One explanation for Russia's catastrophic financial crisis would begin by evoking the Byzantine Empire and its influence on the ancient Russians to demonstrate that their economic culture was always statist, even under the Tsars. That is why they do not know how to run a stable and successful free-market economy, in spite of all the good advice and all the billions of dollars of loans they have received from the West. Another would merely note that 'Arabian light', the petroleum that sets the base price of all forms of energy throughout the world, is selling for $10.11 cents a barrel, the lowest it has been since the Great Depression of the Thirties, taking inflation into account. Prices of other commodities exported by Russia are just as low, beginning with gold at $283.15 an ounce. The advice the Russians have received since the fall of Communism has, in any case, often been dubious and always contradictory. As for the billions of dollars, South Korea's 1997 emergency loan package was more than twice as large as Russia's earlier this year.

LRB 17 September 1998 | PDF Download