1989 – Did Europe grow together?

November 1989 was a crucial year for the development of a common, united Europe. The breakdown of the communist „Eastern“ Block created new opportunities for Europe growing together and give it a strong global position. Did Europe succeed in meeting the challenges of that enormous upheaval? Unfortunately, we are still confronted with a mutual blame game. Part of the Western attitude blames a too speedy enlargement for many of the difficulties the EU has to deal with. As if Brexit and the failure to agree on a European constitution has been caused by the accession of the „new“ member states. On the other side we see a new accusation towards the „West“. It is blamed to be responsible for a neo-liberal aggression and neo-colonialism in overtaking the Eastern economies in violating basic interests of its citizens.

Let us look to the facts before evaluating the developments and responsibilities. Fact is, that there was and is a catching up process of the new member countries in economic terms – measured in GDP and GDP per capita. Especially between 2000 and 2018 we can see that progress clearly: in relation to the growth rate of the whole EU, the GDP per capita of the EU-CEE countries grew from 45% to 70%. So far so good.

We get a different picture if we look at the population growth or rather decline. Whereas the population of the EU overall grew from 487 Million in 2000 to over 512 Million the population of the EU-CEE countries decreased from over 108 Million to 103 Million. Especially strong were the decline in Romania and Bulgaria, but also in Hungary and Latvia. The West attracted a lot of workers to join their labour force.

In connection with the population decline – primarily because of emigration – we have to recognize a decline of public services – from health to education – in areas mostly affected by emigration of qualified citizens. Whereas emigration can have some positive financial effects due to the transfer of remittances, the social consequences should not be underestimated. Ivan Krastev and Stephen Holmes speak in their contribution “Explaining Eastern Europe: Imitation and Its Discontents” even of a “demographic collapse- resulting from aging population, low birth rates and massive outmigration”.

This population decline and its social and psychological consequences cannot be overcome and undone by immigration, especially by non-Europeans of different cultural and religious background. The demand for opening their borders and their hearts for those migrants and refugees is often perceived as an additional provocation by citizens in countries and areas of emigration. It is perceived as an additional insult after the enlargement based on western interests and its invitation to qualified labour to emigrate, resulted in hardship for those who stayed behind.

Also Timothy Garton Ash in his essay “Time for a New Liberation” puts the emigration into the center of his critical remarks. For him “the individual gain of freedom creates the collective problem of emigration”. In general, the new divide in the new member countries is “between those who have managed to adapt to the new reality, and are coping, and those who don’t understand it and feel themselves pushed away, rejected by the market economy and democracy.” The emigrants are part of those who could adapt and those left behind are feeling themselves neglected.

For Timothy Garton Ash as for Ivan Krastev and Stephen Holmes the causes for the negative developments lie in the simplistic concept of economic liberalism without due regard of the cultural and social aspects of development in the countries of Central and Eastern Europe. This neglect is especially underlined in the critical work of the Hungarian economist Attila Agh. He speaks in his book “Declining Democracy in Eastern-Central Europe” of a “massive neo-liberal pressure for rapid privatization in the socio-economic transformations, which unleashed a deepening socio-economic polarization. Similarly, the introduction of liberal democracy in the legal-political system was mostly reduced to the formation of big legal institutions, neglecting the formation of participatory society…” Attila Agh missed “a region specific road map of Europeanization and democratization” which led to the “Western fallacy”, according to which a blind and uncritical following of the Western development model would lead to quick success.

Also, for Krastev and Holmes the imitation of the West had disastrous consequences. But for them it was not only a western driven transformation and inhaling of the East: “Imitate the West. The process was called by different names – democratization, liberalization, enlargement, convergence, integration, Europeanization – but the goal pursued by the post-communist reformers was simple. They wished their countries to become “normal”, which meant like the West. This involved importing liberal-democratic institutions, applying Western political and economic recipes, and publicly endorsing Western values. Imitation was widely understood to be the shortest pathway to freedom and prosperity.”

From my (our) own experience I (we) can only support that argument. Because whenever some of us in “Brussels”, especially in the European Parliament argued for a more moderate and socially oriented liberal economic system we found much resistance from the Eastern European colleagues. They often had the impression, we would only like to preserve our – Western – privileges. After having lived in sclerotic and bureaucratic systems without individual freedom, and foremost consumer choice, they were sceptical towards new regulations and limitations of freedom. And these attitudes matched perfectly with the neo-liberal approach of deregulation which even found support by some social-democratic parties. If accession would have taken place twenty years earlier the role of the welfare state and a social market economy would have played a much stronger role in imitation the Western model.

In fact, the imitation of the “West” has often been implemented in an even more radical interpretation and performance than in most Western European countries. And this had to lead to a decisive backlash. It resulted in a counterrevolution especially in Hungary and Poland. The invention of an “illiberal” concept of democracy and the transformation into authoritarian systems could find electoral support in view of the disappointing results and failures of the imitation of “Western” style capitalism and democracy. In the end the “new normal” of European society and economy – at least for the East – were defined and realized by Victor Orban rather than by Angela Merkel. Although herself from a Christian Democratic party, her “normality” included secularism, openness for refugees and even gay marriages.

The new normality of Orban and Kaczynski are defined by Christian values, traditional families and homogeneous societies. The “new Europe” became proud of preserving and presenting the old European values. And some of their representatives even expect the West to return to these values and imitate the East in a reverse process. For this reason, they are allying themselves with right wing forces in the West. They long for a United Europe under their own “illiberal” conditions instead of the neo-liberal promises of the times after 1989.

In this respect we can see, that the specific backlash on democracy in the East has also its counterpart in several Western EU countries. The growth of extreme right wing and nationalistic parties demonstrates, that the one-sided neo-liberal policies had also its negative effects in Western European countries. Also, in the West there are regions and people who suffer from being left aside of economic and social developments. Also, here we find neglected “Eastern” regions. Only the different – and mostly longer – democratic development in most Western European countries is still some safeguard against developments like in Hungary and Poland.

As Martin Wolf in a recent contribution in the Financial Times (“Saving Capitalism from the Rentiers”) about the Western world concluded: “We need a dynamic capitalist economy that gives everybody a justified belief that they can share in the benefits. What we increasingly seem to have instead is an unstable rentier capitalism, weakened competition, feeble productivity growth, high inequality and not coincidentally, an increasingly degraded democracy…. The way our economic and political systems work must change, or they will perish.”

It will need more diligence and intelligence in economic and social policies to run a capitalist system in Europe which preserves the democratic values. The fight against rising inequalities in income and wealth and more respect for the “cultural” well-being of the people are necessary ingredients of such a European policy. Demographic issues- concerning immigration and(!) emigration – and its social consequences have to be given more attention.

With all the different development patterns and issues in the East and the West of our continent we still can find some common, underlying challenges. The catching up process has to be seen more differentiated and critical than by looking just at the shrinking GDP per capita growth differential. But to promote the process of growing together and the cohesion of Europe we need a joint redefinition of a social market economy and of a common European “identity” which is constituted by several national and regional identities.

It will be one of the most decisive tasks of the new EU Commission to design policies which are taking up citizens’ concerns without leading to nationalistic and populist policies. Such considerate policies could make a very valuable contribution to overcoming divisions between East and West but also inside countries. Because in many countries on both sides of the former and still dividing line we can find an “East”, where people are and feel themselves neglected and forgotten. Yes, in many respects, Europe was growing together, but there is still a lot to do. And that includes also the integration of the still left out region of the Western Balkans. For these countries we should learn from the successes but also failures of the past accession process and policies.

There is no “end of history” as Francis Fukuyama was concluding from the breakdown of the Communist regimes in Eastern Europe, especially of the Soviet Union. And there is no end of the European integration process. There is still a lot of unused potential in Europe. When the former US deputy Secretary of States and World Bank President recently said: “Reunification gave Europe strategic purpose”, the EU is far from coming close to fulfill that purpose. Let us hope the development is not going a reverse way but going forward into a well-considered and publicly supported transformation into a common European future.