 My name is David Kotz. I'm a professor in the economics department at the University of Massachusetts Amherst in the USA. My talk today is on the demise of the Soviet Union and its impact on the socialist movement in the world. Reflections from 20 years after the events. The demise of the Soviet Union in 1991 was a historic event of major proportions. This event had several negative impacts in the world. First of all, it overturned the relative geopolitical balance of power that had existed in the Soviet days, leading the USA as the only superpower. This encouraged a series of aggressive actions, military actions by the leading capitalist states. Secondly, the demise of the Soviet Union affected the conditions, internal conditions within the capitalist countries. Fear of the Soviet example had been one factor that contributed to the big advances in the rights and benefits of working people in the capitalist countries following World War II. The beginning of the neoliberal era around 1980, when capitalism moved backward on workers' rights and benefits. Coincided with the economic weakening of the Soviet Union. After 1991, with the Soviet demise, the capitalist attack on the economic and social achievements of working people in the capitalist countries accelerated. As those who were in power in the US and Britain and France and so forth believed that the threat of socialism had disappeared. Third, the demise of the Soviet Union greatly weakened the socialist movement throughout the capitalist world. Most socialist parties that had been critical of the Soviet Union were affected by this, and of course the Communist parties in the West were disoriented. Many prominent intellectuals abandoned Marxist and socialist ideas. My comments today will focus on, first, why the Soviet Union made its end, and second, its effect on the socialist movement in the world. The Russian Revolution of 1917 was inspired by the idea of socialism, in particular the variant of socialist ideas that began with Marx and Engels. Marx and Engels developed a critique of capitalism and a vision of an alternative socialist system that gave birth to a powerful socialist movement in every corner of the world. The critique of capitalism was very powerful. It showed how capitalism led to the exploitation of those who produced the goods and services, to poverty and great wealth existing side by side, to unemployment and overwork at the same time, to harsh working conditions, to economic insecurity. Later, Marxists, for example, Lenin, developed the theory of how capitalism leads to imperialism and war, and other Marxist writers, analysts, developed an analysis of how capitalism leads to environmental destruction. All these problems of capitalism were widely known. The key contribution of the socialist movement was the vision of a viable and achievable higher form of society that would eliminate these problems. It was this vision that motivated millions of people to dedicate their lives to bringing about this transformation. Socialism promised to eliminate exploitation and to replace production for the profit of a small class of owners of the means of production by production to meet human needs and wants. Marx and Engels did not provide a detailed blueprint of the socialist system, yet the early socialist movement, despite many differences, agreed on several key features. The means of production would become common property instead of the private property of a small class. Production and distribution would be guided by an economic plan based on people's needs and wants instead of the pursuit of profit. And the working class would become the real rulers of the new society instead of being dominated by the capitalist class. The Russian Revolution of 1917 gave rise to the first effort to build a socialist system. While others followed, such as China and so forth, the Soviet system was the first. It played a special role. The Soviet system demonstrated some of the benefits that had always been claimed for socialism. However, the Russian Revolution occurred under difficult conditions and the first attempt to build socialism took place under very adverse conditions. And it is not surprising that the resulting system had significant flaws. Nevertheless, it stood for more than 70 years as proof that a socialist alternative to capitalism was possible. Then in a few short years, from 1989 to 1991, the Soviet state disintegrated into 15 new states. Its socialist system was dismantled and replaced by a particularly harsh form of capitalism. The Soviet demise was a complex process. My co-author Fred Weir and I analyzed it in detail in our book Revolution from Above, The Demise of the Soviet System. There are many myths about the Soviet demise. The key myth advanced by pro-capitalist ideologues is that the Soviet demise resulted either from socialism being unworkable economically or inferior to capitalism on the economic level. It is totally unpersuasive to claim that Soviet socialism was unworkable as an economic system, since, after all, it worked for more than 70 years. The claim that it was inferior to capitalism also is not supported by the historical record. From 1928 to 1975, the Soviet social system brought rapid economic growth and rapid technological change, rapid technological advance. The Soviet Union grew faster than the U.S., even after World War II, after the Soviet economy had achieved basic industrialization. For 25 years after World War II, the Soviet economy grew faster than the U.S. economy, based on estimates by U.S. government specialists. However, after 1975, the rate of economic progress slowed down in the Soviet Union. Yet, its economy still yielded positive economic growth every year through 1989. The Soviet economy stopped growing and began to contract, only starting in the summer of 1990, when central planning was dismantled and the Soviet state began to disintegrate. The fact that Soviet growth in its last 15 years was slower than U.S. economic growth, following 45 years when Soviet growth was faster, is hardly evidence that the Soviet socialist system was inferior economically to capitalism. What the Soviet growth slowdown showed was that economic reform was needed in the Soviet system. In fact, the growth slowdown cannot itself explain the demise of the Soviet Union. After all, the Great Depression of the 1930s in the capitalist countries was much more severe than the Soviet growth slowdown. Yet, capitalism survived in most of the capitalist world. Soviet socialism could have been reformed if pro-capitalist forces, political forces, had not taken power in the Soviet Union in 1990-91. In my view, based on my study of the Soviet experience, the fundamental reason for the Soviet demise was a contradiction that lay at the heart of the Soviet form of socialism. This was a contradiction between, on the one hand, an economic system designed to deliver benefits to the vast majority of the people, and on the other hand, a political and economic power was concentrated in the hands of a small group, a small elite, which over time became increasingly privileged. Initially, the high-level leaders of the Soviet system were dedicated revolutionaries, but over time this group was transformed into a group of leaders primarily interested in power and privilege. This ruling group had no interest in maintaining socialism, which restricted its privileges. At some point, they were bound to move to dismantle socialism and replace it with capitalism. They were positioned to become the owners of the valuable assets of the system, which many of them in fact did, as is well known. The attempt to reform Soviet socialism, Perestroika, provided an opportunity for pro-capitalist forces to gain state power. Boris Yeltsin was supported by the majority of the high-level officials of the Soviet system in his plan to dismantle socialism and restore capitalism, while during that period public opinion surveys show that a large majority of the Soviet people opposed a restoration of capitalism. The impact of historical events such as this, major historical events, is always great in the world. Regardless of the real reasons for the Soviet demise, that event was bound to weaken socialism and strengthen capitalism. The immediate impact was bound to be a demoralization of the socialist movement. The Soviet Union had been the first and longest lasting example of socialism. And what we saw in the West was that very soon after 1991, socialist parties became disoriented. Many powerful Communist parties such as that of France and Italy had particularly hard time in Italy, the Communist Party disbanded. Socialist parties that had not been sympathetic to the Soviet example moved away from any belief in socialism. Some such as the British Labour Party even followed neoliberal policies in office. However, the final point I'd like to make is that the prospects for the socialist movement have again awakened. The late 1990s was probably the low point of the international socialist movement. At that time the deepening neoliberal transformation seemed unstoppable. The period after 1980 was very different from the post-war decades when capitalism under pressure from the Soviet example and from other historical factors provided many benefits for working people, a rising living standard, growing public services, relatively low unemployment rate most of the time. However, in the neoliberal era since 1980 all of those trends reversed. And since 1980 in the developed capitalist countries real wages have declined in many of them. Public services have contracted, poverty and inequality have increased, unemployment and job security increased. And then in 2008 the severe financial and economic crisis of that system has made conditions much worse. This was bound to produce a reaction on the part of ordinary people and today we are seeing this reaction. The ruling groups in the capitalist countries are trying to use this crisis to take away the few remaining decent jobs and decent social programs that exist. But it is producing a reaction on the part of working people. We have seen in response to the bankers continuing to get rich while ordinary people suffer. We have seen big protests in Greece, in the United Kingdom, in Spain and now recently in the USA with the Occupy Wall Street movement. In my view conditions have again become favorable for a rebirth of the socialist movement. However, there is one final point I'd like to make. A militant struggle for better conditions by itself leads only to reform of capitalism. Not to a fight for an alternative system. The key missing element today is a clear vision of a viable alternative to capitalism. Even in the USA recent public opinion surveys show a surprisingly large part of the population has a generally positive view of the term socialism. About one third of people under age 30 have expressed sympathy for that idea but few have an idea what it is. What it means is that large numbers of people have decided capitalism cannot meet their needs and they are looking for an alternative. At this time it is necessary to develop a renewed vision of socialism and to do this we must confront the Soviet experience. The Soviet experience demonstrates that a system based on public property and economic planning can bring rapid economic and development and progress. It can do so with a relatively egalitarian distribution of income and without any class of rich owners of the means of production exploiting the producers. The Soviet demise was not a result of those features but of its main flaws and these flaws centered around political and economic power being held by a small group that grew increasingly privileged over time. A socialism in which benefits are given to working people by a hopefully paternalistic elite cannot survive. A sustainable socialism must be based on popular sovereignty in the economy as well as in the state. Economic planning should be the instrument through which working people decide what will be produced, how it will be produced and how it will be distributed. The state should be the instrument through which working people administer society. These in my view are the most important lessons of the Soviet experience and its demise. Thank you.