Demise of the Cold War - Assignment Example

The disintegration of communism in Eastern Europe and the Soviet Union was the most unexpected and rapid major economic and social transformation that occurred in the 20th century.

Although the demise of communism in Eastern Europe was largely peaceful, it had extremely destabilizing repercussions in the Soviet Union. This was because communism was founded on two defining economic features which were characterized by a centralized command economy in which prices as well as output targets were administratively fixed. It is worth noting that the key premise behind communism was that the cause of human suffering was capitalism and its subsequent lack of the distribution of wealth.

The heaviest price that was paid by the relatively disorganized manner in which communism ended was the financial/ monetary costs that the European countries had to face, and the subsequent debt the states would have to the West for the economic assistance offered to help in the building of market economies in the East. There was an unexpectedly high cost to reunification and reconstruction in the East which consequently caused tension that spilled over the country’s borders. Additionally, there was a quick growth in the number of Eastern European immigrants which in turn spurred powerful racists and rightist political movements which ultimately culminated in anti-immigrant riots.

Unfortunately, as a result, there was a great increase in unemployment caused by the chaos in the currency markets in Europe and the fragmenting of the European monetary system. There was a lingering recession characterized by unemployment and hyperinflation where people’s savings were exhausted. Unfortunately, European governments were preoccupied with striving to lower their budget deficits as well as national inflation and had little room to deal with the issue of unemployment or any other social issues that arose from the collapse of communism. Therefore, due to the mentioned reasons, I believe the demise of communism should have been given more thought to allow for proper management which could have reduced, if not avoided the consequences witnessed.