The Rise and Fall of the Great Powers (99 page)

By comparison, then, the increasing reliance of the Soviet Union upon imported technologies and machinery—whether legally traded goods, or stolen from the West—is a less fundamental if still serious problem. The extent of the industrial and scientific espionage (whether for military or commercial purposes) can obviously not be quantified, but seems to be yet another indication of Russia’s worry that it is falling behind.
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The more regular trade—importing western technology (and also eastern-European manufactures) in exchange for Russian raw materials—is a traditional way in which the country seeks to “close the gap”; it was done in the 1890–1914 period, and again in the 1920s. In that sense, all that has changed is the more modern nature of the product: oil-drilling machinery, rolled steel, pipe, computers, machine tools, equipment for the chemical/plastics industry, etc. What must be much more worrying to Soviet planners is the accumulating evidence that the imported technology takes longer to set up, and is used much less efficiently than in the West.
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The second problem is the availability of hard currency for the purchase of such technology. Traditionally, this could be circumvented by importing
manufactured goods from fellow Comecon countries (thus involving no loss of hard currency), but the latter’s products have increasingly failed to keep up with those from the West, even if they still have to be accepted to prevent a collapse of their eastern-European economies.
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And while Russia has normally paid for a large proportion of western imports through the barter or direct sale of surplus oil, its prospects (and those of eastern Europe) may be shrinking because of the uncertainties in oil prices, its own growing energy needs, and the general change in the terms of trade for raw materials as manufacturing processes become more sophisticated.
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At the same time as Russian earnings from oil and other raw materials (except, presumably, gas) shrink, the payments for a variety of imports remain high—all of which presumably reduces the sums available for investment.

The third major cause for concern about Russia’s future economic growth lies in demographics. The position here is so gloomy that one scholar began his recent survey “Population and Labor Force” with the following blunt statement:

While all of these elements are serious—and interacting—the most shocking trend has been the steady deterioration in both life expectancy and infant mortality rates since the 1970s and perhaps earlier. Because of a slow erosion in hospital and general health care, poor standards of sanitation and public hygiene, and the fantastic levels of alcoholism, death rates in the Soviet Union have increased, especially among the working males: “Today, the average Soviet man can expect to live for only about 60 years, six years less than in the mid-1960s.”
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Equally shocking has been the rise in infant mortality—the only industrialized country where this has occurred—to a point where infant deaths are, comparatively, over three times the U.S. rate, despite the enormous numbers of Soviet doctors. Yet if the Russian population is dying off faster than before, its birthrates are slowing down sharply. Because (presumably) of urbanization, higher female participation in the work force, poor housing conditions, and other disincentives, the crude overall birthrate has been steadily dropping, more particularly among the
Russian
population of the country. The consequences of all
these trends is that the male Russian population of the country is scarcely increasing at all.

The implications of all this have been disturbing Russia’s leaders for some time, and are obviously behind the exhortations to increase family size, the stricter campaign against alcoholism, and the efforts to persuade older workers to remain in the factories. The first is that the country clearly requires a larger proportion of resources to be devoted to health care and social security, especially as the percentage of older population increases: in this the USSR is no different from other industrialized countries (except in its increased death rates), but this again raises the issue of spending priorities. Secondly, there are the implications for both Soviet industry and the armed services, given the drastic fall-off in the rate of growth of the labor force: according to projections, between 1980 and 1990 the labor force will enjoy a net increase of “only 5,990,000 persons, whereas during the preceding ten years the estimated increase in the labor force was 24,217,000.”
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To leave the military’s problems until later, this trend reminds us again that a large part of the growth in Russian industrial output in the 1950s to the 1970s was due to an enhanced labor force, rather than increases in efficiency; from now on economic expansion can no longer rely upon a fast-increasing work force in manufacturing. To a considerable extent, of course, this difficulty could be overcome if more able-bodied males were released from agriculture; but the problem there is that an excessive number of youths in the Slavic areas have already left the communes for the city, whereas the surplus which does exist in the non-Slavic republics is more poorly educated, often has little knowledge of the Russian language, and would require an immense investment in training for industry. This brings us to the final trend which makes Moscow planners uneasy: that since the fertility rates in central Asian republics like Uzbekistan are three times larger than among the Slavic and Baltic peoples, a major shift in the long-term population balances is under way. In consequence, the Russian population’s share is expected to decline from 52 percent in 1980 to only 48 percent by 2000.
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For the first time in the history of the USSR, Russians will not be in the majority.

This catalog of difficulties may seem too gloomy to certain commentators. Military-related production in the USSR is often impressive and is constantly driven to improve itself because of the dynamic of the arms-race itself.
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As one historian (admittedly writing in 1981)
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points out, the picture cannot be seen as altogether negative, especially if one looks at Soviet economic achievements over the past half-century; and it has been a habit among western observers to exaggerate Russia’s strengths in one period and its weaknesses in the next. Nevertheless, however much the USSR has improved itself since Lenin’s time, the awkward facts are that it has not caught up with the West and,
indeed, that the gap in real standards of living seems to have been widening since the later years of the Brezhnev regime; that it is being overtaken, by all measures of per capita output and industrial efficiency, by Japan and certain other Asian countries; and that its slowdown in rate of growth, its aging population, and its difficulties with climate, energy stocks, and agriculture cast a dark shadow over the claims and exhortations of the Soviet leadership.

It is in this context, then, that Gorbachev’s belief that “acceleration of the country’s socioeconomic development is the key to all our problems” becomes the more understandable. And yet, quite apart from natural difficulties (permafrost, etc.), two main
political
obstacles stand in the way of producing a “leap forward” on the Chinese model. The first is the entrenched position of the party officials, bureaucrats, and other members of the elite, who enjoy a large array of privileges (depending upon rank) which cushion them from the hardships of everyday life in the Soviet Union, and who monopolize power and influence. To decentralize the planning and pricing system, to free the peasants from communal controls, to allow managers of factories a greater freedom of action, to offer incentives for individual enterprise rather than party loyalty, to close outdated plants, to refuse to accept shoddy products, and to allow a far freer circulation of information would be seen by those in power as dire threats to their own position. Exhortations, more flexible planning, enhanced investments in this or that sector, and disciplinary drives against alcoholism or corrupt management are one thing; but all proposed changes, Soviet party officials have stressed, have to take place “within the framework of scientific socialism” and without “any shifts toward a market economy or private enterprise.”
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In the opinion of one recent visitor, “the Soviet Union needs its inefficiencies to remain Soviet”;
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if that is so, all Mr. Gorbachev’s urgings about the need for a “profound transformation” of the system are unlikely to make much impact upon the long-term growth rates.

The second political obstacle lies in the very significant share of GNP devoted by the USSR to defense. How best to calculate the totals and how that measures with western defense spending has exercised many analysts; the CIA’s 1975 announcement that the ruble prices of Soviet weaponry were twice as high as previously estimated—and that Russia was probably spending 11–13 percent of GNP upon defense rather than 6–8 percent—led to all sorts of misinterpretations of what that meant.
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But the exact figures (which may not even be available to Soviet planners) are less significant than the fact that although the growth in armaments spending slowed down after 1976, the Kremlin appears to have allocated around twice as much of the country’s product to this area as has the USA, even under Reagan’s arms buildup; and this in turn means that the Soviet armed forces have siphoned off vast
Stocks of trained manpower, scientists, machinery, and capital investment which could have been devoted to the civilian economy. This does
not
mean, according to certain economic forecasts, that a large reduction in defense expenditures would quickly lead to a great surge in Russia’s growth rates, simply because of the fact that it would take a long time before, say, a T-72 tank-assembly factory could be retooled to do something else.
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On the other hand, if the arms race with NATO over the rest of this century drove up the share of Russian defense spending from 14 to 17 percent or more of GNP by the year 2000, a larger and larger amount of equipment such as machine-building and metalworking tools would be consumed by the military, crowding out the share of investment capital going to the rest of industry. Yet, while economists believe that “this will represent a tremendous problem for Soviet decision-makers,”
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all the indications are that defense expenditures
will
rise faster than GNP growth—and have the consequent effect upon prosperity and consumption.

Like every other one of the large Powers, therefore, the USSR has to make a choice in its allocations of national resources between (1) the requirements of the military—in this case, with their built-in ability to articulate Russia’s security needs; and (2) the increasing desire of the Russian populace for consumer goods and better living and working conditions, not to mention improved social services to check the high death and sickness rates; and (3) the needs of both agriculture and industry for fresh capital investment, in order to modernize the economy, increase output, keep abreast of the advances of others, and in the longer term satisfy both the defense and the social requirements of the country.
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As elsewhere, this involves difficult choices by the decision-makers concerned; yet one has the sense that however large and pressing are the needs both of the Russian consumer and of “modernizing” the economy, the traditional obsession by Moscow with military security means that the fundamental choice has already been made. Unless the Gorbachev regime really manages to transform things, guns will always come before butter and, if need be, before economic growth as well. This, as much as any other characteristic, makes Russia basically different from Japan and western Europe, and even from China and the United States.

Historically, then, the Kremlin today follows the tradition of the Romanov czars, and of Stalin himself, in its desire to have armed forces equal to (and, if preferable, larger than) those of any other Power. There is no doubt that at the present time, the military strength of the USSR is extremely imposing. To try to offer a realistic figure for annual totals of current Soviet defense expenditures would probably be a deception: on the one hand, Moscow’s
official
figures are absurdly low, concealing large amounts of defense-related spending under other headings (“science,” the space programs, internal security, civil
defense, and construction); on the other hand, western estimates of the real total are complicated by the artificial dollar-ruble exchange rate, limited understanding of Soviet budgetary procedures, the difficulties in, say, the CIA’s effort to put a “dollar cost” on a Russian-made weapon or manpower costs, and institutional/ideological biases. The result is an array of “guestimates,” which one can choose according to one’s fancy.
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What is not in question, however, is the massive modernization which has occurred in all branches of the Soviet armed forces, both nuclear and conventional, on land and sea and in the air. Whether one considers the rapid growth of Russian land- and sea-based strategic missile systems, the thousands of aircraft and tens of thousands of main battle tanks, the extraordinary developments in the surface navy and in the submarine fleet, the specialist activities (airborne and amphibious warfare units, chemical warfare, intelligence and “disinformation” activities), the end result is impressive. It may or may not have cost as much in real terms as the Pentagon’s own allocations; but it undoubtedly gives the USSR a range of military capabilities which only the rival American superpower possesses. This is
not
a twentieth-century military Potemkin village, ready to collapse at the first serious testing.
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