WHAT WAS SOCIALISM, AND WHAT COMES NEXT?

1. Overview:
   1. Today we're going to answer two questions
      1. What Was Socialism?
      2. Why did it Collapse?
   2. Over the next few weeks, we'll be answering a third question
      1. How does the experience of state socialism change the trajectories and development of Eastern European countries?

    

2. Why Didn't We Predict the Collapse of Socialism?
   1. Number of academics, politicians, and journalists who predicted the Collapse in 1989.
   2. Why?
      1. Lack of information: we didn't have access to much information
      2. Americans have many preconceived ideas about socialism
         1. These ideas come from propaganda that existed in our own country from 1945-1989, increasing during times of crisis, decreasing at other times
         2. McCarthy era
         3. Increase in propaganda during other times of US-USSR crisis, eg. Reagan era

    

3. What Was Socialism?
   1. Communism vs. Socialism
   2. A political and economic movement that changed the political and economic geography of the world
      1. Political geography
         1. Communism was a political movement: rule by a one-party state which seized power from the bourgeois or capitalist class, and governed in the interests of the working class.
         2. "Containment"
         3. "Iron Curtain" a fluid line.
         4. Berlin Airlift
         5. Wars: Korea, Vietnam.

          

      2. Changed the economic geography of the world
         1. Communism was as much an economic as political movement.
            1. The idea of letting the workers own the means of production
            2. Planned Economies as a central feature of socialism. That is, the state, not the market, balances supply and demand.
            3. It does so via a model of centrally planned redistribution
               1. Lemonade example
               2. Works well in theory - but we'll see, not so well in practice.

    

4. Why did State Socialism Collapse?
   1. The Tower of Pisa model
      1. Reagan/Bush take credit for Fall of Berlin Wall
      2. Story is perhaps more complex than that: four important factors
         1. Socialism had its own propensity towards collapse
         2. Dissidents pushing it over
         3. Gorbachev holding it up by threatening invasion
         4. Reagan/Bush making it difficult for Gorbi to do that

       

   2. Socialism's inherent tendency towards collapse
      1. Parent-state
      2. Would have worked great, if the state could deliver. But the planned economy didn't work in practice. Subject to great shortages.
      3. Plan bargaining, hoarding
      4. Hoarding - shortage - hoarding
      5. Led to both shortages in one place and aggregate shortages in the economy.

       

   3. Dissidence
      1. Shortages in Poland very acute, system is verging on collapse in late 1970's.
      2. Solidarity as Union of workers and intellectuals
      3. Two important strategies
         1. As dependent as the workers were on the state, the state was dependent on them. Genesis of strike strategy.
            1. Strikes in Lenin shipyards
               1. Solidarity: nobody goes back to work until all demands are met
            2. 90% of all workers on strike towards 1980-81.
            3. It worked bc. It deprived the state of resources to redistribute, and hence of legitimacy
         2. SELF-LIMITING
            1. Martial law imposed
      4. 1989: Gorbachev announces he will not militarily support EE regimes
         1. Beginning of the end
         2. Wall collapses in 1989

    

5. TAKE HOME POINTS
   1. State socialism was a system with its own internal predisposition to collapse
   2. Dissidents removed the state's right to represent the working class and the mass of people
   3. The collapse of socialism was a complex blend of factors, but the most important ones happened INSIDE Eastern Europe.