My theory on why the USSR collapsed

Ever had to deal with a government department to sort out your taxes, get a driver’s license etc? Notice how frustrating and annoying the paper-pushing process is? Now think about a whole country where everything you do goes through that process….


NB: Before anyone thinks I’m a crazed anarcho-capitalist or something, I’m not against the government providing social welfare, healthcare, etc. I don’t think the free market can provide those things well enough for all citizens, so dealing with government bureaucracy is a necessary evil sometimes. But a whole country like that? Yikes!


7 responses to “My theory on why the USSR collapsed

  • jisantuc

    I think you ought to look into the concept of “blat.” From “Practices of Exchange and Networking in Russia” (Ledeneva, 1997):

    “The objects obtained in blat relationships were rarely exchanged in a straightforward man- ner. It should be emphasized that blat involved relationships and not merely goods. What was exchanged were neither things for things, nor the relative values people quantified in things, but mutual estimations and regards. Blat was thus not a relationship for the sake of exchange but an exchange for the sake of a relationship.”

    Blat was an informal exchange network the implicit purpose of which was to circumvent the bureaucratic demands of a centrally-planned system, and it was huge.

    • fromthefourthcorner

      I had heard that the level of corruption/informal exchange was huge in the Soviet Union, and that that was part of the reason for the power of organised crime there in the post-Cold War era. Easy to see why.

      • jisantuc

        But if informal exchange was huge, then it isn’t it impossible for ‘paperwork for everything’ to be a part of the reason it broke up? I mean if ‘paperwork for everything’ weren’t actually the case.

      • fromthefourthcorner

        I would think that informal exchange was a response to the state failing because of its massive bureaucracy, so the two aren’t mutually exclusive. Also, even if people were using the informal exchange system many of them would still have to do all the paper-pushing to show their superiors, who would then do more paper-pushing to show their superiors, and so on. The centralisation of all aspects of the economy must have been incredibly cumbersome, especially in a country the size of the USSR.

  • eideard

    Look around a bit more. Though I dislike most of the politics of the US bureaucracy, understand that the admin costs for SSA and Medicare are <3%.

    The average American insurance company runs 20-40% charged off as admin.

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