Soviet Economic Crisis: Prelude to United Europe?
Plain Truth Magazine
January 1986
Volume: Vol 51, No.1
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Soviet Economic Crisis: Prelude to United Europe?
Keith W Stump  

The Soviet economy is in trouble. The political — and prophetic consequences are major!

   IN Moscow, the feeling is growing that the Soviet Union is rapidly nearing a turning point.
   The reason?
   A seriously sick Soviet economy.
   While there is no immediate danger of economic collapse, the dismal picture presents a major challenge to Soviet planners charting the nation's fiscal future. The Soviet Union's economic system is sliding deeper and deeper into trouble, and no one is sure what can be done about it.
   Soviet economists are warning that major adjustments will have to be made or the whole system will be seriously threatened.
   How the Soviets respond will be a major test of Moscow's mettle under new leadership. And the ramifications could extend far beyond Soviet borders, Bible prophecy reveals!
   An example: A severe Soviet economic crisis could have major consequences for the communist bloc countries of Eastern Europe, now under Soviet domination. The face of the European continent could be radically transformed as a result. The European balance-of-power structure would be shattered, laying the groundwork for a New Europe and the fulfillment of major Bible prophecies!

Trouble Down on the Farm

   The U.S.S.R. has a slightly greater population than the United States. It has more than twice its territory. Yet the Soviet Union has a gross national product (GNP) little more than half that of the United States. Why?
   The Kremlin has long claimed that its economy is healthy and that its national budget runs a substantial annual surplus. But Western economists have determined there is actually a considerable Soviet budget deficit. which is masked by what the analysts tactfully call "creative accounting." The Soviet Union, moreover, has the world's third-largest foreign debt, owing the West some US $30,000,000,000.
   Despite official disclaimers, inflation is also a consistent problem in the Soviet Union. And the Soviet economic growth rate is down. Real growth for the rest of the 1980s is projected by Western analysts to be about 2% per annum, which is about 40% below the Soviet growth rate in the 1970s. Some analysts even believe the Soviet economy has ceased to grow in real terms.
   It is no secret that the Soviet Union provides its people with one of the lowest living standards among industrial nations. What is more, living standards have all but stopped rising. And still harder times may yet lie ahead.
   Especially grim is the picture in Soviet agriculture. The monumental inefficiency of the Soviet system of collectivized agriculture, coupled with dismal harvests stemming from adverse weather conditions, has rendered it impossible for the Soviet Union to adequately feed its own people. This despite the fact that half its citizens still work on farms!

Trouble in the Oil Fields

   Other economic problems include declining labor productivity (now down to only 55 percent that of the United States), a serious labor shortage (because of the country's low birthrate), and growing shortages of energy and raw materials (Soviet resources are increasingly less accessible, locked in the frozen wastes of Siberia).
   Declining production of oil — the chief Soviet export — is of special concern. Production has peaked at 12 million barrels a day and is heading slowly downward.
   Compounding these problems is the huge Soviet military buildup. According to publicly announced figures, the Soviet military budget in 1985 totaled US $23,000,000,000 or 4.9 percent of the entire budget. Western military experts contend that actual Soviet defense spending may be two or three times higher. This, of course, places an enormous burden on the Soviet economy. It compares with 6 percent of the budget devoted to the military in the United States.
   Taken together, these factors have forced the Kremlin to awake to the fact that it has a major challenge on its hands. As Soviet planners struggle to revive their flagging economy, many are asking the fundamental question: Why is the crisis occurring in the first place?
   Not a small number of Soviet planners are centering the blame on inefficiency, rampant waste, lack of incentives, mismanagement and technological backwardness that the Soviet system seems to inevitably create in industry and agriculture. There is, in the Soviet system, no direct link among personal income, worker productivity and quality of products. No real imperative exists to improve the situation. The knotty dilemma facing the Soviet leadership is how to remedy this state of affairs without compromising basic communist principles and ideals.

Eastern Europe — Asset or Liability?

   The effects of the Soviet economic crisis will not be limited solely to increased belt tightening at home. More worrisome to Kremlin planners are the potentially wide-ranging political repercussions.
   Major consequences lie in store for Eastern Europe.
   In recent years, money-minded Soviet planners have come to realize that the communist bloc countries of Eastern Europe are becoming more of a liability than an asset. For years, Moscow has been sending vast sums (most estimates say more than US $20,000,000,000 annually) to bailout the sagging collective economies of its six East European satellites, whose combined populations total some 110 million people. But now the Soviets — themselves caught in a worsening economic squeeze — are finding it increasingly difficult to be generous to their allies.
   Most of the Russian bloc countries of Eastern Europe are facing economic stagnation. The six East bloc countries owe Western banks and governments more than US $60,000,000,000 — an enormous strain on their slumping economies. With sources of new credit from the West fast drying up, the satellites have been requesting increased aid from Moscow. Moscow, however, finds itself hard pressed to substantially boost its outlays to keep them afloat.
   Soviet economists are coming to view Eastern Europe as an increasingly severe drag on the Soviet economy, draining scarce resources at the expense of the Russian people. The money and goods being shipped to Eastern Europe have become a source of growing bitterness to hard-pressed Russian workers.
   The Kremlin has been pressing its allies to assume a greater share of their own financial burdens. The long-standing oil price subsidy to its East European associates has already been virtually eliminated by Moscow. The conflict between East European economic interests and those of the Soviet Union will be a major topic for discussion at the coming Communist Party congress in Moscow in February.

The Implications

   Highly placed observers believe this growing crisis in the Soviet Union might one day soon persuade the Soviet political leadership that it can no longer afford the luxury of maintaining satellites in Europe. They foresee a time just ahead when economic pressures may force the Kremlin to cut loose the cumbersome weight on its western flank — lest the 'Soviet Union itself go under in a sea of red ink!
   In this age of intercontinental missiles, the nations of Eastern Europe no longer adequately fulfill their original function as a security buffer for the Soviet Union anyway. Couple this with the severe strain they place on Soviet financial and military resources. Eastern European satellites, therefore, may soon find themselves dumped by a desperate Kremlin struggling for economic survival!
   Such action might well take the form of a Soviet — initiated political deal with the West: a complete withdrawal of Soviet military forces from Eastern Europe in exchange for the withdrawal of American troops (today numbering 300,000) from Western Europe. Such a proposal would likely find favor with the increasing numbers of Americans who would like to strike from the overburdened U.S. budget the enormous cost of maintaining U.S. servicemen in Western Europe and with many West Europeans who are disillusioned with America and desirous of doing more for themselves in the way of defense.
   The resulting political vacuum might then be filled by a new entity — an association of East and West European nations in a new era of all — European cooperation! The countries of Eastern Europe would become free to exercise their right of self-determination. In view of their historical and cultural links with Western Europe, they would undoubtedly seek to associate themselves with an evolving West European union.
   This would effectively end the political division of the Continent that has prevailed since 1945. Even the long-delayed reunion of divided Germany might be achieved within such a framework of general European reunification.
   The nations of Western Europe have much to offer those of Eastern Europe in the way of economic aid and consumer products, and eager East Europeans know it.
   Even the Soviet Union itself might then seek greater economic cooperation with the nations of Western Europe. Already, reform minded Soviet leader Mikhail Gorbachev has indicated he wants to pursue more productive initiatives with Western Europe. Conceivably, some sort of new Rapallo-type economic and diplomatic pact might eventually be hammered out between the U.S.S.R. and the evolving European union.
   Now consider the far-reaching prophetic implications.

Revived Roman Empire!

   The above events would, in short, create the circumstances necessary for the prophesied emergence of a United Europe, proclaimed for more than 50 years by this magazine.
   Bible prophecy reveals that an end-time revival of the ancient Roman Empire will once more arise in Europe. This confederated Europe will rapidly become an immense economic, political and military power — a Third Force in world affairs, a superpower in its own right. This powerful union, prophecy tells us, will be composed of "ten horns" — meaning 10 nations or groups of nations (Rev. 17:3).
   Notice further that the ancient prophecies of Daniel picture this system as a human image standing on two legs. The original Roman Empire was broken into two "legs" — the Eastern Empire at Byzantium (Constantinople) and the Empire of the West centered at Rome. Thus it is probable that the coming reconstituted Roman Empire will also be composed of two distinct yet cooperative parts: one comprising nations of Western Europe, the other incorporating nations released from Soviet dominance in Eastern Europe.
   Moreover, the 10 toes of the image of Daniel's prophecy (Dan. 2:41-43) correspond to the 10 end-time national units described as "horns" in Revelation 17. These 10 entities constitute a political system that will dominate the Western world and will exist at the return of Jesus Christ, when he will establish the kingdom of God on this earth and bring us peace at last (Dan. 2:44, 45).
   Given the fact of five toes on each foot, it is possible that five entities will come from Western Europe. and five from the East. That the toes are described as being composed of "iron mixed with miry clay" indicates an imperfect adhesion. Will this be the result of countries of Eastern Europe retaining some aspects of communist economic practice?

Role of Religion

   Religion is also destined to play a major role in loosening the Soviet grip on Eastern Europe and inspiring enthusiasm for European unity. The religious and nationalistic fervor being stirred in Eastern Europe by a Polish Pope is already troubling the Kremlin. The Pope's voice is a source of enormous influence in that region. Many East Europeans have caught his vision of a pan-European alliance against the secular materialism of our modern. age.
   In recent years, Pope John Paul II has spoken frequently and forcefully about the "spiritual unity" of Europe, and has appealed for Europeans in both halves of the Continent to "revive your roots." The cultural, religious and political implications are obvious. As one news commentator plainly observed during one of the Pontiffs visits to the East: "The Pope has undertaken the liberation of Eastern Europe." Not surprisingly, Bible prophecy reveals that the coming confederated Europe — like the medieval Holy Roman Empire — will be a powerful church — state union, not merely a mercantile arrangement.
   Many European political figures and leading churchmen are publicly expressing their belief that a revived alliance between church and "empire" may be the key — the only key — to European survival in the face of Soviet — U.S. confrontation. The Roman Catholic Church is pushing its historic role of attempting to cement together the diverse peoples of the Continent.
   The stage is being set! Events are moving inexorably in the direction of European reunification. What is transpiring today on both sides of the Iron Curtain are the first steps in the refashioning of Europe into a new, yet old, alignment. As George Bailey suggests in his perceptive book Germans: "Can we be sure that history has written finis to what was perhaps the grandest design ever conceived by man: the Holy Roman Empire?"
   Forces already have been set in motion that will revolutionize the face of Europe. A powerful New Europe is on the horizon. Bible prophecy is about to be fulfilled, with astonishing consequences for Protestant Britain and the United States.
   The coming restoration of the Roman Empire will astound the world! Europe — a United Europe, East and West — will once again be a power to reckon with!

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Plain Truth MagazineJanuary 1986Vol 51, No.1