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Russian Reforms

LIKE shifting sand dunes, economies are constantly changing. Usually little can be done about it; attempts to block change are houses built on sand, creating economic distortions that will one day have disastrous consequences.

The Soviet Union's Marxism-Leninism was an attempt to create an economy that would respond only to direction from the center. Prices were fixed with little understanding of the cost of raw materials and labor and no regard to supply. Thus the nation was flooded with cans of tinned fish no one wanted, while black-marketeers literally bought the clothes off Finnish tourists' backs, so sought-after were modern fashions. The price of basic foodstuffs was kept artificially low, but little was available except from the same black-marketeers who now form the ''Russian'' mafia.

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So when Boris Yeltsin took the lid off prices, it was like blowing up the dam that holds back a mighty river. After a destructive flood, the flow seeks its natural level. In Russia, inflation fueled by bad monetary policy wiped out savings and left those on fixed incomes, mostly the elderly, in dire straits. But application of market principles and norms of international finance has brought inflation to a more-manageable level, and the first glimmers of hope for economic growth are now visible.

That is, unless they are squelched by the political temptation to return to a controlled economy. Trying to outflank resurgent Communists in Russia's presidential campaign, Yeltsin's ministers are now making noises about renationalization. Yet, as noted in a Monitor opinion column on Mexican economic reform last week, the road to a better economy lies in further market reform, not in a return to the chimeras of the past. Russia's problem is not too much privatization, it's not enough privatization.

Like the drifting sands that bury houses, the ''hidden hand'' of the market can be an unkind force. The right kind of government programs can help protect a society's vulnerable from its worst effects. But enough experience has accumulated in the past 200 years to make it clear that prosperity comes from letting the market have its way - not from doomed attempts to block it.

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