Gorbachev and Yelstin Near Economic Accord
MOSCOW — THERE are tough choices ahead for Mikhail Gorbachev. The Soviet leader has all but signed on the dotted line of a new, more radical economic reform plan. But he says he does not want a major reshuffling of his government.
The radical plan worked out in cooperation with Boris Yeltsin, the president of the Russian Republic, is clearly counter to the more gradual scheme of Prime Minister Nikolai Ryzhkov. Mr. Gorbachev praised the radical plan on Friday, but said he had given his advisers yet another week to try to mesh the two.
Yeltsin wants Ryzhkov out
``You cannot mate a hedgehog and a snake,'' Mr. Yeltsin retorted the next day. He demanded the resignation of Mr. Ryzhkov's government as ``a condition for the successful implementation of economic reform.''
Yeltsin's challenge to Gorbachev is not only economic. The Presidential Council should be replaced as the body responsible for carrying out the program by a group consisting of Gorbachev and the heads of all the 15 republics, he said. ``There should be no big or small presidents - all of them must be equal,'' he said.
Sense of emergency grows
Yeltsin struck a conciliatory note yesterday as he opened the new session of the Russian Republic's parliament, which he heads. ``We feel an increasing desire to understand and sort out our ideas and to act jointly,'' he said, referring to his recent meeting with Gorbachev.
Yeltsin is prepared to work together, ``but it will be tough for Mikhail Sergeivich [Gorbachev], because he is very strong-willed,'' commented Vladimir Tikhonov, a people's deputy from the Siberian oil town of Tyumen.
``Ryzhkov's got to go,'' he added. ``He placed his fate in the results of his economic program, and as everyone can see, there have been no results.''
A sense of emergency surrounds this moment. The economy is disintegrating, creating new and politically dangerous shortages at every turn. Power is being seized from below, by the republics that make up the Soviet Union and even by smaller units within them.
As always, Gorbachev responds to crisis by trying to strike a balance between opposing forces, by seeking stability, and by asking for time to set things right. But as he himself said, following a grueling two-day meeting with leaders from around the country, ``we are running out of time.''
Gorbachev called for a six-month period to ``stabilize'' the economy, arguing that without such ``stability'' it is impossible to ``move resolutely towards the market.'' In contradictory fashion, he called for resorting to using the old command methods to try to halt the current collapse. A communiqu'e issued following the meeting last week referred to ending ``wobbly labor and executive discipline, ... the extremely low level of work in the distribution network, the rampage of crime, and other extreme destructive phenomena.''
At the same time, Gorbachev let his programmatic preferences be known by praising the plan drawn up this past by month by a joint group under his and Yeltsin's direction. The group, headed by Stanislav Shatalin, a radical economist and member of Gorbachev's Presidential Council, has produced a detailed 400-page document providing a 500-day transition to a market economy, according to press reports.
The Shatalin plan also devotes its first stage of 100 days to ``stabilization'' of the economy. It seeks to dampen the expected inflationary explosion when prices are freed by enforcing a tough financial austerity policy. It would also decrease the huge budget deficit and restore balance in the consumer market. To do this, the plan would freeze the budget and expansion of the money supply and stop new bank credits.
This phase is not too dissimilar from the Ryzhkov plan but reports cite a number of areas of major difference of principle.
Privatization. Ryzhkov's plan calls for privatizing the state-controlled economy over five years, mostly by selling stock to employees. Radicals say the central ministries will just retain control by keeping a controlling interest in the stock. The radical plan calls for two-to-three-year privatization, including outright sale of government property.
Land. The radical plan would give the republics the power to decide how to use land.
Prices. Ryzhkov's plan seeks a one-time, government-administered rise in prices of basic goods, to bring prices into line with costs and raise revenues, followed by gradual decontrol. The radical plan freezes prices for basic goods during the transition, freeing 70 to 80 percent of prices by the end of the program. Wholesale prices of fuel and raw materials will be raised step by step.
Republics versus center. Ryzhkov's plan leaves power with the center, including over currency, banking, and trade. The radical plan calls for an economic union of republics, with agreement that during the program they will use the ruble to avoid chaos.
The agreement worked out at the meeting last week, which included the members of the Presidential Council and the heads of all the republics, calls for only one program, submitted by the end of this week to the republics for amendment and approval.
Political observers here say Gorbachev will try to keep Ryzhkov in place to carry out the more unpopular stabilization measures, perhaps until the end of year.
Replacing Ryzhkov would not solve any fundamental problems, but it might give Gorbachev the thing he wants the most - time.