Polls to test turbulent Albanian democracy

Tirana, Albania – Under the secretive Communist regime of Enver Hoxha, Blloku was the most restricted district in Albania. Only high-ranking apparatchiks in the ruling Party of Labour were allowed to reside in the tight grid of tree-lined streets located in the centre of the capital, Tirana. In the middle of “the Block” stood Hoxha’s own private residence, an opulent Italianate villa with a swimming pool in the garden, completely at odds with the poverty that most Albanians lived in.

More than two decades after the fall of the hardline Communists, Blloku has been transformed into the busiest location in this picturesque Adriatic state. Formerly austere government buildings are now shopping emporia and luxury flats. Hoxha’s old house is still there – but now it’s a popular open-air bar.

Currently, Blloku features something else unimaginable in Comrade Enver’s authoritarian time – election paraphernalia. And lots of it.

Coalition politics

It’s hard to walk more than a few metres in Blloku without coming across a poster for the ruling Democratic Party, a billboard for a the small LSI party, or even a stencil in support of the main opposition, the Socialists, spray-painted on a wall.

On Sunday, June 23, Albanians go to the polls in parliamentary elections for the first time since a contentious vote in 2009. The choice is essentially the same as four years ago: incumbent Prime Minister Sali Berisha and his Democratic Party – in power since 2005 – or the Socialist party led by the former mayor of Tirana, Edi Rama.

Electoral coalitions are the norm in Albanian politics. Rama is leading the “Alliance for a European Albania”, which includes the Socialists, LSI, a Greek minority party and four small Communist groups. Berisha’s “Alliance for Employment, Welfare and Integration” – led by the Democratic Party – includes the Republican Party and a party for the Chams, a group of Albanians originally from near the Greek border. Most polls put the Socialist alliance ahead – but the result is far from certain.

‘Everything we need’

“This government needs to change,” said architect Lindito Ziu, as she waited for a friend less than a hundred metres from Hoxha’s former home. “In eight years, they haven’t invested anything in this country.”

Edi Rama is the leader of the Albanian opposition and Socialist Party candidate for the Prime Minister post [EPA]

Earlier this month, Berisha cut the ribbon on a new highway linking Tirana and the industrial city of Elbasan to the south. An hour and a half journey on dangerous mountain roads has been cut down to just 40 minutes. But Ziu is not impressed. “They say they have done the roads but they will only last a year or two. They were not built properly,” she said.

Not everybody is dissatisfied with Berisha. A little further down the street, shopkeeper Fatos Kume said he will be voting for the craggy-faced northerner and former cardiologist who has dominated Albanian political life for more than two decades. “Everyone can see the difference he has made,” he said.

Originally from the southern city of Vlore, Kume contrasts the bustling shop he has run for the past seven years with life under the Communist regime. “Under Communism, a man had just one suit – and even that he would have to borrow. When I got married I borrowed my brother’s suit,” he recalls. “When I first went to Tirana with my wife, I bumped into my sister-in-law and she recognised me by her husband’s suit.”

“Now it is different. Now we have everything we need.”

Competing platforms

Many Albanians are not so fortunate. Average monthly salaries are around $330 dollars. Unofficially, unemployment is around 30 percent. The economy has avoided recession but is struggling to grow, while public debt has risen sharply. In February, the World Bank criticised the Berisha government for breaking a self-imposed public debt ceiling of 60 percent. Corruption is a fact of daily life.

Rama has attacked Berisha for his failure to tackle Albania’s economic problems and the endemic corruption. “We are in a deep economic crisis, with high unemployment, bad services, (and) a very poor social situation, especially in suburbs and rural areas. Corruption and crime are big problems,” the Socialist party leader told Al Jazeera.

“The core problem of Albania has to do with the fact that our economic model has exhausted itself. It has been based for many years on wild exploitation of resources, on constructions and on the remittances of emigrants, no job creation and no productivity. It is time to turn the page and build a new economic model,” Rama said.

Both the Democrats and the Socialists have committed to creating upwards of a quarter of a million new jobs. Berisha’s party plans to attract more foreign direct investment by establishing a 10 percent flat rate on all personal income and corporate taxes. Rama has promised to lower taxes for low-and middle-income employees at the expense of higher income earners.

“In terms of substance, it’s a fiscally irresponsible campaign,” said Lutfi Dervishi, executive director of Transparency International Albania. “They promise pie in the sky – raising salaries, raising pensions, reducing taxes – but where is the money coming from?”

“The economic issue is the elephant in the room that nobody wants to talk about.”

There has been little thought given to how “Albania is going to face these turbulent economic times”, said Dervishi.

A muddled election process

As is often the case in Albanian elections – and those elsewhere – the campaign has been dominated more by personalities than policies. Berisha and Rama have a long and acrimonious history. After the 2009 vote, the Socialists boycotted parliament, accusing Berisha and the Democratic Party of stealing the election. Two years later, four people were killed in Tirana when police opened fire on protesters at an opposition demonstration.

The beleaguered country also has a chequered election history. Previous votes have been marred by allegations of vote rigging, violence and intimidation. This time around there have numerous reports of vote buying, particularly in the key marginal districts that will decide the outcome of Sunday’s vote.

“We have reports coming from poor citizens of being offered money in exchange for their vote, or young voters who are thrown parties and [offered] excursions by candidates to win their favour,” said Aranita Brahaj, project coordinator for ZaLart, a website which collects reports about alleged electoral fraud from across Albania.

The economic issue is the elephant in the room that nobody wants to talk about.

Lutfi Dervishi, Transparency International Albania

Brahaj said that, in the Kamza district of Tirana, voters were being offered anything from $30 to $100 for their ballot. Elsewhere in the country there have been reports of voters being offered food, money, and even cows in exchange for their votes.

“I think it is not a democracy, as some citizens cannot have a vote because they are poor,” said Brahaj.

There are question marks, too, over whether the result can be verified after Sunday’s vote. Following a split in Berisha’s ruling coalition in April, the Central Elections Committee (CEC) has only four sitting members – one fewer than the five required to declare the result of the election.

“There is no clean way for the results to get out, which doesn’t look good,” said Skye Christensen, an international election consultant. “You could find a way to get around it but you would have to break the law. The question is who breaks the law and where.”

All the main parties support membership of the European Union. But the accession process has stalled badly in recent years and the EU has warned that it will be watching Sunday’s vote closely. The election must be “in line with international and European standards”, Catherine Ashton, the European Union’s foreign policy chief, said in April.

Given Albania’s turbulent electoral history and the machinations around the Central Elections Committee, few are expecting a quick result.

“Albanian elections are interesting not prior to the election but the day after,” said Dervishi. “It’s a question of political will whether both parties want to proceed at speed [with the count and declaration] or put the brakes on the election process. It could take a while.”

This piece originally appeared on Al Jazeera. 

Croatians divided over EU accession

Zagreb, Croatia – As Croatia prepares for its accession to the European Union on Monday, many in the capital say they are hopeful the move will revive a moribund economy, but others aren’t optimistic ordinary citizens will benefit.

Croatia’s capital recently hosted a volunteer week to encourage people to get involved with groups that assist those in need.

In Strossmayer Park, a band in colourful traditional dress belted out Croatian songs, cheered on by a crowd of about 200 onlookers. Along the park’s well-maintained walkways were wooden stalls belonging to a raft of volunteer-based organisations, from associations representing lesbian, gay, bisexual, and transgender teenagers, to photography classes for the elderly.

Strossmayer Park, near Zagreb’s centre, is named in honour of Josip Juraj Strossmayer. A prominent 19th century Roman bishop, Strossmayer firmly believed that all the southern Slav nations in Europe should be unified – a dream eventually realised after his death with the creation of Yugoslavia.

I am glad we are joining the European Union, not because I think it is very great, but because I don’t think we have any other options. It would be worse without the European Union.Tajana Stamenkovic, psychology student

In the 1990s, Yugoslavia disintegrated in violence and ethnic conflict, leading to thedeaths of more than 100,000 people, and the displacement of hundreds of thousands of others. The wars also led the the country’s break-up. Now Croatia is set to join once again in a political union, this time not with its Slavic neighbours but its European cousins.

On Monday Croatia becomes the European Union’s 28th member, after two-thirds of Croatians voted “yes” in a referendum on joining the bloc. Among those in Strossmayer Park, opinion was divided on what life in the EU might bring for the Balkan state.

“I am glad we are joining the European Union, not because I think it is very great, but because I don’t think we have any other options. It would be worse without the European Union,” said psychology student Tajana Stamenkovic, a volunteer at an association dedicated to helping young people with behavioural problems.

Young people, many of them jobless graduates for whom volunteering is the only way to gain experience, man most of the stands in Strossmayer Park. In Croatia, unemployment is about 18 percent, according to data released by Eurostat in April. Among the under-25s, more than half are without a job.

Unemployment woes

“You have people with academic degrees, with masters degrees, and they can’t find any work,” said another volunteer, Vanja Pavlovic. “If you want to work you have to volunteer for no money, and after you finish your year of volunteering you have have no job for at least five to 10 years. It’s horrible.”

Like many young Croatians, Pavlovic wants to leave the country to find work abroad.

Dejan Jovic, a lecturer in politics at Zagreb University, described unemployment among the young as “the biggest problem” facing Croatia.

Jovic said he envisages some initial economic challenges as Croatia leaves the Central European Free Trade Agreement (CEFTA) – a trade bloc with various non-EU states, including former Yugoslav republics Serbia, Bosnia, Montenegro and Macedonia.

But he said he believes membership in the European Union will ultimately lead to increased investment, economic growth, and eventually jobs.

A Croatian war veteran holds a sign with pictures of former generals Ante Gotovina (L) and Mladen Markac [AFP]

“In the long term, we hope to be beneficiaries of the new situation, in which it should be easier to become part of a large European market. The main Croatian companies have already prepared themselves for leaving CEFTA. So we expect some initial set-backs in terms of export to these countries, but on the whole the impact will be positive,”Jovic said.

Europe ‘slowing down’

Not everyone is as hopeful about Croatia’s future in the European Union. Mihelin Ninoslav is a former drug addict now volunteering at an outreach programme for people with substance abuse issues. He said he sees little value in Croatian EU membership.

“I am a sceptic,” said Ninoslav. “Young people want a better life in Europe, but Europe is slowing down. It’s not like a couple of years ago. Before I was in favour [of Europe], but not now.”

The ongoing economic crisis in the eurozone is a concern, as is a fear that Croatia, which only became independent in 1991, could lose some of its identity. “It is not for me, Croatia is Croatia, it is not Europe,” said Ninoslav.

But professor Jovic said worries about the country losing its cultural identity are misplaced. “This has not happened to others, and thus it will not to Croatia either. These fears are part of conservative view on what makes ‘national identity’. Basically, this is fear for tradition.”

Croatian support for joining the EU remains reasonably strong. An opinion poll conducted this month found 61 percent in favour of membership. Most people “accept that membership in EU is good for Croatia, since it will mean more freedom, more security, and the end of a complicated transition from the 1990s”, Jovic said.

But he also noted it remains to be seen how the transition will benefit people here. “Research on Euro scepticism in Croatia shows that they are not sure whether they will personally live better or worse, since there is uncertainty over prices and increased competition for jobs. This is the biggest fear some people have.”

Healing the past?

European Union membership could also provide an opportunity to heal some of the festering wounds from the chaos that tore Yugoslavia apart two decades ago. Relations with neighbouring Serbia, with whom Croatia fought a brutal war, remain strained. Ethnic Serbs make up about four percent of Croatia’s population of 4.4 million.

“Croatian accession to the EU will improve the position of Serbs,” said Nataša Kandi, a human rights activist and the founder of the Humanitarian Law Center, an organisation campaigning for reconciliation in the former Yugoslavia.

Minorities will have more mechanisms to exercise their rights, the Serbs to return the property, and Roma will have more access to the public good.Nataša Kandi, founder of the Humanitarian Law Center

The European Union’s legal frameworks will make it easier for the 200,000 ethnic Serbs who were forced to leave their homes in Croatia during the conflict to reclaim property, said Kandi. It will also improve the situation for other minorities who regularly face discrimination, such as the Roma.

“Minorities will have more mechanisms to exercise their rights, the Serbs to return the property, and Roma will have more access to the public good,” said Kandi.

Joining the European Union has been portrayed as a pivotal moment in Croatia’s post-Yugoslav history marking the country’s transition from war and ethnic strife to peace and stability.

But not everyone agrees with this line of thinking. Sreko Horvat is a Croatian philosopher and the director of the Subversive Forum, an annual anti-globalisation, pro-peace conference held in May in Zagreb.

“From this perspective, Croatia is just a part of the Balkans, the mythical space where neighbours just can’t wait to kill and rape each other, and by joining the EU, Croatia will become a ‘stabilised’ and ‘civilised’ country,” said Horvat.

“The problem is, of course, that the EU is already ‘balkanised’. It is enough to look at Switzerland where the mosques are banned, or to France and its protests against gay marriage. Look at Greece where the public TV was just shut down, or Ireland where you even have drones surveilling protesters against the G8. These are the problems Croatia will face soon as well – not to mention even higher unemployment.”

Horvat also expressed concern about a deepening of Croatia’s already-advanced privatisation process. But he said there could be some unintended benefits with greater European integration.

“Maybe the only good thing with Croatia’s entrance to the EU is precisely the possibility of more cooperation between different progressive movements all around Europe, because we are all in this together,” said Horvat.

This piece originally appeared on Al-Jazeera.

On eve of EU accession, Croatia cautiously optimistic

During the recent local elections in Zagreb, almost every candidate was keen to stress their pro-European Union credentials. In the city’s Cvetni Trg, or Flower Square, some councilors handed out bumper stickers with the EU’s starry logo to passing shoppers. Others appeared on platforms festooned with Croatian and European flags.

Croatia is not yet a member of the European Union but it soon will be. On Monday, the Balkan state of just over 4 million people will become the 28th country to join the EU, and only the second from the former Yugoslavia – Slovenia joined in 2008.

croatia“I am looking forward to joining the European Union. As a young person, I personally think it is the best option for Croatia,” says Danijel Bicanic, a recent psychology graduate working in Zagreb.

Most Croatians agree: Last year, two-thirds voted “yes” to joining the European Union, and a majority still support that decision according to recent surveys.

Europe’s ongoing economic and political difficulties do raise some concerns in Croatia – which is suffering its own economic woes. But many believe that membership in the EU will help reinvigorate Croatia’s economy and tackle its corruption.

“I am not really concerned with the problems that are now in the European Union, because there are also so many internal national problems. I am more concentrated on those,” says Mr. Bicanic.

Tight times in Croatia

Croatia certainly has its fair share of local problems. The economy, which has scarcely grown since 2008, is back in recession and is expected to shrink by 1.5 percent of GDP this year. In March, unemployment stood at 21.6 percent.

Croatian politicians have been keen to stress the benefits of being part of the world’s largest trading bloc, but are playing down expectations that EU membership will bring an overnight reversal in the country’s fortunes.

“We are very aware that the European Union will not solve all our problems,” says Andrea Zlatar-Violic, Croatia’s minister for culture. “But it is very useful for us not to be one closed society, one closed state but to be open and without frontiers.”

Although any expansion of the EU in the Balkans is unlikely in the foreseeable future, Ms. Zlatar-Violic believes Croatia has an important role to play as a standard bearer for the region in Brussels.

“We really don’t want to be a wall between the Balkans and the European Union. We want to be completely open,” she says, “to organize a new Balkan space, a new public space, for all our experiences.”

New markets

EU accession will have a significant effect on the Croatian economy, says Vuk Vukovic, lecturer in political economy at Zagreb School of Economics and Management.

Clustering, where groups of inter-related industries are encouraged to locate close together and collaborative, has been a popular economic strategy in Croatia. But Dr. Vukovic says that businesses that have not adapted to entry into the European Union by forming clusters”will experience great difficulties and most likely go under.”

“On the other hand,” he adds, “there is a possibility that the new increased competition from the EU will encourage new innovative solutions among Croatian entrepreneurs and thus contribute to more wealth creation.”

A number of EU members – including Britain, Germany and the Netherlands – have placed restrictions on Croats traveling to work. Despite this, many in Croatia are worried about rising emigration, especially among young people, in the wake of the increased freedom of movement that EU membership will bring.

Vukovic believes that such a rise in emigration might actually help Croatia’s labor market – at least in the short term. Young people leaving for jobs in the rest of the EU would reduce unemployment in Croatia and lead to an increase in remittances sent back home. However, with an aging and diminishing population, Croatia can ill afford to lose its best and brightest for good.

Still, it might not come to this, says Vukovic. “The poor labor market situation across Europe may after all keep the people at bay.”

Arguably Croatia’s greatest asset is its 1,100-mile Adriatic coastline, peppered with spectacular islands. Hopes are high that EU membership will be a boon for the country’s tourism sector, although there are fears that increased numbers of foreign visitors will put prices – and particularly land values – beyond the reach of most locals.

‘A chance to move on’

Opposition to EU membership has risen since the eurozone crisis, but most Croatians still support joining the EU. The Associated Press reported earlier this month that according to recent surveys, some 60 percent of the population are in favor of entry, though only 49 percent believe that their country will benefit.

Some Croatians cite the EU’s role in strengthening transparency in Croatia and tackling the corruption that flourished after independence.

In 2012, former Prime Minister Ivo Sanader was convicted of accepting bribes. The onetime head of Croatian Democratic Union is still on trial facing further corruption charges. “Without outside pressure, the people feel this would have never been revealed,” says Vukovic.

Back on the streets of Zagreb, Bicanic typifies the cautious optimism that characterizes many Croatians’ attitudes toward EU membership. “Europe is our chance to move on” from the past, he says.

“It’s a chance to develop our society, to meet new people. I am really trying to look forward and not look back, because there is no sense to doing that.”

This piece originally appeared on the Christian Science Monitor.

Book review – Austerity: A History of a Dangerous Idea

The discovery of an error in an academic economics paper – even one authored by a pair of Harvard dons – is hardly most people’s idea of a headline grabbing news story. But that’s exactly what happened, in April, when a professor at the University of Michigan and an undergraduate student published data that revealed a serious coding mistake in a spreadsheet in Carmen Reinhart and Kenneth Rogof’s paper 2010, ‘Growth in a Time of Debt’.

Why was this headline news? Because Reinhart and Rogof’s research – which putatively showed that economic growth falls off a cliff once a state’s debt exceeds 90 per cent of Gross Domestic Product – provided the intellectual ballast for the on-going waves of ‘growth friendly fiscal consolidation’. That’s austerity, to you and me.

But, as Mark Blyth shows in this timely, authoritative account of the history of ‘cuts for growth’, the economic rationale for austerity was pretty diaphanous long before Reinhart and Rogof’s Excel boo-boo was unearthed.

austerityFor Blyth austerity (‘voluntary deflation’) is ‘a dangerous idea’ because ‘it doesn’t work in practice, it relies on the poor paying for the mistakes of the rich, and it rests upon the absence of a large fallacy of composition that is all too present in the modern world.’

After World War I, austerity was the policy of choice on both sides of the Atlantic, a process accelerated after the Wall Street Crash of 1929. The result, as any Junior Cert student can tell you, was, eventually, war. (In Germany, the Nazis were the only party opposed to austerity policies being pursued in the interwar years. They pledged to take the country off the gold standard and to actively increase employment. They did this — by building a war economy.)

Why then, 80 years later, when the global financial system went into meltdown, did world leaders turn again to austerity? The answer is that in narrow (but influential) circles, particularly in the US, the core ideas of austerity, inspired by rightwing Austrian economists – a minimal role for the state, cutting government spending, relaxing labour laws – never went out of fashion. And in one European state a version of austerity was being practiced for decades: Germany.

Tracing the lineage of the ‘the German ideology’, in Blyth’s homage to Karl Marx, is one of the book’s most useful contributions. Teutonic ‘Ordoliberalism’ has become the economic dogma of the continent, and particularly in the Eurozone. Which is great, as Blyth notes, ‘so long as you are the late-developing, high savings, high-technology, and export-driven economy in question’. For the peripheral PIGS, it’s awful and, worse, pointless. No matter how much it drives down wages and cuts back government services, Greek exports will never be able to compete with German exports.

Blyth has a terse explanation for the current economic travails: they ‘started with the banks and will end with the banks.’ The crisis unleashed in 2008 had nothing to do with government spending – Ireland’s net debt was 12 per cent GDP in 2007, this year it is expected to top 117 per cent – but arose from negligently over-leveraged banks hitting the wall. The cost of bailing out the banks was a sovereign debt crisis that we are still wading through with little prospect of shore in sight.

Austerity is often presented as TINA: ‘there is no alternative’. Blyth, however, has no truck with the ‘we all partied’ line and the moral puritanism that sees a post-bing purge as necessary purification. Instead he draws on reams of economic history to show that austerity as a road back to growth has seldom, if ever, worked.

He also has a good rummage around in austerity’s ideological baggage, from its roots in the Scottish parsimony of John Locke, David Hume and Adam Smith (the author himself hails from a working class household in Dundee) through to the impassioned anti-statism of Milton Friedman and Friedrich Hayek. Economically austerity is self-defeating, since if we all reduce spending at the same time we all grow poorer. What it has done is consolidate wealth in the hands of the already rich: in the United States, the top seven percent saw their average net worth increase by 28 percent between 2009 and 2011. For the remaining 93 per cent it dropped by 4 per cent.

So if austerity makes most of us poorer and only prolongs recessions, what is the alternative? Blyth is a respected academic economist, as the pages of footnotes attest, and he wisely counsels against pain-free solutions. His proposals – higher taxes and ‘financial repression’, such as capping interest rates on government debt – would not be without their opponents. But, as this timely book shows, austerity isn’t working, and it’s not about to start.

This review originally appeared in the Sunday Business Post

Book Review — The Unwinding: An Inner History of the New America

On Monday, September 19, 1977, Lykes Corporation of New Orleans announced that, by the end of the week, it would close Campbell Works, the largest mill in the blue collar Ohio city of Youngstown. That day, which became known locally as ‘Black Monday’, was the latest in a long line of body blows for a once prosperous city.

By the late 1980s, Youngstown, with a population of less than 100,000, was among the top ten cities in the United States for homicide. It led the country in the murder of black women under 65.

Youngstown’s story epitomises what New Yorker writer George Packer calls ‘the unwinding’: a historical epoch in which old political, social and economic models break down, where ‘everything changes and nothing lasts’.unwinding

Crisis, as the Italian Marxist Antonio Gramsci noted, ‘consists precisely in the fact that the old is dying and the new cannot be born.’ Packer’s is a reporter’s journey into this material and existential crisis as it unfurls across the US, from the derelict lots of Youngstown, Ohio to the foreclosed dream homes in the sun in Tampa, Florida, via the Ayn Rand acolytes in Silicon Valley and the corridors of power on Washington and Wall Street.

Packer has been consistently among the world’s top non-fiction writers and ‘the Unwinding’ is his tour de force, uncoiling over 400-plus pages to reveal the inner workings of modern America through the stories of three very different characters. Dean Price grew up in Rockingham County, North Carolina, where everyone ‘had Scotch-Irish names that fit neatly on a tombstone’. The son of a racist tobacco farmer, Dean has an epiphany in the wake of Hurricane Katrina – oil will run out, eventually. His life becomes a battle to convince skeptical Piedmont Republicans of the virtues of alternative energy and small-scale, local industry.

Dean loses everything – his house, his family (more than once), his business – but never his optimism. ‘[T]o me this is the greatest economic explosion that’s ever going to hit in our lifetimes, because all the money that’s being concentrated at the top, with food, fuel, clothing – what else do they control? banking – it might go back to little towns. I can see that happening.’

Occupy Wall Street appears late in the book – in a expertly weaved chapter about the disappointments of life in corporate banking and, ultimately, in the encampment at Zuccotti Park – but the protestors’ ‘We are the 99 per cent’ mantra provides the Unwinding’s unspoken leitmotif. The closest any of Packer’s central characters get to the omnipotent top percentile is in the form of Jeff Connaughton.

As a 19 year-old at the University of Alabama, Connaughton is inspired by a speech from a young Delaware Senator named Joe Biden. After law school, Connaughton – who describes himself as ‘the perfect number two’ guy – slowly begins to immerse himself in Washington: working on Biden’s ill-fated 1988 and 2008 presidential campaigns (with little thanks from the current vice-president); enriching himself as a lobbyist; eventually winding up as a senatorial aide opposing Obama’s appointment of the same Wall Street scions who had overseen the crash to clean up the mess. Jaded, Connaughton quits DC and moves to Savannah, Georgia where he spends his days writing about his time in Washington. The Payoff: Why Wall Street Always Wins was published last year.

Finally there is Tammy Thomas, a pugnacious Youngstown African-American who overcomes a heroin-addicted mother and a teenage pregnancy to secure a “job for life” in the factory. She raises her kids drug-free in a city choked by crack. She loses her job when the factory was asset-stripped, and is defrauded of most of $48,000 savings. But she remains indefatigable: building a new life for herself, and her neighbors, as a community organizer.

Subtly, yet relentlessly, Packer constructs his individual characters, and through them the character of his homeland. Here real incomes have not risen since the 1970s.  ‘As wages stayed flat, debt kept more and more families afloat’.

This new America needed new idols, too, and Packer supplements his character’s stories with pen portraits of Sam Walton, Jay-Z, and others. Most effective is the opening pair, Newt Gingrich – the New Right doyen who was among the first politicians to understand ‘the new rules of celebrity’ – and Oprah Winfrey.

Oprah’s motto (‘Go, girl. Go for it.) was an open invitation to her millions of viewers. And if they don’t manage to emulate her success? “[S]ince there was no random suffering in life, Oprah left them with no excuse.’

The Unwinding is a fascinating journey through an America that has largely remained hidden from a view. There are echoes of Don DeLillo’s Underworld in the scope of Packer’s vision and his deft eye for language and detail. There is a lugubriousness to this book, too, despite early protestations that ‘the unwinding brings freedom’.

It is not “Morning in America” any longer; the question now is whether the gloom is a precursor to a new dawn, or a long dark night.

This review originally appeared in the Sunday Business Post.

Aye or nae? Scottish teens will vote on independence

Most days after school, Sean Garcais and his friends ride their BMX bikes in North Kelvin Meadow, a patch of scrub land in the west end of Glasgow. They build ramps, try new tricks. Sean and his friends are like 15- or 16-year-olds anywhere else in the world, but with one difference: Next year they will all have a say on the future of their country’s independence.

Under the Edinburgh Agreement, which sets out the terms for Scotland‘s independence referendum in 2014, 16- and 17-year-olds will have a vote. The legislation that will enable them to vote in a United Kingdom plebiscite for the first time ever is currently making its way through the Scottish Parliament atHolyrood, in Edinburgh.

Today, the Referendum Bill Committee will report to Parliament, and a debate in the chamber is scheduled for the following week. But the lowered voting age is almost certain to be passed into legislation later this summer. It is longstanding policy of the pro-independence Scottish National Party (SNP), which dominates Scotland’s devolved Parliament.

The SNP has said that it backs lowering the voting age in order to enfranchise more youth in a decision that will affect the rest of their lives. “No one has a bigger stake in the future of our country than today’s young people,” said the SNP’s Nicola Sturgeon, Scotland’s deputy first minister, when the bill was introduced in March. “And it is only right that they are able to have a say in the most important vote to be held in Scotland for three centuries.”

But some see a political interest in the SNP’s support.

Politicians only gave young people a vote “because they think we will be more radical,” says Sean, who is a student at Glasgow’s Hillhead High School. “I’m not sure about it myself. I might vote yes, I might vote no.”

Some of his friends share his ambivalence. Others say they are firmly in favor of independence for Scotland. But when asked if they will actually vote in the referendum, the youthful bikers respond with cacophony of “ayes” and “yeses.”

Annie McFadyen firmly supports the proposal. “I think we should get a chance to vote – we can drive a car, get married, but aren’t allowed to vote.” The 15-year-old Glaswegian is in little doubt about how she will vote. “I’m for it. I’ve got strong views on the whole topic but I’ve got friends who aren’t bothered either way,” she says.

More nationalistic?

Young Scots, like their peers across the world, increasingly get information from social media rather than from traditional sources such as television news or newspapers.SNP-Scottish-independence-referendum-debate

This is an important change, says James Mitchell, professor of politics at the University of Edinburgh. “The big issue rather than the election is how we engage with this new generation that is coming through that don’t read newspapers.”

Access to information will be an important factor on how 16- and 17-year-olds vote, agrees Isla MacLennan, head of modern studies at St. Margaret’s Academy, Livingston, a school of around 1,200 students in central Scotland.

“Young people, generally, are more likely to be nationalist. It comes from a place of Scottish pride and the Tartan Army [the supporters of the Scottish national soccer team],” she says. But that nationalism “may be not that thought out. That’s what we are trying to do in our classes,” she says.

Recently, Ms. MacLennan staged a debate and a mock vote in class. Before the debate, a majority of students said they were against independence. After the discussion, 60 percent voted in favor.

But Professor Mitchell rejects the popular assumption that young people are likely to be more nationalistic, and more likely to vote for independence. “It will be very interesting to see if 16- and 17-year-olds vote differently, but I don’t think that will happen,” he says.

And even if they do swing one way more than the other, Mitchell does not expect the youth vote to be a difference-maker. The age bracket makes up around 3 percent of the Scottish electorate. With such small numbers, young people are unlikely to be a decisive constituency in 2014. Just getting them to the ballot box could prove a challenge.

“Young people are less likely to vote than older people, so I’d expect turnout among young people to be low,” says Mitchell.

An eye toward the future

Among the advocates of votes at age 16 are the Scottish Youth Parliament, a non-party political assembly that meets three times at the Scottish Parliament in Holyrood to discuss issues that affect young people and suggest solutions.

In the 2009 Scottish Youth Parliament elections, 65 percent of the 32,000 14- to 25-year-olds across Scotland who voted backed a proposal to extend the vote to 16-year-olds.

Allowing young people to vote “will give the referendum, whatever the result, more credibility,” says Kyle Thornton, vice chair of the Scottish Youth Parliament. “For 16- and 17-year-olds this is something that will change their entire life – the effect of it will be seen 30, 40, 50 years from now.”

One factor that may sway the minds of young voters is the promise of greater participation for 16- and 17-year-olds in an independent Scotland.

“If Scotland votes yes, I find it inconceivable that we won’t have votes at 16 and 17 in Scotland after that,” Mitchell says.

“But it is also possible that many of the people who think that votes at 16 will bring the sky down will wake up the morning after a ‘no’ vote and say, ‘maybe it’s not such a bad idea. We gave votes to women, votes to the working class, maybe we should give votes at 16.'”

After smoothing tensions in Slovenia, PM Bratusek seeks to win over Europe

If a week is a long time in politics, then two months can feel like an eternity. That has certainly been the case for Slovenian Prime Minister Alenka Bratusek.

Ms. Bratusek, the country’s first female premier and the telegenic leader of Pozitivna Slovenija (Positive Slovenia), only took office in late March. But she has spent the short weeks since attempting to negotiate passage between the Scylla of a European Commission that demands solutions for Slovenia’s ailing banks and the Charybdis of a public with limited stomach for further austerity.alenka_bratusek--621x414

And while Brussels’ verdict on Slovenia’s proposed reforms is expected tomorrow, she has already won plaudits at home for her handling of Slovenia’s biggest crisis since its secession from Yugoslavia in 1992.

“So, so far, so good,” a leading Slovenian economist says of the new premier’s performance. The economist, who is close to the government, was not authorized to speak and so asked not to be named. “[She] has a nice public appearance ,and she hasn’t antagonized the public in the way the former premier always did. Working in her favor is also the fact that she is a completely new figure in our politics,” the economist told The Christian Science Monitor.

Financial crisis

The immediate cause of Slovenia’s current travails is a familiar problem across the eurozone’s struggling periphery: undercapitalized and struggling banks. Slovenia, a nation of 2 million tucked in between Austria, Italy, Croatia, and Hungary, has been in recession since 2011.

After independence – and particularly after membership of the European Union in 2004 and the euro in 2007 – Slovenian banks extended generous credit lines to the “managers” of many formerly state-run companies to purchase controlling stakes in these businesses. These so-called “management buyouts” were politically popular, as they ensured that Slovenian industry remained in national hands.

But questions have been raised about the probity of these management buyouts. In the wake of the 2008 financial crisis and the tightening of credit globally, many of the loans made to fund these purchases are underwater, taking Slovenia’s once-formidable banking sector with them.

Further, the bursting of a construction bubble that grew from 2004 to 2008 has left empty properties across the country, particularly in Ljubljana, and tens of thousands of unemployed. Anecdotally, emigration has increased.

Corruption

On the streets of Slovenia, frustration with the economy has been compounded by the corruption that has dogged Slovenian politics in recent years.

Bratusek only became leader of Positive Slovenia when former President Zoran Jankovic was forced to resign earlier this year. A state anti-corruption commission found that he failed to report fully €2.4 million ($3.1 million) of assets accrued during his six years in office. (He remains mayor of the capital, Ljubljana.)

The same anti-corruption commission also found then-Prime Minister Janez Janša guilty of systematically violating law on the reporting of assets. A coalition headed by Mr. Janša’s center-right Slovenian Democratic Party fell in February, to be replaced by a new coalition with Bratusek and Positive Slovenia at its apex.

Janša’s downfall was also fueled in part by protests that began last November in Maribor, the country’s second-largest city. Tens of thousands protested against Mayor Franc Kangler, also accused of corruption. Here, for the first time since independence, Slovenian riot police used tear gas on protesters.

Mayor Kangler was forced to step down in December, but not before the protests had spread across Slovenia.

Staving off a bailout

The fallout from the corruption probe left the relatively unknown Bratusek as an unexpected beneficiary. But while Bratusek might be a new face on Slovenian television screens, she has a relatively long political pedigree.

Although only elected to the Slovenian parliament in 2011, for six years she was head of the directorate of the state budget at the ministry of finance under the former Liberal Democracy of Slovenia (LDS) administration that ruled from independence until 2004. That has helped her navigate the tricky political maneuvering currently required in Slovenia, where Europe and the public are pulling in opposite directions.

“If the politicians are too tough, they are out at home. If they are too soft, they are out from Brussels,” says Primoz Cirman, a leading economics writer for the Slovenian newspaper daily Dnevnik. “Right now [the government] are trying find out where the equilibrium is.”

Earlier this month, Bratusek announced a series of measures aimed at convincing the European Commission that Slovenia, the most developed economy in the former Yugoslavia, can plug a multibillion-euro hole in its banks’ balance sheets and stave off a eurozone-led bailout.

Proposals include the creation of a “bad bank” to allow the banking sector to offload non-performing debts; a 2 percent increase in VAT; and the sales of 15 publicly-owned businesses including Telekom Slovenia and national carrier Adria Airways.

Smaller protests

Bratusek’s presence has softened the country’s ongoing demonstrations, whose size and frequency have decreased in recent months.

In Metelkova, a former barracks of the Yugoslav National Army in Ljubljana that has been home to squatters since 1993, Anej Korsika from the nascent Initiative for Democratic Socialism explained that the change of government has taken some of the sting out of the protest movement.

“The struggle under Janša was much easier,” he says. “[Janša] called the protesters ‘Communist zombies’ and ‘leftist fascists’ and all these things which really infuriated people and really mobilized them to go onto the streets in bigger numbers than they would otherwise.”

Slovenia prepares for summer of discontent

Ljubljana, Slovenia – In Slovenia, few traits are as highly prized as gospodariti, literally the ability to manage finances prudently. Gospodariti was often cited to explain Slovenia’s emergence as an industrial motor of Marshal Tito’s Yugoslav system during the Cold War. As Yugoslavia collapsed in bloody fratricide,gospodariti again came to the rescue, helping a newly independent nation of just two million people to fashion a flourishing economy on the edge of a warzone.

Two decades later Slovenia’s cherished reputation for fiscal rectitude has, like the status of its government bonds, been reduced to junk.

On May 29, the European Commission told Slovenia that its heavily indebted banking system would require an independent review. The same report gave Slovenia until 2015 to bring its budget deficit below the European Union threshold of 3 percent of gross domestic product.
ljubljana-slovenia
The Commission also called on Prime Minister, Alenka Bratusek, to push forward with a package of fiscal proposals announcedlast month. These measures include the sale of fifteen publicly-owned businesses, a 2 percent increase in Value Added Tax (VAT) and the creation of a “bad bank”.

Slovenia appears to have staved off the short-term threat of becoming the sixth Eurozone member to receive a bailout — but everything is far from green in this picturesque Alpine state.

Difficult transition

Ljubljana, Slovenia’s compact capital, is peppered with empty apartment blocks and unused retail units. Across the country, emigration is on the rise. Unemployment, historically low even after communism, stands at over 13 percent. Lack of infrastructure investment has terminally weakened a once powerful manufacturing sector.

Slovenia has twice been in recession since 2009. This year the economy is expected to shrink by around 2 percent. Prospects for growth are “weak even in a quite long medium term horizon,” a leading Slovenian economist who spoke on condition of anonymity, said in Ljubljana, the capital. “We have a contracting domestic sector and an exporting sector that is slowly losing momentum.”

When Slovenia gained its independence in 1991 it was by far the most developed of the former communist economies of Eastern Europe. Tito’s 1974 reforms of Yugoslavia’s socialist system helped open the country up, socially and economically. Taking advantage of its industrial workforce and its location between Central Europe and the Balkans, international companies such as Bayer and Renault built factories in Slovenia.

We are now in the state of shock that Slovenia avoided 20 years ago. Maybe our story is proof that you can’t change systems without a shock.

Primoz Cirman, economics writer,

“We had communism which was not as severe as in other countries,” said Primoz Cirman, an economics writer for Dnevnik, a leading Slovenian newspaper daily newspaper. “The fist was not as iron as it was in other countries, it was more mellow.”

In the early 1990s Slovenia’s first generation of post-independence leaders looked to consolidate the country’s economic strength within its borders, rather than follow the privatisation drive in much of Eastern Europe. “For the first time in our history we were the masters of our own property. We thought ‘let’s not waste it, let’s privatise slowly,” said Cirman.

The roots of Slovenia’s current crisis lie in this uneasy transition from socialism to the free market. Many of Slovenia’s best companies remained in the hands of the state and a new generation of ‘managers’. Many of these managerial executives took out huge loans to buy controlling stakes in the businesses they ran.

Slovenian banks relied on the cheap credit that flowed in the wake of joining the European Union in 20004 and, particularly, the Euro currency three years later to fund these managerial buyouts. When the credit crunch hit in 2008 loans stopped performing.

Attempts by Slovenian bank to plug the gap in their finances by tightening lending to the national economy has contributed to the slowdown in Slovenia but not solved the country’s banking crisis. Its two leading banks, Nova Ljubljanska Banka and Nova Kreditna Banka Maribor, are badly in need of recapitalisation. Last month, Nova Ljubljanska Banka’s Chief Executive Officer Janko Medja said that the bank would transfer €1.3bn ($1.69bn) of non-performing loans to the new “bad” bank.

“Slovenia’s problem was not the (global) economic crisis it was the naivety of the banking sector,” said Igor Luksic, a professor of politics at Ljubljana University and president of the opposition Social Democrats. “There was a great appetite for real estate and the great appetite of managers who wanted to buy their companies. That made the crisis of the banking sector.”

‘State of shock’

The crisis has also laid bare the close connections between business and politics in Slovenia. Earlier this year, Prime Minister, Janez Jansa, was forced to step down after a report from a national anti-corruption agency identified irregularities in his tax returns. Ninety-four per cent of Slovenians consider bribes to be a normal practice in business, according to a recent study by Ernst & Young.

It is not all bad news for Slovenia. At 56 percent, public debt is well below the EU average. The Slovenian banking sector is just 1.6 times GDP. There are some success business stories, especially in technology. But with an export-led economy and a paucity of lending at home, there is no end in sight for the Slovenia’s economic travails, despite Wednesday’s cautious green light from Brussels.

“The economy has collapsed. We have a corrupted political class and a managerial system,” said Franc Trcek, professor of sociology at the University of Ljubljana. “People have said that they have enough. At the same time half of the people will go and vote for the old parties. The other half are in apathy.”

On the streets of Slovenia, apathy has given way to frustration. Last autumn, a series of protests broke out over the decision to introduce speed cameras in Maribor, a once prosperous industrial city near the border with Austria. Thousands took to the streets in what became known as the “Maribor Uprising”.

For the first time since Slovenia’s independence from Yugoslavia in 1991, riot police fired tear gas on its citizens. Maribor’s mayor, Franc Kangler, was forced to step down, but not before the protests had spread across Slovenia, contributing to the downfall of the Jansa government in Ljubljana.

The demonstrations have died down, for now, but journalist Primoz Cirman believes they could reignite again. “The fire is out but the fuel is still there,” he said as a summer shower pours down on the outdoor market on Petkovsek Embankment in Ljubljana.

As for Slovenia, Cirman said that the current crisis shows that the country didn’t manage the transition from communism to capitalism as well as it – and the rest of the world – had thought. “We are now in the state of shock that Slovenia avoided 20 years ago. Maybe our story is proof that you can’t change systems without a shock.”

This piece originally appeared on Al-Jazeera