Gorbachev quickly realized that all was not well. Most alarming was the poor performance of the Soviet economy. Soviet rates of economic growth had declined from five percent in the 1960s to two percent in the early 1970s to zero in the mid-1980s (Spanier 347). Spanier said that "capable only of producing a plentiful supply of weapons, the Soviet economy was characterized by an absence of consumer goods and food . . . harvests have repeatedly failed since the 1970s . . . the centralized Soviet economy was nearing a breakdown" (347).
Gorbachev then initiated in progressive steps his policies of political and economic liberalization at home, perestroika restructuring) and glasnost (greater openness culturally and politically), and adopted a policy of easing tensions with the West.
Gorbachev largely succeeded at first in achieving his principal foreign policy objective, which was to allay suspicions in the West so that he could reduce defense expenditures and concentrate on the reform of the Soviet economy. He withdrew Soviet forces from Africa and Afghanistan and reduced aid to Cuba and Nicaragua. By 1989 he had negotiated the principal terms of the Start Treaty and in 1990 the Central Front Europe Treaty which led, respectively, to very large mutual reductions in nuclear arms and the withdrawal of conventional forces from Central Europe.
However, the United States posed a dilemma for the Soviet Union. Through the arms buildup and strategic forces modernization program of the Reagan administration, "the Soviet Union was . . . confronted not only with a costly arms race when it needed huge capital investments at home, but also a high-tech arms race when it could not even keep up with contemporary Western technology" (Spanier 347). By 1986, the Soviet Union was spending 16-25 percent of its GNP on defense, as compared with six percent in the United States and three percent in Western Europe (Spanier 347). Some observers, s...
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