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USSR could not use scale of global market. It means USSR was mere 10% of global economy while USA was 35% of global economy and USA could trade with West Europe and Japan who made another 25% of global economy which USSR could not. USSR traded mainly with East Europe who make 5% of global economy. Third World have only raw materials and no technology to trade with.

USSR could not use individual entrepreneurship and so failed to commercialize the technologies invested by USSR scientists. USSR was number one in patent making from 1960 to 1985. In USSR technological demand mainly used to come from military and little from from production.

USSR shows central planning is best for Research and Inventions and market is best for commercializing those inventions. Thus USSR could easily compete with USA in technologies but not in production and the more USSR lost in production the more its competitive edge in technology is lost.

Low fertility rate (less than replacement rate of 2.1) since 1970s further weakened production base of USSR as it could not rely on rise in productivity and efficiency of workers which is considered exploitation due to flawed understanding of Marxism. USSR growth was dependent on growth of population and since 1970s this only growth factor was gone.

In 1970s, it seems USSR was winning mainly due to rise of anti colonial movements across the Third World and USA's non intervention approach due to Kissinger's decolonisation policy after loss of Vietnam War. Also high inflation in global market made USSR economic condition look good and its non integration to global economy was given credit.

In 1970s, USSR economy looked in good shape due to high oil price. Many of USSR problems were neglected in 1970s due to the fact that oil exports was leading to huge foreign exchange gains. In fact, this high oil price further weakened production base of USSR.

In 1980s when oil price went down, USSR understood its production base was gone. Population growth has stopped and so production growth has to rely on productivity gains only. So reforms had to start which was looked down upon as anti Marxist again due to lawed understanding of Marxism.

Global market in 1980s is facing low inflation rate due to lower oil price and becaue of integration of huge Chinese productive cheap labor force into the global economy.

It is said that Marxists are masters of using rivalry among capitalists for their own gains. Lenin used German vs British to form USSR. Stalin used American British rivalry with German Japanese to make USSR a super power. But Breznev failed to use the capitalist rivalry between UK based computer maker ICL and US based counterpart IBM. Gorbachev failed to use Japanese offer for help to counter US competitors. Toshiba, the Japanese chip maker tried to help USSR chip making but Gorbachev failed to use the offer. In fact, Toshiba was punished severely by US government for offering help to USSR.

Author: Saikat Bhattacharya