Me:
>
>In the Soviet Union in the
>1980’s, after six decades of the command economy, 57 percent of the
>population had to live on less than $10 a month.
>---
>This is complete and utter horseshit. Average Soviet wage in the 80s was
>about 150 dollars a month (one ruble to the dollar), with strict price
>controls. A loaf of bread cost 5 kopeks. Does the writer think Soviets were
>buying Ladas on an income of 10 dollars a month?
>
>Poverty did not exist in the Soviet Union.
RE: Rube to dollar purchasing power:
Ruble vs. dollar
>
>Alexander Kondorsky
>
>The history of the dollar's purchasing power in Russia is truly exciting.
>
>Contrary to what is commonly believed, the Soviet era's official exchange
>rate of 0.7 ruble for one U.S. dollar was quite reasonable and was
>effective in comparing the dollar's and the average salary's purchasing
>power both back then and now. It suffices to look at the
>dollar-per-loaf-of-bread ratio dynamics.
>
>Of course, very few Soviet people ever had dollars. After all, keeping
>foreign currency was illegal, and dealing in foreign currency was
>punishable by up to seven years in prison under the Criminal Code. Those
>Soviet people (diplomats, scientists, actors, etc.) who traveled abroad
>and earned foreign currency were obliged to exchange it upon their return.
>And not for rubles! I must admit that the Soviet authorities were generous
>enough to appreciate those who earned real money for the state. In
>exchange for dollars or other foreign currency, they were given "cheky" –
>special checks that were accepted in payment only at stores belonging to
>the Beryozka chain, which offered foreign foodstuffs and goods. "Cheky"
>were traded on the black market, and the rate was one check per two
>rubles.
>
>Now, we have grown very familiar with foreign currency, particularly with
>the dollar. Incidentally, for many Russians, at least residents of the big
>cities, the ruble/dollar exchange rate is as important as the weather
>forecast. It is broadcast many times a day on the radio and television,
>sent free to pagers, mobile phones and e-mail boxes and is available at
>numerous Web sites on the Russian Internet.
>
>Dollars held in cash are one of the most popular savings instruments in
>modern Russia, and, according to different estimates, from $10 billion to
>$50 billion reposes in people's private coffers throughout Russia. A
>popular Russian joke goes: "A New Russian returns from a trip to the
>United States and tells his friend: 'What shocked me most there is their
>money. Can you imagine, their dollars are absolutely identical to our
>bucks!'"
>
>Unlike many other economic indicators, such as gross domestic product,
>stock market index, etc., the ruble/dollar exchange rate directly affects
>the financial situation of a considerable percentage of the Russian
>population, particularly those who keep their savings in dollars and
>people employed in the dollar-dependent sectors, for example, in foreign
>companies, joint ventures, the oil and metals industries and so on.
>
>It is easy to calculate that the purchasing power of 0.7 Soviet rubles in
>terms of bread, metro rides or other staples was roughly equal to the
>purchasing power of the dollar in Russia after the August 1998 financial
>crisis.
>
>Many economists maintained that the crisis brought the ruble to its
>"proper" value in relation to the dollar. Deviations from this ratio,
>which were especially strong in the early 1990s, led to a lot of ugly
>phenomena in Russian business and the economy. Suffice it to recall how
>small companies purchased empty bottles from the population and exported
>them as scrap glass, while in 1996-1997 the country was literally flooded
>with imports that suffocated domestic production.
>
>Since 1998, the ruble has grown stronger relative to the dollar but buys
>fewer staples than 0.7 Soviet rubles. This has caused a downturn in the
>gross domestic product's dynamics and drastically slashed the real incomes
>of those who earn hard currency.
Loaves of bread/$ Metro rides/$ rubles per dollar ----------------------------------------------------------------------- Soviet era 6 14 70 kopeks Early 1990s 50 100 1,000
(before the 1,000-fold denomination) Mid 1990s 3 4 5,500
(before the 1,000-fold denomination) After 1998 crisis 6 10 25 Present time 5 5 32
>[20 Dec 2002]
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