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Agriculture Policy - Gorbachev

In the 1980s, the Soviet Union went from being self-sufficient in food production to becoming a net food importer. The Gorbachev agricultural reform program aimed to improve production incentives. Gorbachev sought to increase agricultural labor productivity by forming contract brigades consisting of ten to thirty farmworkers who managed a piece of land leased from a state or collective farm. The brigades were responsible for the yield of the land, which in turn determined their remuneration. After 1987 the government legalized family contract brigades and long-term leasing of land, removing the restrictions on the size of private agricultural plots and cutting into the state's holdings of arable land.

Although Gorbachev's reforms increased output in the agricultural sector in 1986, they failed to address fundamental problems of the system, such as the government's continued control over the prices of agricultural commodities, the distribution of agricultural inputs, and production and investment decisions. In the contract brigade system, farmers still had no real vested interest in the farms on which they worked, and production suffered accordingly.

Like his predecessors, Leonid I. Brezhnev had considered agriculture a top priority. Unlike Khrushchev, however, he backed his program with massive investments. During his tenure, the supply of livestock housing increased 300 percent, and similar increases in the delivery of chemical fertilizers and tractors were recorded. Brezhnev's Food Program, announced in 1982, was intended to guide agriculture throughout the 1980s. It provided for even larger investment in the agro-industrial complex (agro-promyshlennyi kompleks -- APK), particularly in its infrastructure (see The Complexes and the Ministries , ch. 12). The program also set up regional agro-industrial associations (regional'nye agropromyshlennye ob''edineniia -- RAPOs) to administer all elements of the food industry on the raion, oblast, krai, and autonomous republic (see Glossary) levels. The program's overriding objective was improving the availability of food for the consumer. Production goals now referred to per capita consumption of meat, fruit, vegetables, and other basic foods. Unlike previous campaigns, the Food Program gave the same prominence to reducing waste as to increasing output.

In 1988 Gorbachev, who had been the Central Committee secretary for agriculture when the Food Program was announced, appeared to be pursuing a two-pronged approach to agricultural administration. On the one hand, he attempted to improve the APK's efficiency through further centralization, having merged five ministries and a state committee in late 1985 into the State Agro-Industrial Committee (Gosudarstvennyi agro-promyshlennyi komitet -- Gosagroprom). Eliminated were the Ministry of Agriculture, the Ministry of the Fruit and Vegetable Industry, the Ministry of the Meat and Dairy Industry, the Ministry of the Food Industry, the Ministry of Agricultural Construction, and the State Committee for the Supply of Production Equipment for Agriculture. But, on the other hand, he called for delegation of greater decision-making authority to the farms and farmers themselves.

Gosagroprom proved to be a major disappointment to Gorbachev, and at the March 1989 Agricultural Plenum of the Central Committee, the superministerial body was eliminated. Moreover, Gorbachev complained that the RAPOs meddled excessively in the operations of individual farms, and he urged abolishing them as well. The general thrust of the reforms proposed at the plenum was to dismantle the rigid central bureaucracy, transfer authority to local governing councils, and increase the participation of farmers in decision making. Gorbachev also elected to give the individual republics greater freedom in setting food production goals that were consistent with the needs of their people.

A key objective of Gorbachev's perestroika was to increase labor productivity by means of the proliferation of contract brigades throughout the economy. Agricultural contract brigades consisted of ten to thirty farm workers who managed a piece of land leased by the kolkhoz or sovkhoz under the terms of a contract making the brigades responsible for the entire production cycle. Because brigade members received a predetermined price for the contracted amount of output plus generous bonuses for any excess production, their income was tied to the result of their labors. After 1987 family contract brigades also became legal, and long-term leasing (up to fifteen years) was enacted -- two reforms that in the opinion of some Western analysts pointed toward an eventual sanctioning of the family farm. Because contract brigades enjoyed relative autonomy, much of the administrative bureaucracy resisted them. Nevertheless, in 1984 an estimated 296,100 farm workers had already banded together in contract brigades, and the document Basic Directions for the Economic and Social Development of the USSR for 1986-1990 and for the Period to the Year 2000 (a report presented to and subsequently adopted by the Twenty-Seventh Party Congress) called for their wider use. The March 1989 Agricultural Plenum endorsed contract brigades and agricultural leasing, a major victory for Gorbachev's reform effort.

Soon after assuming power in 1985, Gorbachev demonstrated his intention of reforming another enduring feature of Soviet food policy--the maintenance of artificially low retail prices for staples in the state stores. In 1986 he raised prices for certain categories of bread, the first such increase in over thirty years. But much remained to be done in this critical area. For example, milk and meat prices had not been adjusted since 1962. The bill for food subsidies in 1985 came to nearly 55 billion rubles; of this, 35 billion rubles was for meat and milk products alone. By June 1986, the absurdity of the food subsidy policy had become a matter of open discussion in upper echelons of the party, and higher prices were expected to take effect by the end of the Twelfth Five-Year Plan (1986-90).

Following the disappointing performance of Soviet agriculture during the Eleventh Five-Year Plan, the Twelfth Five-Year Plan [1986-90] got off to a promising start, with larger than expected grain harvests and improved labor productivity. Nevertheless, Western analysts viewed as unrealistic most of the Twelfth Five-Year Plan production targets--both those set forth in the Food Program of 1982 and those subsequently revised downward.

Although grain harvests were excellent in 1986 and 1987, output fell to only 195 million tons in 1988, forcing the Soviet Union to import more than 36 million tons that year. The 1988 harvest of potatoes, other vegetables, and fruits also declined as compared with the previous two years. As a result, the availability of food products throughout the country worsened, and in mid-1989 many Western observers believed a severe shortage and possibly famine were impending. Clearly the Twelfth Five-Year Plan's goals for agriculture would not be attained, a severe setback for Gorbachev's perestroika efforts.

A number of factors made the Soviet collectivized system inefficient throughout its history. Because farmers were paid the same wages regardless of productivity, there was no incentive to work harder and more efficiently. Administrators who were unaware of the needs and capabilities of the individual farms decided input allocation and output levels, and the high degree of subsidization eliminated incentives to adopt more efficient production methods.

Under Stalin the government socialized agriculture and created a massive bureaucracy to administer policy. Stalin's campaign of forced collectivization, which began in 1929, confiscated the land, machinery, livestock, and grain stores of the peasantry. By 1937 the government had organized approximately 99 percent of the Soviet countryside into state-run collective farms. Under this grossly inefficient system, agricultural yields declined rather than increased. The situation persisted into the 1980s, when Soviet farmers averaged about 10 percent of the output of their counterparts in the United States.

During Stalin's regime, the government assigned virtually all farmland to one of two basic agricultural production organizations--state farms and collective farms. The state farm was conceived in 1918 as the ideal model for socialist agriculture. It was to be a large, modern enterprise directed and financed by the government. The work force of the state farm received wages and social benefits comparable to those enjoyed by industrial workers. By contrast, the collective farm was a self-financed producer cooperative that farmed parcels of land that the state granted to it rent-free and that paid its members according to their contribution of work.

In their early stages, the two types of organization also functioned differently in the distribution of agricultural goods. State farms delivered their entire output to state procurement agencies in response to state production quotas. Collective farms also received quotas, but they were free to sell excess output in collective-farm markets where prices were determined by supply and demand. The distinction between the two types of farms gradually narrowed, and the government converted many collective farms to state farms, where the state had more control.

Private plots also played a role in the Soviet agricultural system. The government allotted small plots to individual farming households to produce food for their own use and for sale as an income supplement. Throughout the Soviet period, the productivity rates of private plots far exceeded their size. With only 3 percent of total sown area in the 1980s, they produced over a quarter of agricultural output.

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