The Hungarians open the border with Austria. The USSR’s economy is collapsing, due to military spending, the inefficiency of the communist system, and the drop in oil prices. For this reason, Gorbachev decides he can no longer finance Eastern European countries to support an unsustainable standard of living, so he decides “every man for himself.” Eastern European countries look to the West and begin to request, and obtain, loans from Western countries. Gorbachev also withdraws a large part of the Red Army from Eastern European countries and cannot afford a military intervention to crush reforms. This leads to the events in Hungary, followed by the fall of the Berlin Wall and then the Ceausescu regime in Romania.
