as a people’s deputy in Gorbachev’s parliamentrnnever materialized, because thernfilters established by the election committeernautomatically rejected anyonernwhose loyalty to socialism and Gorbachevrncould be questioned—althoughrnit wisely included a handful of visiblerndissidents as a token opposition.rnThe real reason for playing the parliamentrngame was to create a body of supportrnfor Mr. Gorbachev outside the Politburornand Communist Party apparatus,rnwhich were antagonistic to perestroika.rnParadoxically, the first “democraticallyrnelected” Russian legislature had a higherrncontent of communists (80 percent)rnthan those autocratically appointed byrnStalin, Khrushchev, and Brezhnev (usuallyrnbelow 50 percent). The real choicernthe people of Russia faced at the pollingrnboxes in 1989 was between hard-linernStalinist communists and reformed andrnsoft-spoken Gorbachev communists.rnAnd so Gorbachev-style communistsrnwere elected, as well as Stalinists whornwon in rural districts where people werernhoarded into polling stations the samernway their fathers had been hoarded intorncollective farms or the dreadful gulag. Arnhandful of dissidents known in the Westrnand used by Gorbachev to give an impressionrnof legitimacy to his governmentrn(and even more important, eligibility forrnWestern foreign-aid handouts) were includedrnas token liberals. Their role inrnparliament was downplayed by its leaders.rnVice President Rutskoi and SpeakerrnKhasbulatov. These are the peoplernwhom Yeltsin asked to “cease and desist”rnon September 21 and “Wacoized”rnon October 4.rnIt was not a surprise that Yeltsin’srn”coup” was immediately denounced asrn”foolish,” “antidemocratic,” and “unjustifiable”rnby the real father of this pariiament,rnMikhail Gorbachev, and his fellowrnsocialists from Moscow to Amherst, Massachusetts.rnFor example, Stephen Cohen,rnwho is consistently wrong on anyrnissue he talks about—and thereforernprobably valued highly in certain circlesrn—was appointed the director of Russianrnstudies at Princeton University and arnCNN consultant. Given this opportunityrnto be a regular “lying head” on Russia,rnCohen commented on Yeltsin’s decision:rn”There is no more democracy in Russia.”rnWas it there before? Obviously not, butrnin Cohen’s mind, it was a socialistrndemocracy of which the people of Russiarnshould be proud. A former writer forrnthe Kommunist, the main propagandarnmagazine of the Politburo that ceasedrnpublication with the end of the CommunistrnParty, Cohen switched to CNN,rna hard-currency payer.rnThe events after the “Yeltsin coup” ofrn1993 showed that Yeltsin’s calculationsrnproved correct. Besides Gorbachev andrnWestern academic Stalinists, only a tiny,rnpathetic group of old-age Stalinists andrnteenage products of the socialist publicrnschool system supported the “People’srndeputies” in Russia. The tragic story ofrnthis second Russian Revolution tells usrnthat it is impossible to proceed graduallyrnand phase in freedom stcp-by-step.rnNumerous warnings from Western governments,rnthe IMF, and all kinds of wellwishersrnon the left against the “shockrntherapy” approach to economic and politicalrnreforms in postconrmunist countriesrnled, in the case of Russia, to “shockrnwithout therapy”—numerous hardshipsrnfor the people without any significantrnprogress on the transition to a marketrneconomy. The end of the socialist parliamentrnnow deprives Yeltsin of any furtherrnexcuses not to pursue the path ofrneconomic freedom. Only time will showrnwhether Yeltsin sacrificed the “democratic”rnfacade of his regime for the substancernof the free market.rnThat the economic situation in Russiarnis going from bad to worse is already arntautology. The Consumer Price Index inrnRussia listed the inflation rate to be overrn700 percent in the first nine months ofrn1993 instead of the “promised” 100 percent.rnThe value of money is diminishingrnso rapidly that cash is physically scarce.rnRussia does not have the printing capacityrnto keep up with demand. The budgetrndeficit exceeded 45 percent of the estimatedrnGDP. Production dropped 15rnpercent last year and continues to shrink.rnContrary to the basics of Keynesian economies,rnwe witness simultaneous increasesrnin prices and fall-offs in productionrnand employment.rnThe essence of socialism is publicrnownership, and without dismantling thisrnsystem none of the economic “reforms”rnof Yeltsin’s government will ever work.rnAt the most general level, the goals ofrnprivatization are twofold: one, to introducerna society based on economic freedomrnand the democratic rule of law; andrntwo, to increase the efficiency of the nationalrneconomy. “The acceptance of arnprivate property-based economy is—notrnunexpectedly—the last line of defense ofrnthe old order,” states Larisa Piyasheva,rnthe only visible free-market economist inrnpresent-day Russia. Fired by Yeltsin’srngovernment because of “budget cuts,”rnshe rightly believes that privatizationrnalone will not solve all of Russia’s problems,rnbut she realizes that without itrnthere is absolutely no hope for improvement.rnThe Russian government’s recentlyrnadopted program for “privatization”rnleads neither to private propertyrnnor to private ownership, but rather intendsrnto create a “mixed,” or collective,rnproperty owner, essentially leaving propertyrnrights a monopoly of the state. Thernfact that private ownership dominatesrnthe most efficient economies of thernWest points unmistakably to the economicrninferiority of “collective property,”rnleasing, and cooperatives as an ownershiprnsolution.rnProgressive taxation with an upper taxrnbracket of 60 percent was introduced,rnwhile the new sales tax rate was set at 28rnpercent. This “free market” approachrnmeans everv new reform causes perversernpublic responses and that every new lawrnostensibly passed to increase freedomrnonly increases opportunities for fines andrnbribes. Russia’s prisons, probably thernworst in the world, are still filled withrnover 100,000 entrepreneurs, most convictedrnfor commercial and business practicesrnabsolutely legal in civilized countries.rnAs popular Russian journalistrnViktor Kopin assesses the present stage ofrnthe “Capitalist Revolution” in Russia:rn”The ‘White Guard’ attack on socialismrnfailed. We have gotten a quasi-democraticrnsociety with quasi-market, quasilegality,rnquasi-morale. The predominantrnconclusion is that freedom leads tornthe devastation of spirituality, crime,rnpauperization of the masses, and emergencernof a class of fat cats.”rnThe short-term possibilities for foreignrninvestment in Russia remain quiternlimited. The business climate will continuernto be intolerably risky as long as investorsrnmust worry about economic instability,rnlack of reliable currency,rnpolitical conflicts, and uncertainty aboutrnthe future of the Russian empire. Untilrnthe Kremlin adopts civilized practicesrnand laws on investment, the prospectsrnfor joint ventures and similar forms of cooperationrnwill remain grim. Yeltsin’srngovernment has chosen (or was forced tornchoose by the hard-liners in parliament),rnthe least daring, least radical of the reformrnoptions available. As my formerrncolleague at the Russian Academy ofrnSciences, Yevgeni Yasin, admits, “Therninfluence of politics on the economy hasrn42/CHRONICLESrnrnrn