Revolution 1989

by Victor Sebestyen

  In 1983, the country reached a point when it could barely meet the payments. It was bailed out through the good offices of an unlikely figure: the right-wing Minister-President of Bavaria, Franz Josef Strauss, who had been West Germany’s aggressive Defence Minister when the Berlin Wall was built. For decades Strauss had been vilified by the GDR regime as an ultra-reactionary warmonger who was trying to obtain a West German nuclear bomb. Honecker himself described him as ‘a militarist who would not stop at marching through the Brandenburg Gate to recapture Berlin’. Now Strauss acted as a go-between to help arrange a US$ 1 billion credit from a consortium of West German banks so that the GDR could make ends meet. On this occasion Honecker agreed to pay a political as well as a financial price. Part of the deal, which the FRG undertook to keep confidential, was an agreement by the GDR to let 35,000 East Germans emigrate to the West. Strauss was presented as an honoured guest at Honecker’s beloved hunting lodge in Thuringia, Werbellinsee.

  The negotiator on the Eastern side was one of the most curious figures to emerge from Soviet-style communism. Alexander Schalck-Golodkowski was a spiv on an epic scale who ran an alternative and highly secret ‘other’ economy on behalf of the East Berlin regime for which it did not have to account. Golodkowski, born in 1932 to Russian immigrants in Berlin, was adopted when he was eight by a German family called Schalck - hence his double-barrelled name. He started work for the Ministry of Trade in a low-grade post. But he was spotted early as a creative accounting talent and also as a discreet, politically reliable and highly sophisticated young man. He was the brains behind the Bereich Kommerzielle Koordinierung (Bureau of Commercial Co-ordination), known as Ko-Ko. It was charged with earning foreign currency outside the normal planning system, and Schalck-Golodkowski was given extraordinary freedom of manoeuvre. It started as a way for the East German elite to fund their elaborate lifestyles and buy Western goods unavailable to all but a few of their compatriots. It soon became the method by which the GDR tried to plug the gaps in the myriad failures in its economy. Towards the mid- 1980s, East Germany entirely depended on Ko-Ko to raise enough convertible currency to remain solvent from week to week. As Manfred Seidel, one of the men who signed Ko-Ko’s cheques, said, it was the organisation’s task ‘to employ all available means to create foreign currency for the GDR. To that end, no legal restrictions were to be taken into account. That was the case at home and abroad.’12

  Ko-Ko’s work was technically supervised by the Stasi, where Golodkowski was given the rank of General. But only three other men knew the main details of his dubious transactions: Honecker, Mielke and the GDR’s industry and finance chief, Günter Mittag. A huge, bulky, cheerful and gregarious man, Golodkowski operated as an entrepreneurial freebooter, with enormous success. He set up 2,000 fictitious accounts and hundreds of fraudulent front companies in East and West for stock-market deals, gold and precious gem transactions and commercial speculations of all kinds. Golodkowski ensured that the elite always had plenty of cash in hard currency at their disposal. Honecker had an account, number 0628, at the Deutsche Handelsbank in East Berlin, which always had to contain at least one hundred million Marks. But he did not always use it entirely for himself. One year he sent forty million Marks’ worth of grain to help the Sandinistas in Nicaragua. Another, a shortage of apples and bananas in the GDR produced discontent outside food stores among consumers fed up with the limited choice of fresh food available. Honecker wrote a personal cheque for two million Marks for the importation of fruit.

  Some sources of Ko-Ko’s funds were cruel and criminal. Golodkowski ‘persuaded’ the curators of certain museums and galleries to reclassify some of their treasures as ‘not worth keeping’. They were then sold in the West. More than 600 pictures from the Dresden collection went missing in the 1980s. The Stasi confiscated some paintings and ceramics known to be owned by individuals, which were then sold in the West. The owners were handed huge and fictitious tax bills they did not owe - and told to hand over a painting or valuable antique in lieu of the tax demand.

  The East’s relationship with Franz Josef Strauss continued, typically with a bizarre business venture. Golodkowski met Strauss to negotiate a deal involving the brothers März, who ran a huge meat company in Bavaria. They bought mass deliveries of cheap pork and beef from the East, which never went through any books in either the East or the West. Payments were made by the millionaire butchers in hard currency which the head of Ko-Ko took home personally in a briefcase.

  Golodkowksi’s conscience remained relatively clear. East Germany could not have continued in the style to which it became accustomed, without him - or someone like him. ‘It was only my job. I had to get Honecker his tailored suits,’ he said.

  THIRTEEN

  LENIN’S APOSTLE

  Moscow, Thursday 4 April 1985

  WITHIN DAYS OF HIS ACCESSION , Mikhail Gorbachev showed himself to be a new kind of Kremlin leader. His first high-profile campaign, launched three weeks after he took office, was a dramatic drive against a besetting Russian vice: booze. It was a noble cause, worth fighting for, and he went ahead with optimism, vigour, passion, a measure of priggishness and - at the start - clever political salesmanship. The campaign had far-reaching consequences, unforeseen by him, that precipitated a crisis almost as serious as the one he tried to solve. It was typical of the way he was to govern for the next six and a half years.

  Russia’s appalling drink problem has been a national disease for centuries, as Pushkin, Dostoyevsky and Tolstoy testified. It was probably worse than ever in the late twentieth century, though there are no accurate figures about vodka consumption during serfdom. Now in the late Soviet era there were forty million officially recognised alcoholics in a population of around 270 million. That figure was sure to have been an underestimate. The ascetic Yuri Andropov had made a token effort to reduce alcoholism, but the task defeated him. On the whole, the Communists over the decades had done little to address the issue, even though it was the workers and the poor who suffered the most. Successive regimes reckoned, as the Tsars did, that a nation anaesthetised by alcohol was likely to be politically compliant. In 1984 more than nine million drunks had been picked up off the Soviet Union’s streets. The premature deaths, absenteeism, crime, poverty, ruined families and misery caused by alcohol were to be seen everywhere.

  The new man in the Kremlin was determined to do something about them. Gorbachev summoned a group of key Party power-brokers on 4 April 1985 and simply announced what he had decided, leaving little room for argument. It fell short of outright prohibition, but not by much. He trebled the price of vodka. Beer and wine production was reduced by nearly three-quarters. A faint note of caution was expressed by Vladimir Dementsev, the Finance Minister, who warned that income to the state would be reduced and the proposal would leave a black hole in the national budget. He came prepared with figures - it would cost four billion roubles that year and fifteen billion within five years. Gorbachev barely let him finish: ‘What you’ve said is nothing new. We know there’s no money to cover it. But you’re not proposing anything other than to keep people drunk. Do you propose to build Communism on vodka?’

  That was the end of the debate. The measures went through and Gorbachev pursued his course with determination - but to disaster. There were huge queues outside the liquor stores and a thriving black market in vodka was created overnight. The biggest problem was home-distilling of various types of hooch. Sugar disappeared from the shops and had to be rationed. The financial black hole Dementsev warned of was even deeper than he had projected. The death rate shot up from consumption of poisonous home brews. Historic vineyards, mostly in Georgia, were destroyed and never recovered. After three years Gorbachev admitted he had made a mistake and abandoned the alcohol campaign, but the damage had been done.1

  The launch of the alcohol campaign was less of a shock to the old-timers who had been in comfortable office for so long than another initiative Gorbachev proposed at that same meeting. He must have had in min
d the years of toadying and sycophancy he had endured in the Brezhnev years when he made a second announcement, apparently casually, but which was carefully pre-planned. As he was gathering up his papers to return to his private office in the adjoining room, he said: ‘I ask Comrades to wait a minute. I would like to exchange opinions on . . . the need to struggle systematically against ostentation, arrogance, vainglory and bootlicking.’ He went on to say that he hoped at the highest levels of the Party there would be fewer high-flown banquets, fewer medals displayed on chests and altogether more modesty. The others - some wearing honours proudly even at the meeting - left the room looking aghast.

  Gorbachev was the first Soviet leader who went on regular public walkabouts to meet the people and be publicly seen. He was good at pressing the flesh, better there than at larger formal gatherings where often he was inclined to be verbose and retreat into dreary, unintelligible Marxist-Leninist speak. In front of huge applauding crowds, his personality shone through; he appeared relaxed, warm, amusing, considerate, thoroughly decent. He was admired by the public and his appearances were ‘events’. It was noticed that his wife was nearly always with him, often touching him or holding his hand - normal for a Western leader, but unprecedented in the USSR. People were as intrigued by him as they were inspired.

  It was at a walkabout in Leningrad in May, a couple of months after he took power, that two terms forever identified with the Gorbachev era first entered the lexicon. Perestroika and glasnost became buzzwords throughout the world. In Russian they have specific definitions. When Gorbachev used them they meant whatever he chose them to mean. Gorbachev never wanted to abandon communism. He thought it was his destiny to save communism and purify it. In its early days perestroika - ‘restructuring’ - meant a process of fairly modest reforms to improve workplace discipline. He launched a rush of energetic measures to allow enterprises to show more initiative and made some minor economic changes in distributing goods around the country. He removed a raft of Brezhnev cronies and bureaucrats who had shown themselves over many years to be incompetent. The KGB moved against a powerful network of corrupt magnates in the Central Asian republics and Gorbachev shook up the Party apparat in Ukraine and other regions. He made some halting steps to introduce a little more democracy into the system. He wanted to reorganise electoral lists - though still in a one-party state - so that people could choose which Communists would be elected for certain positions. But none of this was revolutionary. He had no intention of abandoning central planning, introducing a market economy, or abandoning the Communists’ monopoly of power. He wanted to ‘restructure’ everything, but without touching the foundations.

  Gorbachev believed in socialism and was convinced that Lenin had outlined the true path, but the project had gone wrong when Stalin deviated from it and ‘misrepresented’ it. That was a powerful illusion he and many Communist true believers shared. Perestroika, Gorbachev thought, would return to Lenin’s ideals. Gorbachev often talked of Lenin, whom he spoke of reverentially as a ‘special genius’. There was no cynicism involved. Sergei Tarasenko, a highly experienced and shrewd Foreign Ministry official, said that most apparatchiks throughout the Soviet empire merely paid lip service to the teachings. ‘It was politically correct to have Lenin in your library. If you had to . . . write a speech you were keen to find a Lenin quote . . . so you turned to the index.’ Hardly anyone any longer believed the teachings, but Gorbachev did. When he quoted Lenin, as he frequently did, it was because he thought the founder of the Soviet Union had a special relevance to his own situation seventy years on.2

  Glasnost - ‘openness’ - was also a movable feast, subject to interpretation. He began cautiously, grew far bolder later and the consequences were a transformation in the way the Soviets and the East Europeans saw themselves. Gorbachev believed that if people knew more about the way the Soviet Union worked - or was not working - they would choose to make it operate better. He said that there should be ‘no black spots’ in Soviet history, confident that if the public knew the truth they would understand the achievements of socialism as well as the mistakes and appreciate their rulers. It was typically optimistic, some would say naïve, but at least it was based on the moral principle that the public had a right to know. This was revolutionary, in a state that had been run for decades by a governing class paranoid about secrecy. The Party controlled information and employed thousands of censors to make sure nothing it did not authorise was printed or broadcast. Under Gorbachev they were still employed, but they had increasingly less to do.

  Soon after taking office Gorbachev was telling groups of journalists that they should feel free to expose corruption in high places, the failures in the system, and be open about some of the horrors in Soviet history. Slowly, cautiously, they began taking him at his word and in the Gorbachev period there was some brilliant campaigning journalism which for the first time in the Soviet Union went beyond Party propaganda and revealed a more accurate picture of the state of the nation. It was not a wholly free press, if such a thing exists anywhere. The state owned nearly all of the media, not to mention the production of newsprint, all big printing presses and the paper distribution network. Communist Party chieftains could still hire and fire editors - or even journalists lower down the chain. But it was freer than at any other time in Soviet history. Newspapers and magazines contained lively debate, an unprecedented irreverence towards powerful institutions and readers were at last provided with information they wanted to know.

  Circulation rocketed. The most extraordinary success story was Vladimir Starkov’s weekly, Argumenti y Facti. It started life in 1979 as an arcane publication for statisticians and economists, with a circulation of around 10,000. Transformed into a popular, though intelligent, paper, telling stories about the lives of ordinary people in Soviet factories and housing estates, at the high point of the glasnost reforms of the 1980s it sold thirty-three million copies. Interesting new television programmes started to be broadcast. There was still a lot of dry propaganda material but some fresh and challenging shows aimed at a young audience were being screened - for example the weekly Vzglyad (Spark), which ran well-made investigative items about such previously taboo subjects as AIDS, destitute street kids living rough in Moscow, the plight of Afghan War veterans or the untold riches (by Soviet standards at the time) earned by hard-currency call girls working in Moscow hotels. The Soviets stopped jamming foreign radio stations like the BBC World Service and Deutsche Welle.3

  Hundreds of previously banned books by some of Russia’s most gifted writers were published in the USSR for the first time. Alexander Solzhenitsyn’s work had been available only in samizdat or in foreign translation, read by a handful of intellectuals in Moscow and Leningrad and by Party bosses. Gorbachev and his wife were avid readers of ‘underground’ literature most Soviet citizens were not allowed to see. Now Solzhenitsyn’s books came out by official publishers in huge print runs and were bought voraciously by a highly literate public starved of honest literature for so long. Boris Pasternak’s Doctor Zhivago appeared legally in the Soviet Union - about twenty years after David Lean’s film version received its world premiere. The biggest popular sensation of the glasnost years was the publication of Anatoli Rybakov’s Children of the Arbat, the epic novel of Soviet life under Stalin. The decision to publish or not went all the way up to Gorbachev, who gave his approval.

  There was a renaissance in Soviet film, which in the early days of the USSR had earned a deservedly high reputation, but which had produced little of note for decades. The release of Tengiz Abuladze’s extraordinary anti-Stalinist allegory Repentance, set in Georgia in the 1930s, caused a sensation, but was handled carefully. The movie had contemporary themes and the Kremlin reformers did not want to provoke a reaction from conservatives in the Party, who were terrified by the very notion of glasnost. Repentance was not ‘officially’ released, but shown to ‘invited audiences’. Soon the producers of the film had issued so many ‘invitations’ that more than twenty-five milli
on people had seen it. Vitali Korotich, editor-in-chief of the news magazine Ogonyok (The Flame), was a major beneficiary of the Soviet Union’s new journalism. He was given encouragement from the top and was told that his reporters could write what they wanted. He thought that Gorbachev was only half-sincere about glasnost. ‘[Gorbachev] had in mind giving an old trollop a sponge bath and putting clean clothes on her, assuming this would restore her virginity,’ he said. Yet the transformations ‘openness’ produced were so radical that, whether or not the leader or his advisers had predicted any of the consequences, they became unstoppable.4

  Gorbachev wanted to make a mark on the world stage immediately. He believed the first imperative of the Soviet Union should be to avoid a further slide into confrontation with the West. He told his aides repeatedly that ‘domestic and foreign policies are totally interconnected’ - that none of the reforms he hoped to make at home were possible without ‘a more advantageous international environment’. Disarmament talks with the US had run into the sands. He wanted to restart them. Among his first decisions, less than a month after taking office, was to halt the deployment of further SS-20 medium-range nuclear missiles in Europe. For a mixture of personal, political and moral reasons he tried hard to earn a reputation as a ‘peacemaker’. But his main problem was the way the Soviet Union was perceived abroad. The diplomat Sergei Tarasenko explained:We had amassed such a negative legacy . . . that we had to free ourselves from that. The first thing we had to do was change the country’s image. We had to become a ‘normal’ country. We could no longer play the role of a rogue state. In all respects we were up against a brick wall . . . In world public opinion we were on the level of barbarians. We were feared, but at the same time no one respected us . . . We were ‘the evil empire’. We had to get out of the corner we had been driven into in respect of human rights, freedom to emigrate, Afghanistan and so on. But all we could do was snap at people. There were demonstrations against our Foreign Minister, Gromyko, everywhere. Few people read Pravda, but everyone read the New York Times. The people who read Pravda were Fidel Castro . . . and the World Peace Council, whose services we paid for.5