“The Negative Consequences of “Shock Therapy” Capitalism “ Arbatov
Thesis: As a Russian economist, Arbatov accurately elucidates the poor effects of shock therapy capitalism upon the Russian economy and its people.
· Previous economic system was horrible and extravagant
· Yeltsin took charge of the economic development and the country yet there remained problems with “administrative command” system
· Yegor Gadar with the approval of Yeltsin implemented the “Chicago School” program which launched this program to “inject laissez-faire capitalism immediately into Russian economy”
· Results include the decline of their economy, poor GDP ratings, inability to compete with own domestic markets, inability to make technological and scientific advances, and the “pauperization” of the Russian people
· Criminals ran rampant while the standard of living ceased to be stable de to inflation, increased salaries lagging behind price rises, and decline of birth rate and growth in death rate
· Millions lacked needed medical care and common materials and accessories became luxury goods
· Thus, education deteriorated immensely and culturally, access was limited for financial difficulties were abundant
· Likewise, govt aid disappeared while trade unions vanished
· “The Majority are fully immersed in day to day fight for survival” due to fact that “the country is being robbed of its wealth”
This passage helps explicate the ideas that capitalism and western style economics don’t always provide beneficial affects for all who adopt it
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