by Richard C. Cook
Featured Writer
Dandelion Salad
richardccook.com
January 10, 2010
After the collapse of the Soviet Union caused it to split up into its components, the newly-established nations each faced an economic crisis. In Russia the crisis lasted for a decade. Inflation had destroyed the currency. There was no banking sector to speak of. And the central government had failed to monetize the nation’s potential production through a functioning monetary system.
The answer? Barter–not only among individuals, but also among businesses and even with the central government. According to a study from the period by Dr. David Woodruff of MIT, “As of early 1998, 50-75 percent of exchange in industry took the form of barter…” With regard to payment of taxes, “In 1997, at least one-quarter of the revenue collected for the federal budget took a non-monetary form.”