PERSPECTIVE ON THE SOVIET UNION : A Choice ‘Twixt Frying Pan or Fire : The radical economic plan now being debated may be Gorbachev’s ruin, whether he opposes or supports it.

The debate over economic reform in the Soviet Union has entered its climactic phase. It is likely that Soviet leader Mikhail Gorbachev will have to accept some version of the radical program devised by his top economic advisers, despite his dimming enthusiasm for it.

The plan, named after its author, Stanislav Shatalin, is now being debated in the Soviet Parliament. It calls for dismantling the Soviet economic system and a rapid transition to a free-market economy. The timetable for the plan--500 days--is probably unrealistic, and many components of the program could eventually be derailed, leading to uncertainty and turmoil. Nevertheless, there is no question that the Shatalin plan, if adopted, will mark a decisive break with 60 years of highly centralized Soviet economic planning.

After seeming to endorse Shatalin’s plan last week, Gorbachev is now backing away. He has called for a popular referendum on one key component of the program, the private ownership of land by peasants. This could delay the 500-day plan by several months.

Gorbachev’s attitude is understandable. Whatever the plan’s economic merits, the resulting changes would have far-reaching political consequences.

Adoption of the plan would certainly lead to the resignation of the Soviet prime minister, Nikolai Ryzhkov, who wants a more gradual program retaining many of the existing state controls. He has come under attack by crowds of demonstrators shouting outside the Kremlin for his government to step down, something Ryzhkov has vowed will happen if the plan passes.

He has been a loyal prime minister for the last five years, and has often served as a lightning rod to deflect criticism from Gorbachev. There are no obvious candidates for the job among Gorbachev’s allies (except Eduard Shevardnadze, whom Gorbachev wants to keep as foreign minister). A new prime minister might be far less willing to look out for Gorbachev’s political interests.

Even more worrisome for Gorbachev is the boost that the 500-day plan would give to the political fortunes of his chief rival, Boris Yeltsin, the president of the Russian Republic. Yeltsin has supported the radical program from the outset, and it is as much his plan as it is Shatalin’s. The Legislature in the Russian Republic has already approved the plan, at Yeltsin’s urging. If Gorbachev now embraces the 500-day program, he will strengthen the political clout of the one man who has a realistic chance of dislodging him.

But if Gorbachev tries to push the Supreme Soviet to vote for a more gradual program, the political costs may be even greater. The Russian Republic, by far the largest and wealthiest of the 15 Soviet republics, will be able to accomplish a good deal on its own, regardless of what the central Soviet government wants. Moreover, most of the non-Russian republics seem likely to follow Russia’s example in pursuing radical economic reform. Thus, if Gorbachev were to hold out against the 500-day plan, he would merely expose how weak the central government has become.

This points to the broader political effect of the Shatalin plan on the political cohesion of the Soviet state. Political and economic decision-making has long been concentrated in the hands of a small group of officials in Moscow. Under the 500-day program, political and economic power would be rapidly transferred from the central government to the republics and local governments as well as to newly privatized companies.

This will hasten the dissolution of the Soviet Union in its current form. Some proponents of the 500-day plan, such as Yeltsin, have argued that the program would help hold the Soviet Union together by satisfying the republics’ demands for control over their own economic affairs. But it seems improbable that most of the non-Russian republics will be content to remain part of the Soviet Union once they have gained dominance over economic matters.

The 500-day plan may also encourage violent social unrest stemming from economic discontent. Popular expectations of economic improvement will rise once the highly publicized program has been adopted. It is questionable whether the public will be willing to put up with the austerity and hardships that will be necessary for many years to bring about genuine economic revitalization. Pressures are likely to build for immediate tangible benefits, which may skew or undercut the whole reform program.

It is true, of course, that in Poland the government has been able to impose a radical program of austerity without provoking violent unrest. But Poland has a government that enjoys genuine popular support. Poles are willing to put up with hardships and economic upheaval because they have faith in their democratically elected government.

Gorbachev, who has made sure he faces no popular vote before 1995, does not have full-fledged legitimacy in the eyes of many Soviets. This may prevent him from being able to enact the kinds of measures that the democratic government in Poland is pursuing and that are envisaged in the 500-day plan. It also may create an opportunity for Yeltsin, who enjoys great popular support, to move against Gorbachev.

In short, when Gorbachev contemplates the political implications of radical economic reform, he finds almost nothing positive. Even if he remains in office, he may eventually find himself with few powers other than in foreign policy, and there his authority could weaken with the breakup of the Soviet state.

It is little wonder, then, that Gorbachev would think hard before embarking on a path whose economic benefits are at best uncertain, but whose political costs seem all too clear. The adoption of the 500-day plan now seems inevitable, but that is because “life itself,” to use Gorbachev’s phrase, is forcing the issue.