/ 5 September 2006

Where liberalism equals depression

As the entry of Bulgaria and Romania into the European Union edges closer, the condescension towards Eastern Europeans and their countries of origin grows. The double standards could not be more glaring. Bulgaria and Romania are routinely portrayed as backward, mafia-ridden hellholes that will infect the rest of the continent. But is the political system in either country so much more corrupt than in Berlusconi-tainted Italy or cash-for-honours Britain?

We also witness this unappealing chauvinism in the way Eastern European migration is covered in the British tabloids. Eastern Europeans are castigated for flooding into Britain, yet few people stop to ask why so many people (427 000 have left for Britain since 2004) are leaving the region where they grew up and where they have friends and family. On the rare occasions they do, the ”pernicious legacy” of 40 years of communism is usually held responsible.

But communist rule ended more than 16 years ago. Can it really still be blamed for the problems of today? What the people of the region are, in fact, escaping from are the consequences of the neo-liberal economic policies of the early 1990s, which led to what economist Laszlo Andor has called ”Europe’s great depression”, the biggest economic slump in the continent since the 1930s.

Away from the glitzy, globalised centres of Budapest, Prague and Warsaw, millions face poverty and hardship in the former communist bloc. Gross domestic product in the region fell between 20% and 40% in the decade after 1989 and, while a minority have seen real wages rise since the millennium, for the majority the ”transition” process has witnessed a spectacular fall in living standards and a massive rise in unemployment and inequality. Western politicians laud the countries of ”new” Europe for their ”dynamic, flat-rate tax” economies, but deny there is any link between the economic reforms and the massive exodus.

The condescension shown towards Eastern European migrants is, in many ways, the real, lasting legacy of the Cold War. It is essential for Western neo-liberals to deny any achievements of the system that half of Europe lived under.

Had the Eastern countries not thrown out the baby with the bathwater in the early 1990s by adopting the massively deflationary International Monetary Fund/EU prescription, their economies would now be in better shape and much of the current wave of migration could have been avoided. The large-scale labour exodus may benefit Western multinationals, but certainly not most Western workers, who are seeing their wage rates depressed. But the biggest losers are the Eastern countries, which are being deprived of young, talented and productive people.

The irony is that, far from being backward, Eastern Europe puts much of Western Europe to shame when it comes to the quality of its education, public transport and health care.

The people of the east have been bombarded by more than 15 years of relentless propaganda extolling the need for further ”reforms” and ”modernisation”. The view that ”West is best” and ”there is no alternative” has proved disastrous.

The East-West divide and the xenophobia that accompanies it will only end when there is a more honest, balanced appraisal of the legacy of communism and an acknowledgment that, despite the lack of political freedoms, there were also solid achievements. At the same time, we need to recognise that the economic ”reform” process has created far more problems than it has solved. Global capital and its political spokespeople will, of course, do all they can to ensure that neither happens. — Â