Perestroika and glasnost had served only to open up a Pandora’s Box. The explosion of strikes threatened to bring the whole bureaucratic order crashing down. Gorbachev was facing removal, as happened to Khrushchev earlier. Completely disorientated, he appeared to be facing in all directions at once. Boris Yeltsin, who had been removed from the Politburo of the Communist Party in 1988, now emerged as a key figure in the move towards capitalism.
As chairman of the Russian Supreme Soviet, Yeltsin was de facto president of the Russian Federation. Under his command, the Russian Congress adopted a Declaration on the Sovereignty of Russia, further reinforcing his authority and power. He repeatedly clashed with Gorbachev, finally calling for his resignation publicly on television. At the 28th Congress of the CPSU in July, Gorbachev spoke of the end of the “Stalinist model of socialism”. He admitted that “decades of the domination of the administrative command system have alienated the working class from property and authority…” This was an astounding confession of bankruptcy. But instead of posing a clear Leninist alternative, Gorbachev, as usual, confined himself to empty generalities and ambiguities.
‘Genuine democracy’ was being established. The over-centralised Soviet state was in the process of being converted into a genuine union of “self-determination and voluntary association of peoples”. But he still insisted that his plans for a market did not signify a reversal to capitalism: “This means that by moving towards a market we are not swerving from the road to socialism, but are advancing towards a fuller realisation of society’s potential.”
Yeltsin resigned from the Communist Party; following the lead of ex-foreign minister Eduard Shevardnadze. On the very next day, the ‘reformist’ mayors of Moscow and Leningrad, Gavriil Popov and Anatoly Sobchak, also resigned. In the previous six months 130,000 had left the CPSU – 10,000 in Moscow in July alone. The pro-bourgeois wing was beginning to get organised. Three hundred deputies established an independent group within the Congress dedicated to accelerating perestroika and “to countering the pressure put on parliament by conservative forces”. Its leadership comprised Yeltsin, Sakharov, Afanasiev and Palm. They represented the openly counter-revolutionary wing of the bureaucracy. Popov and Sobchak were also representative of this layer.
In early 1990, the decision had been taken to end the constitutional monopoly of power of the Communist Party. The demoralised Party was further weakened by Gorbachev’s tinkering. In July, the CPSU adopted a new draft programme, replacing Marxism-Leninism with ‘Social-Democratic principles.’ Thus, with the stroke of a pen, the ‘Communist’ Party formally broke all links with the ideas and principles of the October Revolution, although in practice they had long since ceased to have anything to do with them.
The representatives of the pro-bourgeois wing were using their control of the government of the Russian Federation to engineer a confrontation with the Kremlin. On 19 October 1990, the USSR Supreme Soviet finally approved a plan for a market economy. According to The Guardian (20/10/90) the mood was “sombre and desperate”. It was a compromise programme “short on detail”. During the month of October, Gorbachev issued decrees on the liberalisation of wholesale prices and the rouble commercial exchange rate (a step towards a convertible rouble).
In November, the government set the official exchange rate at $1:1.80 roubles (six years later it was $1:5,000); foreign ownership of enterprises (the right of foreign capitalists to set up in USSR, and buy shares and property) was allowed for the first time. The imperialists could hardly believe their luck. They seized the opportunity with both hands. By the end of the year, a summit was held between the presidents of the Soviet Union and the USA. At the press conference, President Bush stated he was “prepared to encourage the Soviet Union in every way” in that country’s search for “greater engagement with the international market economy”. The representatives of world imperialism were throwing all their weight behind the nascent bourgeoisie in Russia.
Gorbachev gave the state of the nation speech in an atmosphere of crisis. The food crisis worsened as the economy deteriorated rapidly.