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As a rule, my approach to the research for and execution of this paper prioritizes the analysis of narratives built on facts, rather than the facts themselves. In presenting narratives — mostly American narratives about the Cold War and the Soviet Union — I do not contest that necessarily they have some grounding in concrete facts, just as the narratives that I present to counter or add nuance to them are grounded in concrete facts (some of the same ones, in fact). But throughout it is not the facts themselves that interest me the most, but the stories people tell themselves with them.

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What better place to start, then, than with the story of the end of the Cold War, and the collapse of the Soviet Union? Once again, my high school history textbook is as good a place as any to start, which pegs the collapse of the Soviet Empire on Gorbechev's flawed reforms, Perestroika and Glasnost, which were introduced in the 1980s in response to widespread problems with the existing system, "Gorbachev was committed to aggressively tackling the country’s many problems — economic stagnation, a flourishing black market, public apathy, and cynicism about the party. His economic program, launched in 1987 and known as perestroika...freeing state enterprises from the heavy hand of government regulation, permitting small-scale private businesses called cooperatives, offering opportunities for private farming, and cautiously welcoming foreign investment in joint enterprises." (Strayer, Nelson, 1723-1724) Gorbechev's response to the failure of a communist economy was, essentially, to try and revitalize it by incorporating elements of a free-market capitalist economy that other countries, like the United States, found successful. According to this telling, Gorbechev had the right idea, but it was too little too late, "In a dramatic contrast with China’s booming economy, the Soviet Union spun into a sharp decline as its planned economy was dismantled before a functioning market-based system could emerge. Inflation mounted; consumer goods were in short supply, and ration coupons reappeared... few Soviet farmers were willing to risk the jump into private farming, and few foreign investors found the Soviet Union a tempting place to do business" (1725). Here is just one small example of the kind of narrative that gets used to talk about the collapse of the Soviet Union. A high-school-level history textbook is a good way to see what Americans get told about this history, though there are many different versions disseminated in lots of other forms of media. The basic premise is always the same: "The Soviet Union was really bad, and wasn't working. So the Soviet leaders tried to make things more like the west, which was working, but they were too late and it all came crashing down." Again, I'm not here to argue over the concrete facts of the collapse of the Soviet Union, but rather the way they're used to present the story of it in this way, which makes several bold assumptions. We can deal with the "was the west really working?" question later on, but for now I'd like to focus primarily on this question of economic stagnation. "The Soviet Union wasn't working". Gorbachev certainly seemed to think so, in putting forward his Perestroika reforms. But how do we know this is true?

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This is the question that Robert Allen tries to grapple with in his 2001 retrospective analysis of the Soviet economy. He divides the history of Soviet economic performance into two periods: 1928-1970, when the Soviet economy was growing rapidly, frequently outpacing the economic growth even of western economies, and then 1970 onward, when economic growth stagnated when compared with western economies. Allen provides this basic explanation for the second period, "The growth rate dropped abruptly after 1970 for external and internal reasons. The external reason was the Cold War, which diverted substantial R&D resources from civilian innovation to the military and cut the rate of productivity growth. The internal reason was the end of the surplus labour economy… the accessible natural resources of the country had been fully exploited" (Allen, 878-879). These, then, were the economic challenges that Gorbachev was trying to address with his perestroika reforms, put into capitalist terms for the benefit of future study.

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Evaluating the performance of the Soviet economy was not just something that Robert C. Allen and the Soviets were interested in doing, of course. The United States also had a vested interest in analyzing the strength of its greatest adversary. From a 1985 declassified CIA report entitled "A Comparison of the US and Soviet Economies: Evaluating the Performance off the Soviet System", we can glean further insight into the narrativization of the facts that took place during this period and contributed to Gorbachev's reform activities. The CIA was very aware of the problems that the Soviet economy was facing by the mid 1980s, and describe them in this report using much the same terms as Allen, "The areas in which the Soviet performance has been poorest relative to US performance since the mid 1970s are GNP (Gross National Product) size and growth, per capita consumption, quality of consumer goods and services, agriculture, development and application of new production technologies, and labor productivity" (PDF, 5). Again, the failures of the Soviet Union's communist system are put into capitalist terms. This makes sense if you are Robert Allen, an economist working in and writing for a capitalist country, or the CIA in the 1980s, addressing US policy-makers and political leadership. But critically, these were also the terms that Gorbachev himself was most likely thinking of these problems in, "The Soviets' use of the US economy as the standard against which to measure their own progress is longstanding. In fact, comparisons of Soviet economic performance with that of the United States are given a prominent place in the USSR's major statistical compendium" (5).

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Now I think we are prepared to approach some of our central questions. By the mid 1980s, the Soviet economy, at least in terms of GDP, labor productivity, and consumption levels, was not able to keep pace with capitalist economies that the Soviet Union was competing against politically, namely the United States. But even more critically, Soviet leadership at this point determines, by analyzing their problems through a capitalist lens, that Soviet communism must be reformed towards emulating rival capitalist economies for the sake of bridging this gap in performance. The typical narrative given to these reform attempts, as we've seen, is simple from the perspective of the Soviet's capitalist competitors: too little, too late. Should have tried to be capitalist earlier! But what if instead it was the very reforms that tried to "fix" the Soviet economy, to make it operate more like a capitalist economy, which led to its demise? Gorbachev and other Soviet leadership were dismayed by the Soviet Union's economic performance in comparison with that of the United States, but should they have been? Or could it be argued that the slowdown in economic growth was a natural by-product of the communist system working as it was always intended to?

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Consider for a moment the basic principles of communism and capitalism. Under capitalism, the basic idea is to create incentives that will drive innovation and increased productivity. Some of those incentives are positive, what a psychologist might call a "carrot"; improved living conditions, material wealth, access to higher echelons of society. Other incentives are negative, "the stick", as it were; the threat of poverty, starvation, social failure. In order for a capitalist system to be perpetuated, it is necessary that some people are suffering when compared with others. Communist thought rejects this incentive structure. Communism presents the theory that under a system of collectivized labor, the goal is to organize things efficiently so that every person working within the system has enough to get by. The only incentive necessary for people should be that by working they are helping themselves, their loved ones, their community, and their country to thrive. Returning to Allen's analysis of Soviet economic productivity, we see strong evidence that the communist system was producing results: employment rates rose almost to capacity, productivity increased as workers were organized by the system so that their labor would be made use of most efficiently. These were the drivers of the dramatic economic growth of the Soviet economy observed during the period between 1928 and 1970. If analyzed through a communist lens, the economic slowdown in capitalist terms such as Gross National Product, and rates of consumption, are unimportant so long as labor productivity is high enough to provide for the basic needs of the people. But as the CIA report observes, these kinds of failures — the failure to provide for its citizens as promised — were also present by 1985, "The poor quality of many Soviet consumer goods and services is a persistent torment of daily life: Health care is notoriously bad, insufficient funding, lack of qualified personnel, and shortages of supplies have helped to lower Soviet life expediencies. Housing is shoddily constructed and poorly maintained, and about 20 percent of the urban population either lives in dormitories or shares living space with unrelated families and singles" (6). Now, that's not to say that the "shoddily constructed" housing and "notoriously bad" healthcare was not leaps and bounds better than most people were getting under Tsarist Russia. Again, there were massive improvements in all of these areas between 1928 and 1970. It wasn't until after that that things stopped improving so quickly, or in many cases began to get worse. So what gives? Allen's research tells us that much of the reason for the economic slowdown was increased investment in military spending to compete with the United States on a global scale. Money invested in the military was necessarily cut from essential civilian programs.

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Robert Allen's paper concludes with the following message, "The interpretation of the Soviet decline offered here is the reverse of analyses that emphasize incentive problems and the resulting failure of managers to act in accordance with the plans. On the contrary, the plans were implemented; the problem was that they did not make sense. The strength of Soviet socialism was that great changes could be wrought by directives from the top... the early strength of the Soviet system became its great weakness, since the economy stopped growing because of the failure of imagination at the top" (879). There it is again, a "failure of imagination", "too little, too late". But given the added context of the sort of narrativization that has been done by the west, both during the Cold War and in the decades following its conclusion, and the influence that this perspective had on Soviet leadership, including Gorbachev, I present the argument that the "failure of imagination" was not Gorbachev's inability to incorporate the success of capitalism sooner. Rather, his failure came from the fact that he was viewing a communist system through a capitalist lens, and in doing so his reforms undermined the original intentions of attempting a communist system in the first place; a system based not on endless economic growth and ever-increasing rates of consumerism, but in sustainable providence for all people. Gorbachev's reforms attempted to stick a capitalist band-aid over the failures of a communist system, rather than addressing those problems in a fashion that would have been fitting for the system that had already been working as intended for more than fifty years. I agree with Allen's claim that Soviet economic decline was not the fault of "incentive problems", and I agree also that that the reforms implemented "did not make sense"; the reforms being made weakened the government's ability to control the economy, at the very moment when things were beginning to go wrong!

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There's some evidence to suggest that Gorbachev might have realized his mistake, and tried to correct for it. At the end of 1989, it was arranged that he would meet then President of the United States, George H.W Bush, on a Soviet ship off the coast of Malta. According to a 2023 New Yorker Article which describes this incident, "Gorbachev lamented the sad state of his economy... [and] unveiled what he considered a great surprise. It was a heartfelt statement about his hope for new relations between the two superpowers. 'I want to say to you and the United States that the Soviet Union will under no circumstances start a war,’ Gorbachev said. ‘The Soviet Union is no longer prepared to regard the United States as an adversary.'" (Gessen, pgph 3). Had the negotiations gone differently, perhaps the Soviet Union would have reduced military spending to appease the United States, end the Cold War, and revitalize the economy of the Soviet Union. Instead, the Union was dissolved, in part thanks to pressure and/or indifference from the West, and American priorities shifted from managing its diplomatic relationships with a capable adversary to the exploitation of geopolitical circumstances where it had suddenly become the sole global superpower. To quote from the New Yorker's analysis again, "Gorbachev thought he was discussing the creation of a new world, in which the Soviet Union and the United States worked together, two old foes reconciled. Bush thought he was merely negotiating the terms for the Soviets' surrender" (pgph 4).

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