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Crumbling Walls and Simultaneous Transitions.

datePosted on 19:10, November 10th, 2009 by Pablo

Among the celebrations and self-congratulations marking the 20th anniversary of the fall of the Berlin Wall, perhaps it is worth mentioning the process involved as opposed to the event. Contrary to what some may think, this was not exactly a full triumph of freedom orchestrated by a Ronald Reagan-led US in the space of ten years. Instead, it culminated a long process of decay within the Stalinist camp that was the result of internal contradictions that analysts of regime change have seen in other forms of authoritarianism. Not to belabor the point, but authoritarian regimes tend to fall for the same reasons even if their specific ideologies may differ. Defeat in war is one such reason, but where the regime is long-lived and institutionalised, the source of decay is from within the regime itself. Institutional sclerosis and lack of responsiveness are to key measures of authoritarian regime decline. Short of war, the role of external agents in authoritarian demise is marginal, at best serving as an accelerant for long-standing trends. That was clearly evident in the Soviet bloc, and once the repressive apparatus decided not to increase its support for Stalinist regimes in the face of rising socio-economic unrest, it was only a matter of time before they fell. Yet, interestingly enough, none of the Sovietologists in Western academia or intelligence agencies foresaw the inevitable until events were already unfolding (something that reflects the nature of their training, which is now evident in US approaches to MIddle Eastern and Chinese studies. To put it bluntly: studying countries from an adversarial viewpoint often leaves analysts unawares of both the broad and narrow nuances that make or break a given form of rule).

Be that as it may, it is not the subject I wish to address here. Instead, I simply wish to note that the post-collapse era in the former Eastern bloc has been a mixed blessing rather than an unqualified triumph for democracy or capitalism, and that is largely due to the nature of the regime transitions themselves.

Students of regime change note that the transition to capitalist democracy from socialist authoritarianism occurs in one of two general ways involving three specific processes. The first two processes of change  are called sequential transitions, where either change in the economic structure is followed by change in the political structure or vice versa. For example, China is undergoing a long transition whereby its economic bases have moved from socialist to capitalistic, yet it retains one-party rule while the transition is ongoing. Here structural change precedes political change. With some variances, this is what Cuba and Vietnam are doing today, and was also the case in Chile in the period 1973-1990, where the market-oriented economic base was cemented under dictatorial rule, which was followed by a period of authoritarian regime liberalisation leading to the restoration of democracy.  More broadly, the sequence holds true for a number of countries: e.g. South Korea, South Africa, the Philippines and Taiwan all fostered capitalism before they embraced democracy. It is important to note that political liberalisation leading to democracy is not often the stated intention of the liberalising authoritarian elite, but becomes an increasingly possible outcome once command economies are dismantled simply because of the proliferation of private actors and decentralisation of economic decision-making that ensues. At that point the genie is pretty much out of the bottle–but not always.

Conversely, political change towards democracy can precede economic change towards capitalism, although it is generally believed that such a sequence is more difficult to achieve because democratic politics allows subordinate groups to organise electoral resistance to economic dislocations caused by a shift to market-oriented macro-economic policy. This was seen in Argentina in the 1990s and Mexico in the early  2000’s. Generally speaking, students of regime change agree that economic change ideally should precede political change simply because the latter occur after populations have gotten used to the new economic facts of life. That counsels for so-called “top-down” transitions where authoritarians control the timing and tempo of sequential economic and political changes leading to democracy. Put differently, once the new (diminished) threshold of economic consent has been established, elections can be held. This is in contrast to “bottom-up” regime change whereby the masses rise against the authoritarians before the latter are  able to schedule an orderly transition sequence, often leading to political conflict and economic stagnation. Although there are (semi) peaceful forms of bottom-up change (such as Argentina after the Falklands War or the People’s “revolution” in the Philippines), social revolutions are the most intense form of “bottom-up” change, and it should be noted that in most modern instances they result in the imposition of a new form of authoritarianism rather than democracy.

That brings up the second general transition path: simultaneous transitions. Analysts concur that, due to the myriad complexities involved, simultaneous transitions from socialist authoritarianism to democracy and capitalism are the least likely to succeed. In some sense, they are directly contradictory in that they involve the opening of the political franchise while at the same time narrowing social redistribution networks, pubic goods and other socialist “entitlements” (noting here that the trade off in authoritarian socialism was supposed to be diminished political voice in exchange for increased social egalitarianism and welfare). The general line is that a country can do one sequence or the other with some chance of success, but in trying to do both at the same time it is almost guaranteed to do neither. That, however, was something that Western political elites ignored or did not care about in their headlong push to “open” these former Stalinist societies to Western economic and political influence.

Ergo, the Fall of the Wall. Never mind that  Polish dockworkers began the slow crumbling of European Stalinism with their strikes in 1980, that Glasnost and Perestroika accelerated it, and that the Berlin Wall came at the end rather than the beginning of the process of Stalinist decline. Or that the fall of communism in Romania was violent and resulted in a different Stalinist cadre taking over. Or that the result of the implosion of Yugoslavia was genocide at the hands of Serbians that required repeated NATO military interventions. Instead, let us note that the entire Soviet bloc, from Central Europe through the Balkans to the Caucuses and into Central Asia, endured simultaneous transitions with very mixed results. Some countries–the Czech Republic, Hungary,Estonia, Latvia, Slovakia and Slovenia, for example–managed to weather the transition process and are now doing remarkably well as market-oriented democracies. Others–Georgia, the Ukraine, Bulgaria, and all of the Central Asian “stans,” are governed by mixtures of elected authoritarians and oligarchs, to which can be added the centre piece, Russia. In many of these countries the transition to market capitalism has also been thwarted, and instead has turned into variations of crony-capitalism, mafia-capitalism, oligarchical control and/or state capitalism in strategic industries (especially energy resource extraction). In fact, in most of the former Stalinist world there is neither democracy or markets at play in the lives of the average citizen. In many countries pre-Soviet ethnic-religious divisions have come back to the fore, and in some of these countries conditions are worse than they were before (Chechnya). Ultra-nationalist movements have gained ground in many former Soviet republics, and in response Communists have started to regroup.

The broader reasons for this are multiple and deeply rooted in social, political and economic authoritarian legacies that cannot be changed or dismantled in a generation, much less overnight. But the precipitating reason lies in the simultaneity of the transitions themselves: absent a historically rooted culture of democracy, social tolerance and market exchange, most of the former Soviet bloc became a field of play for economic opportunists and demagogues rather than democrats and entrepreneurs. What is most striking is that, once having realised the difficulties in simultaneously pursuing democracy and market economics in post-Soviet contexts, both Western as well as local elites have apparently made the decision to support markets (even in their quasi-capitalistic versions) rather than democracy in most of that world. Whether by choice or chance, there is no elective affinity between democracy and market economics in these contexts.

Thus, we should view the 20th anniversary celebrations of the fall of the Berlin Wall with a jaundiced eye. On the one hand, it marked the death of European Stalinism and liberated millions of people from that scourge. On the other hand, for many it did not deliver on its promise of freedom and prosperity, and is still far from doing so in many parts of the non-European former Soviet bloc. More generally, authoritarian regime transitions may be a universal good, but only if they lead to something better. That has not always been the case in the Post-Cold War world. Less self-congratulation and more reflection would therefore seem to be in order.

10 Responses to “Crumbling Walls and Simultaneous Transitions.”

  1. SPC on November 10th, 2009 at 22:52

    It’s so hard to be a government ruling with consent, accountable to the democratic process, when state assets are going into the hands of only some of the people – people whom will receive profits which once afforded largesse to all the people.

    The people may not like it.

    In such a transition, contacts, banking and the black market become the new means to power – who has access to money can buy up assets when they are cheap and join the new oligarchy.

    Many of the people who know of this will not like it.

    A free media would hold those involved in running the transition to account, which is why it remains in the hand of the state throughout the process, or is given over to the new oligarchy.

    But does a transition from socialism state economy to a “capitalist” economy have to occur in such a way?

    There is a democratic problem with such a capitalist transition whenever the economy is struggling – because making some of the people richer while others are less provided for will result in inequality. Such a change would not be popular.

    There are alternatives.

    The problem in Russia was that the transition occured while oil prices were low – under duress. At a later stage, the rising oil revenues would have enabled the state to continue to make social provision and for the shares given to the people to remain with them (rather than being sold under duress of poverty). Then the outcome could have been more on the Scandinavian model, rather than a failed democracy and an oligarchic economy.

    After all Russia’s economic recovery has little to do with its new “capitalism”, but the rise of energy prices.

    The flawed presumption is that socialist economies are all failures and that for economic success to occur capitalist leadership and command of the market and workers is required.

    But whether an economy is successful, or not, often has little to do with socialism or capitalism, but how well the economy fits in with the wider world – the failure of socialist economies has more to do with nationalist self sufficiency separating them from globalisation (growing markets and investment and technology). Many of the strengths of state socialism – such as a focus on the development of an industry, were copied by Asian tigers before they succeeded in the global market.

  2. Ag on November 11th, 2009 at 12:04

    To put it bluntly: studying countries from an adversarial viewpoint often leaves analysts unawares of both the broad and narrow nuances that make or break a given form of rule).

    So does studying them from a sympathetic viewpoint. The same people can’t seem to see that democracy looks like collapsing because it seems incapable of dealing with climate change and other long term problems.

    We can add to that the increasing authoritarianism in Western Society over the last 25 years, and it makes me think that everybody lost the Cold War.

    Apart from the Germans and a few others, most of those people were better off under the communists. They were told that capitalism meant that they would be living like Americans when the truth was it meant that most of them would be living like the poor in Latin America.

  3. Pablo on November 11th, 2009 at 12:20

    Actually Ag, for the political analyst the opposite of adversarial is not sympathetic but objective. I agree that getting “soft” on the culture/society involved can render objective analysis impossible just as viewing a culture or society as an enemy can do so.

    I do not see the post-Soviet picture as grimly as you do. As I mentioned in the post, a host of countries have benefitted from the demise of Stalinism. The trouble is that a majority have not, and you are right to note that mature democracies, in their present form, provide little in the way of “role models” for their nascent cousins in the former Eastern bloc.

  4. millsy on November 11th, 2009 at 13:41

    From what I gather, Gorbachev wanted a decentralised, more democratic USSR with some form of social democracy. The reforms that he initiated, were geared towards that end.

  5. Ag on November 11th, 2009 at 14:45

    Actually Ag, for the political analyst the opposite of adversarial is not sympathetic but objective. I agree that getting “soft” on the culture/society involved can render objective analysis impossible just as viewing a culture or society as an enemy can do so.

    I don’t disagree. I was insinuating that many political analysts think they are being “objective” when they are really being “sympathetic”. I’m not including you among them, but a hell of a lot that has been written in the last couple of weeks fails in that way. Democracy for many of us is a matter of religious faith. I wish it weren’t.

    I do not see the post-Soviet picture as grimly as you do. As I mentioned in the post, a host of countries have benefitted from the demise of Stalinism.

    They’re about the only people who did. We certainly didn’t. I accept your point, since not many people are as grim as me about anything. Maybe I listened to the Cure too much when I was younger. ;-)

    I wonder if there is a connection between the end of the Cold War and the increasing unreality of western democratic politics. That’s not to say that Cold War politics weren’t full of the usual BS. However, the genuine and terrifying prospect of nuclear war tended to drag things back to reality when push came to shove.

    Now we have a hyperindividualist faith-based politics based on the tried and tested principle of having one’s cake and eating it. I’ve been trying to work out why this has led to an increase in authoritarianism. I’m a mild fan of the political compass site, which maps people onto left/right and authoritarian/anti-authoritarian axes. It’s not hard to see from that site that politics has undergone a sharp tilt towards right wing authoritarianism in the last 25 years, even if the voters tend to be somewhat less authoritarian than their leaders (I guess that is to be expected and that political scientists have a name for that particular phenomenon). I’ve noticed this myself as a teacher (at various times I have had to teach ethics, and the issues come up in other things I do). While students are more tolerant of homosexuals and minorities, support for harsh retributive justice and social policies is much much higher than it used to be. I thought it was pretty bad when I got to college in the early 90s, but it has gotten worse since.

    I’m at a loss to see why what was trumpeted as a victory for the freedom of the individual has produced a world political climate that is in large part increasingly inimical to it (with the obvious exceptions of gay rights and suchlike). New Zealand has fared better than other countries (for what reason I do not know), but some, like Britain, are much more authoritarian than they were 20 years ago.

    That, for me, is the puzzle of 1989. I’m afraid solving this problem is beyond my competence. Any ideas, anyone?


    PS. Apologies for the poor structure of this post. I am in a hurry.

  6. SPC on November 11th, 2009 at 15:37

    The problematic transition of the last 20 years has been from protected economy to global economy and that has been true for many nations, not just former nations of the Soviet bloc.

    That the global economy operates on a competitive basis and thus diminishes protection for jobs of workers has caused as much costly socio-economic change as global warming is forecast to.

    The inability of the state to protect jobs in this environment leads governments to divest itself of ownership in industries subject to global market competititon. This speeds up the job dislocations.

    Here we adjusted painfully – and the approbrium falling on both Labour and National led to MMP.

    All a political transition requires is

    1. an executive accountable to some group in a public guardianship role (in lieu of an elected party contesting parliament).
    2. an independent judiciary
    3. a free media

    The problem is trying to do any more than this while a national economy is being brought into the global economy.

    And let’s be blunt the global economy involves wealth transfer to China – which is growing at the expense of the rest of the world because of its undervalued yuan. Of course the end result of this is the greater economic wealth in the world, but it is a cost on the rest of the nations of the world in the meantime.

    PS There is some irony in the globalisation being seen as a victory for capitalism – when China, which is the great winner of the past 20 year process, retains so much state sector ownership and control of its economy. But capitalism has triumphed in the declining West, this despite the fact the people of the West and the new democracies are not so enamoured with it. No wonder authoritarianism is on the rise amongst us – a new security imperative to declare surveillance of society to deter dissent (under cover of the declared war against terrorism and or crime).

  7. What would Hayek say on November 12th, 2009 at 13:51

    Aaargh – can people stop wasting time with criticism based solely on a mythical “if reform was done differently everything would be perfect”.

    I significantly agree with Pablo’s post any points I could add are just quibbles around the edges that add no value. But everyone else – what value are you adding saying the world sucks today.

    Yes there are problems in the world, its a bit messy, not everyone has a good life. But more people today than ever before have higher life expectancies, more people are enfranchised to vote and participant in civil society. And we have more ability to address issues.

    Maybe the problem with most commentators (myself included) is an irreconcilable debate that is essentially between optimists and pessimists (the world peaked at age 17 and high school – since then its all been downhill). I tend to see the pessimist problenm as being one of situation transferance. They see something bad happen in the world (child mugged in german park) and go I have a child, we have a park the world is becoming a dangerous place, ignoring the fact they live in NZ and the risks are completely different.

    On transitions – as a world we haven’t had a lot of experience with them in general – historically its been through ruling class revolutions and/or defensetration of kings/dukes (I like the word defensetrate, has a certain gastly but cool factor to it). Maybe what really is amazing about 1989 is that on that occassion defensetration was needed for authoritarian change – this leaves something to be hopeful about ourselves.

  8. Falafulu Fisi on November 15th, 2009 at 21:38

    Paul, what you’re describing in your post is application of complex system theory (CST) to global politics.

    Here is a good introduction on the subject.

    Causality, Emergence, Self-Organisation

    CST is still predominantly a research domain in physics and mathematics, but now researchers from other social science disciplines have started adopting it, since they recognize that it applies in economics, politics, etc,…

    PS: Paul, I haven’t seen you in the (Uni Rec Center) gym (if you’re back to NZ already). The last time I saw you, was outside Radio Live building waiting to go in for a live interview with John Tamihere and I think, it was a year or two ago.

  9. Falafulu Fisi on November 15th, 2009 at 22:05

    Here is one abstract summary that I came across:

    Complex systems approach to the study of politics

  10. Pablo on November 15th, 2009 at 22:21

    FF: Nice of you to join us here, and thanks for the references. You are always welcome to add your thoughts to our discussions.

    Let me digest your links before commenting–it looks like it could make good material for a separate post.

    As for me. Sorry to say but the terms of settlement preclude my return to my former job, and hence the gym (although I do try to use it when visiting NZ). Formal reinstatement does not mean de facto reinstatement in this instance, and given the lack of job prospects in NZ, I continue to live, reluctantly, in SE Asia (although it does offer another perspective on comparative politics and IR).

    I did not want things to work out that way, but management was adamant that my presence was inimical to the institution’s reputation and I did not have the financial means to continue the ER dispute through the courts. Thus the settlement on (largely) their terms.

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