Switching To The New Economic Model (1991)

Anna asked me to write about shock therapy, but first I need to say a couple of words about the economic situation in the Soviet Union: not how did it look objectively, not how did it look for the rest of the world, but how the ordinary people, who’ve been inside this system, perceived the economic situation.

The ruling word was “deficit,” and in Russian, in those days it meant not the fact of deficiency of certain goods, but deficient goods themselves. “Deficit” meant anything, which you were unable to find in the store, anything, you had to “get,” either staying in a long line, if you were lucky to be at the place and at the time, where and when “a deficit” has been distributed. Or perhaps you knew somebody who worked in retail, and they could help you to “get a deficit.” There were also “holiday distributions” at the workplaces, or in the worst case scenario, you could find “a speculator” who would sell to you “a deficit” for a sky-rocketing price.

You might ask – who could afford this sky-rocketing price? The answer is that most of the people could. Not every day, not for everything, but if you really-really needed something, you would come up with the money, most of the time.

The salaries were approved somewhere far away from your place of work, and in a majority of cases were not individualized, meaning that a junior engineer will have the same 120 rubles monthly, and maybe 130 or even 135 rubles monthly, if they would work for the Department of Defense. All prices, from bread to beef, to bananas, to underwear, to chairs were fixed across the country, so everybody knew what did the “ice-cream for 19 kopeks” mean, you could use a price instead of a brand.

Most of the people would use their “retail connections” or “speculators” from time to time, for example when they would needed new winter boots or a coat for their toddler. And the vast majority of people would complain about this situation. Most of “intelligentsia” would lament: I wish it would be legal being able to get something for a higher price. It’s much better than not having these goods at all! Why “they” won’t let these people sell what they have.

It’s important to understand that anything could become a deficit. Not only caviar but also a hard salami, and even canned green peas or mayo. Not just fashionable dresses, but sandals for preschoolers or coats for toddlers. And a “deficit” meant that when you come to the store, you do not see any of these goods. None. Not wrong size or the wrong color, but none.

There should not be a surprise, that under such circumstances most people were rather enthusiastic when something which would look like a free market started to appear. That was before shock therapy, during Gorbachev’s times, and I recall the opening of the new store on the first floor of there building where I lived. It was a store that had some goods. The prices would be 2-3 times higher, that in “regular” stores, but they were selling nicely tailored winter jackets (I still remember the look!), and fashionable sweaters, and this felt good like never before. And most people assumed life would get even better this way.

At the same time, “the cooperatives” started to appear. Before perestroika, it was almost illegal to work in more than one place. Your primary workplace had to agree in writing to you working somewhere else and had to confirm that hours of work won’t intersect.

Then things changes – it was all up to you. And that was a real liberation for me. I often think, how ironic is the fact, that by any formal criteria, I belong to the socioeconomic group that suffered most during perestroika and shock therapy. But in reality, everything worked great for me. I could take a second job (which I could partially do at the university). It was a software development cooperative, and I can’t remember how have ordered the actual work, but all of us were working on a portable C compiler. I was working on the string functions library for mainframes and was making several times more money, that on my university job.

Meanwhile, some goods ended up being in such a shortage, that the government had to start rationing them. I remember beef being rationed for an extended period, and at some point soap, washing powder and vodka were also distributed by the ration cards. By fall 1991 we had monthly ration coupons for beef (1.5 kg per person), butter (0.5 kg per person), sugar(1 kg per person) and vegetable oil (0.5 liters per person).

And then just after the New Year the prices on goods were “released,” letting the Market to name their actual worth. And all of a sudden it was not about the fancy clothing or caviar – it was about EVERYTHING.

Anna and Vlad were born in August 1991, and at that time, I thought that I was wholly prepared to take parental leave. I’ve saved enough money to be able to stay at home for two years, and since I would become a mother of three, I would be eligible to buy a new washing machine Viatka without waiting in a queue for two years.

All my plans have collapsed. All my savings were turning into nothing at high speed. We still had ration cards, but there was nothing in the stores to get even the minimum they would guarantee. If we heard about “something” being “given” for the ration cards, we would run there to get in line. The lines were everywhere. At some point a specialized distribution center for new mothers was opened, where you could get some butter and sugar on your ration cards. The proteins were virtually non-existent in the city. I know that most of the places didn’t get the food situation as severe, as it was in Saint Petersburg, but here it was pretty bad, and nobody would let me skip the line.

To be continued

15 thoughts on “Switching To The New Economic Model (1991)

  1. Why shokovaya teraoia?? Why would you of all people call it like that? Communists and such use this term to discredit everything good that was done.
    Anna should read Gaidar’s books if she is really interested, it’s fascinating reading if you ask me.

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    1. Anna has read Gaidar, as well as many other politicians and economists, but the purpose of this bog is different. No matter how I would call it, this term is something, which is used in the US, and people routinely mention it, referring to this specific period of Russian history. Thereby, if I want my friends, my children and grandchildren, and probably future generations to be able to pin this episode of our family history to the global timeline, it should be labeled accordingly. I do not write a book on history or economics, I am blogging about my personal experience, trying my best to reconstruct my feelings and thought at each moment I describe, while I still can do it.

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    1. Precisely :). Do you remember how Anna was saying how weird is it to see English names spelled in Russian :)? But this is the whole reason, why we’ve started this project, the reason I’ve outlined in the first post in this blog: https://hettie.family/2019/06/05/disappearing-history/.

      We usually do not write about these things, because “everybody knows it.” But once I’ve started writing for a different audience, I’ve realized, how many things are being untold, and how much of additional information I need to convey to fully explain the situation. Otherwise, the myths emerge.

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  2. До сих пор помню, как открылся магазин ЦФТ.. я купила себе там красивую блузку, колючие полушерстяные колготы и две мельхиоровые чайные ложки. И да, у нас на заводе в программном отделе тоже выкручивались – начальница как-то провела хоздоговором программное обеспечение для цехов, которое мы писали, и я уже позже, уволившись, получила несусветные восемьсот рублей. И мы купили на них в Эстонии музыкальный центр, за месяц до того,как все упало..

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    1. Just ran it through Google translate 🙂 plus minor edits,:)

      I still remember how the CFT store opened .. I bought myself a beautiful blouse, spiky half-woolen tights, and two melchior teaspoons. And yes, we were also finding our ways in the software department at the plant – our boss managed to pay us extra, as if we were independent contractors, for some software development, And I later, after quitting, I received an utter eight hundred rubles. And we bought a music center for them in Estonia, a month before everything fell ..

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  3. It would be unjust to say that you had have your life in the St. Petersburg as a shock therapy…anyway, in the 90s, when I lived there, I did not feel that way. The most of all produce or fruits I had no problem to buy. I was buying a lot of things and sent to my family. Also, in those kinds of period of our lives, the Moscow or St. Petersburg were the most good places to live. Yes, I agree that we had some difficulties but we knew how to manage and stay happy.

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  4. “The nineties” is a VERY prolonged period, during which each several months were very different periods. From 1990 to 1996, I lived at least four very different lives. I genuinely admire your abilities, if you could live comfortably in Saint Petersburg during winter 1991-92 and subsequent spring – I could not, especially having baby twins.

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  5. Nice read… my own pet peeve of total deficit in 1980s is a memory of getting a sports uniform. At my after-school sports class, we were required to wear solid color dark (preferably red or navy) cotton T shirts – light colors or prints were banned by the rules of the sport. However, such a simple thing – the kind you can get at Walmart for 5 bucks or less – proved impossible to find in stores. My mom managed to solve the problem by procuring some fabric dye through a network of friends and dying a couple of white T shirts dark red with her own hands. Why such a mundane thing became a super rare commodity in Moscow in mid 80s is totally beyond me…

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  6. O, I will still have to write about the gym uniforms, when I will get to writing about my life in the Soviet Union! We had to have different colors for different grades, and that was a disaster as you’ve described!

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  7. By ‘not as bad outside Moscow and St. Petersburg’, I think, you mean that those people who had relatives in the villages where they had plots of land and could grow potatoes and such, could survive on that as food.
    I know my mother said that’s how we survived – grandparents sent us what they grew. In the city (Cheboksary) you could not buy anything at all; at one period, my father had to go as an ‘intern’ to work in Germany (he was an engineer closer to 60 then, and worked for ABB, but not officially), while we had to make it on literally no money for 3 months (January, February, March). I was old enough to understand the concept of ‘we have no money at all’, and try to come up with creative ways to make do on existing resources. I think the lunch at school must have been free, because I cannot imagine how I’d have made it otherwise. My mother was working full time, but the salaries were ‘held back’ – whatever we ate, came from the gradparents’ village (eggs, potatoes, canned vegetables – they had nothing else themselves).

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  8. It is really hard for me to say, to which extent it depended on geography, and to which extent – on particular circumstances of particular families. I heard a lot of very different stories and many people are saying there was no hunger around them….

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