Tag Archives: neoliberalism

New authoritarian tendencies_pic

New authoritarian tendencies – a legacy of the past?

Political parties that serve as employment agencies and hence engender and perpetuate entrenched corruption and clientelism, weak state institutions, political control over the media, rampant inequality, dismantling of the welfare state. The ‘authoritarian temptation’ proved too big for most of the new post-Yugoslav elites to resist. While across the political spectrum, to varying degrees, there have been prominent tendencies of portraying the socialist past as a deviation and essentially criminalising it, neglecting it or purposefully erasing it from the public space and public history/memory, there has been an uncritical appropriation in intellectual and media discourse of a linear, simplistic narrative – common in the post-communist states of Central and Eastern Europe – ascribing all contemporary negative phenomena to the ‘totalitarian’ socialist past.

The Yugoslav successor states have not been immune to what can be termed nesting anti-communism. In Macedonia, all the while insisting on the undemocratic nature of the socialist ‘regime’, the ruling political elite engineered (through a highly controversial Lustration Law, the establishment of a Museum to the victims of communism and the deliberate destruction of the socialist/modernist architectural legacy in the capital) a hegemonic official memory regime which in many ways mirrors the worst practices of the system they seek to demonise. Nevertheless, the question of whether and to what extent the new authoritarian political culture in the region is a legacy of the one-party, socialist past is worth asking.

Generally, and in the Macedonian case more specifically, ascribing the blame for contemporary ills and for a 21st century authoritarianism to Tito, his comrades, or ‘communism’ is nothing but an easy way of self-vindication for the appallingly corrupt and irresponsibly elites. What is shocking is that in some crucial aspects, Macedonia in 2015 is doing far worse that it did 40 years ago. The income inequality (Gini) index rose from 28.1 in 1998 to 43.6; almost a third of the population lives below the poverty line; the country plummeted from 34th in 2009 to 117th place in 2015 in the World Press Freedom Index; around a quarter of the population emigrated abroad; and it has become impossible to find employment without connections and party membership (contrary to popular opinion that even in socialist Yugoslavia Party membership was crucial, as a matter of fact, the League of Communist of Yugoslavia for most of its existence had around 1 million members).

Pointing out some of the positive features of the socialist period does not imply an uncritical glorification or idealisation of that system; it is above all an attempt to emphasise the fact that what was positive in it (the emancipatory practices, workers’ rights, social protection and solidarity, equality, social mobility, relative meritocracy, active foreign policy and highly competent diplomacy) has been severely diminished or completely destroyed, while that which was negative (political authoritarianism, personality cult, lack of freedom of speech) has been amplified and ‘perfected’. Hence, Nancy Fraser’s vision of ‘another “postsocialism”’ – ‘one that incorporates, rather than repudiates, the best of socialism’ – still seems pertinent.

This assembly brings four perspectives that zero in on the post-Yugoslav space:

Assembly editor: Ljubica Spaskovska

Photo: Ljubica Spaskovska


Forwards to the legacies of ‘post-communism’ in the Balkans!

Part of the regular assembly “New authoritarian tendencies – a legacy of the past?“. Author: Vladimir Unkovski-Korica

In the years following the collapse of the Berlin Wall, the countries of the former Soviet Union, the Soviet bloc and Yugoslavia were subjected to a major experiment. Treated as a tabula rasa, these societies became a laboratory for neoliberalism. The recipe is now familiar to most of us: privatisation, liberal democracy, debt-driven export orientation, European integration… The question was not whether to apply these measures, but how much, at what pace, by which interest groups, using what kind of institutions. It soon became clear, however, that major divergences between countries were emerging, often unrelated to substantial policy differences. Thus, a new science began to emerge: how to explain these differences according to differing legacies, often legacies of Communism.

In the Balkans, and particularly Yugoslavia, the legacies of Byzantium and the Ottoman Empire came to the fore, but so too did the particular legacies of so-called ’communist ethno-federalism’, ’workers’ self-management’, ’the withering away of the state’, etc. What had been seen as sources of relative ’liberalism’ in the ’Communist’ world now turned to major disadvantages in terms of ’transition’. Thus weak states could not establish strong democratic governance, property rights and rule of law. Ethnic diversity initially slowed down the strengthening of democratic process or even derailed it as different groups tried to assert, often violently, national exclusivity to territorially granted rights. Welfarist instincts in the mass of the population prevented full economic liberalisation giving rise to populist and authoritarian leaders who craved power and disregarded due process.

Much of the wisdom therefore turns to the need for further external intervention to fix the problem. What is particularly necessary in the new orthodoxy is the need for the EU to use various sticks and carrots to lure elites and civil societies away from their recalcitrant ways, and often their flirtation with their age-old Great Power sponsors in Moscow or Istanbul, towards true democracy. If only the EU were tougher on bad leaders, more generous with good civil society initiatives, and more willing to expand quickly, then the sources of backwardness would be expunged, and the Balkans brought closer to Europe, as had occurred with East-Central Europe or the Baltic states. Perhaps this also explains why so many East-Central European and Baltic states ironically backed Germany in the recent struggle to make Greece accept the rules of the Eurozone or quit and become Balkan once more.

The trouble is precisely that, when we look up from the neoliberal textbook at the realities of Europe as a whole, what we see is that Europe itself is at odds with democracy and is ever more reminiscent of an undemocratic, post-modern Austria-Hungary, where the elites of the core countries and the bureaucracy they use to rule the empire, far from liberating peoples of national feelings, are in fact reinforcing old national divisions in new ways. Digging deeper, we even find that this European project has in fact been around for much longer than the last quarter of a century. Yugoslavia’s trade links with Germany and Italy were dominant through the twentieth century, not excluding the so-called Communist period. Yugoslavia’s dependency on American credits started as early as 1949, and its first of many IMF arrangements came in the mid-1960s. Several other bloc countries followed suit in the 1970s and 1980s as part of détente. European integration stretches back many decades.

Unsurprisingly, workers often rebelled against so-called workers’ states, Poland being the most famous example, but Yugoslavia following close behind in the number of strikes in the 1980s. As modernisation resembled in many ways what had gone on in the West too, workers popularly joked that, in capitalism, man exploits man, but in communism, it is the other way around. Now another transition-era joke appears ever more pertinent: that what the communists had told us about communism had all turned out to be false, but what they had told us about capitalism is coming true. It should be unsurprising that many communist parties became proponents of neoliberal transformation, only to be electorally eclipsed since. This is again not unlike the parties of the centre-left in Western Europe, like Greece’s PASOK. The authoritarianism that grew up with corportatist responses* to Europe’s failures is therefore only tangentially a legacy of ‘Communism’ – or its failure, and the popular belief that there is no alternative. As new generations enter the political arena, they come to realise that an alternative is necessary, since capitalism works against democracy, not just in Greece or Spain, but also in Macedonia and Slovenia. They may even realise that Europe means austerity and nationalism, while the Balkans can mean solidarity and diversity. New generations do not need to go backwards to a past that is widely discredited, though for more complex reasons than mainstream commentators would have it. Instead, they can recover forgotten forms of resistance to previous authoritarian rounds of European integration before European integration. And they can move forward in confidence, towards the legacies of ‘post-communism’: the rebirth of an authentic left in opposition to capitalism and the overdue death of the myth of Europe.

* corportatism, rooted in the Latin word corpus, meaning body, refers to the sociopolitical organisation and control of a society by large interest groups.

Skopje and the neoliberal city

Part of the regular assembly “Urbanisation and the right to the city”. Author: Aleksandar Shopov

David Harvey has characterised the neoliberal city as, among other things, a space where the creation of new forms of city governance and of a partnership between public and private sectors leads to ‘improvements’ that are cosmetic, while actual living conditions and services such as education or housing are unaffected or decline. The goal is to create spaces for increasing consumption.

In the centre of Skopje this new partnership has taken on especially dramatic forms. The baroque facades ostensibly meant to transform the city into a European capital have been used to justify the construction of private office and housing spaces on land formerly owned by the state. One of the first fruits of such a partnership was the Ramstore shopping mall (Koç Holding), for which state land was sold at a discount through an agreement between developers and the government, creating at the same time a new form of city governance. The partnership was advertised as beneficial for the citizens who would gain, the developers assured, a modern space suited to their needs. In the decade since the Ramstore deal, more state-owned land has been sold in Skopje, in the centre and elsewhere, through partnerships forged between the city government and investors. The national government also plays a role in such deals by redirecting public funds to developments, even if the use and ownership of the land is passed on to private entities. One example is the gated community Sonchev Grad (‘Sunny city’), in whose construction the government is currently investing tens of millions of euros while preparing the grounds for the foreign corporation (Cevahir Holding).

In the neoliberal city the violence from these partnerships is distributed to already marginalised communities, the victims of this urban ‘progress’. The Albanian residents of the village Patishka Reka, on the slopes of Karadjica Mountain, are seeing their water appropriated for use in Sonchev Grad. Development would also be a catastrophe for the hundreds of families in the Topaana neighbourhood, inhabited by Roma people, which would be squished between the new U.S. Embassy and the proposed international financial zone that it set to replace the neighbouring military base; the historic Roma neighbourhood will then be threatened by developers competing for more space. Urbanisation in Skopje’s municipality of Aerodrom is taking the form of open racial discrimination as Roma dwellings are destroyed to open space for parking lots and parks. Dispossession, which Harvey analyses in “The Right to The City” and which is occurring in cities all over the world, looms on the horizon for many of the inhabitants of Skopje.

The privatisation of large tracts of state-owned land in Skopje could not have been possible without the creation of a new architectural aesthetic, the neo-Baroque look applied by the government to their redesigns of the centre. Moreover, the construction of dozens of monuments privileging ethnic Macedonians over other ethnic groups is in large part actually aimed at marginalising those ethnic, racial, and religious communities which stand in the way of the new urban process.

The urbanisation of Skopje is a class phenomenon. In Novo Maalo, car repair shops and their workers who constituted part of the history of the neighbourhood were evicted by force to open the space for the construction of the corporate shopping mall Vero, just across from the National Bank. Neoliberalism has increased the class power of the rich in Macedonia and the world by weakening the ability of the rest to resist their own economic exploitation. Even the park-forest Vodno has fallen victim to the neoliberal city and urban planning. In light of this situation, the struggle to protect the facade of the historic Gradski trgovski centar (City Trade Centre) from the planned neo-Baroque redesign, which would entail yet another public-private partnership, should form part of the resistance against the neoliberal city and the newly established hegemony.

Работнички права

Regular assembly: Labour rights in a neoliberal and post-socialist Macedonia

Along with the explicit, even if only declarative, commitment to transition to a democratic society, all governments since the independence have been unconditional promoters of market economy and neoliberalism. This, inter alia, significantly redefined labour rights. Between the socialist legacy, the poorly implemented privatisations, the labour unions’ partisanship, the neoliberal legal reforms, and the populist rhetoric, the Macedonian worker has been put in a specifically precarious position. It is for this reason that this assembly brings four analyses of the state of labour rights in the Republic of Macedonia:


photo: Radio Free Europe

Is crisis our new order?

Part of the virtual assembly “Labour rights in a neoliberal and post-socialist Macedonia” Author: Aleksandar Dimitrovski

Neoliberalism arrived in Macedonia as the answer to the debt crisis that shattered the Yugoslav economy in the eighties. Roughly, its ideal aim is the liberation of individual entrepreneurial potentials by mediating all forms of human relations through the market where the only function of the state is to create and maintain the institutional framework that safeguards the system (e.g. courts, police, stable currency). The economic stagflation of Yugoslavia was interpreted precisely as a consequence of the absence of such a framework: backed by the state, the system of social ownership and self-management gave workers too many “rights” and too much power to increase wages beyond their market value, thus reducing the overall efficiency of the economy.  The ensuing shift to “privatization, marketization and democratization” was meant to secure, in Jeffrey Sachs’ words, a “recovery of human freedom and a democratically based rise in living standards.”

In reality, this turned out to be a smokescreen for an all out assault on labour. After ten years of reform, the number of employees in industry dropped from 470,000 in 1990 to 221,000 in 2000. Unemployment in 1999 stood at a whopping 47 percent. Workers lost not only their jobs and legal rights but their social status. In the new order, the former “vanguard” of the socialist economy suddenly became a social burden.

The question that imposes itself is how could this have been made possible in a context where people were finally living in a democracy where they could supposedly decide their own fates? David Harvey says that for a shift of such magnitude to take place in (relatively) democratic conditions it must be preceded by the prior construction of consent among the population. Neoliberalism must be infiltrated (for example through the media, the educational system and political propaganda) as a new kind of common sense way in which we experience the world.

Yet what is immediately apparent is that in spite of over two decades of neoliberal remedies to the ills of socialism the basic premise of the neoliberal idea has never been a matter of consensus in Macedonia outside the narrow circles of governing elites. If there is any consensus among workеrs it is that the economy is there to serve the needs of the people rather than the other way around. Exploitation and inequality are everyday topics to the extent that wealth accumulation is itself seen as a reflexion of moral decrepitude and the state is called upon to offer protection from markets rather than for markets.

How then, in the face of such popular refusal to accept the basic tenets of the neoliberal creed, does the system reproduce itself? Not through the manufacturing of consensus, but through the continuous production of disorder, crisis and insecurity that disable collective action. Factory workers are constantly bombarded with daily reminders about the fragility of their industry, the difficulty of securing regular orders, or the threat of capital flights to competing labour markets; the possibility to employ workers on temporary three-month contracts for up to five years increases their vulnerability; consumer credits cement people’s dependency on a regular income; well meaning union activists fear that union interference might cause more harm to individual workers than score benefits etc.

When the roads to collective action are blockaded workers are gradually co-opted into pursuing individual strategies for improving their position (e.g. getting “connections” or migration). The cumulative effects of such practices foster a culture of individualism, self interest, mistrust and the destruction of the horizontal bonds of mutual support that are the basis of any form of collective action.

In short, the question of “workers’ rights” is not purely legal but pervades all social spheres and involves the peripheral position of Macedonian workers in the global division of labour. It is a context wherein all alternatives appear impossible and political creativity is buried. But perhaps we can revive it if we start from the realization that the crisis is not a transitional phase that we can patiently outwait. The crisis is not an epiphenomenon but a set of coercive mechanisms that maintain the system. In other words, we’ve already walked our neoliberal road and it has led most of us to the periphery of cheap labour. From here on there lies only more of the same. We can either change direction, or seize the power to make roads.

Neoliberalism: A rat race to the bottom

Part of the virtual assembly “Labour rights in a neoliberal and post-socialist Macedonia” Author: Goran Lazarevski

One of the chief aims of the neoliberal-inspired transition to a free market economy was the deregulation of the labour market. In order to achieve this ideal a large number of labour rights and protections, formerly granted under socialism, were stripped away, unions were suppressed, minimum wage laws repealed (for an in-depth analysis of this process, see the excellent study by Lenka, “Devaluation of labour”). Decades later, the results are disenfranchised workers, laid-off workers and workers earning subsistence wages. Even the ideologues of this transition agree that large costs in human suffering were sustained, but they claim these were necessary in order to achieve competitiveness with the rest of the world. What this competitiveness means in practice is actually a rat race to the bottom, where the countries of the world compete among themselves which one would offer more precarious labour conditions and lower wages in order to attract foreign investors to build manufacturing plants. Thus, our government’s commitment to attracting FDI is an ideological commitment to participate in this race to the bottom, which is why we see the emergence of so called “free economic zones” – areas with taxes plummeting to 0% and wages also glued to the bottom.

The neoliberal globalisation project, however, had a self-defeating flaw in its very design, and that is the problem of generating aggregate demand that Keynes predicted long ago. If the developing world’s vast population is forced to slave away in factories for extremely low wages, then who will buy all those fancy products that these factories are supposed to produce? The answer was, of course, the Western (primarily US) consumer, so this consumer was encouraged to spend money (s)he did not have in order to keep the global economy going. These free-flowing “easy” money in turn helped produce the housing bubble which eventually collapsed and thus we are in the mess where we are today.

Unless sufficient internal demand is generated in major markets in the developing world, global imbalances, instability and economic stagnation are but guaranteed to persist in the future. But for this to happen, it is crucial for all countries to give up the rat race, i.e. strengthen their unions and introduce generous minimum wage laws that will guarantee their workers decent wages and thus purchasing power to sustain that domestic demand. The EU is in a unique position to pursue this agenda due to the ability to enact legislation to coordinate such pro-labour policies among all its member-states, reducing the credibility of the threat by investors to flee a market with stronger labour protection. So far the EU has been successful at this strategy to a certain degree, hence no surprise that standards of living in Europe are on par with those in the US.

It should be the economic imperative of all European countries to get under this labour rights umbrella and protect their workers from exploitation from multinationals, and thereby generate domestic demand and spur economic activity. But first we need their leaders to forget about their ideological commitment to the neoliberal mantra: “low taxes, low wages, and attract FDI”, and we need them to start focusing on developing the productive and purchasing potentials of their own economies.

In the particular case of Macedonia, these recommendations need to be tempered somewhat due to the country’s extremely high unemployment rate. In this sense, a flexible labour market is crucial for incentivising employment, however the central point remains – eliminating the minimum wage and weakening the labour unions has not brought the country any closer to prosperity. On the contrary, poverty and inequality have soared since its independence like never before in history. That is why the minimum wage raise expected to take place in 2014-2016 is most welcome and further steps in this direction should be encouraged. Additionally, strong and independent from political interference labour unions are a necessary partner in an economically prosperous society, and not a drag to the economy as they are usually viewed by our ruling elites.