Woes of Capitalism in Armenia Exposed in Markar Melkonian’s Book The Wrong Train


The attention of Armenians worldwide is focused understandably on Armenia and Artsakh’s tense relations with Azerbaijan at present. Markar Melkonian, with a book published in 2020 prior to the war, treats longstanding fundamental questions of economics and politics affecting Armenian society that also deserve attention. In The Wrong Train: Notes on Armenia since the Counterrevolution (Los Angeles: Sardarabad Press), he consistently argues that the post-independence choice of a capitalistic economy and neoliberal ideology continues to harm Armenia and Armenians.

The Wrong Train is a slim 186-page paperback volume bringing together articles published by Melkonian on Hetq Online, the internet site of the Investigative Journalists of Armenia, between 2010 and 2018, together with a new introduction. Seta Kabranian-Melkonian is the managing editor of the book.

The author received a doctorate from the University of Massachusetts at Amherst in 1997, and is a lecturer in the Department of Philosophy at California State University, Northridge. He has authored a number of books, including Richard Rorty’s Politics: Liberalism at the End of the American Century (Humanities Books, 1999), My Brother’s Road: An American’s Fateful Journey to Armenia, a riveting book about his younger brother Monte Melkonian (2005, 2007), and several college textbooks published in recent years.

Decline of Living Standards Post-Independence under Capitalism

Melkonian peppers his articles with a seemingly unlimited number of depressing statistics indicating the decline in the living standards of the citizens of the Republic of Armenia. In 2010, some fifty percent of the population lived in poverty, and poverty continues to be widespread today. Privatization of land depopulated the countryside while real estate speculation pushed housing costs in Yerevan beyond what many can afford. Women and children have suffered the most, points out Markarian, due to the dismantlement of public schools, clinics, childcare programs and in general a social safety net.

A UNICEF report on the 25th anniversary of the end of the Armenian Soviet Socialist Republic reported that 1/3 of children in Armenia were “poor and deprived.” More specifically, 1/3 of children five years old and under are nutritionally deprived. Oxfam’s Armenian office the same year reported that 60 percent of the Armenian population overall is malnourished.

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In the Soviet period an average of $500-$600 was spent per student, but according to a 1997 United Nations report, this dropped to $30. School dropout rates grew 250 percent a year from 2002 to 2005 according to another source. Children in the poorest families are forced to work in the fields, beg, sell trinkets in the streets or collect recyclables from garbage, instead of going to school or playing.

Women’s role in politics declined in independent Armenia. In 1985, 35 percent of the deputies elected to the Supreme Soviet in Armenia were women. In 1999, only 4 women were members of the Armenian National Assembly, composing some 3.6 percent of its membership. While it is correct that women still remain grossly unrepresented in the cabinet and most parts of government, it should also be noted, though it is not mentioned in the book, that representation in parliament increased again over time. It reached over 23 percent by the beginning of 2021, and returned to the levels of Soviet times in the June 2021 election, through which 37 women were elected out of 107 deputies, or roughly 35 percent once again.

The population of Armenia nearly quadrupled under Soviet rule to a peak of 3.3 million, while it has declined by at least one million under the current republic. Families in independent Armenia have been pulled apart due to dislocation and unemployment, with many males seeking jobs abroad and leaving women and children behind. The Republican Party when Serzh Sargsyan was president only paid verbal respect to the conditions necessary for families to thrive. It included in its platform, Melkonian notes, that “the basis of Armenian society is a traditional family,” which is simply a way, he explains, “not to convey meaning but to numb brains” about what was happening.

Markar Melkonian

Causes of the Decline

The primary cause of the aforementioned decline is the capitalist economic system, Melkonian argues. Corruption existed in Soviet Armenia, but capitalist privatization and “reforms” led to an explosion of thuggery, extortion and exploitation far beyond what Armenians had seen before, Melkonian wrote, which is not simply due to the inheritance of a “mysteriously inherited” Soviet mentality. Several decades of foreign-directed reform only led to more sacrifices and burdens on the poor, he stated, yet Western agencies and free market proponents consider this approach successful. Melkonian quoted New York Times columnist David Brooks, who considered Armenia and Azerbaijan among only five countries that had successful capitalist economies from the entire post-Soviet region in 2014, and then speculated what Armenian capitalists might be thinking: “If this is what a successful capitalist economy looks like, then the question naturally arises: What was the point of letting capitalists take over the country in the first place?

Melkonian places the socioeconomic situation in Armenia in world context, and in more than one chapter/article points to the increasing gap between the superrich and the rest of the world. He notes that in 2014, the wealth of the 80 richest individuals in the world equaled that of one-half of the rest of the world’s population. The same increasing concentration of wealth and power in the hands of the few is taking place in Armenia.

Under the first three presidents, various ways to make the free market economy more “efficient” were proposed. During this period, there has been no true political opposition in the Republic of Armenia, Melkonian states, which could deal with the deeper problems of the economy. The opposition parties were similarly supporters of neoliberalism, implying privatization of public property, cutbacks in state provision of healthcare, education, public transportation, and removal of environmental and other regulations. “The overall effect,” Melkonian said, “in Armenia as elsewhere, has been an enormous transfer of wealth from the bottom to the top.”

The reason, he concludes, “is that successive administrations have been dominated by cliques that have in common the fact that they own and control a large part of the country’s productive wealth.” In other words, he said, “a class that comprises a tiny minority of the population has come to wield a near-monopoly on economic and political power.” In turn, these plutocrats use public institutions to advance their own interests and power.

Shrill nationalist rhetoric of groups like Sasna Tsrer, he stresses, is not an alternative to neolibleralism but too often camouflage for the same ideas.

‘Velvet Revolution’ Merely a Change in Administration

Melkonian does not find the “Velvet Revolution” to be a true revolution, as it did not bring a new economic class to power. He exclaimed in 2018: “What has taken place in Armenia since [Serzh] Sargsyan’s resignation was neither a revolution nor a counterrevolution; it was just a change of administration,” and predicted that primarily stylistic changes would be made.

In his book’s introduction, written a year or two later, Melkonian quotes Prime Minister Nikol Pashinyan in January 2019 assuring businessmen in Zurich that “Armenian citizens do not want more redistribution of income. They have seen enough of that.” He observed, “But Pashinyan has turned reality upside down,” since “in Armenia, as elsewhere, redistribution has not taken place from the rich to the poor; on the contrary, in the past decades the wealthiest minority has massively expropriated the poor and working-class majority.” Armenia has become one of the most unequal countries on earth during its period of independence. Consequently, he sarcastically points out, Armenians have indeed seen enough of such redistribution.

Pashinyan, he concludes, is prescribing the same neoliberal policies of his predecessors, the results of which are plain to see.

How to Improve Economic and Political Conditions

The only broad solution to these woes that Melkonian offers is to organize resistance to free market reforms which hurt the majority of the population. He cites the resistance in the US to the attempts of politicians such as Governor Scott Walker in Wisconsin as an encouraging example. Traditional constituencies with independent organizational presence, like labor unions, played an important role in this, he adds, just as in the past popular resistance led to the abolition of child labor, the eight-hour work week, universal suffrage, consumer safety legislation, and many other achievements.

In a chapter written prior to the Velvet Revolution, he said, “the best counterforce against the ongoing abuses by Armenia’s plutocrats is resistance from the bottom – from the streets, social media, offices, factories, and public squares.” The next step would be “to build a common vision and a common organization to fight against plutocracy altogether – and to fight for workers’ power.” Melkonian finds that militant unions and a party of labor is necessary to force the ruling class to give up state power. A “mass-based democratic opposition that has built a sustainable institutional presence on the ground and that presents a realistic way forward” is necessary.

Instead of the market model of democracy that ratifies the existing control of Armenia by wealthy oligarchs, Melkonian proposes deliberative democracy, through which “open discussion and debate transform personal preferences, creating new conceptions of the greater good.”

He hoped for “a generation of working-class Armenians who will break with the delusions of their parents and grandparents as thoroughly as the counterrevolutionary generation twenty-five years ago blotted the lives and hopes of their Soviet Armenian predecessors.” His ultimate goal is the replacement of capitalist rule by socialism, or workers’ power.


Melkonian sketches out how he sees a possible non-capitalist state with workers in power as a class controlling the state. Economic planning exists in any state today, but if workers are in control it will benefit the poor, and those in the middle instead of just a small minority of the rich. The means of production do not have to be owned by the state, he explains, to have a socialist system. Private ownership by self-employed workers is possible, but some large sectors like energy, transportation, mining, banking, finance and insurance should be socialized. Eventually production for the market will decrease and be replaced by production for use value. Land also should be removed gradually from private ownership. He wants a multiparty representative democracy within the workers’ state. Cuba is one of the states which Melkonian holds up to Armenians as a socialist example despite decades of US obstruction and embargo.

Rare for an American-born Armenian, Melkonian remains a staunch defender of the early period of Soviet communism, though a critic of its many flaws in its later decades. On the 100th anniversary of the October Revolution of 1917, Melkonian penned an article of praise on its spurring of workers’ rebellions, ending Russian participation in World War I. Its heirs, he observes, hastened the end of colonial regimes, liberated women, defeated fascism, fed the hungry, extended lifespans, pioneered scientific and technological research, and so forth. He defends Lenin against blame for Stalin’s brutalities. Melkonian looks to the revolution as a source of inspiration for the future, stating: “Perhaps the best and brightest of a rising generation will reclaim the vibrant spirit of the October Revolution.”

Foreign Policy Issues

While primarily focusing on domestic Armenian politics and economics, Melkonian occasionally touches on foreign policy issues. He notes that “Foreign aid is an instrument of foreign policy,” and gives the examples of the large roles played by USAID and Western-funded NGOs in Armenia. Furthermore, he finds the promotion of civil society
“a distraction from the struggle for freedom.”

He warns of US intervention with financial aid to strengthen trust in the Armenian electoral process through new technical processes, pointing out that “many American voters themselves do not trust the American electoral system.” He wrote about the US embassy’s announcement about its program, stating that  it “is not really about improving Armenia’s electoral system. We know that it is just another propaganda stunt, a tit-for-tat against Moscow, another lesson in obedience for the instruction of the natives.” Melkonian also in a separate chapter wrote about US intervention in the elections of other countries, including in the run-up to the 1996 presidential election in Russia in support of Boris Yeltsin.

Melkonian presents the destruction wreaked in Iraq and Syria since 1990 by the US, which also largely destroyed the local Armenian communities, turning most Armenians there into refugees. In fact, he notes that among the 30,000 Iraqi Armenians uprooted, some had fled to Syria, where they were made refugees a second time. He then criticizes Armenia for sending its own soldiers as part of the Coalition of the Willing, thus giving some additional legitimacy to the plans of American neoconservatives to destroy the armies of Syria and Iraq, despite their harmful results for Armenians. Ominously for Armenia, Melkonian wrote, Iran was the next country in the sights of the US neocons.

For the Republic of Armenia too, Melkonian finds that the growing Russophobia in the Armenian opposition prior to the Velvet Revolution, was contrary to Armenia’s vital security interests, while the US agrees in general with Turkey that Armenia and the rest of the South Caucasus should be integrated into the “dominant imperialist system” as Melkonian calls it, within Ankara’s sphere of interest. He warns readers of “the old dangerous fantasy of Uncle Sam as Armenia’s savior.”

While many readers may not agree with Melkonian’s admiration of the early Soviet Union and Cuba, or his ultimate goal of socialism, they still can benefit from his revealing analysis of the effects of the practice of neoliberalism in Armenia. Understandably, there is a bit of repetition in the book’s chapters, which after all were initially written as independent articles, and the language could use additional minor editing.

The English edition is available from Abril Bookstore in Glendale and various online vendors, while an Armenian-language edition, ՍԽԱԼ ԳՆԱՑՔԸ. Գրառումներ հետհակահեղափոխական Հայաստանի մասին (2021) is available from Zangak Publishing House (www.zangak.am) in Yerevan.



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