Gorbachev Delays Economy Reforms : Soviet Union: The Kremlin heeds warning by conservatives. Radical changes are postponed until next year. Social revolt is feared.

Soviet President Mikhail S. Gorbachev, warned by conservatives that he was risking social upheaval of revolutionary proportions with plans for radical economic reforms, is slowing the pace of change but maintaining his goal of establishing a “regulated market economy,” his spokesman said Monday.

Most of the reforms, including sharp increases in consumer prices and extensive privatization of the Soviet Union’s state-owned industry, will be deferred until next year, presidential press secretary Arkady A. Maslennikov said, and then undertaken only when low- and middle-income families have been protected from sharp drops in their standard of living.

Top Soviet officials, including Gorbachev’s senior economic advisers, had said the first steps would be taken by May 1 and that quick, sharp moves were necessary. But Maslennikov told a Kremlin briefing that the government will concentrate this year on reducing inflation and the economy’s chronic shortages and use the additional time to develop the reform program.

“This year, we shall aim to stabilize the market, and 1991 will be the year of the beginning of reform,” Maslennikov said. “It is unrealistic to say that all our problems can be resolved in the year and a half to the end of 1991, but we should have our parameters worked out by then.”

Plans presented to the new Presidential Council at two meetings this month called for the whole reform program to be presented to the Supreme Soviet, the country’s legislature, on Wednesday, with initial moves to be made next week.

Most of the measures were to come into effect on July 1, and the economic transition was to be complete by 1993.

“These shocks are unacceptable because the situation in the country is difficult, if not to say tough,” Maslennikov said, acknowledging that the government retreated from the timetable when it reassessed its high social cost.

“To ask people to make such serious sacrifices would not only be morally wrong but also unwise from every standpoint, including the political one.”

The government’s stabilization effort this year will attempt to withdraw surplus money from the economy by selling shares of stock in state enterprises, issuing high-interest bonds, selling apartments and construction materials for new housing and related measures.

But there apparently was so much dispute over the other measures that the balance of the program, including the timetable, remains unsettled, and most of the necessary legislation, perhaps as many as 18 new laws, will not be introduced until the autumn.

Radical reformers, including Nikolai Y. Petrakov, Gorbachev’s own economic adviser, and Stanislav S. Shatalin, a member of the Presidential Council, had argued for bold and immediate action, criticizing the measures of the past five years as so timid that they only worsened the situation.

With this approach in mind, a team of 60 economists and other social scientists has been preparing a comprehensive set of reforms, most of which require legislative action but some of which Gorbachev could implement by presidential decree. Most these will now be put off until Gorbachev can win support for them within the party at its July congress and among the people.

“No one had set a fixed period of weeks or months for this program,” Maslennikov said, ignoring the timetables laid out publicly by senior government economists over the past two months.

From Maslennikov’s remarks and those of leading party and government officials, the radical reformers appear to have suffered serious reversals in the intense politicking now under way over the future of the country.

Vadim A. Medvedev, the party secretary for ideology, told a conference of other party ideologists Monday that, despite the trend away from Marxism-Leninism and communism as the country’s theoretical underpinning, ideology remains decisive and should not abandoned or ignored.

He called on the ideologists to halt the growing panic within the party’s ranks and to fight efforts to divide it.

Prime Minister Nikolai I. Ryzhkov, meeting with worker representatives from the Tyumen oil fields in western Siberia, harshly criticized the government bureaucracy for failing to supply the region with sufficient food and consumer goods and to improve living conditions there.

Promises had been made in March to avert what would have been a crippling strike, one that would shake the whole economy and perhaps the country’s stability, Ryzhkov reminded officials, and these commitments were not being met.

For the past two months, the Communist Party’s resurgent conservative wing, citing such worker unrest, has been warning that the sharp departures from traditional Marxism entailed in the planned move to a market economy would split the party on the eve of a pivotal congress, which opens here on July 2, and thus undermine the broader reform effort.

As the full impact of the reforms became clear--consumer prices doubling and trebling, unemployment running into tens of millions with plant closings, a new property-owning, entrepreneurial class emerging--more dire warnings came of possible, even probable worker revolts and widespread social upheavals.

“They approached the edge, looked over and were horrified by what they saw,” a senior Soviet editor said of the intense government debate over the reforms during the past three weeks. “They did not pull back in a panic but out of a real fear of what could happen.

“The anger, the frustration are already there, and a few sparks could set quickly off the proverbial ‘prairie fire’ in this revolutionary tinder. . . . Well, carrying out these reforms in a quick shock would be like turning a blow-torch on.”

Maslennikov said that, while the government remains committed to accelerating and broadening its economic reforms, there will be no “shock therapy” despite the published outlines for a program similar to that undertaken by Poland’s Solidarity-led government to establish a market economy there.

After much debate, the government had concluded that the economic transformation has to be carried out without “large social shocks,” Maslennikov said.

High levels of unemployment are “unacceptable to socialism,” he continued, and steps to bring Soviet prices into line with real production costs and international prices, thus ending the heavy subsidies for many consumer goods, have to be “coupled with measures that guarantee the social security of the population.”

“The principle of ‘Let the strongest survive’ is not acceptable to us,” Maslennikov said, “but we do need to rid ourselves of the mentality of social dependency, which it has a very negative impact.”

The planned economic transformation must take the country’s present administrative system into account, Maslennikov said, dissociating Gorbachev from radical reformers who hoped that the new measures would bring a complete and immediate break.

“It is necessary to get rid of it, but it is not good sense and even dangerous to ignore it,” he said.

Gorbachev’s resolve to proceed to bolder reforms may also have been weakened by the country’s deteriorating economic performance and the contention by some that this must be reversed before proceeding.

The Soviet gross national product, the value of all the goods and services here, dropped by 1% and industrial output by 1.2% in the first quarter of this year, compared to the same period in 1989, according to government figures.

The national income, the best overall indicator in a socialist economy, shrank by 2%, and labor productivity, another critical measure, dropped by 2.2%.

Inflation has continued to soar. While officially estimated at 8%, it probably is far higher--the gap between the country’s declining output and increasing incomes jumped 14% in the first quarter of the year, and the State Bank issued 26% more money than it did in the first three months of 1989.

A BEARISH PICTURE--Soviets question CIA estimates of their economy. A13