Judges of history in the making: A group of academics who foresaw Soviet collapse reconvened recently. Julian Bullard was there

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CHAPTER XVI of Baroness Thatcher's memoirs is entitled 'Men to Do Business with'. It opens with an account of a seminar she convened at Chequers on 8 September 1983 'to pick the brains of experts on the Soviet Union' - meaning not the reigning ministers and mandarins in Whitehall, but specialist academics.

Such teach-ins had been held before, and others were to follow, including a notorious lesson on Germany in 1990. But the seminar of 1983 was outstanding in content as well as result.

The academics scored an early goal when Professor Archie Brown of St Antony's College, Oxford, predicted that the then master of the Kremlin, Yuri Andropov, would before long be replaced by a man named Mikhail Gorbachev, who was likely to be different from all his predecessors.

Professor Alec Nove of Glasgow cast his analysis of the Soviet economy in the form of an imaginary report by a provincial party boss, urging respectfully that the Soviet Union was holed and sinking fast.

The academics went on to foretell much of what was to happen in the Soviet Union from 1989 onwards - not just generational change and economic collapse, but also erosion of national self-confidence, sweeping economic reform and even a move from within the Communist Party to carry out political reform, too.

Their overall advice was: know your enemy, identify the key figures, broaden your contacts. It was all very different from the prevailing analysis of the Soviet Union, which was couched in terms of military threat, 'evil empire' and dissident protest. If few of those present saw these changes happening quickly, that insight was to come later from 'catastrophe' theorists, who know that a big ship can capsize more rapidly than a small one.

The events that followed the Chequers seminar speak for themselves. In February 1984, Mrs Thatcher made an official visit to Hungary; shortly afterwards, she seized the opportunity of Andropov's funeral to open a dialogue with the Soviet leadership; in December 1984, she received Gorbachev in London as leader of a parliamentary delegation, and summed him up as a man she could do business with - from which stemmed, after his rise to power early in 1985, that series of Thatcher-Gorbachev meetings, which for depth and frankness had no parallel in 70 years of Anglo-Soviet relations.

Professor Ron Amann of the University of Birmingham, one of the academics who had been present at the 1983 Chequers meeting, suggested that the seminar be reconvened on its tenth anniversary last month at Birmingham's Centre for Russian and East European Studies. In the chair this time was Sir Charles Powell, whose eventful stint as private secretary at No 10 Downing Street began about the time Mrs Thatcher was changing course on East-West relations.

The cast numbered 40, half of them academics (including all those who had contributed papers in 1983) and the remainder officials, bankers, businessmen and the like. Together we took stock of today's confusing scene in Russia and Eastern Europe.

Confusing, and a lot of it black, even before the stormy events of the past few weeks. Russia was assessed as being in the grip of a triple crisis: of economy, authority and nationality. Khrushchev used to talk of catching up with the United States, and this feat had now been achieved in one respect anyway: the murder rate. The polls showed sagging public confidence in politicians and the political process, contradicting hopes that the apathy of the Soviet period would be lifted when the transition to democracy began.

The businessmen at the seminar emphasised that the former Soviet Union's economic future could be of profound importance for British and Western interests. The unbroken row of minus signs in the 1992 GDP tables carried an unanswerable message, they said, as did the calculation that it would take a middle-ranking Russian bureaucrat 100 years to earn enough roubles to buy that BMW in the showroom window.

But frequent travellers to the regions had reported vibrancy at the grass roots: a benign black economy, in some respects repulsive, but making an unmistakable contribution to the quality of life. Italian conditions, in other words.

A more respectable form of capitalism, stable enough to encourage investment in new manufacturing industry, was nevertheless some way off. Another case, then, of 'there is no alternative'.

Confusion in Russia would doubtless continue for a year or two at least. A sudden lurch or explosion could not be ruled out (this came graphically true a month later) but the Russian capacity for muddling through was probably not yet exhausted. The country today was more frightening than threatening. Political and economic factors, not security, should be the main determinants of Western policy.

As to what that policy should be, one sensed at the Birmingham meeting that the phase of history when the winners of the Cold War seemed not to know what to do with their victory was at an end. Treat Russia with respect, ran one prescription - the respect due to the great power that one day it will be again - on everything from nuclear issues downwards.

The country's total needs were so great that foreign investment could be of only marginal help, but it could be channelled into useful directions: for example, a partnership with a local bank to back technologically advanced export industries such as aerospace, which had benefited from priority funding in the days of central planning.

'Bottom-up' advice and training, for example in the work of parliamentary committees, were cheap and effective, and conformed to the principle that help should be directed towards institutions rather than individuals, even if the name of the individual concerned was Boris Yeltsin.

The countries of Central and Eastern Europe hovered on the edges of this discussion like poor but interesting relations. They had played their part in the downfall of Communism, and seemed now to be returning to the pattern of the inter-war years, comprising a zone of potential instability, but with a reasonable standard of living and wide local variations.

Should Eastern Europe be left to fend for itself? The answer seemed to be 'No', for a clutch of reasons that ranged from moral commitment to a feeling that instability there could be contagious. Then, how to prevent or contain it?

And so to Nato. The 'why not?' school saw no problem in an organisation enlarged from its present 16 to 20 or more members to accommodate Central and Eastern European nations; this would also provide an up-to-date answer to the question of why US troops needed to remain in Europe. The British people, this school conjectured, would see little difference between the old commitment to defend Germany against the Soviet Union and a new one to defend Poland against the Ukraine.

As the seminar drew to a close on this point, some grey heads were seen to shake in disagreement or alarm. At least, without a prime minister in the room on this occasion, there was no fear that the future of the United Kingdom might hang on our conclusions.

The writer was British ambassador in Bonn from 1984 to 1988.

(Photograph omitted)