Library:To kill a nation/Third worldization

Unlike most nations, Yugoslavia was built on an idea, Ramsey Clark once noted. With a federation of their own, it was hoped that the southern Slays would not remain weak and divided peoples, easy prey to imperial interests. The idea was that they would learn to live together, forming a substantial territory capable of economic development. Indeed, after World War II, socialist Yugoslavia became something of an economic success. Between 1960 and 1980 it had one of the most vigorous growth rates, along with free medical care and education, a guaranteed right to an income, one-month vacation with pay, a literacy rate of over 90 per cent, and a life expectancy of seventy- two years. Yugoslavia also offered its multi-ethnic citizenry afford- able public transportation, housing, and utilities, in a mostly publicly owned, market-socialist economy. As late as 1990, better than 60 per cent of the total labor force was in the public sector, much of it self-managed.' Even Misha Glenny, who sees Stalinism lurking in every Communist system, was able to state: "Throughout forty years of Communist control in central and south-eastern Europe, Belgrade had always offered a ray of optimism. Together with its sister cities in the [Yugoslav] feder- ation, Zagreb, Ljubljana and Sarajevo, it boasted a lively cultural life, [and] a relatively high standard of living.

This was not the kind of country that global capitalism would normally countenance. Still, the United States tolerated socialistic Yugoslavia's existence for forty-five years because it was seen as a wedge to divide the Warsaw Pact nations. The continued existence of Yugoslavia as a nonaligned socialist country also had the grudging support of the Soviet Union. Yugoslavia was a founding member of the United Nations and of the Nonaligned Nations Conference, and a regular participant in UN peacekeeping missions. But by 2000 it had been reduced to a pariah, the only country ever expelled from the United Nations. After the overthrow of Communism throughout East- ern Europe and the former Soviet Union, the Federal Republic of Yugoslavia (FRY) remained the only nation in that region that would not voluntarily discard what remained of its social- ism and install an unalloyed free-market system. It also proudly had no interest in joining NATO. The US goal has been to transform the FRY into a Third World region, a cluster of weak right-wing principalities with the following characteristics:

§ Incapable of charting an independent course of self- development.

§ Natural resources completely accessible to transnational corporate exploitation, including the enormous mineral wealth in Kosovo.

§ An impoverished but literate and skilled population work- ing at subsistence wages, a cheap labor pool that will help depress wages in Western Europe and elsewhere.

§ Dismantled petroleum, engineering, mining, fertilizer, phar- maceutical, construction, automotive, and agricultural industries, so they no longer offer competition against Western producers.

US policy makers wanted to abolish Yugoslavia's public- sector services and social programs, using the same "shock therapy" imposed on the former Communist countries of Eastern Europe and the Soviet Union. The ultimate goal has been the complete privatization and Third Worldization of Yugoslavia, Eastern Europe, and, for that matter, every other nation. It is to replace the social wage with a neoliberal global free market, a process that would deliver still greater wealth and power into the hands of those at the top. In the late 1960s and early 1970s, FRY leaders, not unlike Communist leaders in other Eastern European countries, com- mitted a disastrous error. They decided to borrow heavily from the West in order to simultaneously expand the country's industrial base, its export production, and its output of domestic consumer goods. But when Western economies entered a reces- sion and blocked Yugoslav exports, thereby diminishing its export earnings, this created a huge debt for Belgrade. And the massive debt began to develop its own interest-fed momentum. In short order, as in so many other debtor nations, the creditors, includ- ing the World Bank and the International Monetary Fund (IMF), demanded a "restructuring."' Restructuring consists of a draco- nian austerity program of neoliberal "reforms": wage freezes, the abolition of state subsidized prices, increased unemployment, the elimination of most worker-managed enterprises, and mass- ive cuts in social spending. The Yugoslays were to consume less and produce more, so that a larger portion of the national wealth might be redirected toward meeting debt payments.

GETTING COZY WITH THE PRIVATE SECTOR On NPR's Talk of the Nation, June 10 1999, Brian Atwood, an administrator in the US Agency for International Develop- ment (USAID), noted that the economies of the breakaway republics of Yugoslavia had to be transformed. "How do you privatize much of the society?. . . You have to use a lot of people on the ground, helping to provide the technical assistance so that societies can transform their [economic] systems." The other guest, Lodewijk Briet, a member of a European Commission delegation, agreed: "We need to work more closely with the private sector." He noted that US ambassador Richard Shifter, who was leading an effort in the state department in full coordination with USAID, "isvery much interested in getting the US private sector including, of course, the corporate sector, involved. And we are very much onboard in Europe as well."

Restructuring wreaked its neoliberal havoc. The World Bank drove hundreds of firms into bankruptcy, producing six hun- dred thousand layoffs in 1989-90, with additional hundreds of thousands working without pay for months at a time.4Tens of thousands of Yugoslays were forced to find employment as guest workers in West Germany, Switzerland and elsewhere. Industrial production, which had averaged over 7 per cent annual growth during the late 1960s, plummeted to less than 3 per cent in the 1980s, and to minus 10 per cent by 1990. The IMP and World Bank "financial aid package" allowed for an influx of imports and unrestricted foreign capital, leading to a further slump in domestic production. Transfer payments from Belgrade to the republics were frozen, again undermining the federal fiscal structure.5The drastic economic depression induced by IMF restructuring in turn helped fuel the ensuing ethnic conflicts and secessionist movements.

By 1991, the international creditors were in control of monetary policy. Yugoslavia's state-run banks were dismantled and the federal government no longer had access to its own Central Bank. Economist Michel Chossudovsky points out that the country "was carved up under the close scrutiny of its external creditors, its foreign debt carefully divided and allo- cated to the republics, each of which was now committed to decades of debt payments."7With a few strokes, the inter- national creditors helped dismember the FRY and put a fiscal headlock on the newly "independent" republics.

Through all this, the Serbian Republic was to prove especially troublesome. The government of Serbia rejected the austerity programs to which the federal government (then under a conservative president) agreed. Some 650,000 Serbian workers engaged in massive walkouts and protests, joined in many instances by workers of other ethnic backgrounds including Croats, Bosnian Muslims, Roma, and Slovenes.8In the 1990s, the rump Yugoslav federation (Serbia and Montenegro) con- tinued to prove refractory. It refused to produce primarily for export and would not privatize completely. As late as 1999, more than three-quarters of its basic industry was still publicly owned.9As far as the Western free-marketeers were concerned, these enterprises had to be either privatized or demolished. A massive aerial destruction like the one delivered upon Iraq might be just the thing needed to put Belgrade more in step with the New World Order.

NOT CLEANSED ENOUGH Belgrade reveals remnants of its Communist past in the many streets and buildings named for famous Communist leaders and partisan fighters. One major thoroughfare is "Boulevard of the Revolution;" others include "Lenin Boul- evard" and "Brotherhood and Unity Highway." Surely, I thought to myself, as I read such street signs, US leaders will not leave this country alone until those names are changed to "IMF Avenue" and "Morgan Trust Way," or at least renamed after some orthodox saints or reactionary military heroes of yore.