history of russia - Russian Federation
Although Yeltsin came to power on a wave of optimism, he never recovered his popularity after endorsing Yegor Gaidar's "shock therapy" of ending Soviet-era price controls, drastic cuts in state spending, and an open foreign trade regime in early 1992 ( see Russian economic reform in the 1990s). The reforms immediately devastated the living standards of much of the population, especially the groups that had enjoyed the benefits of Soviet-era state-controlled wages and prices, state subsidies, and welfare entitlement programs. In the 1990s Russia suffered an economic downturn more severe than the United States or Germany had undergone six decades earlier in the Great Depression. Peter Nolan
Meanwhile, the profusion of small parties and their aversion to coherent alliances left the legislature chaotic. During 1993, Yeltsin's rift with the parliamentary leadership led to the September–October 1993 constitutional crisis. The crisis climaxed on October 3, when Yeltsin chose a radical solution to settle his dispute with parliament: he called up tanks to shell the Russian White House, blasting out his opponents. As Yeltsin was taking the unconstitutional step of dissolving the legislature, Russia came close to a serious civil conflict. Yeltsin was then free to impose the current Russian constitution with strong presidential powers, which was approved by referendum in December 1993. But the December voting also saw sweeping gains for communists and nationalists, reflecting growing disenchantment with the costs of neoliberal economic reforms.
Economic reforms also consolidated a semi-criminal oligarchy with roots in the old Soviet system. Advised by Western governments, the World Bank, and the International Monetary Fund, Russia embarked on the largest and fastest privatization that the world had ever seen in order to reform the fully nationalized Soviet economy. By mid-decade, retail, trade, services, and small industry was in private hands. Most big enterprises were acquired by their old managers, engendering a new rich (Russian tycoons) in league with criminal mafias or Western investors. See Fairbanks At the bottom, many workers were forced by inflation or unemployment into poverty, prostitution, or crime.
By the mid-1990s Russia had a system of multiparty electoral politics. But it was harder to establish a representative government because of two structural problems—the struggle between president and parliament and the anarchic party system. Although Yeltsin had won plaudits abroad for casting himself as a democrat to weaken Gorbachev, his conception of the presidency was highly autocratic. He either acted as his own prime minister (until June 1992) or appointed men of his choice, regardless of parliament.
Meanwhile, the central government had lost control of the localities, bureaucracy, and economic fiefdoms; tax revenues had collapsed. Still in deep depression by the mid-1990s, Russia's economy was hit further by the financial crash of 1998. After the 1998 financial crisis, Yeltsin was at the end of his political career. Just hours before the first day of 2000, Yeltsin made a surprise announcement of his resignation, leaving the government in the hands of the little-known Prime Minister Vladimir Putin, a former KGB official and head of the KGB's post-Soviet successor agency FSB. CNN Apologetic Yeltsin resigns; Putin becomes acting president
. Written by Jim Morris. Published December 31 In 2000, the new acting president defeated his opponents in the presidential election on March 26, winning on the first ballot by garnering 53% of the vote. _ "BBC Putin Elections"_
Nevertheless, reversion to a socialist command economy seemed almost impossible, meeting widespread relief in the West. Russia's economy has also recovered somewhat since 1999, thanks to the rapid rise of the world price of oil and gas, one of Russia's largest exports, but still remains far from Soviet-era output levels.