ABSTRACT
A tacit 'social contract' governed the Leonid Brezhnev regime's relationship with its working class. According to the terms of the contract, the regime provided full and secure employment, egalitarian wage policies and lax performance pressures in industry, state-controlled and heavily subsidised retail prices for essential goods, and socialised human services. This chapter argues that Mikhail Gorbachev's attempt to make a new 'social contract' failed. Gorbachev's reform programme called for modernisation and technological changes which would require large-scale shifts in the structure of the Soviet labour force, shifts which would displace large numbers of workers who were long accustomed to job security. Gorbachev himself, always on the defensive about the prospect of unemployment, repeatedly stressed that millions of existing vacancies in Soviet industry were available to absorb released workers. Nevertheless, for a few months in the autumn of 1988 the Gorbachev leadership oversaw enforcement of financial measures which pushed scores of enterprises to the brink of collapse.
