Hate to go all “Vas you der Charlie” on young Matt Yglesias, but this recent post on the debate over the size of the Soviet economy is completely wrong.
In the 1970s and 1980s , it was Cold War hawks who argued that the Soviet economy was smaller than the conventional CIA generated estimate. From this smaller estimate, the hawks drew the following conclusions:
1) The Soviets were spending much more on weapons than conventionally estimated: maybe 1/3 of national output rather than the 1/8 guessed by the CIA. (The US was spending about 1/20 in the Reagan era.)
2) Because the Soviets were spending so much, they probably could not spend more. This implied that arms control was a waste of time. The US was trading something it COULD do (build more) for something the Soviets could not do (build more)
3) Spending 1/3 of national output on the military was unsustainable, obviously. Either their economy was teetering on the verge of collapse (the Richard Pipes view) or they were planning for a pre-emptive war (the Edward Luttwak view).
By contrast, the conventional estimate implied:
1) The Soviets could increase their arms spending, therefore arms control was worthwhile.
2) The Soviet economy did function more or less adequately, therefore the Soviet Union could expect to endure. Therefore like it or not the United States had to deal with it as a permanent fact of politics. Nor was there need to fear that the Soviets would launch an unprovoked war anytime.
3) The Soviet bloc was providing an acceptable standard of living to its people. (On the official estimate , GDP per capita in East Germany roughly equaled that in Britain. The hawks argued that East German incomes were equivalent to Mexican.) The Soviet regimes accordingly commanded something like assent from their people; dissidents were unrepresentative of public opinion generally.
Obviously, it was the conventional not the hawkish view that proved wrong. This experience permanently jaundiced many against the estimates of the CIA – and so to this limited and upside down extent, Yglesias is inadvertently correct that the debate prepared the ground for the later debate over Iraq’s nuclear capabillities, which this time we hawks got wrong.