Shocking Mother Russia: Democratization, Social Rights, and Pension Reform in Russia, 1990–2001

Myroslav Shkandrij is head of the Department of German and Slavic
Studies at the University of Manitoba. He is the editor of The Cultural
Renaissance in Ukraine: Polemical Pamphlets, 1925–1926.

Russia’s shock therapy began around 1992. Rapid and simultaneous
reforms were applied to privatizing the economy and stimulating economic
growth. Consumer prices soared while collected revenues fell. The
old-age pension system became a major casualty. As President Yeltsin and
parliament remained deadlocked, the new Russia saw its social welfare
system unravel. The declining superpower struggled to institute reforms
in its convoluted federal system of 89 republics and regions, while
anger mounted among its older citizens, who saw their savings wiped out
and their social safety net disappear.

The Bolsheviks had initially been ambiguous about creating a universal
system. Only in 1956, after Stalin’s death, did a universal pension
system mature. It was established in large part because of the sense of
entitlement felt by a population that had fought in the war. However,
the system was always troubled. The percentage of Soviet citizens over
60 was 6.8 in 1939, 13.3 in 1975, and 20 in 1985. The cost of pensions
in the state budget jumped from 7.1 billion rubles in 1960 to 45 billion
in 1985. Yeltsin’s popularity sank at the same time as Gennadii
Ziuganov’s Communist Party of the Russian Federation received
increased support from the large army of pensioners.

In 1999, President Vladimir Putin brought a populist rhetoric to the
discussion of pensions when he stated that the government had “not
fulfilled its moral duty to the pensioners.” This language indicated
the government’s realization that broad support was required if any
further reforms were to be introduced. In the ensuing years, old-age
pensions became a top priority and a market-oriented reform plan was
passed by parliament.

Chandler’s most interesting conclusions concern the importance to
Soviet citizens of national history. In the 1990s, not only most older
people but broad layers of the population were aware that the social
welfare system had been expanded in the aftermath of the Second World
War. This was widely interpreted as the government’s recognition of
citizens who had participated in the war effort. For this reason, the
system’s demise was seen as the breaking of a social contract, and was
linked to an offended sense of national patriotism.

Shocking Mother Russia traces the pension system’s roots in the past,
particularly to 1956, but focuses on the repeated crises of the 1990s.
It examines how political factors and major policy reversals delayed
reforms to the system. There is little mention of developments after
2001 and few clues as to how the new system is working. The author’s
main interest is in the political manoeuvring and the debates in Russia
during the Yeltsin era.