Arms Control or Bust for Soviets? : Gorbachev Insists Economy Won’t Make Them Sue for a Deal

Soviet leader Mikhail S. Gorbachev, speaking after his return from the Reykjavik summit, went out of his way to accuse Washington of wanting to “exhaust the Soviet Union economically through the buildup of sophisticated and costly space arms.” He warned that it wouldn’t work.

Although the idea may be attractive to some folk in Washington, Gorbachev is wrong to suggest that the Reagan Administration’s Strategic Defense Initiative is really a ploy to spend the Soviets under the table. By now it is obvious that President Reagan’s love affair with SDI is genuine.

However, it has become an article of faith within the Administration that Moscow’s interest in arms control springs in major part from the need to get the sluggish Soviet economy moving again.

The thesis that strategic nuclear-arms reduction would actually bring about a cut in Soviet military spending--not just a diversion of resources to other weapons programs--should not be accepted uncritically. Nobody knows. But Gorbachev’s preoccupation with Soviet economic problems is an observable fact.

Anybody discussing Soviet economic problems should be careful not to overstate the case. The United States, after all, has a low-growth economy, an out-of-control budget deficit and a staggering trade deficit in low-tech goods, high-tech goods, even agriculture. We are well on the way to surrendering global economic and technological supremacy to the Japanese. But that doesn’t mean the Soviet Union should not take us very seriously. They do.

The Soviet Union has a continental-size economy, second only to that of the United States, with a long track record of providing full employment and gradually rising living standards for the Soviet people while supporting an expansionist foreign policy and large, technologically formidable armed forces.

The fact remains that the Soviet economy is in deep trouble. The system is chronically unable to feed the Soviet people without major imports of food. Soviet industry has fallen far behind the West in computer-related technologies. The people have grown cynical about corruption in high places and they are impatient with an economic system that produces excellent missiles but can’t seem to provide stylish clothing or things like good, affordable video recorders.

Economic growth, while up a bit under Gorbachev, is slow. It now seems certain that by 1990 Japan, not the Soviet Union, will boast the world’s second largest economy. Even the Soviet military has shown signs of worry that a second-class economy won’t forever be able to support a first-class military machine.

A major problem, as Gorbachev has recognized, is that the Soviet system of economic planning and management is too rigid, insular and hostile to innovation.

The Soviet leader, looking for short cuts, has undertaken a wide range of steps to increase access to Western technology at a time when foreign exchange earnings from petroleum exports have been depressed by the fall in world oil prices.

At one level the massive Soviet espionage operation in the United States and Western Europe is aimed at stealing technology that is not commercially available.

Gorbachev’s speech at Vladivostok, declaring Soviet interest in better relations with Asian nations, was in major part the beginning of an effort to lure the Japanese into a swap of capital and technology for Siberian energy and mineral resources.

Moscow’s dramatic move to gain admittance to the current round of international trade negotiations is clearly aimed at smoothing the way for greater Western credits and easier access to Western markets and technology.

The Soviet bid met with considerable skepticism, since the tightly controlled Soviet trade system is incompatible with the free-trade principles of the General Agreement on Tariffs and Trade. Moscow’s response has been to suggest that the Soviet system could be modified sufficiently to meet GATT requirements.

This is a little hard to believe but the Soviets are plainly serious about trying. The Kremlin recently announced a seemingly dramatic loosening of controls over certain kinds of enterprises wishing to do business with the capitalists.

The jury is still out, however, on whether Gorbachev is prepared to undertake really fundamental changes in the Soviet system--or whether he can carry the Politburo with him if he is.

Extra incentives are being offered to farmers, for example, but there is not the slightest indication that the Kremlin is considering the return of the farms to private ownership. Nor has there been anything beyond lip service to the idea of allowing more small-scale private enterprise in the cities.

Gorbachev has proved himself willing and able, up to a point, to shake up the government and economic bureaucracy; a lot of heads have rolled since he took office 19 months ago. But as recently as last Friday he complained publicly that calculated foot-dragging is holding back the campaign for economic renewal.

Logic tells you that, caught in this sort of bind, one sensible step would be to cut military spending--which is roughly twice the proportion of gross national product that the United States spends on defense--in order to channel more resources into the civilian economy.

This may in fact be part of Gorbachev’s game plan. His proposal for soothing border tensions with China could ease the way for a reduction of military manpower. And his attempts to contain the American SDI program may be motivated mostly by a desire to avoid an expensive competition in “Star Wars” technology.

Assuming that is true, Administration officials are most unwise to suggest, as they often do, that the Soviet Union’s painful economic situation leaves it no choice but to come to terms on arms control. As Gorbachev’s recent speech again makes clear, that kind of talk drives the Soviets up the wall--and tends to force them to dig in their heels and demonstrate that it isn’t so.

Sometimes wisdom lies in speaking the truth softly.