1973 Soviet economic reform
Encyclopedia
The 1973 Soviet economic reform was an economic reform initiated by Alexei Kosygin, the Chairman
of the Council of Ministers. During Leonid Brezhnev
's rule of the Union of Soviet Socialist Republics
(USSR) the Soviet economy began to stagnate; this period is referred to by historians as the Era of Stagnation. After the failed 1965 reform
Kosygin initiated another reform in 1973 to enhance the powers and functions of the regional planners by establishing associations. The reform was never fully implemented, and members of the Soviet leadership complained that the reform had not even been fully implemented by the time of the 1979 reform
.
by establishing associations at the republican and local level of government. The newly established associations were to increase co-operation between enterprises on such important matters as technology, innovation, and education. Each association was to be specialised. A normal inefficiency with Soviet planning was that each enterprise was burdened by excessive production.
was initiated. Local planners and economists in the 1980s still complained that they had too little power in the daily running of their local economies. Specialised literature proved that the reform's main goal had failed to meet the expected standards.
If the reform had been fully implemented it would have given republican and local-level associations considerable more leeway in economic management. The central Ministries would lose influence by the abolishment of the glavki, high-standing departments housing skilled administrators and planners, and the level below the central Ministries would have been strengthened; the merger of enterprises into associations would have given them a common spokesman with economic expertise. The reform would have increased the influence of the political leadership and the State Planning Committee
(Gosplan). Historian Jan Åke Dellenbrant notes that an "unofficial reason" for the reform was to intentionally weaken the central Ministries, which had been accused of halting economic progress.
The merging of enterprises into associations was accomplished by a highly controversial campaign by Soviet standards. The campaign was carried out in a spirit of derationalisation, which aggravated and even hurt the plan's highly rational goals. The industrial structure of the economy became even more derationalised and therefore more complicated. Central Ministries objected to the loss of enterprises by the setting up of associations, and enterprise managers disliked giving up most of their authority to association chairmen. Local party officials were skeptical of turning plants into local subsidiaries, because the plants' output would not be included in the republics' or regional yearly output statistics. Another problem was that local party cells claimed that they were informed too late about the reform's implementation.
s, oblast
s, and even republics, which aggravated the State Planning Committee's localisation planning.
The newly established associations made the Soviet economic system even more complex. Many associations increased production amongst member enterprises, such as the Gor'kii automobile plant in Leningrad
, which was used as a "model example" by the Central Committee
of the Communist Party of the Soviet Union
(CPSU) to demonstrate a good association and a unified Primary Party Organisation (PPO). The Gor'kii plant did not share the same problems as some other associations, as all its members were located in the same city. The relations between an association and the PPO were much more strained if the association had members over a wide geographic area.
The reform had the effect of disrupting the CPSU's traditional allocation of resources between territorial and industrial agencies. Kommunist
, a Soviet newspaper, noted that PPOs that supervised associations with members over a wide geographic area tended to lose touch with the local Party and factory organisations. This hindered the raikoms from working effectively.
Premier of the Soviet Union
The office of Premier of the Soviet Union was synonymous with head of government of the Union of Soviet Socialist Republics . Twelve individuals have been premier...
of the Council of Ministers. During Leonid Brezhnev
Leonid Brezhnev
Leonid Ilyich Brezhnev – 10 November 1982) was the General Secretary of the Central Committee of the Communist Party of the Soviet Union , presiding over the country from 1964 until his death in 1982. His eighteen-year term as General Secretary was second only to that of Joseph Stalin in...
's rule of the Union of Soviet Socialist Republics
Soviet Union
The Soviet Union , officially the Union of Soviet Socialist Republics , was a constitutionally socialist state that existed in Eurasia between 1922 and 1991....
(USSR) the Soviet economy began to stagnate; this period is referred to by historians as the Era of Stagnation. After the failed 1965 reform
1965 Soviet economic reform
The 1965 Soviet economic reform, widely referred to simply as the Kosygin reform or Liberman reform, was a reform of economic management and planning, carried out between 1965 and 1971...
Kosygin initiated another reform in 1973 to enhance the powers and functions of the regional planners by establishing associations. The reform was never fully implemented, and members of the Soviet leadership complained that the reform had not even been fully implemented by the time of the 1979 reform
1979 Soviet economic reform
The 1979 Soviet economic reform, or "Improving planning and reinforcing the effects of the economic mechanism on raising the effectiveness in production and improving the quality of work", was an economic reform initiated by Alexei Kosygin, the Chairman of the Council of Ministers...
.
Intentions
The reform was ratified in April 1973. Alexei Kosygin's intention with the reform was to indirectly weaken the powers and functions of the central MinistriesMinistries of the Soviet Union
-Ministries:- Other agencies under the Cabinet of Ministers :-See also:* Council of People's Commissars, head of government from 1917-1946* Council of Ministers, head of government from 1946-1991* Cabinet of Ministers, head of government in 1991...
by establishing associations at the republican and local level of government. The newly established associations were to increase co-operation between enterprises on such important matters as technology, innovation, and education. Each association was to be specialised. A normal inefficiency with Soviet planning was that each enterprise was burdened by excessive production.
Implementation
Implementation of the reform was slow. New associations were still being established in 1980s, a decade after the reform was initiated. High-standing Soviet officials commented on the problem when the 1979 reform1979 Soviet economic reform
The 1979 Soviet economic reform, or "Improving planning and reinforcing the effects of the economic mechanism on raising the effectiveness in production and improving the quality of work", was an economic reform initiated by Alexei Kosygin, the Chairman of the Council of Ministers...
was initiated. Local planners and economists in the 1980s still complained that they had too little power in the daily running of their local economies. Specialised literature proved that the reform's main goal had failed to meet the expected standards.
If the reform had been fully implemented it would have given republican and local-level associations considerable more leeway in economic management. The central Ministries would lose influence by the abolishment of the glavki, high-standing departments housing skilled administrators and planners, and the level below the central Ministries would have been strengthened; the merger of enterprises into associations would have given them a common spokesman with economic expertise. The reform would have increased the influence of the political leadership and the State Planning Committee
Gosplan
Gosplan or State Planning Committee was the committee responsible for economic planning in the Soviet Union. The word "Gosplan" is an abbreviation for Gosudarstvenniy Komitet po Planirovaniyu...
(Gosplan). Historian Jan Åke Dellenbrant notes that an "unofficial reason" for the reform was to intentionally weaken the central Ministries, which had been accused of halting economic progress.
The merging of enterprises into associations was accomplished by a highly controversial campaign by Soviet standards. The campaign was carried out in a spirit of derationalisation, which aggravated and even hurt the plan's highly rational goals. The industrial structure of the economy became even more derationalised and therefore more complicated. Central Ministries objected to the loss of enterprises by the setting up of associations, and enterprise managers disliked giving up most of their authority to association chairmen. Local party officials were skeptical of turning plants into local subsidiaries, because the plants' output would not be included in the republics' or regional yearly output statistics. Another problem was that local party cells claimed that they were informed too late about the reform's implementation.
Failure
The reform had the side effect of weakening the powers of regional planners over industrial policy even further. By 1981, roughly half of Soviet industry had been merged into associations with an average of four member enterprises in each association. A problem was that an association usually had its members spread over different raionRaion
A raion is a type of administrative unit of several post-Soviet countries. The term, which is from French rayon 'honeycomb, department,' describes both a type of a subnational entity and a division of a city, and is commonly translated in English as "district"...
s, oblast
Oblast
Oblast is a type of administrative division in Slavic countries, including some countries of the former Soviet Union. The word "oblast" is a loanword in English, but it is nevertheless often translated as "area", "zone", "province", or "region"...
s, and even republics, which aggravated the State Planning Committee's localisation planning.
The newly established associations made the Soviet economic system even more complex. Many associations increased production amongst member enterprises, such as the Gor'kii automobile plant in Leningrad
Leningrad
Leningrad is the former name of Saint Petersburg, Russia.Leningrad may also refer to:- Places :* Leningrad Oblast, a federal subject of Russia, around Saint Petersburg* Leningrad, Tajikistan, capital of Muminobod district in Khatlon Province...
, which was used as a "model example" by the Central Committee
Central Committee of the Communist Party of the Soviet Union
The Central Committee of the Communist Party of the Soviet Union , abbreviated in Russian as ЦК, "Tse-ka", earlier was also called as the Central Committee of the All-Union Communist Party ...
of the Communist Party of the Soviet Union
Communist Party of the Soviet Union
The Communist Party of the Soviet Union was the only legal, ruling political party in the Soviet Union and one of the largest communist organizations in the world...
(CPSU) to demonstrate a good association and a unified Primary Party Organisation (PPO). The Gor'kii plant did not share the same problems as some other associations, as all its members were located in the same city. The relations between an association and the PPO were much more strained if the association had members over a wide geographic area.
The reform had the effect of disrupting the CPSU's traditional allocation of resources between territorial and industrial agencies. Kommunist
Kommunist
Kommunist was a Soviet newspaper. It was the official theoretical and political organ of the Central Committee of the Communist Party of the Soviet Union.-External links:*...
, a Soviet newspaper, noted that PPOs that supervised associations with members over a wide geographic area tended to lose touch with the local Party and factory organisations. This hindered the raikoms from working effectively.
See also
- 1965 reform1965 Soviet economic reformThe 1965 Soviet economic reform, widely referred to simply as the Kosygin reform or Liberman reform, was a reform of economic management and planning, carried out between 1965 and 1971...
- 1979 reform1979 Soviet economic reformThe 1979 Soviet economic reform, or "Improving planning and reinforcing the effects of the economic mechanism on raising the effectiveness in production and improving the quality of work", was an economic reform initiated by Alexei Kosygin, the Chairman of the Council of Ministers...
- 1984 reform