Poverty in the Former Soviet Region

Feb 19, 2001

When the Soviet Union and Eastern Europe ceased to function in 1989, the capitalists and their supporters cheered. A whole area which had been deprived of the joys of the "free market" was now opened up–giving capitalism the opportunity to show how it could benefit 400 million people.

More than a decade has now passed–and we can see just what benefits exist.

Economic activity (as measured by the Gross Domestic Product, the GDP) has fallen by a third in this whole region of the Soviet Union and the former People’s Democracies of Eastern Europe. This is a greater loss than the drop in GDP experienced in the U.S. during the Great Depression.

The consequences are severe, as a report from the European Children’s Trust published this past October points out. "Since the break-up of the communist system, conditions have become much worse–in some cases catastrophically so. The economic collapse that followed the break-up combined huge rates of inflation with high levels of unemployment. The reductions in public expenditure which were made in the wake of this economic liberalization have combined with the economic collapse to impose a huge cost in terms of human suffering."

The effect on the people of the area are shown by statistics produced by the World Bank and the United Nations. Among adults, life expectancy has declined; tuberculosis has risen. One quarter of the population is unlikely to live to the age of 60. Tuberculosis, a disease which appears among the poor, has a rate of 67 cases per 1000 in this region, far higher than the rate of 48 per 1000 in Latin America. (The rate is 18 per 1000 in the rich countries.)

Children are even more at risk than adults. Infant mortality rates have risen to levels like those of the poor in Latin America. About 37 infants die for every 1000 births in Azerbaijan, as in Brazil. About 28 infants die for every 1000 births in Moldava, as in Mexico. And in the worst case, Rumania’s children who survive end up–180 out of every 10,000 children–in under-equipped, understaffed orphanages.

There were enormous problems for the population under the old Soviet system, which in effect was controlled by a bureaucracy which sat on the backs of the population. But it was a society born of a workers’ revolution in 1917. If the revolution was first pushed back and finally strangled by the weight of the greedy bureaucracy, it nonetheless provided a certain number of social safeguards for its people.

Today the people of the former Soviet Union and Eastern Europe suffer not only from the remains of the bureaucracy, but from ten years of the "free market." The oldest and youngest are left to drop dead–the first fruits of the capitalist way of life.