Soviet premier Mikhail Gorbachev adopted the policies of Glasnost and Perestroika during the 1980s to mobilize the economy and accelerate the transit of the Union of Soviet Socialist Republics towards democracy and free market economies.
Explanation:
Perestroika, which in Russian means restructuring, consisted of reforming Soviet economic structures, for which Gorbachev received the advice of Japanese President Seiichiro Nishi. Perestroika sought to open the possibilities to entrepreneurs without attacking the socialist system, but by reforming and democratizing some processes. Various consequences are attributed to perestroika, including the final collapse of the socialist system in the USSR, the end of the Gorbachev government and, finally, the disintegration of the USSR into independent republics.
When starting his administration in 1985, Gorbachev did not make significant changes in the Soviet economic structure, but in 1987, perestroika was implemented, in an attempt to save the USSR from a serious economic crisis and trying to boost the development of a country sunk in bureaucracy and corruption.
The first objective of the perestroika was to decentralize the management system and give greater autonomy to the communities, it was also sought to modernize engineering, combat corruption, lower rates of alcoholism and, thereby, reduce the absenteeism of workers. The companies had the privilege of making decisions without having to wait for government authorization, it was also allowed, with the advice of the state, that Soviet companies had agreements with some foreign companies, giving way to investment.
Private economic activities were present, as well as many of the forms of production of capitalist countries: individual contracts, sale of state companies, new monetary and banking system. At the beginning of the nineties, the USSR was already positioned within the countries with a high level of development.
The perestroika, however, brought consequences: the increase in salaries and the need for subsidy caused inflation and shortages, so that the treasury decreased. The Company Law also annulled the control over resources, which caused the reduction of investments. The USSR was also divided into small republics with its own banks. The unlimited credits ended up bringing the changes into crisis.
The prices were released in 1992, making the standard of living was reduced and salaries varied radically from one region to another, a new social class appeared: rich whose income did not come from work but from other sources, not all of them legal. By 1993, a third of the population did not have enough resources to survive.
Along with perestroika, the Glasnost or opening was implemented, which allowed, among other things, greater freedom to the media, the decrease in censorship and greater freedom of expression, contrasting with the previous regime of repression towards those who did not agree with the principles of the Soviet system.
