A LOOK AT PRIVATIZATION OF HOUSING IN THE SOVIET UNION:
THE LENINGRAD EXPERIENCE
by
Leigh H. Rae
Submitted to the Department of
Architecture
in Partial Fulfillment of the Requirements
for the degree of
MASTER OF SCIENCE
in Real Estate Development
at the
Massachusetts Institute of Technology
July, 1990
Leigh Hamilton Rae, 1990.
All rights reserved.
The author hereby grants to MIT permission to reproduce and
to distribute copies of this thesis document in whole or in
part.
Signature of
author......................................................
Department of Architecture
July 29, 1990
Certified
by .............................................................
James McKellar
Senior Lecturer, Department of Architecture
Thesis Supervisor
Accepted
by.............................
Gloria Schuck
Chairperson
ROtC&
Interdepartmental
in Real
MAS SAUCSEiT S!NST!U
T
SEP 19) 1990
LIBPARIES
Degree Program
Estate Development
A LOOK AT PRIVATIZATION OF HOUSING IN THE SOVIET UNION:
THE LENINGRAD EXPERIENCE
by
LEIGH H. RAE
Submitted to the Department of Architecture
on July 29,1990 in partial fulfillment of the
requirements for the Degree of Master of Science in
Real Estate Development
ABSTRACT
An exploratory study of the housing allocation system in the
the
to evaluate
in order
Leningrad was undertaken
feasibility of the Soviet Government's recent proposal to
privatize approximptely 70% of the state-owned housing stock
The study included an analysis of the
by the year 2000.
centralized political and planning processes as well as an
evaluation the socioeconomic and cultural environment in
the Soviet Union.
The results of the study indicated that expanding the
non-state housing sector is not a panacea for the Soviet
Leningrad is
If the situation in
housing problems.
representative, the housing problem is merely a subset of a
much greater set of problems which pervade the political,
Without
economic and cultural fabric of Soviet society.
political
planning and
restructuring
the centralized
processes and the socialized economy, for instance, any move
toward privatization would be impotent. Furthermore, because
values,
the
depends
on consumer
market
economics
long-standing tradition of collectivism and authority and the
institutionalized inequalities which pervade Soviet society
would need to shift for privatization to succeed.
Thesis Supervisor: James McKellar
Title: Senior Lecturer,
Department of Architecture
ACKNOWLEDGEMENTS
This study was made possible by many. The employees from
Leningrad's Institute of Architectural and Urbanistic Theory
hours of
and Anna contributed countless
(Lenniitag)
professional time and personal effort to make this paper
which they surrendered to
The spirit with
possible.
relentless questioning demonstrates their deep commitment to
creating understanding between the citizens of two nations
which have long misunderstood each other. Acknowledgement
is also given to Marnie and Kimberly for sharing an
unforgettable experience, and to Bonnie, Donna, Victoria,
and Lisa for always bringing perspective and rigor to my
pursuits. Finally, I acknowledge John for his unwavering
commitment to uncovering truth and discovering humor in all
of the adventures which we share.
TABLE OF CONTENTS
Introduction........................................6
Housing in Leningrad
Allocation of
and its Implications for Privatization..............12
-Allocation of Primary Housing
Table I (DWELLING TYPES)
Table II(FORMS OF TENURE)
-Exchange System
-Allocation of Secondary Housing
-Implications for Privatization
Privatization and
the Political Process...............................28
-Centralized Supply System
-Centralized Planning
-Political and Ideological Factors
Affordability Issues
Impacting Privatization..................
........... 40
-Income Profile and the Secondary Economy
-The Automobile
-Wage Structure
Cultural Issues
Impacting Privatization.............................47
-Collectivism and Authority
-Inequality
-Family
Conclusions.........................................59
Appendix A.................. ........................
65
........................
66
Bibliography................ ........................
71
Footnotes
................
S...other havens.. .were and remain the homes of friends:
Those padded, intimate interiors whose snug warmth is all
the more comforting after the raw bleakness of the nation's
public spaces; those tiny flats steeped in the odor of dust
and refried kasha in which every gram of precious space is
filled, every scrap of
matter --
icons, crucifixes, ancient
wooden dolls,
unmatched teacups preserved since
Revolution --
is stored
and gathered
before the
against the
loss of
memory; those homes which even in times of greatest dearth
have centered about a table, about food miraculously foraged
for the visiting relative or guest; those tables over which,
until the Gorbachev era, one engaged in elaborate mimicries,
note-passing, sign language, to escape the scrutiny of the
Over the years, such Soviet
state's murderers and spies.
homes, however poor, beleaguered, continued to exemplify
those virtues that underlie the national tradition of
uyutnost: that dearest of Russian words, approximated by our
'coziness'... [which] denotes the Slavic talent for creating
a tender environment even in dire poverty and with the most
modest means; it is associated with intimate scale, with
small dark space2, with women's domestic generosity, with a
nurturing love."
INTRODUCTION
the Constitution of the Union of
According to Article 44 of
Soviet Socialist Republics, all Soviet citizens have a right
Under perestroika,
to housing.3
of
In March
proclaimed that
1986,
at the
the Soviet
of
Party
Communist
to fulfill this
inadequacy of its ability
acknowledged the
right.4
government has
the Soviet
Congress of
27th
Mikhail
Union,
the
Gorbachev
family would have
a separate
estimates revealed that
there were
every Soviet
dwelling by the year 2000.
As of
1989, government
approximately
republic's
83
million
90 million
housing
units
households.5 By
serving
the year
the
2000, the
number of households is forecasted to increase to 97 million,
and the current housing stock
11%-16%.
Thus,
in order
approximately 20-25
By U.S.
is estimated to depreciate by
to achieve Mr.
Gorbachev's goal,
million new units must
be constructed.
standards, this figure is staggering.
However, the
Soviet government has proven its ability to produce enormous
quantities
of housing.
constructed 72.3
Between 1956
and 1989,
million units (average
2.2 million units). 6
the state
annual production:
hopes
Gorbachev
Mikhail
system.
delivery
housing
government
Under perestroika,
the
of
Soviet
and
market based economy,
create a
intends to
level
restructuring the entire
at the same time
production while
high
a
maintain
to
been declared a high priority.
privatization of housing has
Sources at the State Committee for Architecture and Planning
(Goscomarchitecture)
project that
of the
70%
state-owned
housing stock will be privatized by the year 2000.7
The government has declared the single family home to be the
future.
preferred housing type of the
attributed, in
the
it also has
government has
high-rise prefabricated
requires
enormous
contrast, the
relatively
on
capital
for plant
and
themselves
plant and
of
strategy which
In
equipment.
homes requires
construction of single family
in
In the
the construction
concrete housing, a
low investment
homeowners
an economic basis.
relied
equipment.
As
a
construction companies as well
result, small privately held
as
desire to improve
part, to the government's
living conditions,
past,
Although this can be
could
begin
to
reduce
the
government's burden for providing housing to every citizen.
Some believe that, by shifting the responsibility of housing
away from the
can
revitalize the
occupants of
only
state and into private
3%-5% of
teetering
Soviet economy.
state-owned housing live
an
hands, the government
average household's
Currently,
virtually rent-free:
official income
is
rental expense.
needed to cover monthly
other hand,
the
annually
to
the
housing
increase
prefabricated
to
(due
the
in
the
Soviet
near future
declining productivity
as renovations
of
deterioration
during
constructed
buildings
concrete
stock
raw materials) and
scarcity of
and growing
(due to
costs rise
as construction
roubles
7 billion
grow in the
sum will undoubtedly
Union. 8 This
costs
approximately
expends
maintain
The government, on
the
the
Khrushchev era).
In contrast to the increasing drain which housing is placing
on
state
personal wealth.
accumulating
spent on
food and consumer
goods
not surprising in
in
available
housing,
many
transferred
Although
believe
to
Soviet
items.
Soviet
that
disposable income
441 billion was
Union in
end, consumers
into the
central bank. 9
regard
should be noted that the
of consumer
By
Union.
privatizing
savings
could
be
investment.
housing
specific benefits, it is
some
are
By year
personal
state-owned
housing problems.
to document
Union
view of the scarcity
productive
ownership may offer
attempt
the
transferring
for Soviet
Soviet
In 1987,
billion roubles
deposited 24
This is
in the
billion roubles, of which
approximated 586
had
consumers
resources,
The following
of the
to
private
not a panacea
analysis will
difficulties facing
to privatization
of housing.
the
It
observations in this analysis were
drawn from two
result,
they
may
in other
conditions
parts
based upon
of the
be
a
Soviet
Union, and
limited perspective
As a
housing
to
any
This
as exploratory.
viewed
very
Leningrad.
relevance
limited
have
should only
conclusions
study is
weeks of field research in
of
the
Soviet housing problem.
In
to
order
the
evaluate
privatization of
and
feasibility
of
Union, the analysis
housing in the Soviet
the following: the
to address
is organized
impacts
current system
for allocating housing, the Soviet political process and its
privatization, housing affordability
impact on
issues, and
cultural factors impacting privatization.
The following conclusions can be drawn from this research:
observations in Leningrad, privatization
1. Based on
Housing is symptomatic of a
remedy for the housing problem.
larger set of sociopolitical,
which left
is not a
economic, and cultural issues
unresolved will hinder any
proposal for solving
housing problems in Leningrad.
2. In
Leningrad,
any
move towards
transferring
state-owned
housing to private hands must be preceded by a restructuring
of the basic tenets of
system.
political
housing allocation under the current
Housing can no longer be inextricably linked to the
process
and
used
as
a
method
of
reward.
which
sectors
the
Furthermore,
system of allocation (e.g., the
ownership under the current
of
development
Proclamations
owners and
for individual
financing mechanism
a
trade
retail
and laws
are
for
be fostered
availability of
and continuous
the development
through
sectors) must
individual home
cooperative and
private
encourage
do
through the
materials.
building
not sufficient
a
to foster
the
materials
and
growth of these sectors.
3. Privatization
services.
Gossnab's
control
establishment
analysis of
supply
be
of
of
a
to
the elimination
accompanied by
the
supply
of
and
the
network.
As
the
system of
Leningrad indicates, the centralized
fostering inequality
--
of
of
materials
local distribution
restricts movement
the economy.
local access
towards transferring ownership to
Thus, any move
hands must
private
on
depends
goods and
services --
and creates artificial
thus
scarcity in
The primitive budgetary system of finance must
also be restructured and a housing finance mechanism must be
created to foster home purchases.
4. Any solution
to the
housing problem
predicated on a fundamental
in Leningrad
must be
shift of responsibility for the
supply and allocation of housing from the state to the local
level.
Without
strong local
control, particularly
in the
hands of local elected representatives such as the Leningrad
City
Council, housing
solutions are
likely to
repeat the
been deeply entrenched over the
historical trends that have
last 70
years.
5. As the Leningrad example illustrates, the socialized economy
in
the
Soviet
Union
must be
Wages
restructured.
must
reflect the real cost of living, and in-kind subsidy must be
made measurable so
by
the
that the real cost
government are
pervasive
secondary
accounted
economy
currently operates in such
in
is
result,
one example
it may
where
be an
for.
The role
housing
of
production
the
that
areas as allocation and material
procurement must be recognized.
it
of services provided
market
This economy has strength;
forces
are
appropriate starting
at.
As
point for
a
the
expansion of privatization.
6. Finally, market
a result, the
economics depends
deeply rooted
authoritarianism
and
the
on consumer
tradition of
values.
As
collectivism and
institutionalized
inequalities
which pervade the lives of Leningraders must begin to shift.
Taken
a step
further, consumer
preferences must
begin to
be expressed for privatization of housing to take hold.
ALLOCATION OF HOUSING IN LENINGRAD
AND ITS IMPLICATIONS FOR PRIVATIZATION
In order to analyze the implications of privatization in the
Soviet Union, it is important
available and
how it
to understand what housing is
is allocated.
(See
Tables I
and II
below for dwelling types and forms of tenure).
Table I
DWELLING TYPES
PRIMARY HOUSING
Separate Flats: These apartment-style units are occupied by a
single household. In other words, the apartment is shared by
members of the same family (though not necessarily members of
the same nuclear family).
Communal Flats: This type of housing was created immediately
following the Revolution in accordance with the communist
the family.
for the dissolution of
doctrine calling
Although there were some notable buildings constructed in the
1920's which provided a model for communal living
(e.g.,
communal dining facilities, communal day care, etc...), many
of the communal flats were created simply by splitting up the
homes of the pre-revolutionary nobility.
As a result, the living conditions in the communal flats are
In addition to crowded
among the worst in Leningrad.
water.
with hot
not
equipped
conditions,
many are
electrical systems are often
Furthermore, plumbing and
primitive. Under perestroika, the elimination of this type
of housing has been emphasized.
Dormitories: This category of housing provides temporary
accommodation to students (military and civilian) and workers
who
are
not
residents
of
Leningrad
(limitchicki).
Nonresidents are distinguishable by the internal passport
system which requires all citizens to carry propiska. The
limitchicki come to Leningrad at the invitation of a factory
(often to perform the least desirable work) hoping that they
can somehow procure permanent residency. Sanitary conditions
in the dormitories are often poor due to lack of services and
crowding.
Specialized Housing: Specialized housing includes orphanages
and housing for the elderly. Although no data is available
on this type of housing for Leningrad, only .5% of the total
specialized
Union occupies
Soviet
in the
populatigg
housing.
Tusing for primary residency
Individual Housing: Individual
However, it encompasses
does not exist in Leningrad.
stock throughout the
housing
approximately 1 2 25% of primary
held by individual
is
Aousing
of
type
This
Union.
Soviet
citizens as personal property.
SECONDARY RESIDENCES
Official data is not available on secondary housing in the
Soviet Union. However, estimates of the number of Leningrad
families which have seTgndary homes ranges from one in six to
one in four Leningrad.
Dachas: The dacha is often a run-down cottage which served as
the primary residence for some previous generation. Dachas
are located either on individual lots or on land which is
held by a homebuilding cooperative.
Kitchen garden plots: Kitchen garden plots are small parcels
(600 square meters) intended for use as gardens. In theory,
there are strict laws regulating what can be built on these
lots to insure that they are maintained for cultivation only.
In recent
However, law enforcement seems to ebb and flow.
lax, and
been
has
region
Leningrad
the
in
enforcement
years,
this has given rise to the construction of many makeshift
summer cottages on the plots.
There are at least two types of kitchen garden plots: one in
which the maximum size of the building structure cannot
exceed 20 square meters and one in which the maximum size g
the building structure cannot exceed 50 square meters.
Generally, the kitchen garden plots are held by homebuilding
cooperatives.
Table II
FORMS OF TENURE
State-owned housing: State-owned housing is held by the city
or state government, or by a factory, a trade union, or some
other enterprise of the state. It is provided to residents
for a nominal rental fee (3%-5% of official household
are rarely
of state-owned housing
Occupants
income).
evicted, and they are entitled to transfer their Tgcupancy
rights to family members upon death of the occupant.
the
housing entitles
Cooperative
housing:
Cooperative
occupant to use of the dwelling as owner of a share in the
cooperative. Although cooperative dwellings can be exchanged
rights of
which define the
the laws
and inherited,
cooperative owners are much more ambiguous than thg 7 laws
outlining the rights of state-owned housing occupants.
State cooperative housing is provided by the Leningrad
City Council and is usually located in high-rise
industrial buildings in the suburbs of Leningrad.
These dwellings are procured at a considerably
higher cost than the state-owned housing. What
seems to determine the price differential is the
shorter waiting list for state cooperatives. In
Leningrad, the waiting list for state cooperative
housing is one to three years compared to the ten yegg
wait which currently exists for state-owned housing.
Homebuilding cooperatives are usually organized
through a factory or a trade union. They can be found
in the countryside and are formed for use by individual
homebuilders either for primary or secondary
residency.In the homebuilding cooperative, the
cooperative association is given access to a parcel of
land which is then divided for use by individuals.
Individual Plots: Some single family homes for primary and
secondary residency are located on individual plots of land
granted to individual citizens for use. In these cases, the
individual owns the building as personal property.
In
Leningrad, the
housing
problems
are somewhat
unique.
This is largely due to the fact that the city's downtown has
remained
virtually
centuries when
unchanged
it was
since
the capital
the
of the
18th
and
19th
Russian Empire.
housing stock in the downtown
Much of the
As
Only 56% of the population
residents are especially grave.
occupies separate flats.
The remaining citizens live either
(See Appendix
or dormitories (8%).
in communal flats (36%)
million
city's 4.9
among the
the shortages
a result,
of the Revolution.
flats at the time
converted to communal
which were
this period),
(built during
low-rise buildings
area consists of
A for population and housing data).
ALLOCATION OF PRIMARY RESIDENCES
The
Soviet
philosophy
housing
system
calling
for
Prior to
inequality.
(as
in
many
considerable
places
in
the
state created
on
based
world)
the
housing in
of
Soviet
the
a right, and
distribution system.
a strict
Russia
source
a
was
of housing
social
of
Consequently,
the provision
communist
the
elimination
Revolution,
inequality.
constitution made
the
the
is
Spatial
norms and eligibility categories were created to insure that
all
citizens
were
provided
However, because
to the
political process and
as the
greatest
minimum
standard
used to reward those
contributors
of
linked
always been
housing has
living.
perceived
with a
who are
in society,
this
distribution system is riddled with inequality.
The system of spatial norms designates the minimum amount of
space to which a person
is entitled.
Since the Revolution,
have changed
these norms
following
Revolution, the
the
8.25
set at
was
standard
standard was raised
In 1926 the
person.
square meters per
Immediately
occasions.
on three
person, and under perestroika the
1 9 20
standard has been raised again to twelve square meters.
to nine square meters per
Unfortunately, because of
these
merely
standards
the continuous housing shortages,
serve
as
standards --
set of
eligibility for
to designate
Under
an improvd unit.
a person's
these standards, a
he/she has less than
can prove that
person who
new
another set of standards --
construction, and the state has
a much lower
for
guidelines
5.5 square
meters of living space is eligible to be placed on a waiting
list for
that he/she has less than
is
and a
state-owned housing,
eligible
to be
person who
can prove
6.5 square meters of living space
on
placed
a
for
state
various
other
waiting list
cooperative housing. 21
In
addition
categories
to
spatial
used to
norms, there
designate eligibility.
eligibility.22
One source
in
many as 17 distinct categories
Leningrad said there were as
of
are
However,
no
one
interviewed
could
reconstruct this list.
The more important of these categories are for people living
in communal flats who either participated in World War II or
who survived the siege of
Leningrad during the war.
16
Others
given preference on the waiting lists are people who live in
communal flats and suffer certain medical conditions,
people
service, invalids from
any of
completed military
who have
wars, heros
the post-revolutionary
with
three
or
of labor,
people
children.23 These
more
and families
given
are
priority on the waiting lists because their contributions to
Soviet society are
The
valued.
reward system
waiting lists.
waiting
society)
members
the
the nomenklatura
political and military officials and
(which is comprised of
ranking
to bypass
are entitled
the
(because of
those who
For instance,
lists altogether.
people on
limited to
there are
In fact,
positions in
their
only
is not
of
cultural,
economic,
educational,
scientific, and worker organizations) are given preferential
treatment in housing allocation.
What
interesting
is
allocating
housing,
all of
about
aside
from
categories
these
the
fact
that
for
housing
specialists in Leningrad could not identify them clearly, is
that they
do differentiate people --
some people are
subjective
more equal.
criteria.
medical conditions
list and who
enough
example,
it
a
eligibility.
person a
is
person eligible for
makes the decision that a
to warrant
designates
Many of these seem
For
make a
everyone is equal,but
hero
of
It is
labor,
to rely on
unclear
what
the waiting
condition is severe
also unclear
and how
far
what
the
preferential treatment given to the nomenklatura extends?
In
child.
their
and
years,
of eight
his wife
to
desperation
himself, his wife, and his
separate flat for
citizen who
a Moscow
his mother,
flat with
a tiny
lived in
story of
recounts the
David Shipler
procure
a
child, he had
that she could not tolerate his
his mother sign a statement
wife, and he had his mother-in-law sign a statement that she
This declaration of incompatibility
could not tolerate him.
allowed
him
enter
to
roubles for each room, he
his
register
change, however,
to his mother's flat when
protect his right
his name from her flat, the
he had removed
and paying 2,500
procured a separate flat.
address
state
a
for
list
after waiting four years
cooperative, and
not
waiting
the
in
He did
order
to
(If
she died.
flat would have
reverted to the state upon his mother's death). 24
Although this example takes place
process
which
Despite what
reoccurs
appear to
the criteria used for
in Moscow, it describes a
throughout
the
be rigid standards
Soviet
Union.
for allocation,
distribution is ambiguous and subject
to the judgement of individual officials.
As a
result, personal relationships play
in the allocation of housing.
unofficially
pervasive
through
element
friends
of Soviet
an important role
Exchanging goods and services
or
life.
family
With
relations
respect to
is
a
the
apartment or
system, procuring a larger
housing allocation
desirable location can often be made
an apartment in a more
the right person in the right
simple as a result of knowing
ministry.
are
Leningrad
in
interviewed
people
Various
common.
dwellers
apartment
between
negotiations
Unofficial
Almost all of
described how they had procured
their flats.
them had made informal payments
to the previous occupant of
explained that, in order to
of a theatre repertory company,
cash
payment
to
--
42,000 roubles
in a
wages
official
average citizen
than the
more
Another
lifetime.
the
this equates to
by the central bank,
exchange rate offered
on
Based
occupant.
previous
the
a $7,000
had made
cooperative, he
three room
procure his
was a member
man, a Moscow citizen who
One
the apartment.
earns in
member of
this
theatre group had made a payment of 14,000 roubles (equal to
four
and one
wages based
of
half years
on the
official
average) to procure his three room apartment.
The spread of glasnost has led
the
inequalities
exist in
particularly those
system,
treatment
"Fifth
which
for
Wheel"
the
which
Leningrad's
(a progressive
high
the
housing
exist from
nomenklatura.25
show) prepared a controversial
of
to the uncovering of some of
preferential
months
ago,
television
news
Several
Leningrad
allocation
expose on the vacation homes
military and
political
officials. 2 6
This sort
was nonexistent
and public criticism
of exposure
until recently.
EXCHANGE SYSTEM
and state cooperative housing
Exchanges of both state-owned
can be
Bureau, an agency
accomplished through the Exchange
under the Leningrad Executive
which falls
a book of
bureau publishes
month, the
Each
Committee.
apartment listings,
which closely resemble the advertisements in the real estate
sections
of
Officially,
newspapers.
American
place (on terms negotiated
exchange takes
when
by the parties),
an agreement is signed and registered with the bureau.
documents
(propiska).
three years, and they are
.27
many parties.
in Leningrad
networks to exchange flats
take
Exchanges
from one to
Interestingly, people
This
the exchange to procure new
enables the parties involved in
residency
an
anywhere
often arranged among
prefer to
use informal
over the official booklet.
This
takes place through notices pasted on walls around the city.
ALLOCATION OF SECONDARY HOUSING
Secondary
housing allocation
Families
seem
word-of-mouth.
to
procure
Payment
for
20
is not
monitored officially.
secondary
dachas
or
homes
kitchen
through
garden
cottages
buyer and
between the
is negotiated
the seller.
One Estonian indicated that he had purchased his dacha (part
in 1989 for 25,000 roubles.
of a homebuilding cooperative)
had
that they
indicated
family
Another
they could sell
This family estimated that
4,500 roubles.
in 1980 for
in the Leningrad region
kitchen garden cottage
their
purchased
the cottage today for 20,000 roubles.
for a secondary home, payment is
To purchase a plot of land
or town where the plot is
made the city
cooperative
been organized
There
(in
the
case that
a cooperative parcel).
located on
had
association
were 250
located and to the
shareholders in
a local
reported
cooperative
roubles.
that
for use
In the
of
they
paid
land --
the
in
future, they would make
of 30
roubles to the
Total
construction
town for
cost
for
estimated at 10,000 roubles.
their
had
cooperative share
The
would
many of
a
One of these
fee
to
this case
the
1,000
an annual payment
continued use of
their
is
factory.
this cooperative,
whom had recently begun constructing cottages.
families
plot
cooperative visited
One
employees of
by the
the
brick
the land.
cottage
was
family hoped the value of
reach
30,000 roubles
upon
completion of the cottage.
The secondary home in the
allocation,
government.
though
Soviet Union is paradoxical.
informal,
One official described
is
sanctioned
by
Its
the
the secondary home as a
deeply rooted tradition among Soviet people which originated
long
before
Through the
revolution.
the
or
dacha
the
kitchen garden plot, Mr. Nazarov argued, "people are able to
their own homes and enjoy the
satisfy their desire to build
leisurely activity
home is
also an appeasement: a
a tradition, it is
way for
inadequate system of
to escape changing the
the government
the secondary
of gardening."28 Although
producing and allocating primary housing.
CURRENT ALLOCATION SYSTEM
AND ITS IMPLICATIONS FOR PRIVATIZATION
government to standardize the living
Despite efforts by the
there are people who are
conditions of all Soviet citizens,
system is
used
based upon
by some
should
dwellings than others;
procure better
able to
be
that
Therefore,
inequality.
privatization
disregard.
the current
the argument
inequality
would create
Instead,
the
feasibility
of
privatization should be explored.
Both the
cooperative and
the individual home
been
existence since
the
in
noting because,
proclaimed
occur.
Soviet
"It
as
This is
under perestroika, these sectors
vehicles
According
through
to Mr.
economists under
is
revolution.
sectors have
difficult
which
Aganbegyn,
worth
have been
privatization
one
of the
leading
perestroika,
to
overestimate
22
the
can
vital
importance of our plan to create a pluralist
attitude to
property.
There is
a powerful
movement, which is encouraged by the state, for
the creation of cooperatives... for the development
of
individual
domestic
holdings,
for
the
individual construction of housing anggfor private
gardening and allotment cultivation."
The cooperative movement originated in the 1920's.
the
Soviet
towards its growth.
cooperative
always
exhibited
ambivalence
Lenin's New Economic Policy, the
Under
by
was viewed
movement
transforming the
fact, the
has
Government
However,
some
socialism.
capitalism to
masses from
house leasing cooperatives
tool
as a
(one of two
for
In
forms of
cooperatives established under Lenin) gained so much support
that by
the mid-1930's
million
square
perceived the
tenure"
both
association
meters.
There were,- however,
cooperative "as
for
with
managing 53
these cooperative were
its
a heretical form
autonomous
the
those
bourgeois.30
opposition towards the cooperative
of housing
and
nature
who
Under
for
its
Stalin,
sector grew, and by 1937
cooperatives were abolished.
In conjunction
with Khrushchev's
the housing shortage by
This reinstatement
the growth of
had a
1957 decree
1970, cooperatives were reinstated.
pragmatic basis.
the cooperative sector, the
responsibility for
to eliminate
solving the
By encouraging
state could share
housing problem --
in much
the same way that the reforms under perestroika are viewed.
Khrushchev's
1957 decree
was impotent,
at first,
because
the form of
it was not
backed by concrete state support in
financing.
Even after financing was made available in 1962,
have failed
cooperatives
to achieve
Soviet Union peaked in
Construction activity throughout the
the late 1960's
construction. 3 1
and early 1970's at 7%-8%
figures
for the
of total housing
available
not
is
data
Although
current
Leningrad,
significant momentum.
entire
Soviet
Union
only 5% of
state cooperative housing comprises
reveal that
for
total housing stock.3 2
construction of
the budgetary allocation for
In Leningrad,
state cooperative housing was recently increased to 20% and,
according to one source at Lenniitag, the city council would
like
to. increase
this percentage
However,
resources were allocated
trepidation that if more
there is
more.33
even
for the construction of state cooperatives, the waiting list
for state-owned housing would grow even longer.
One reason for
(aside from
in a state
this fear is that there
the shorter waiting
cooperative.
ambiguous, and
is little incentive
list) to purchase
The rights of
the shareholder are
the costs are prohibitive.
In Leningrad, a
roubles, while a three room flat
one room flat costs 10,000
may cost as much as 30,000 roubles.
cost is
financiable over a 15-25
rate of
interest.
sizable
down payment
However,
of
a share
Between 50%-60% of this
year period at a
a family still
has to
5,000-15,000 roubles
24
very low
make a
followed
by
monthly payments
rental payments for
of 40-60 roubles (vs.
state-owned housing of 5-20 roubles per month).
to make these payments (and the
Even if a family can afford
many cannot),
suggests that
evidence
Leningrad evidenced this.
result of the
as a
visited
cooperative
A
housing.
like the
looked exactly
in decorating,
barely adequate, and
thousands of
surround the city.
blocks which
of
Although the apartment was lovely
care its occupants took
finish was
the interior
"suburbs"
the
in
nothing to
the state-owned
cooperatives from
the state
differentiate
there is
the exterior
state-owned building
Furthermore,
the location
offered no advantage.
The
homebuilding cooperatives
(which does
private forms
Gorbachev.
not exist
of tenure which
To
are
only used
for
Leningrad region) and the individual
secondary homes in the
home sector
(which
are also
in Leningrad)
by Mr.
have been emphasized
these sectors under
encourage the growth of
perestroika, financing has been made available to individual
citizens.
However,
very limited basis.
Director at
Managing
went unfilled
roubles at
state
construction
only been
made available
on a
According to Valere Antonov, the Deputy
Lenniitag, 130,000
in Leningrad
the state
homebuilders. 3 4
it has
in 1989 due
level".
In 1990,
money
available
loan applications
to "a
shortage of
there has
for
been no
individual
A family
was
which
enough in
fortunate
1989
to
get
a
construction loan was only permitted to borrow between 5,000
At best, this would have covered 50% of
and 10,000 roubles.
the
cost
materials. 3 5
of
Because
are
there
state
few
building stores, materials are difficult to procure, and the
individual who
chooses to build
However, this
personal
be very
can
relationship
with
homebuilding factory is the
because
it
provides
Having
expensive.
someone
who
works
in
a
a
preferred method of procurement
direct
access
to
the
(See "Privatization and
centralized supply.
must be
One alternative is through the black
extremely resourceful.
market.
his/her own house
system
of
The Political
Process" for detail).
The growth of low density housing development -the expansion
of either the homebuilding
home sectors --
the
Because the planning system
development
housing blocks, it is
and capital
provide
the
and
of
industrialized
extremely inflexible.
Large resource
allocations must
necessary
infrastructure
density housing.
large
is oriented
scale
transportation networks.
roads
or the individual
would require an overhaul of the centralized
planning process.
towards
implicit in
be made
for each
infrastructural
improvements
This prevents the
needed
for the
project to
and
development of
growth
of
low
The
cooperative and
existence
since
encompass 30%
the
of the
Union.36 This is
individual home
Revolution.
primary housing
sectors have
Soviet government has never been
they
However,
stock in
largely attributable to the
been in
only
the Soviet
fact that the
willing to loosen its hold
on centralized authority in order to foster their growth.
PRIVATIZATION AND THE POLITICAL PROCESS
".
the
process of
privatization
does not
mean
handing state property over to private ownership,
as some people think. It is really a search for
new, decentralized forms for management of state
Therefore the
property in capitalist countries.
significance of this phenomenon... becomes even
and the term
(in socialist countries],
greater
privatization is... inadequate to describe this
complicated process. It might.. .be more accurate
to call the process socialization... since the
process is one of advancing property to people, of
liquidating 7 the alienation of people from their
property."
In other
words, privatization depends
Although
this observation
Union where
the Soviet
paramount throughout
home
of leaders
such as
say whether
The
Ivan the
to
can take place
has been
Russian Empire
was the
Peter the
Terrible and
supreme autocrats.
French ambassador to Russia
is difficult
centralized authority
history.
Great, both of whom were
"I cannot
astute, it
the process of decentralization
imagine how
in
is
on decentralization.
A 16th century
made the following observation:
it is the
character of
the Russian
nation which has formed such autocrats, or whether it is the
autocrats themselves
nation."38 In
the rise
who have
the 20th century,
of Joseph Stalin
given this character
the Soviet Union
who created many of
to the
has seen
the central
political policies which still exist today.
The
In the Soviet
the privatization of housing.
impediment to
an
is
centralization
political
towards
tendency
Union, all important decisions are made at the highest level
of
both
is
Gossnab
Soviet.39
report directly
which
of
planning
Gosplan is
budget.
Until
introduced under
the
to
the
Supreme
supply
central
the government's
"self-financing
national
the
oversees
which
agency
two separate
materials and supplies in the
are distributed.
financial
of
allocation
government's
the
agency, through which all raw
Soviet Union
the
are made by
financial resources
material and
agencies
regarding
Decisions
government.
were
enterprises"
perestroika, the financial affairs
of all
enterprises were managed by Gosplan. 40
Land planning
institute.
planning
throughout the
by Genplan, the
is conducted
plans
Master
central master
designating
USSR are prepared every
land
15-25 years.
use
These
are then used by the local officials to guide development.
High-rise housing designs remain uniform throughout the USSR
This is
attributable, firstly,
construction regulations.
to strict state
design and
Secondly, there is a strong ethic
among the state
construction organizations which encourages
simplicity
discourages
and
organizations
provide
technological
ultimate
approval
change.
of
the
These
design
Consequently, even through new housing designs are
process.
created
by local
architects
for
the local
appearance of the
to seven years, the
factories every five
homebuilding
buildings never changes.
centralized control
Finally,
local Soviet
disempowers the
governmental bodies.
Historically,
they have served merely
adminstrators of
policy passed
down to
as
the
them from
state.
CENTRALIZED SUPPLY SYSTEM
One obstacle to privatization
supply system
All
which operates
of housing is the centralized
throughout the
are distributed
material resources
demand, but instead, they are
result,
extremely
It
by the state.
the state budget.
mechanism in
primitive.
In
set to satisfy a political or
or to balance
the financial
state.
on the forces of supply and
Prices are not determined based
ideological agenda
by the
these materials are set
addition, prices for
Soviet Union.
the Soviet
is material
As
a
economy is
procurements
which
drive Soviet economic behavior.
Unfortunately, the emphasis on material procurements creates
a "hoarding"
mentality
enterprises stockpile
not
only
in
which
materials.
secure against
future
By
state
factories
and
stockpiling, managers
scarcity,
but they
also
opportunities for
create business
leads
to
scarcity
an artificial
to
negotiate
procure the
of housing
quantity
in
the state
has
the
to build
budgeted for
a
the job
According to one source,
particular municipality.
must
which everyone
needed
materials
which
Stockpiling
themselves.
of the local planner is to be the best "beggar".4
If
local
ministries
have
to
to
beg
builders have to break
materials and individual
building
procure
the law to
prospect of creating normal
procure building materials, the
market relations is extremely limited.
CENTRALIZED
PLANNING
The centralized land planning process in the Soviet Union is
also
problematic
created many
local
very
footings
privatization.
years in advance
planners.
resources.
are
for
This
leads
In Leningrad, for
wet,
and
would be
guidelines
with very little
to inefficient
systems
most suitable.
the
plans
are
input from
use of
local
instance, the soil conditions
foundation
call for
Master
use of
utilizing
However, because
piles
(a more
spread
state
expensive
foundation system), the method which would be most efficient
is not used.
The
development
of
high-rise
industrial
housing
is
an
inflexible system which consumes resources and capital at an
rate.
enormous
are much higher
Construction
plant and
be made
must
development.
to
public
and
improvements
transportation networks for each
Finally,
equipment.
allocations
and resource
infrastructural
satisfy
necessitates
construction
investment in
capital
the Soviets' reliance on
Furthermore,
concrete
prefabricated
large
low-rise and single
than they would be for
family construction.
considerable
high-rise building
costs for
As a result,
the state has little remaining to develop infrastructure for
housing.
non-state
With respect to land and resource allocation, priority seems
to be given to the industrial and military sectors.
agenda, which calls for continued
of the Soviet ideological
military expansion, the housing
industrial and
Even during
lower priority.
peak construction
housing sector was allocated only
Soviet
economy
has
become
state budget
increasingly
In 1987,
percentage has diminished.
was allocated
years, the
of the state
In recent years,
allocated to housing.
budget was
sector is a
a small percentage of the
1960, for example, only 15%
In
state budget.
Because
to the
as the
stagnant,
this
only 8% percent of the
housing sector.42
In a
market system, housing is recognized by the government as an
important sector of
serves as
insures
the economy, in large
a store for individual
credibility
growth and
in
wealth.
the marketplace
stability of a financial
part, because it
This recognition
and
fosters
the
mechanism for housing.
If housing were
Union, the
transferred to private hands
government would
similarly need
in the Soviet
to acknowledge
its importance in the economy.
Historically, housing development
from participating
housing
incentive to
construction process.
in the design and
Because the state is a
the
has excluded the consumer
sector;
monopoly, there is no competition in
the
state,
as
producer,
recognize consumer preferences.
has
no
This creates
a dilemma for privatization because it fosters an uneducated
buyer.
only be
from The
In
fact, the consumer
in the Soviet Union
uneducated but complacent.
Glasnost Reader suggests
skilled at instilling
The
may not
following anecdote
that the state
the belief that housing is
has been
a gift as
well as a constitutional right:
The railing in a stairwell of a residential
building has just been painted. "It turned out
You can
nice.
Such a noble dark green color.
even say that it had shades of red. Or was it
No one
rust that was coming through the paint?
knows. Only it came out.. .not too ugly." Three
paint does not dry. The
days pass and the
explanation
by
the building's
chairman
is
"'Comrades,
you
can't
place
unrealistic
expectations on this paint. Give it time, it'll
dry... '" Two weeks pass, and the tenants call the
painter.
After the painter explains that the
paint has probably been made with the wrong type
of oil (but that it will undoubtedly evaporate
soon, leaving the railing with streaks),
the
chairman says, "'...it's just as well.
If it'll
[sic]
be
with
streaks,
the
dirt
won't
show'".. .Again the tenants are satisfied. After
several months pass, and the paint --
what is left
of it -- has begun to dry, the narrator exclaims,
"But one must remain an optimist and find good
sides in every sad situation. The paint... did not
really turn out to be that bad, and it was
folk. It came
affordable for the not rich [sic]
You did not even have to wash
off the suits.
them. It just disappeared by itself." In the end,
the paint
the entire 4 groblem is blamed on
manufacturer.
POLITICAL AND IDEOLOGICAL FACTORS
for
prerequisite
be a
the decision-making process would
Decentralization of
move
any
toward
be
governmental
bodies
must
responsibility
for the
supply and
This
transformation
down
from
central
cannot
to
empowered
allocation of
take
housing.
passed
decrees
occur through
Instead,
authorities.
Local
privatization.
must
it
take
place at a grass roots level.
authority
the
Currently,
of
the
ministries
local
is
severely constricted because they have no direct link to the
It is the state ministries which oversee
Soviet work place.
the factories
factories as
and, because
a "carrot"
state ministries
housing is
to attract
remain much
used by
and hold
many state
workers, the
more powerful than
the local
authorities.
There
have
been
rumblings
occasional
transferring more power to local
efforts has proven
lack
of
political
successful.
muscle
in
the
past
of
Soviets, yet none of these
This is due
behind the
largely to the
rhetoric.
In
the
during
legislation
and
1950's
the late
enactment
of
early 1960's
to
the
to
led
decline
This
1956.
in
27%
1940 to
of living space in
dropped from 46%
local Soviets
the
by
housing
of state
ownership
Russia,
of
Republic
promote the transfer of properties from the state ministries
the
to
the administrative abilities
base, successfully discredited
of the local
state
power
their
maintain
to
anxious
ministries,
the
However,
municipalities.
local
Soviets in the
Soviets, and in 1975 the local
Russian Republic had only increased their holdings to 35% of
44
the total state-owned housing stock.
Under
Soviets are
limited to
becoming more powerful.
Moscow and Leningrad
the Soviet Union which have
Interestingly,
exercised
this
power
--
However,
as
this gain is
cities in
the only two
power over their local budgets.
a
city
neither
perestroika
before
the local
evidence that
is some
perestroika, there
of
result
the
even
long-standing
45
reliance on decision-making from above.
In
Leningrad, through
1990, LENSOVIET
the first
process in
(Leningrad's legislative body)
time in
political power.
than
the election
a formality;
history, a
governmental body
In the past, elections
one
candidate who
senior officials was elected.
was
early
became, for
with real
were nothing more
hand picked
by
All local authority was held
by ISPOLCOM, the executive committee which maintained direct
links
ISPOLCOM
is
appointed
the head
Because
authorities.
the central
to
elections
1990
the
by LENSOVIET,
of
effectively transferred power from the executive agency to a
legislative body.
This is an important step in shifting the
political process
from a centrally
authorities are
which local
both
establishment of
and the
privatization
for
advocates
strong
are
chiefs of
The new
empowered.
ISPOLCOM
and
LENSOVIET
one in
based system to
economy.
a market
However, their hold on leadership is tenuous --
as reflected
in the recent rumblings by more conservative elements of the
communist party.
the
of
confidence
Soviet
least
trusted
paralleled only
organizations
the
by law enforcement on two
religious organizations
organization
in
on
on one occasion.
all
five
is even
more
occasions
fully
"Whom do we
are among
the local Soviets
show that
Responses
to
needed
people
The poll asks
system.
transform the political
the
even if the
may not receive
able to gain power, they
local Soviets are
trust?".
five occasions
Weekly on
and March, 1990 shows that
between March, 1989
the
Moscow News
by the
A poll taken
Soviet
Union,
occasions by and
The
was
most trusted
the
Supreme
Soviet. 4 6
Perhaps
what
privatization
participation
than
in
the
the
critical
historical
for the
lack
political process
36
is
success
of
the
a
of
local
national
--
of ideology
crisis
under
which persists
a phenomenon
perestroika.
Gorbachev's movement has produced a
As in past reforms, Mr.
the
attempt to integrate
rhetoric which seems to
myriad of new
proposed reforms
into the
system.
existing communist
Mr. Aganbegyan suggests that the process of privatization is
one
philosophy was
human
a
face".
rhetoric, little has really changed in
In spite of all this
basic
socialism with
"developing
as
described
transferring ownership).
at Lenniitag, Mr. Gorbachev's
In interviews
the
(not merely
of socialization
system
political
the Soviet
of
structure
to
transform economic relations.
The difficulties arising from this are exemplified in one of
the
entrepreneur who
Under
the
describes
has recently
Mr. Masarsky
Novgorod.47
business.
which
USSR",
Gorbachev's
launch a
to
has been
perestroika, he
of
plight
purchased a brick
plans
"Inside
for
Smith
Hedrick
by
produced
exposes
an
factory in
homebuilding
form a
able to
However, because of the monopolistic operation
cooperative.
of the state, he is unable to successfully run his business.
The
state
Mr.
When
supplies.
compete
controls
with
"begging"
for
materials (if
the
and
production
Masarsky
state
materials.
he is able
needs
the
allocation
materials,
enterprises,
which
are
in
order
to
Then,
to procure them) he
he
of
must
already
pay
for
must perform
This leaves him little opportunity
services for the state.
to operate
as a private
Efforts to
contact Mr.
venturer.
Masarsky upon arrival
made the gravity of his situation apparent.
finally acknowledged that his
When they
he has been
indicated that
the
city
permitted
to form
a
firm existed, they
anything in
forbidden to build
the
Under
of Novgorod.
At first, state
business altogether.
the existence of his
officials denied
in Leningrad
law, Mr.
However,
business.
private
Masarsky
is
because
the system remains unchanged, he is unable to operate.
constraints which are imposed
Clearly, the
by
conservative
the
In a
enormous.
forces
system
in the
on Mr.Gorbachev
Party
a're
where ideology
and
Communist
of government
reality are not easily reconcilable, people have learned how
to make use
In the
of
the
of the communist doctrine for
their own ends.
Soviet Union, professionalized politics
game.
David
Shipler
is the name
notes,
"The ideological heritage has passed from thinkers
and theoreticians to the textile engineers and
Andropovs, and
the Brezhnevs,
metallurgists,
everyday
in the
whose interests
Chernenkos
business of economic management have naturally
prevailed over the more intellectual activity of
enriching
ideological
thought... Consequently,
the
to
are... dedicated
Communists
Soviet
e existing system
maintenance and improvement of
of elaborate state ownership."
Khrushchev's
attempted reforms
failed as
a result
of the
same conservative forces which are constraining perestroika.
Although Mr.
Gorbachev has added another
reforms (glasnost), his ultimate
conservative forces
ingredient to his
success at dismantling the
within the communist party
Privatization cannot take place
is tenuous.
unless the liberal factions
of the Soviet political system are fostered.
AFFORDABILITY ISSUES IMPACTING PRIVATIZATION
USSR,
analysis
following
the
would
affordability
privatization
measurable.
is
income earned
highly
is
developed)
not
is difficult to ascertain real
As a result, it
It is also difficult to imagine a successful
affordability.
privatization
(which
the Soviet
Income earned from this sector
from the secondary economy.
economy
compared to
income in
includes an unofficial component:
Union also
the
a
wages are low
Official
However, household
living expenses.
if
housing
that
suggests
problematic
be
adopted.
program were
of
savings in the
the recent growth in individual
In spite of
program
the present
under
wage
structure.
socialized, wages -are low and
Because the Soviet economy is
the consumer has little purchasing power.
INCOME PROFILE AND THE SECONDARY ECONOMY
The average official
Soviet
Union is
month.
However, based on income
of the
population earns below
Leningrad,
the
approximates 140
citizens in the
income per capita for
reported
average
to approximate
200 roubles
per
data prepared in 1989, 70%
200 roubles per
official
income
roubles per month.50 Based
month. 4 9 In
per
capita
on the average
household size (2.7 persons in Leningrad), it is possible to
40
hypothetical
a
create
child.
would equal
Offsetting this income
280 roubles per month.
(pro-rated on a
Taxes
and living expenses.
would be taxes
this case,
income, in
official household
The
illustrative
comprised of two adults and
purposes, the household will be
one
For
income profile.
monthly basis) would approximate 36 roubles (13% of official
and food costs would
income),
equal roughly 250 roubles per
room apartment (including
rent for a two
month.51 Finally,
10 to 15 roubles per
utilities and phone) would approximate
Already this family's
month.
official
income.
How, then,
clothing?
Even
domestically
monthly expenses exceed their
they
are
pay
able to
manufactured
for
clothing
is
expensive: a pair of ladies shoes (made in the Soviet Union)
could cost as
ladies outfit (made
much as 75 roubles and a
52
in the Soviet Union) might cost 100 to 150 roubles.
Based on the above information, one would logically conclude
that
affordability is
housing to
Leningrad
range
private ownership in
region,
prices
from 10,000-30,000
garden cottages
Financing,
seem to
though
barrier to
a critical
the Soviet Union.
housing
for state
roubles, and
range from
advertised,
Nevertheless, at least one in
transferring
is
In the
cooperatives
dachas and
kitchen
10,000-30,000 roubles.
not
really
available.
four families in Leningrad is
estimated to own secondary homes.53 How is this possible?
An important element of household income cannot be found in
In
economy.
the state
the
in this
income earned
of the
Grossman,
wages.54 According
Gregory
of California-Berkely,
30%-50% of the
income.55 These
activities as
include such
dressmaking, private tutoring, graphic
supplement
jobs to
second
of
city's official
38% of
to sources at Lenniitag,
hold
found
recent emigres
from the
class totalled
70 employees
their official
economy, Sovietologist
of income
Leningrad's working
institute's
data on
University
other sources
that
a vast
is no official
Although there
secondary economy.
there is
the Soviet Union,
design, and auto and
home repair.
In fact,
according to estimates prepared
by Gosplan, goods
and services which are provided outside of the state economy
may
approach $150
million per
domestic product).56
a Soviet
economy.
reveals
purchases goods
population
According to
repairs, tailoring,
Nikolai Shmelev,
Research prepared by
economist,
that
the
of
83%
in the
and services
Mr. Shmelev, in cities,
and shoe
the gross
11% of
year (or
Soviet
secondary
40% of auto
repairs are performed
in the
secondary economy and 50% of apartment repairs are performed
in the secondary economy.57
Often
the
secondary economy
exchange of money.
does
not
even involve
Because the Soviet Union is a country of
shortage, the barter system is highly developed.
one good or
the
service for another is common.
Exchanging
In his article
"Inside
the 'Collapsing'
Soviet
Economy", Richard
Parker
describes a meal in which he partook in Moscow during one of
his
visits.
resourceful.
garden
As
always,
had grown
She
purchased
plot,
hostess
was
the vegetables at
the
meat
a
from
enormously
her kitchen
cooperative,
neighbor, received the figs from
purchased the cakes from a
a relative in
his
Georgia, and
traded the wine
and chocolates
for theatre tickets.58
The magnitude of
the secondary economy is
growing rate
of savings in
rate in 1987
was 24 billion roubles, and,
source at Lenniitag,
supported by the
the Soviet Union.
many citizens do not
The savings
according do one
even store their
wealth in savings due to a lack of confidence in the banking
system.59 Twice since the Revolution
--
there have
been
currency
1961, people
were permitted
for
ones, this
the new
result,
there
may
be
--
in 1941 and in 1961
reevaluations.
Although
to exchange their
was not
many,
the case
in
old roubles
in 1941.
As a
among
older
particularly
citizens, who store their money "under their mattresses".
is also
noteworthy that during
been especially
under
periods when the
vigilant of anti-communist
Stalin and
Breshchnev), the
It
state has
behavior (e.g.,
government has
checked
bank accounts to verify income sources.60
Based
on the
above
information, it
can
be assumed
Soviet citizens earn more than they appear to.
that
Although the
should be governmental data in the
If it is enforced, there
near
future on
the
be enforced.
new tax system will
not clear how this
it is
July of 1990,
taxing unofficial income in
government began
meantime,
In the
secondary economy.
affordability cannot really be evaluated based on income.
Moreover, regardless of actual
income, it appears that many
Soviet citizens do not believe
that they can afford private
study
A
respected
sociologists
When asked what
own homes.
and
payment
own their
the respondents could afford to
under
results of
Although the
real
any
income),
to actual
the Soviet
a
they could not
It is noteworthy that
long-term
this study
quantitative
perception of affordability was
own their
to build and
both payment
required respondents to consider
the question
having
residents
conditions.
afford a house under any
outright
1,200
single family home, 50% said that
pay for a
it can be
people do not
most
Leningrad's
1989 surveyed
in
ability and desire
regarding their
of
by one
prepared
housing.
credit
regarded as
cannot be
significance
plan. 6 1
(because
the
not, in many cases, related
used as a general
guide.
perceive that they can
own homes, privatization is
If
afford to
unlikely to succeed.
THE AUTOMOBILE
Another
important
would impact
factor
related to
affordability
privatization is the inaccessibility
which
of cars.
the
land markets
in the
auto
If one is willing to wait as
the state
purchase a car from
five years, one can
manufacturer (Lada)
are prohibitively
United States,
expensive in the Soviet Union.
long as
the growth of
been extremely important to
Cars, which have
is also
It
roubles.
for 10,000
possible to avoid the wait by
purchasing a car on the black
However the cost can
be as high as 30,000 roubles.
market.
ten has a car in the Soviet
As a result, only one person in
six
(vs.
Union
only
Leningrad,
in
the
person
in
ten
in
one
secondary homes
homes.
substantially
who own
the only privatized
public transportation to travel to
housing
primary
If the
In
car.63
a
has
cars, families
(which comprise one of
forms of tenure) rely on
these
twenty
scarcity of
to the
Currently, due
States).62
United
privatized,
stock were
lack
the
to
be
individual
of
transportation would be an impediment.
WAGE STRUCTURE
In the
above hypothetical household, the
sources would approach 3,360
income generated from official
Excluding the
roubles.
sources
of
household is
income
likely
(which
aggregate annual
possibility of
cannot
barely subsisting.
be
unofficial
quantified),
One of the
this
problems with
the income structure in the Soviet Union is that while wages
are low,
form of
households receive enormous in-kind
rent subsidy,
transportation subsidy,
income in the
free health
care,
education,
free
nomenklatura
as
well
free
and
as
pension
workers
at
benefits.
certain
The
designated
factories or state enterprises also receive access to scarce
consumer
products.
hold,
the real
of services
cost
tax structure,
citizens
must
be
Otherwise, people
must
and costs
reflected
to take
be accounted
provided by the state
Costs for services
in the
For privatization
services.
all of these
cost of
compared to the
they exist, are token
Income taxes, though
for.
must be reflected
for services
incurred by
wage
structure.
in
have no purchasing
the
power.
Restructuring the socialized economy in the Soviet Union is
a major
housing to
undertaking.
succeed,
provide purchasing
order
In
the wage
for
structure must be
power and the secondary
reckoned with.
46
privatization
of
revised to
economy must be
CULTURAL ISSUES IMPACTING PRIVATIZATION
The Soviet Union occupies 1/6 of the earth's land area (22.4
million
represented among its 280
vast
Over
square kilometers).
have
spite of subjugation by
the 20 republics
sociopolitical machine, all of
traditions.
and cultural
distinct historical
of Soviet society
however, some common elements
There are,
Given the
of housing.
impact privatization
which
In
society
Soviet
population,
encompasses enormous diversity.
the Soviet
Because of its
million citizens.
varied
its
and
area
are
ethnic groups
100
deeply
rooted tradition of collectivism and authoritarianism, it is
accept
whether
to consider
important
plagues
Inequality in Soviet
ownership.
institutionalized, and
many societies,
although this
cannot be
it
implementing a market economy.
the
Soviet
Union
are
are willing
risks which
responsibility and
the personal
accompany private
the people
problem is
would
life is
one which
remedied simply
distinct and
should
be
carefully
COLLECTIVISM AND AUTHORITY
sense of
individual desire
47
by
Finally, family alliances in
examined with respect to privatization.
"The
to
and personality
submerged in the broader group... is much more than
a fragment of Marx and Engels polished by Lenin
and stuck like an irritating splinter into Russian
flesh. It has been absorbed into the structure of
values and mores so that its violggion stimulates
genuine revulsion in many people."
In the Soviet Union, collectivism is an essential element of
the culture
the Russian peasantry held
19th century,
villages (even
through communal
and
individually),
the blood-related
Slavs.
organized by the ancient
tribal communities
collective
traced back to
which can be
farm)
land collectively
family farmed
though each
rule,
under
Soviet
was
established.
In the
the
kolkhoz
(or
ethic
of
The
important obstacle to privatization
collectivism creates an
because it discourages differentiation among people.
There is a Russian proverb which asserts that "In a field of
wheat, only
above
the
the stalk whose
rest." 6 5
head is empty of
rule,
Under Soviet
grain stands
collectivism
has
served the communist party as a mechanism of social control.
a legacy of fear
Joseph Stalin created
Soviets even today.
of people
themselves
scientist
supporting
As a result, three and four generations
not to differentiate
have learned, by necessity,
from
others.
who is
likely
unorthodox
to
long-standing
by
tradition
of
the
as
an egoist
for
and the
architect
who
be viewed
experiments
others that
describes
Shipler
David
avoids claiming authorship of
accusations
which endures among
an innovative plan to prevent
he
is
seeking credit.66
collectivism
has
created
The
a
from developing
are discouraged
which citizens
society in
their individuality.
Under
the
perestroika,
ethic
Mr. Gorbachev has shaken
has
been
forces of market economics,
By encouraging the
challenged.
collectivism
of
The
this deeply rooted tradition.
for instance, calls on
establishment of cooperative stores,
citizens to accept price differentiation, and there are many
who
refuse
to
changes,
to
Collectivism
loose
is
a
and
uniformity,
they
provides
these
a
valued
of
sense
by
sign
in
evaluated.
She
Soviet
signing
uncomfortable
maintained
in
Maslennikov,
her
a
old
the Director
for
milk
citizens
One
because
employer,
who
it
had
his assistant, requested that
which
declined
price
security.
security.
a contract
are
they
Soviet people are
when the
sense of
recently attempted to promote
she
because
stores
accept this new principle.
unwilling to
accustomed
at
shop
would
be
she
was
security
she
her performance
the promotion
contract.
position
because
The
was
of Lenniitag,
paramount.
has attempted
Mr.
to
remedy this sensitive issue by paying his employees a salary
plus
a
security
bonus.
This
preservqg
while encouraging
the employees'
them to
strive for
sense
of
individual
success in their work.
Anna Maslennikov, a linguist at the University of Leningrad,
49
offered a job for a cooperative
explained that she had been
week.
hours per
earned 200
position, she
her present
In
working nine
month for
roubles per
pay 1,000
which would
According
18 hours per week.
roubles per month for working
to Anna, this sort of differentiation makes people feel like
what they are
really worth.
the Soviet Union where
years, it
In a society
driven by market
However, in
questioning is essential.
forces, this sort of
so many
It makes them question
nothing.
they have been working for
differentiation has been scorned for
of people's
very foundation
shakes the
values.
One important theme in
from
collectivism
In
leadership.
Soviet culture which is inextricable
the
Russian
until 1861.
abolished
urbanization accompanied
the middle
estate-like
population
reliance
the
is
Empire,
While Europe
By
social structure.
occupied
urban
industrialization took hold in the
authoritarian
was
serfdom
not
rapid
was undergoing
by the rise of
class), Russia remained
on
mercantilism (and
a rural empire
1915, only
centers.67
with an
15% of
Even
the
as
late 1800's, the role of
the factory bosses merely replaced the role of the nobility;
the proletariat grew as a subjugated class of people.
The issue of authoritarianism as it relates to the political
environment
Section
III
in Soviet
Union, has
("Privatization
and
been discussed
the Political
above in
Process").
phenomenon as
David Shipler describes this
a solid
structure
explain
reality."
allegiance
of
68
..the need for
to
in which
and
order
authority
on
Reliance
".
transfers
responsibility away from the individual and reduces personal
to
arrogant
Soviet
that privatization
to suggest
exists in the United States,
the
would
be
in the
which
the system
it is difficult to imagine how
reducing
without
privatization
achieve
can
Soviets
it
of housing
after
modelled
should be
Union
Although
property.
private
of
philosophy
its
has based
which America
upon
the tenets
many of
This is antithetical
from loss or failure.
risk resulting
their reliance on authority.
form
unwilling
which
to accept
entails.
this
farmers in his expose
many
seem
accountability and
risk
However,
ventures.
business
private
the personal
Hedrick
people to
has encouraged
Mr. Gorbachev
Under perestroika,
interviews
Smith
several
"Inside Gorbachev's USSR" who provide
the following insights: "To lease it means I have to work on
But if the weather is nasty or something,
this land myself.
how will I
[sic]
manage?
my cows?
What if I do not
What if
I do
Another farmer who was offered
the state as
said,
"No,
have enough feed from
not have
enough strength?"
land and machinery leased by
well as seed and fertilizer for
I won't take it."
rain, no potatoes.. .You are
I lease from you,
When asked why,
a potato farm
he
said,
"No
paying me a salary, right?.. .If
and there is no rain, I
would still have
a loss,
I have
me?
will pay
But who
to work.
and then
there will be nothing to eat." 6 9
to pay
be willing
the
many may
a
for creating
personal cost
the
in
analyzing
privatization, the possibility that
prospects for
met
owners
in
However,
ventures.
business
their
entrepreneurs
as
achieve success
could
they
confidence that
expressed
ahead
cooperative
Several
perestroika.
under
not
are forging
who
those
are
There
market system cannot be ignored.
The
espoused includes
citizens are required to
without
given
documentation,
Moving to
they
one region
Moving from
could
until
those who hold propiskas in
to
of a job
farmers were not
Without
1974.
even
not
Moscow or Leningrad is
their marriages
all
carry, prevents people from moving
propiskas
many, with envy.
which
(propiska),
is noteworthy that collective
It
has
movement of
only accomplished as a result
another is normally
even
passport
proper documentation.
change.
government
Soviet
controlling the geographic
internal
The
people.
the
which
authoritarianism
leave
their
this
farms.
especially difficult, and
either city are looked upon, by
In fact, people have been known to arrange
in order
to gain access
to a
propiska in
these cities.
Lack
of mobility
(due either
to the
previously mentioned
instance, where real
One
movement
in the
similarly impact
Union would
Soviet
population
constricting
that
surmise
can
prices.
rising
in
regulation) results
government
through
supply
upon demand, constricting
are based
estate prices
private
marketplace for
the United States, for
In
ownership.
privatization
problem for
constrains the
it severely
because
(e.g.,
interesting
poses an
propiska)
the
by
limitations imposed
the
to
cars or
of
scarcity
the
real estate market.
INEQUALITY
Inequality in the
and it is
altering
economic
assume
to
naive
Soviet Union is deeply rooted,
forces of
the powerful
relationships,
by
merely
that
history which
Soviet society
fostered inequality will suddenly fall away.
has functioned as a class system for centuries.
for example, a military
the Great,
tchinn)
established,
was
and the
have
Under Peter
class structure (called
entire
was
population
classified into 14 official categories.70 It is notable that
this
class structure
existed
distinct from
In
by
family
their
contrast,
under
person's position in society
the system
which
classes
were
where
Europe
Occidental
in
distinguishable
holdings.
was
names
the
their
and
system
of
land
tchinn
a
was directly linked to his/her
relationship to the imperial government and the czar.
to
was
structure
be
class
squashed, the
nobility was
Although the
dissolved.
class
the
Revolution,
the
With
Today there are many classes of
structure did not dissolve.
people in the Soviet Union: the aparachik, the nomenklatura,
the
bestowed with
Each is
workers.
intellectuals, the
specific qualities.
inequality has
Soviet rule,
Under
II
Section
how the
described
groups of people who are
The
contributors.
who are
granted
As
the
indicates,
discrimination
institutionalizes
Those
is
propiska
farmers
collective
well connected
permission to
live
yet
to those
use
of
example
above
the
of
the
groups.
are
communist party
such
in cities
they are
usually insured
accommodations and
can gain
access to the
of
propiska
certain
against
in the
example
another
There,
Leningrad.
system
perceived to be society's greatest
inequality.
systematic
allocation
housing
living accommodations
most desirable
provides the
been institutionalized.
as Moscow
or
better living
best educational
institutions.
The
Soviet
state
distribution
produced
of
in each
redistributed.
also
goods
fosters
and
republic
Thus,
services.
are sold
citizens
access to all of the same goods.
is not the case.
inequality
In
to
through
theory,
Gossnab and
throughout the
USSR
the
goods
then
have
In practice, however, this
Some republics seem to have a much greater
and
of overstocking
bartering
part,
is, in
This
the widespread corruption within
reflective of
Because
others.
goods than
of certain
supply
the system.
at the
enterprise
level, goods do not flow equally throughout the republics.
The
Soviet
system
social
of
is
inequality
of this phenomenon, certain
As a result
institutionalized.
concept
levels
many
on
yet
equality,
the
on
built
is
groups are prevented from participating in the society on an
altering
by
some
were established without
If a market economy
equal basis.
participate
to
inability
inequality, the
norms of
the societal
equally
in
economy
the
would
prevail.
FAMILY
Finally, privatization must be
family structure
revolution,
the
evaluated in relation to the
Union.
in the Soviet
dissolution
the
of
At the time
nuclear
"...the family, like the
considered paramount.
of the
family
was
state, was
to wither away.. .Under communism, it would give up its major
functions, especially child rearing
the
society
at
large."
The
and property holding to
rapid
growth
of
industrialization which was accompanied by a shrinking labor
force
1930's,
quickly dampened
Stalin
imposed
this
the
ideological
agenda.
redomesticization
of
In
the
women.
Awards were created for mothers who produced large families,
55
the 1970's, were never successful.
and which continued into
In
country
fact, the
its labor
still suffers
force was
insufficient
from an
Government's failure
The Soviet
labor supply.72
under Stalin
work force, which began
expand the
These
curtailed or abolished.
established under Lenin were
efforts to
had been
laws which
and divorce
liberal abortion
and the
to expand
to the
largely attributable
(and is)
inadequate housing provided to Soviet citizens.
As
of shifting ideological
a result
trends, the
This has created a
family in the Soviet Union is in crisis.
For example, the divorce rate is
number of social problems.
of
1/3
high (over
responsibilities
families
Leningrad
work
caretakers at
in
the
enormous.
become
have
women
are
many
home.7 4 Furthermore,
basic necessities continues to
the
of
work place (90%
still
as the
73-
In
providing for
responsibility for
full time),
and
divorce),
in
end
marriages
taking equal
addition to
their
of
nuclear
women
in
primary
the
availability of
worsen, women spend more and
more of their time waiting in lines.
Several of
The
rising
these issues are problematic
divorce
rate
and
more households
Union, as
the
same
facing the United States.
More
has created
economic problems which are
are headed
in the U.S., women
power that men do.
for privatization.
many
by women.
do not have the
of
In the
Soviet
same earning
Consequently, their ability to purchase
56
privatized, would
it were
housing, if
--
be limited
even
more limited than the scenario presented in Section IV.
families often share housing.
More importantly,
see households comprised of
uncommon to
a
in
of persons
persons in a particular
continuous shortage
by
the number
Children may marry
siblings may live
the result of adapting
of housing.
It
of
may also be
to the
rooted in
Family relations in the Soviet Union are very
collectivism.
Anna
Maslennikov said that she
invited to
had been
nuclear family.
part, this is
In
important.
household not
their parents, and older
and remain with
together.
various relations.
Soviet Union is measured by the
In fact, family size in the
number
It is not
and her husband
several times,
move to Moscow
but on
each occasion they had declined because her relatives are in
Leningrad.
Defining the household unit
privatization.
Is the land
presents an obvious dilemma for
Who buys the house?
And who owns the house?
owned by all the members of
does one person maintain title?
the household?
Or
These questions are complex
and to presume that they would be resolved by implementing a
privatization program is shortsighted.
The cultural issues presented in the above discussion should
be
considered
because
with
they reflect
respect to
some of
privatization
the basic
of
values of
housing
Soviet
society.
Under perestroika, many
publicly debated.
Although this
of these values are being
public debate is likely to
be an important first step toward change, it is only a first
step.
CONCLUSIONS
the
time restructuring
be viewed
ownership, must
to private
the
housing is
of all state-owned
so that 70%
delivery system
transferred
the same
while at
year 2000,
dwellings by
20-25 million new
plan to build
The Soviets'
at this
point with a certain skepticism.
The current system for allocation of housing is fraught with
Soviet
Although the
difficulty.
to
has attempted
state
provide a minimum standard of living for all of its citizens
continuous
which
shortages
have led
production process
this
system
complicated
a
through
system.
groups
Certain
housing than others
result
the
distribution,
of
inadequate
an
from
inequalities in
to structural
to procure
are able
as a result of having
better
better access to
state organizations.
Historically, there have been
enable
individuals
cooperative
these have
Under
and
the
own
to
their
own
individual home
never gained
perestroika,
several forms of tenure which
sectors).
enough state support
Mikhail
Gorbachev
(e.g.,
homes
has
the
However,
to flourish.
attempted
to
encourage the growth of these sectors through establishing a
legal
lack
the
Nevertheless,
framework.
building
of
materials and financing continues to obstruct their growth.
to the
extremely
inefficient.
organizations often have to
supplies.
needed
construction
state
Even
resort to unethical behavior to
the
Furthermore,
of management has prevented
budgetary system
which is
of supply
centralized system
large part,
procure
attributed, in a
building materials can be
The scarcity of
simplistic
the growth of
any financing mechanism in the economy.
design
and
process
and
utilizes
enormous
for infrastructural
scale allocations
The large
capital.
barrier to
It ignores local and individual input in the
privatization.
construction
a formidable
also creates
Centralized planning
improvements and transportation networks which accompany the
of high-rise
development
funding
and
resources for
housing sector.
political
the
environment
recently
system,
development
of a
little
private
Unfortunately, because of the nature of the
in
the
systems are self-perpetuating.
only
housing leave
industrial
begun
but their
to
powers
Soviet
centralized
Local political bodies have
establish
are
Union,
authority
tenuous.
within
the
Furthermore,
the
political ideology which dominates economic relationships in
the Soviet Union is often abused by the central powers.
Affordability
issues
are
critical
to
any
privatization
income among
Official
program.
to living
comparison
low in
there is
strong
However,
expenses.
a significant
the secondary economy provides
evidence that
The barter system is highly
supplemental source of income.
secondary economy
Because the
developed.
Soviet citizens is
been
has never
monitored and the barter system is poorly suited to a market
have to
privatization would
toward
any move
economy,
be
accompanied by a shift in the income structure in the Soviet
Wages
Union.
are low,
If a market economy were
economy subsidizes most services.
adopted,
wages would
to be
have
socialized
because the
part,
in
provide
restructured to
citizens with greater purchasing power.
Perhaps the greatest impediment of all to privatization lies
in the deeply rooted cultural traditions of collectivism and
among
and
people
discouraged
have
which
authoritarianism
prevented people
Systematic
from
differentiation
inequality is
responsibility and
risk.
significant factor
in Soviet culture which
Soviet
government
to
is
undertake
also a
will not easily
Finally, if
die with the implementation of a market system.
the
personal
taking
such
a
radical
program, family relations must be closely examined.
paper was gained through two
The analysis presented in this
weeks of fieldwork in
available
changes
Leningrad and through researching the
literature (which
which
are taking
is
place
61
limited due
in
to the
the Soviet
rapid
Union
at
the conclusions which follow should
present).
As a result,
be viewed
as exploratory:
is not a
observations in Leningrad, privatization
1. Based on
Housing is symptomatic of a
remedy for the housing problem.
economic, and cultural issues
larger set of sociopolitical,
unresolved will hinder any
which left
proposal for solving
housing problems in Leningrad.
2. In
any
Leningrad,
transferring
move towards
state-owned
housing to private hands must be preceded by a restructuring
of the basic tenets of
system.
housing allocation under the current
Housing can no longer be inextricably linked to the
process
political
Furthermore,
the
which
sectors
through
individual home
of
development
Proclamations
a
reward.
do
encourage
private
sectors) must
for individual
trade
retail
are
and laws
of
method
owners and
for
be fostered
availability of
and continuous
the development
financing mechanism
a
system of allocation (e.g., the
ownership under the current
cooperative and
as
used
and
building
a
through the
materials.
not sufficient
to foster
the
to
materials
and
growth of these sectors.
3. Privatization
services.
private
Gossnab's
depends
on
towards transferring ownership to
Thus, any move
hands must
control
be
of
local access
accompanied by
the
supply
of
the elimination
materials
and
of
the
a
of
establishment
restricts movement
fostering inequality
the economy.
--
goods and
of
services --
and creates artificial
the
system of
Leningrad indicates, the centralized
analysis of
supply
As
network.
local distribution
thus
scarcity in
The primitive budgetary system of finance must
also be restructured and a housing finance mechanism must be
created to foster home purchases.
4. Any solution
to the
housing problem
in Leningrad
must be
shift of responsibility for the
predicated on a fundamental
supply and allocation of housing from the state to the local
Without
level.
in the
control, particularly
strong local
hands of local elected representatives such as the Leningrad
City
solutions are
Council, housing
historical trends that have
likely to
repeat the
been deeply entrenched over the
last 70 years.
5. As the Leningrad example illustrates, the socialized economy
in
the
Soviet
restructured.
must be
Union
Wages
must
reflect the real cost of living, and in-kind subsidy must be
made measurable so
by
the
pervasive
that the real cost
government are
secondary
accounted
economy
currently operates in such
in
of services provided
for.
housing
The role
of
production
the
that
areas as allocation and material
procurement must be recognized.
it is one example where market
This economy has strength;
forces are at.
As a result,
it may be an appropriate starting point for the expansion of
privatization.
6. Finally, market economics depends
result,
the deeply
authoritarianism
rooted
and
the
on consumer values.
tradition
of collectivism
institutionalized
As a
and
inequalities
which pervade the lives of Leningraders must begin to shift.
Taken a step further, consumer
preferences must begin to be
expressed for privatization of housing to take hold.
APPENDIX A
HOUSING AND POPULATION DATA IN LENINGRAD
ACTUAL
1986
PROJECTED
2001
4,900,000
5,290,000
SEPARATE FLATS
RESIDENTS OF
2,725,000
@4,877,000
COMMUNAL FLATS
RESIDENTS OF
DORMITORIES
1,755,000
@ 153,000
420,000
260,000
2.70
2.55
TOTAL HOUSING AREA
IN SQ METERS
76,000,000
104,100,000
TOTAL LIVING 3AREA
IN SQ METERS3
47,500,000
63,570,000
TOTAL POPULATION
Breakdown 2
RESIDENTS OF
AVERAGE HOUSEHOLD
SIZE (EXCLUDING DORMITORIES)
TOTAL HOUSING AREA
PER CAPITA IN SQ METERS
17.0
20.7
TOTAL LIVING AREA
3
PER CAPITA IN SQ METERS3
10.6
12.6
ANNUAL CONSTRUCTION
VOLUME
1,700,000
1 All
figures
(with the exception of
footnote ) were provided by Lenniitag.
2,300,000
those identified
in
2 The
breakdown of residents occupying separate and communal
flats was estimated for 2001 was based on average household
size.
excludes
3Living
in the Soviet Union
area
bathrooms and corridors within the dwelling.
65
kitchens,
FOOTNOTES
1 Third
International Shelter
(April 26, 1990).
D.C.,
2 F.
du Plessix Gray,
1989), pp. 2-3.
Conference held in Washington,
Soviet Women, (Doubleday,
New York,
3E
. Kudryavtsev, I hereby Apply for an Apartment, (Moscow,
"This right is ensured by the
Progress Publishers, 1986).
and socially-owned housing;
state
of
upkeep
and
development
individual house
and
co-operative
for
assistance
by
building; by fair distribution, under public control, of the
[sic] of
housing that becomes available through fulfilment
the programme of building well-appointed dwellings, [sic]
and by low rents and low charges for utility services."
4Directly translated, perestroika means reconstruction. The
notion of perestroika was created by Mikhail Gorbachev in
1985 primarily as a remedy to the growing stagnancy in the
Soviet economy.
"On Housing Strategies in the USSR",
p. 3. Statisticians in the Soviet
@1989),
draft
(Undated
Union report housing data in relation to household size.
Currently, the average household size approximates three
persons.
5 Goscomarchitecture,
6 Ibid,
pp.
4-5
&
13.
Third International Shelter
D.C., (April 26, 1990).
8
Conference held in Washington,
Ibid.
. Agabegyan, Inside Perestroika, (New York, Harper &
16. Although the savings rate in 1987 was
Row,1989), p.
exceptionally high, there is strong evidence that Soviet
citizens are accumulating savings at a much greater rate,
Average annual
under Perestroika than in past years.
for instance, were
deposits during the years 1980 to 1985,
less than 13 billion roubles.
9A
1 0 Figures
1 1 Henry
on specialized housing provided by Lenniitag.
W. Morton, "The Housing Game", The Wilson Quarterly,
Under the law, individual housing
p. 61.
(Autumn 1985),
for primary residency is prohibited in cities where the
population exceeds 100,000.
1 2 Valere
Antonov, Deputy
(June 14, 1990).
Managing
Director at
Lenniitag,
13It is noteworthy that the term "private property" does
not exist in the Russian language. Real property which is
owned by individual citizens is called "personal property".
1 4 Michael
1 5 Valere
Antonov, Deputy
(June 14, 1990).
1 6 Vladimer
Linov,
at
Director
Research
Berezin,
Interview, (June 9, 1990).
Managing
Director at
at Lenniitag,
Chief Architect
Lenniitag,
Lenniitag,
(June 10,
1990).
17G . D. Andrusz, Housing and Urban Development in the USSR,
(Albany, SUNY Press, 1984), p. 85.
1 8 Vladimer
Linov,
at Lenniitag,
Chief Architect
(June 10,
1990).
19G . D. Andrusz, Housing and Urban Development in the USSR,
(Albany, SUNY Press, 1984), p. 297.
20
Helena
10,1990).
Steinbach,
Sociologist
2 2 Michael
Research
Berezin,
Interview, (June 8, 1990).
at
Lenniitag,
at
Director
(June
Lenniitag,
(June
Lenniitag,
Sociologist at
Steinbach,
10,1990).
24D . K. Shipler, Russia: Broken Idols, Solemn Dreams, (New
York, Penquin Books, 1989), p. 175.
2 3 Helena
2 5 Directly
translated, glasnost means openness. The concept
of glasnost was created by Mikhail Gorbachev in 1985 in
to
was
Its purpose
perestroika.
with
conjunction
publicly expose the growing corruption within the Soviet
political system.
2 6 Hedrick
Smith,
"Inside Gorbachev's USSR",
(Boston, WGBH,
1990).
2 7 Helena
Steinbach,
Sociologist
at
Lenniitag,
(June
10,1990).
2 8 Valentin
Nazarov,
Director
of
Genplan
in
Leningrad,
(June 15,
29A
.
Row,
1990).
Aganbegyan, Inside
162.
1989), p.
Perestroika, (New York,
Harper &
30G . D. Andrusz, Housing and Urban Development in the USSR,
(Albany, SUNY Press, 1984), pp. 38-39.
3 1 Ibid, p.
91. It should be noted that the cooperative
construction has always been concentrated in urban areas,
like Leningrad.
3 2 Valere
(June 14,
Antonov, Deputy
1990).
3 3 Vladimer
Managing
Chief Architect
Linov,
Director at
Lenniitag,
(June 10,
at Lenniitag,
1990).
3 4 Valere
Antonov, Deputy
(June 13 & 14, 1990).
35Ibid.
Managing
Director at
Lenniitag,
36Ibid.
A
Aganbegyan, Inside
Row, 1989),
pp.
Perestroika, (New York,
Harper &
55-56.
3 8 Marquis
du Custine, Empire
Doubleday, 1989), p. 95.
of
the
(New
Czar,
York,
Supreme Soviet is the legislative branch of the Soviet
government which is comprised of 500 members who are elected
by the congress of people's deputies.
3 9 The
term "self-financing enterprise" refers to a new
group of enterprises (established under perestroika) which
operate using the principles of cost accounting. In theory,
profits remain with the enterprise and are used to fund
ongoing business expenses. This mode of operation sharply
contrasts the administrative system of the past, in which
profits (and anything produced) went from the enterprise to
the state for redistribution.
4 0 The
4 1 Vitrenko
the Leningrad
of
Leonidovich, Head
Council's Planning Commission,(June 13, 1990).
4 2 Valere
Antonov,
(June 14, 1990).
Deputy
Managing Director
at
City
Lennitag,
43M . Soshchenko, "The Green Product", The Glasnost Reader,
edited by J. Eisen, (New York, Penguin Books, 1990), pp.
203-204.
the USSR,
44D . Andrusz, Housing and Urban Development in
(Albany, SUNY Press, 1984), p. 55.
4 5 Vladimer
Linov,
1990).
4 6 "Moscow News
Weekly",
4 7 Hedrick
June 3,
Smith, "Inside
(June 10,
at Lenniitag,
Chief Architect
1990: No.
21, p.
Gorbachev's-USSR,
10.
(Boston, WGBH,
1990).
48D . K. Shipler, Russia:
Broken Idols, Solemn Dreams, (New
York, Penguin Books, 1989), p. 264-265.
4 9 Facts
and Arguments, Spring 1990.
5 0 Helena
Steinbach,
Sociologist
Lenniitag,
at
(June
10,1990).
51
Ibid.
52
Ibid.
5 3 Michael
Research
Berezin,
Interview, (June 9, 1990).
Director
at
Lenniitag,
5 4 Richard
'Collapsing'
the
"Inside
Parker,
70.
p.
1990),
(June
Economy", The Atlantic,
Soviet
5 5 Helena Steinbach,
Sociologist at Lenniitag, and Vladimer
Linov, Chief Architect at Lenniitag, (June 10, 1990).
5 6 Richard Parker,
"Inside the 'Collapsing' Soviet Economy",
The Atlantic, (June 1990), p. 70.
5 7 Ibid,
p. 70.
5 8 Ibid,
pp.69-70.
5 9 Abel
Agabegyan, Inside Perestroika,
Row,1989), p. 16.
6 0 Vladimer
Linov,
Chief Architect
(New York,
at Lenniitag,
Harper &
(June 10,
1990).
of Territorial Demands of
Baranov, "Estimate
Leningrad Population in Construction of Individual Houses
and a Sociological Survey of the Possible Contingent of
Individual Developers [sic]," (March 1989).
6 1 Albert
62
A.
Krivov,
Deputy
1990).
(April 23,
Chairman
of
Goscomarchitecture,
6 3 Michael
Berezin, Research Director
at Lenniitag, (June 9,
1990).
Dreams, (New
6 4 David
Shipler, Russia: Broken Idols, Solemn
York, Penquin Books, 1989), pp. 71-72.
6 5 Ibid,
66
73.
p.
p. 72.
Ibid,
D . Andrusz, Housing and Urban Development in the
7.
(Albany, SUNY Press, 1984), p.
6 7 Gregory
USSR,
6 8 David
Dreams,
Shipler, Russia: Broken Idols, Solemn
302.
York, Penquin Books, 1989), p.
6 9 Hedrick
Smith, "Inside
(New
(Boston, WGBH,
Gorbachev's USSR,
1990).
7 0 Marquis
Custine, Empire
du
pp. 300-301.
1989),
Doubleday,
of
the
7 1 David
Shipler, Russia: Broken Idols, Solemn
88.
York, Penquin Books, 1989), p.
72
Francine du Plessix Gray,
34.
York, 1989), p.
7 3 Ibid,
7 4 Helena
pp.
(New
Czar,
Soviet Women,
Dreams,
York,
(New
(Doubleday, New
55-56.
Steinbach,
Sociologist at at Lenniitag,
1990).
70
(June 10,
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the
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Steinbach, Helena.
10, 1990).
Sociologist at Lenniitag.
(June
Tovbeen, Alexander. Chief Architect of Lenproject,
(June 12, 1990).
above formal interviews various
In addition to the
those
Among
conducted.
were
interviews
informal
interviewed on an informal basis were: Anna Maslennikov, a
Linguist at the University of Leningrad; Tatiana Gurkina,
Lenniitag; Helena Pesotskaya, Chief
an Economist at
a
Sergejevitch,
Dimitri
Lenniitag;
at
Economist
cooperative business owner from Estonia; and members of
two families from a home-building cooperative in the
Leningrad region.