Wednesday, December 16, 2009

Yegor Gaidar, 1956-2009

A brief personal anecdote: I did one consulting gig in Russia, back in 1995 during the rush to privatization. My brief was bankruptcy law. I remember how, tucked away in a tiny and poorly lit office, I told my American interlocutor: look, I cannot begin to tell you what kind of bankruptcy law you want unless I know how you collect a debt in Russia now. My interlocutor turned to his Russian "expert;" after a brief exchange in Russian, he turned back and said: "she says they don't have any collection law now; if you need to collect a debt, you just get together a bunch of your friends and go get it."

Such was my brush with "shock therapy," the swift and painful program of transistion from socialism to a market economy imposed in Russia after the fall of communism, under the leadership of, among others, Yedor Gaidar, whose death is reported today . News stories say he died of "complications following a blood clot," but if this story sticks, then there are bound to be conspiracy theories, and I will cheerfully join them. As co-architect-in-chief of the Russian transition to capitalism in the 1990s, Gaidar certainly had plenty of enemies, high and low. Forget about tiny and poorly lit offices: just walk the streets of Moscow back in those days and see the babushkas hawking Mars bars outside the the subway stations in the snow, and you could understand that not everybody saw virtue in the program of mass privatization that Gaidar espoused. There were plenty of others, not so directly harmed, who argued at least in hindsight that Russian privatization moved to quickly, with too little attention to the creation of a legal infrastructure. Proponents of market reform stayed mostly unapologetic: you had to grasp the moment, they said; any other scheme would have become bogged down and come to naught [but for some subtle second thoughts, go here].

But like it or not, the fact remains that Russia was and remains a Wild West show, with huge rewards available to those willing to take huge risks, and where players cannot be certain that they will die quietly in their own beedr. Gaidar himself appears to have been the victim of an attempted poisoning in Ireland in 2006, just a day after a Russian dissident was poisoned in London.

Gaidar himself exercised real political power for just a brief moment at the height of the transition. Like market liberals everywhere, his program was attractive enough to win him attention in the western press, but never enough to compel any more than a rump minority of voters.

Gaidar seems to have taken the decline of his influence in stride. He continued to write and speak about Russia and the cause of market reform. Russian Prime Minister Vladimir Putin and President Dmitri Medvedev uttered kind words in his memory this morning--perhaps easy enough, now that he is safely dead. It would be interesting to know how the real Putin, unbuttoned or under truth serum, thinks about the task of market reform, flawed or otherwise.

An Economist obit of Gaidar is here. DeLong has a brief personal remembrance here. "Chris" in DeLong's comments links to a postmortem on shock therapy by Gaidar himself.

Update: here's a striking personal tribute that suggests we need to seek no conspiracy theory, and that casts doubt on my suggestion that he took his decline from power "in stride" link.

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