Daily Archives: 1 May 2007

Anne Applebaum on the New Europeans

Looking at the French elections, Anne Applebaum defines Sarkozy’s constituency as the New Europeans—those who are willing to emigrate:

Thanks to the European Union, which has opened borders and eliminated employment barriers, it is now not only possible to move, it is downright easy. And not only for the French: Something like a million Poles have left home since Poland joined the European Union in 2004, largely for England and Ireland. Unlike France, Poland is booming. But as in France, high taxes and complex regulations mean that jobs for young Poles are still too scarce and badly paid. Abroad, young Poles earn more and are treated better.

When they come back (if they come back) they’ll demand no less. The plumbers in Warsaw already expect to be paid something remarkably close to what plumbers are paid in Berlin — that is, if you can find a plumber in Warsaw at all.

All of this is, of course, precisely what previous generations of European politicians have feared. For the past decade, French, German and other European leaders have tried to unify European tax laws and regulations, the better to “even out the playing field” — or (depending on your point of view) to make life equally difficult everywhere. The emigration patterns of the past decade — and the past five years in particular — prove that that effort has failed. Sarkozy’s election campaign, if successful, might put the final nail in the coffin.

The political and economic consequences of this new mobility could be quite profound. Countries such as Poland and France may soon be forced to scrap those regulations and taxes that hamper employment, however much the French unions and the Polish bureaucracy want to keep them: If they don’t, their young people won’t come home. Leaders in those countries may also have to alter their rhetoric. Sarkozy’s Socialist opponent, Ségolène Royal, now uses words such as “entrepreneurship” at least some of the time, too.

Down the road, there could be cultural consequences as well. A few weeks ago, I wrote about the European Union’s failure to create anything resembling a meaningful European “Idea.” Almost by accident, the European Union may have created a new kind of European citizen instead: mobile, English-speaking, Internet-using, perhaps with the same nostalgia for Krakow or Dijon that first-generation New Yorkers feel for Missouri or Mississippi but nevertheless willing to live pretty much anywhere. Sarkozy is the first European politician to appeal directly to these new Europeans. Even if he loses, he probably won’t be the last.

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Yeltsin, Putin, and Deng

In his retrospective on Boris Yeltsin in this week’s international edition of Newsweek, Fareed Zakaria contrasts the divergent paths toward reform of China and Russia after their respective ideological houses of cards collapsed.

Boris Yeltsin … will surely stand as a figure on the hinge of history—yet he pointed Russia in the wrong direction. Compare Russia with China. In the early 1990s, they were the two most important countries in the world that lay outside the sphere of democratic, capitalist states. Russia had by far the stronger hand. In those days it was still regarded as the second most important world power, whose blessings were needed for any big international endeavor—whether the first gulf war or Middle East peace negotiations. It had a GDP of $1 trillion (in purchasing-power parity), the world’s second largest military and its second largest pool of technically trained personnel. Perhaps most significant, it had the most abundant endowment of natural resources on the face of the earth. And with Yeltsin as president, the country had a charismatic leader who could leverage this hard and soft power.

China by contrast was an international pariah. It had just gone through the shame of the Tiananmen Square massacres. Its per capita GDP was just one third that of Russia’s, making it one of the poorest countries in the world. Its educational and technological system was still in shambles, having been shut down during the Cultural Revolution. Its leaders—a group of seemingly narrow-minded engineers—were cautiously introducing reforms to a country still limping after decades of Mao Zedong’s mad gambits at home and abroad….

Look at the two countries today: though the Russian economy has surged because of high oil and commodity prices, China’s is now six times larger. Even more interesting is the political trajectory. Russia, in almost every dimension, has become less free over the past decade….

China, by contrast, has seen greater economic, legal and social reform every year. This year, finally, the Communist Party adopted guarantees of private property and greater government transparency. (For those who dismiss China’s reforms because they are “merely” economic, recall that for John Locke and Thomas Jefferson, the right to private property was at the heart of individual liberty.)

My point is not that China is freer than Russia. It is not. But for a decade, the arrow in Russia has been moving backward, while in China it is moving—slowly—forward.

This divergence between the Russian and Chinese models has had powerful implications around the world. Russia has become an example—but a negative example. The Chinese leadership has privately admitted to having watched Yeltsin’s reforms and decided that they produced economic chaos, social instability and no growth. (Russia’s GDP contracted by 20 percent during the 1990s.) Instead of similar shock therapy—which Bill Clinton’s Russia hand Strobe Talbott accurately characterized as “too much shock, too little therapy”—China chose a cautious, incremental path. “We must cross the river by feeling the stones with our feet,” said Deng Xiaoping. Rather than shutting down state-owned enterprises, Beijing chose to grow the economy around them, so that the state-owned portion kept shrinking and its problems became more manageable.

Look around the world, from Vietnam to Egypt, and you see officials studying China’s economic reforms. I have not come across a single official anywhere who has ever claimed to be emulating Russia’s path from communism.

Charles Krauthammer made a similar point last week.

Twenty years ago, Yeltsin made a strategic choice for democracy. Putin and his KGB regime have made a different strategic choice: the Chinese model. They watched two great powers take their exits from communism — Maoist China and Soviet Russia — and decided the Chinese got it right.

They saw Deng Xiaoping liberalize the economy while maintaining centralized power — and achieve astonishing economic success. Then they saw Gorbachev do precisely the opposite — loosening the political system while keeping an absurdly inefficient communist economy — and cause the collapse of the regime and the state.

Yeltsin’s uncertain, undisciplined and corruption-ridden attempt to deregulate both the economy and the political system caused such chaos that during his tenure gross domestic product fell by half. So Putin decided to become Deng. And while Deng destroyed democratic hopes in one fell swoop at Tiananmen Square, Putin did so methodically and gradually. By the time his goons beat up opposition demonstrators in Moscow and St. Petersburg earlier this month, so little was left of Russian democracy that the world merely yawned.

Of course, China also got a head start. Mao Zedong, the Great Ideologue who did more than anyone to discredit utopian ideologies and pave the way for brutally pragmatic realists like Deng, died in 1976.

via Peaktalk

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