CHAPTER 17 – SECTION 2 TEKS: 1A, 5A, 5B, 6A, 10A, 11B, 14A, 15A, 16B, 18B, 18D, 21A, 21C, 22B, 22C THE STRUGGLE FOR REFORM

STEPS TOWARD CAPITALISM 1992 – Price controls were removed. Government started privatization – selling government-owned businesses to individuals. Those with advantages during Communism got advantages during the switch.

OBSTACLE – DISTANCE DECAY Long distances have made transportation/communication of goods difficult – known as distance decay. The country stretches across 11 time zones. Eight large districts formed, each with its own governor-general.

SO….WHAT IS RUSSIA’S GOVERNMENT? It’s a republic – with some areas similar to U.S. Most ministries and federal services report directly to the prime minister, who then reports to the president High criticism from the public over policies and rules.

OBSTACLE – RUSSIAN MAFIA When Communism ended, mobsters took advantage. In the late 1990s, the mafia controlled:  40% of private companies  60% of state-owned enterprises