Reflections on the Summit Jude Wanniski June 5, 1990

As much as possible, I tuned out all discussions about arms control, Lithuania and the German question. With the Soviet Union in the grip of an economic and political crisis that is gathering force, these geopolitical issues seem diminished in relevance. My fear is of general chaos in the USSR, sometime this summer; Nothing that occurred at the summit suggested President Bush realizes how perilous the situation can get -- although he well may. In their joint press conference Sunday, President Gorbachev was correct in asserting that nothing is more important to the world at the moment than perestroika. A breakdown into general chaos would be a harrowing experience for everyone.

American Cold War conservatives like William Safire and The Wall Street Journal editorial page have been sounding as if the triumph of capitalism over communism should involve retribution. At least President Bush is sensitive to the responsibilities of the victors to the vanquished, and I agree with Leslie Gelb of The New York Times editpage, who this morning chided the conservatives for expecting the central geopolitical issues to be solved in these few days. But even he misses the point that eludes Safire and The Journal, that the U.S. victory in the Cold War was a victory of the American political economy over the Soviet, not a triumph of arms. It is our responsibility, it seems to me, to embrace the converted, and offer full-scale counseling in our catechism. This is what I thought President Bush was promising at Malta last year. It has been astonishing to me, and to the Soviets as well, that we have done so little in that regard, as if the Kremlin would be offended if we offered a few helpful hints.

Gorbachev is in deep trouble because his economic team simply does not know what it is doing. Last month's plan to triple bread prices July 1 and double all other prices January 1 was incredibly dumb, which even a third-stringer at our Commerce Department could have warned would bring feverish hoarding. Those responsible, Prime Minister Nikolai Ryzhkov and his deputy, Leonid Abalkin, should be checking their retirement plans. Gorbachev's initial promise of a referendum, which would have been a humiliating defeat, has been withdrawn, it seems, in order to avoid humiliating defeat. To the Soviet citizens, their President is probably starting to resemble the ineptitude of Jimmy Carter in his closing months. A poll in Moscow finds his popularity dipping below 20%.

My hunch is that Stanislav Shatalin, who accompanied Gorbachev to the summit, will be prime minister before the summer is out. I met Shatalin, a member of the Presidential council, in April, when I was in Moscow. I came away impressed with his confidence and composure, surprised at his candor on his differences with the Abalkin team, but with no clear sense of his theoretical framework. This might be all to the good, as his economic training is more mathematical than ideological, and he seems to have struck up a good relationship with the Bush economists at the summit. But this is a pretty slender reed on which to maintain any optimism about the months ahead.

Another slender hope may be Boris Yeltsin, as an alternative to Gorbachev if civil unrest gets out of hand. Yeltsin was quick to criticize the Ryzhkov-Abalkin price hikes, quick to promise that if he were in charge, the people would be protected against such price rises. Yeltsin, though, has suggested no alternative and has no plan, and even those Russians I know who are slowly giving up on Gorbachev are nervous about Yeltsin's obvious opportunism.

Those who criticize Bush for putting all his eggs in one Gorby basket have the problem of identifying an alternative. The fact remains that Gorbachev is still the West's best bet to stumble his way to success. It seems incredible, though, that Uncle Sam seems so diffident at this historic moment, perhaps another reflection of George Bush's childhood warnings that he not be guilty of gloating. In Eastern Europe as well, the prime mover in history's triumph of democratic capitalism is hardly in evidence. Karen Elliott House writes in The Wall Street Journal this morning, amidst the growing unemployment in Poland: "The surprising thing to an American visitor is how infrequently America is even mentioned in the offices or coffee houses of Eastern Europe."