authorities may fine, exile, and imprison individuals without a court decision.

1917-1928: The Bolshevik dictatorship makes private trade and personal property virtually illegal. In the chaos of civil war, the ideal of rule by the people is ignored, and the state exercises harsh discipline. The security police are ordered to eliminate economic speculation and any act seen as hostile to the ideal of the regime. Special revolutionary tribunals replace judicial institutions.

1929-1953: The supremacy of Communist Party dictate over all Soviet laws is enshrined in the constitution and carried out through an elaborate array of laws, structures and psychological taboos. Stalin's directive of 1934 allows the rapid trial and sentencing of suspected so-called terrorists even in their absence. With the onset of Stalin's purges and mass terror, human rights and civil law cease to exist.

1954-1969: Khrushchev reforms and reasserts a legal system, abolishing, or at least severely restricting, military and emergency tribunals used as vehicles of terror. He purges the criminal code of vague concepts like "terrorist intentions," so common in Stalin's mass arrests and show trials. Sentences are sharply reduced, and defendants can no longer be convicted solely on the basis of their own confessions.

1970-1984: In 1970 Andrei Sakharov establishes the Moscow Human Rights Committee, but the government denounces and banishes him 10 years later. In 1975, at the Helsinki summit on Cooperation in Europe, the USSR makes concessions to allow human rights monitoring, but the Soviet regime remains staunchly unaccountable, and suppression of personal freedom of movement and speech continues.

1985-1990: Gorbachev attempts democratization of the Communist Party and the expansion of personal liberty. Glasnost (openness or transparency) allows public debate and freedom of speech. For the first time, the media can criticize the government. Dissidents arrested for their espousal of human rights are released. But political corruption remains endemic, transparency in government absent.

1991-1999: With the declaration of Russia as a new sovereign republic, any old and contradictory Soviet laws are nullified. Russia witnesses democratic elections and the creation of a multiparty government. A draft Russian constitution makes no mention of either the USSR or socialism. But the legal code and system remains cumbersome, contradictory, and unpredictable, with a multitude of loopholes.

2000-2003: Vladimir Putin's election is Russia's first constitutional transfer of power between elected leaders. Putin announces that judicial reform with independent courts is a top priority. The conflict in Chechnya strikes in Moscow when terrorists hold hostage a theater audience; the government counterattack results in civilian deaths. New anti-terror laws include limits on the media.

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Trade Policy

1910-1916: Russia is fully integrated into the world capitalist economy. But unlike the more developed countries, Russia continues to be predominantly an exporter of grain and other agricultural produce, while importing mainly industrial goods. The outbreak of war with Germany means the loss of Russia's main trading partner.

1917-1920: The Bolsheviks' ideological opposition to external economic links, their refusal to pay Russia's World War I debts, and the chaos of the civil war keeps foreign trade to the bare minimum required for the country's industrial development. They pursue a policy of virtual self-sufficiency, drawing upon Russia's large energy and raw-material base for the country's needs.

1921-1928: With the creation of the People's Commissariat of Foreign Trade, active Soviet trade operations begin. An Anglo-Soviet trade treaty is followed by one with Germany. Lenin's New Economic Policy loosens the commissariat's monopoly on foreign trade, allowing other organizations to be established which can trade directly with foreign partners.

1929-1930: With the end of the NEP, foreign trade is restructured to eliminate decentralized private trading practices. Fearing the unpredictable movement and disruptive influence of foreign market forces, Stalin reasserts the state's control of all foreign trade activity. Corporations with monopolies over specific commodities are established, and imports are largely restricted to essential factory equipment.

1931-1933: To support rapid industrialization, the USSR increases imports drastically. By 1931 it is the largest buyer of British and American machinery. To pay, it unloads grain and raw materials on the depressed world market. Charging the USSR with dumping cheap goods to further undermine capitalism, the U.S. restricts Soviet imports, France imposes sanctions, and Britain ends trade with the USSR.

1934-1940: The USSR's admission to the League of Nations leads to a rapprochement with the West and an increase in foreign trade.

1941-1946: World War II virtually halts the activity of the USSR's foreign trade corporations. With relations cooling after the war, Western Europe and the U.S. impose drastic restrictions on Soviet trade. It turns instead to Eastern Europe and China, where it establishes Soviet-owned and joint-stock companies. In 1946 the Ministry of Foreign Trade is created with exclusive rights to negotiate foreign trade.

1947-1963: The USSR declines Marshall Plan aid and orders its satellites to follow suit rather than dismantle international-trade barriers or provide information about the Soviet system's internal workings. Founded in 1949, Comecon, the Council for Mutual Economic Assistance, ties the economies of Eastern Europe to that of the USSR, creating a trading bloc that endures until the fall of the Berlin Wall.

1964-1979: With a policy of detente, the easing of Cold War relations, and a trade deal with U.S. President Nixon, Brezhnev expands trade with the West and increases the USSR's share of world trade. The discovery of major new Siberian oilfields in the '60s turns the USSR from being a net importer to exporter of oil. The 1973 oil crisis sends the world oil price soaring, fueling Soviet history's greatest boon.

1980-1986: As relations between the U.S. and USSR cool, trade with the West decreases in favor of increased integration with Eastern Europe. Gorbachev reforms foreign trade, granting direct trading rights to select enterprises while allowing certain joint ventures with foreigners. Exporters exploit the vast differential in domestic fixed prices and world market prices. Some accumulate vast private fortunes.

1987-1991: In the late '80s, the USSR tries to reduce imports from the West to lower its hard-currency debt, while increasing oil and gas exports. Seeking increased participation in international markets, in 1987 the USSR requests observer status in GATT, General Agreement on Tariffs and Trade, and in 1988 signs a preliminary agreement with the EEC, European Economic Community.

1992-1996: Desperate to overcome terrible shortages, the Russian government further liberalizes foreign trade. Presidents Boris Yeltsin and George H.W. Bush sign trade, investment, and tax agreements designed to make it easier for Americans to do business in Russia. They confer most-favored-nation tariff treatment for the products of each country and eliminate previous barriers and disincentives to trade.

1997-1999: For the first time, Russia participates in the economic discussions of the G7, the world's seven biggest industrial nations, at the Denver summit in 1997. The following year, at the Birmingham summit, Russia is integrated as a full member, and the G7 becomes the G8.

2000-2003: President Vladimir Putin aims to establish a free-trade zone throughout the Commonwealth of Independent States (CIS). Russia hopes to join the WTO and takes an important step in that direction when the European Union and U.S. both recognize it as a market economy. New trade laws and reforms in energy, agriculture, and other areas are still needed before WTO admission.

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Money

1910-1913: Since 1897, the ruble has been on the international gold standard, and stable. Russia's industrialization requires substantial foreign investment. Ruthless tax levies and high tariffs on imports of industrial products aim to protect Russia's infant industries and help balance the budget. Foreign investment soars, and by 1913 an estimated one-third of all capital in Russia is foreign owned.

1914-1916: Russia's state debt has increased so dramatically prior to WWI, the country has become the greatest international debtor in the world. During the war, taxes are hard to collect, and the government is forced to print more paper money and float its loans domestically and abroad. The cornerstone of Russian financial policy, the gold standard, is abandoned, and the ruble is undermined by inflation.

1917-1920: With the October 1917 revolution, the Marxist concept of the moneyless economy becomes a desired goal, but not yet a practical one. The Bolsheviks nationalize the banks, but make no attempt to restrict inflation. With the destruction of the market economy, inflation soars, and money becomes virtually valueless. A black market based on barter develops to fill the vacuum.

1921-1939: In order to make the market elements of the New Economic Policy (NEP) work, a stable currency is needed. The State Bank reopens and is empowered to issue a new ruble, the chervonets, backed by gold reserves and a balanced state budget. A money market and stock exchange revive alongside the new money.

1940-1946: The banking system is owned and managed by the government. Gosbank is the USSR's Central Bank and its only commercial bank. The ruble is an almost entirely internal currency unit, with the government fixing its rate of exchange with foreign currencies somewhat arbitrarily. Without a market economy, prices are set by the State Committee on Prices, and the real value of the ruble is difficult to determine.

1947-1969: A currency reform that makes 10 old rubles equivalent to one new ruble in 1947 attempts to replace the inflated money of the war years with a firmer currency. As was its intention, it deals a severe blow to the flourishing black market, but also sharply reduces the value of people's savings not kept in a bank.

1970-1985: Following the oil crisis, from 1973 to 1985 energy exports account for 80 percent of the USSR's expanding hard-currency earnings. By the late '70s up to 40 percent of hard currency in foreign trade is being spent on increasing agricultural imports to maintain the informal social contract with the people: low pay in return for cheap food.

1986: World oil prices plummet by 69 percent, and the dollar, the currency of the oil trade, drops like a stone. Almost overnight, the windfall oil and dollar profits the USSR has enjoyed for more than a decade are wiped out.

1987-1990: Gorbachev's reforms force state enterprises to rely to a greater extent on their own financial resources rather than on the central budget. Several new banks are set up to finance industrial undertakings, ending the monopoly of Gosbank. By 1989 inflation begins to make a major impact as goods grow ever more scarce. In 1987 checking accounts begin for personal savings accounts.

1991: The budget deficit exceeds 20 percent of estimated GDP. Soviet foreign debt balloons to $56.5bn at a time when the ruble is undergoing steep devaluation. Capital continues to flee the USSR, and Soviet gold reserves and foreign currency accounts disappear never to be found.

1992-1995: The Soviet state bank is replaced by 15 republic central banks. The ruble is retained in the belief that a single-ruble zone will promote economic reintegration. By 1993 many CIS states create their own currencies. Russia ends Soviet price controls, but monetary stabilization proves elusive. To prevent enterprises going bankrupt, the state prints money. In 1992 inflation reaches 2,323 percent.

1996-1997: Despite having sold off much of its industry, the Russian government finds itself virtually bankrupt. High rates of taxation serve only to drive businesses into systematic tax evasion. To cover its persistent deficits, the Treasury issues bonds (GKOs) at very high rates of interest. They help keep the government temporarily afloat and allow it to persuade the IMF it is solvent and deserves loans.

1998-1999: The aftershock of the Asian economic crisis hits Russia. With commodity prices tumbling, Russia, a major commodity export earner, sees its revenues plummet. Unable to fund its soaring GKO obligations despite a large IMF loan, the government defaults on its debts. Overnight most of Moscow's large banks go bust. The ruble declines to less than a third of its previous exchange rate.

2000-2003: Helped by rising commodity prices and the 1998 ruble devaluation, Russia's foreign exchange reserves rise, and the ruble strengthens. A major reform that cuts tax from a progressive rate up to 30 percent to a flat rate of 13 percent aims to simplify and boost tax collection and stimulate consumer spending. Russians begin to buy and use euros alongside dollars as a safe foreign currency.

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Categories: Overview | Political | Economic | Social | Environmental | Rule of Law | Trade Policy | Money
Graphs: Inflation | Unemployment | Well-being

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