Economic problems in Eastern Bloc

[bailey_187]

so ML's of course always point out the economic sucess in the growth rates of the Stalin years, early years of Socialism in Eastern Europe and these regimes ability to provide necesities for their people such as health, education, jobs and housing.

But the crisis the Eastern Europe states started to face in the 70s/80s never seems to be adressed. it seems to be just ignored

the Eastern Bloc began seeing a decline in growth rates in the 70s. Due to cheap Soviet oil they could afford to produce goods with inefficient energy input. But the Soviets soon could no longer/no longer wanted to keep exporting oil at such a low price in return for sub-standard products.

the Eastern Bloc needed to increase intensive growth rather than extensive growth. Any sort of major changes in the the functioning of the economy obviously was of limits after the Praugue Spring, so many Eastern Bloc states looked towards the West for loans to modernise their industry with, finding themselves in massive debt when these didnt always produce the returns they needed. Also in the case of Poland, less was being produced than was being consumed, and attempts to raise prices to lower consumption or to increase working hours (understandably) provoked fierce resistance.

So what were the solution to their problems within the framework of their "socialism", if any?

[Jose Gracchus]

The major problems were: massive problems with institutional corruption, systemic asymmetries and opacities in the flow of needed information for various economic actors throughout the economy to make rational decisions, bad "incentives" [I enclose in quotes because I do not mean profit-motive marginalist propaganda, but rather literally no one in the Soviet-type centrally planned economy had the personal incentive institutionally to pursue the social good] throughout, and an inability to allocate labor to useful ends effectively.