essentially the same. The Russian Revolution and its supposedly radical
dictatorship of the proletariatled to monolithic administrative and policy
control by thecommunist party, while in the West efficient and powerful
civil serviceshave developed and close control is exercised over the everyday
activities of businessmen, workers and others. The imperatives of planning, and
the responses of bureaucrats and planners charged with achieving particular
goals, are seen as transcending overt ideological differences between the two
societies. The thesis has its points, but probably ignores the crucial difference
between bureaucracies which are, and those which are not, subject to electoral
power. It has, however, been very influential, and is a useful corrective to the
belief that the means we use to achieve goals must be less important than the
goals themselves. In its original application, contrasting US and Soviet models,
the theory has simply proved to be wrong, because however much planning
and state power may have grown in capitalism, it ultimately became necessary
for the Soviet-style economies to be abandoned and replaced with market
economies. In fact, during the decade that led up to this economic revolution
in Soviet and Eastern European societies major efforts were also made in
Western societies to ‘roll back’ the bureaucratic and state influence in their
economies by deregulation andprivatizationof state-owned industries.
Convertibility
Convertibility is the arrangement under which the currency of one nation can
be freely sold, usually at prices determined by the market, for another currency.
As it is almost never the case that a currency cannot be sold for another in any
way whatsoever (including the illegal, black market), convertibility really
means free convertibility. Convertibility has come to be a particular problem
for the post-communist economies of Eastern Europe and the former Soviet
Union. The rouble and other Eastern European currencies were not subject to
market forces, governments fixing their external prices at quite absurdly
artificial prices. The rouble, for example, was officially valued at one pound
sterling when its black market value was not even one-hundredth of that. Non-
convertibility was more than merely setting an absurd price, however; it also
involved refusing to exchange roubles, zlotys and so on for other currencies.
Thus if a foreign government or company produced a cheque for one million
roubles and asked for US dollars or French francs in return, even at the state-
fixed price, they would be refused. The communist countries were more than
happy to sell their currencies, indeed tourists were forced to buy a minimum
amount, but would not buy it back again. This had two effects. Firstly no
country outside the communist bloc was prepared to accept payment for goods
or services in the currencies of the bloc, because the money was worthless.
Secondly all analyses of the communist economies were massively inaccurate
Convertibility