KIEV -- The price of bread quadrupled Thursday as President Leonid Kuchma announced he had begun "surgery" on Ukraine's ailing economy.


"The patient is now on the operating table," he said.


Free prices are a key element of Kuchma's prescription for reducing the budget deficit by spending less on government subsidies.


A loaf of bread in Ukraine now costs 12,000 karbovanets, about 10 cents. Only a day earlier, it was the equivalent of less than 3 cents.


Kuchma has also cut government subsidies to the transport and energy industries and prices have jumped five- to tenfold.


"We diagnose the economy as sick," Kuchma told a news conference. "Surgery has begun."


For some, it was without an anesthetic.


Several hundred outraged teachers gathered outside government headquarters Thursday warning that Ukraine could suffer widespread strikes if wages don't keep up with spiraling prices.


Parliament gave Kuchma some breathing room Wednesday, voting down a Communist-backed proposal to suspend price hikes.


Since independence in 1991, Ukraine has lagged behind Russia and others in reshaping its highly centralized -- and stumbling -- economy.


The average state wage is now worth less than $10 a month, and about a quarter of the work force is idle.


Kuchma, who says the success of his reforms hinge on a quick boost in Western aid, plans to visit Washington later this month.


He said the trip was critical to attracting additional aid from other sources.


"Whatever posture America adopts, other nations will follow," he said.


The United States promised $700 million in aid for 1994 after Ukraine agreed to dismantle the nuclear arsenal it inherited from the Soviet Union.