The day Russia adopted the free market
In the early 1990s, there was this brief window of time when a new democratic government in Russia hoped to revolutionize the country. They wanted to build a new system, marked by freedom, democracy, and a vibrant, market economy. But, in the aftermath of the Soviet Union, Russia faced an economic crisis and a monumental challenge in leaping from communism to capitalism. Which is in part why they reached out to the American economist Jeffrey Sachs.
Sachs offered a playbook, popularly known as "shock therapy." While his playbook seemed to have worked in Poland just two years before, the reforms in Russia did not go as planned. Almost immediately, a chorus began blaming "shock therapy" for Russia's rocky transition. But Sachs says what happened in Russia wasn't his playbook at all. Today, he joins the show and tells us his story. We get his view on what went so spectacularly wrong.