What did the "500 Days" program for transition to a market economy promise to citizens of the USSR?
In the late 80s, the Soviet Union was increasingly plunged into political and economic crisis. The country's leadership openly discussed the ineffectiveness of the socialist model of national development compared to the capitalist model. The need for radical reforms to transition to a market economy became urgent.
To overcome the 1990 economic crisis and realize the "rights of citizens to a better, more dignified life," a program for the transition from the Soviet Union's planned economy to a market economy was developed. The working group responsible for creating the program was formed at the initiative and joint decision of Mikhail Gorbachev and Boris Yeltsin. However, among the public and expert community, it became known as the "Shatalin-Yavlinsky program," after the names of its main developers and leaders.
The second common name for this program is the "500-day program" (the first working title was "400 days of trust"). Its developers envisioned achieving, within this timeframe, as rapid and effective a transition from the planned Soviet economy to a market economy as possible.
Although the program was never actually implemented, it's important to recall what exactly it offered Soviet citizens. After all, the essence of the reforms was an evolutionary transition to capitalism while preserving all the positive aspects of the planned economy and, as its developers stated, "moving toward the market primarily at the expense of the state, not at the expense of ordinary people."
In general, the 500 Days program contained the following proposals:
privatization of state property;
decentralization of economic management;
transition to free pricing;
providing favorable conditions for the development of private entrepreneurship.
Here's what Grigory Yavlinsky said about the program 11 years ago:
This was the country's first market-oriented program. Anyone who read it knows that the program didn't envision the country becoming like Switzerland or another, even more developed, market economy in 500 days. It envisioned a year and a half of consistent and clear steps aimed at creating a market economy in Russia.
According to Yavlinsky, the program's key objective was to prevent hyperinflation, and to privatize state property using funds accumulated by the population. The program was "addressed to the entire Soviet Union." It envisioned preserving a unified economic space for all Soviet republics, with a single currency, a common banking union, a free trade zone, and so on.
By September 1, 1990, the "500 Days" program and 20 draft laws for it had been prepared, approved by the Supreme Soviet of the RSFSR, and submitted to the Supreme Soviet of the USSR. Simultaneously, at the direction of Nikolai Ryzhkov, Chairman of the Council of Ministers of the USSR, an alternative draft—"Main Directions of Development"—was being developed. Ryzhkov declared that if it was not adopted, he would resign. As a compromise, Mikhail Gorbachev proposed merging the two programs into a single presidential program for the USSR.
Yavlinsky later recalled that he and the other developers of the "500 Days" program were barred from implementing their plan. He then joined the opposition and created the Yavlinsky-Boldyrev-Lukin electoral bloc, which later became the Russian Democratic Party "Yabloko."
Ultimately, everything ended with the collapse of the Soviet Union, the beginning of the "wild nineties," and the construction of capitalism in the newly formed Russian Federation followed a completely different scenario, created and implemented by Yegor Gaidar's team under Yeltsin's complete carte blanche. In theory, the plan was to quickly restructure the system based on the principles of an extremely liberal monetary policy. In reality, the transformation processes took on a chaotic character with a profoundly criminal slant. But that's a topic for another review.
Some experts still believe that if the "500 Days" program had been fully implemented, the USSR would not have collapsed, and the country could well have achieved a Swiss-like economy. Or, alternatively, it would have been entirely painless for citizens to build a capitalism modeled on China, likely preserving shared economic ties across the post-Soviet space. Is this true?
For example, Belarus clearly benefits from economic synergy with Russia within the Union State. The Baltic republics, by contrast, rank last among EU countries in all indicators. Moldova, and especially the former Ukrainian SSR, are not even worth mentioning.
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