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Capitalism Russian-Style

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Capitalism Russian-Style

Cambridge UP,

15 min read
10 take-aways
Audio & text

What's inside?

No one can be certain about Russia's economic future, but here are the factors to weigh — and the reasons those old-time Marxists are spinning in the crypts.

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Editorial Rating

6

Qualities

  • Comprehensive
  • Analytical
  • Background

Recommendation

Thane Gustafson presents an overview of Russia’s experiment with capitalism to date. In this well-documented, well-reasoned report, he describes the breakdown in the Soviet economy. This collapse was already in the works when Gorbachev’s efforts to reform the system brought it tumbling down. Gustafson weaves his account together like a journalist, as he discusses the heady rush of capitalism, entrepreneurism, political corruption and crime that moved into Russia’s economic vacuum like a modern gold rush. He carefully traces recent developments in Russia’s attempt to recover from its 1998 financial disaster. As the book describes, no one knows what will happen in Russia. Gustafson emphasizes that Russia cannot return to its command economy. The book offers cautious optimism for future business with Russia. However, the admitted uncertainty of Russia’s future may frustrate readers who seek definitive answers. getAbstract recommends this book to readers interested in social and political developments and to academics as well as to executives of companies with economic interests in Russia, or those who may want to do future business there, although – for now – it may be a particularly risky venue.

Summary

An Overview of Russia’s Great Collapse and Transformation

In 1998, the Russian government, in essence, declared bankruptcy when it called a moratorium on debts and admitted its inability to defend the ruble. This signaled that the country’s ten-year effort to create a new market-based economy had run into a disaster and needed a new direction. Before the crash, the Russian elite hoped Western-style capitalism and market reforms could help them quickly transform Russia from its old command-based Marxist economy to a new, modern capitalist society. After the crash, the elite’s mind-set totally shifted. Everyone became very uncertain about what the future might be and how to get there.

Now, Russia’s economic system is in such disarray that it could possibly drop out of the circle of major industrial powers. However, the country still has potential strengths. Its population is highly educated and it has a "strong scientific and engineering culture." Russia has the world’s largest concentration of natural resources. It also has the largest nuclear arsenal and a long history of military success. Thus, Russia is likely to rise up again and it is better for the world if it...

About the Author

Thane Gustafson is a government professor at Georgetown University and a director of the Eurasia/Former Soviet Union Service of Cambridge Energy Associates. He wrote Crisis Amid Plenty: The Politics of Soviet Energy Under Brezhnev and Gorbachev and Reform in Soviet Politics: Lessons of Recent Policies on Land and Water. He co-authored Russia 2010, and What It Means for the World.

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