IPS Blog

How About a Tax System for the 99 Percent?

Cross-Posted with Yes! Magazine

Paying taxes, as tens of millions of us in the United States do every April, evokes many emotions—from gratitude for government programs that feed the hungry to disgust over paying for fossil fuel subsidies and unjust wars. But among a growing number of people, it is also evoking anger over an unequal tax system that favors the 1 percent over the 99 percent. More and more of us are saying that corporations, Wall Street, and the wealthy should pay their fair share.

Robin Hood Tax USA/Flickr

Robin Hood Tax USA/Flickr

The good news is that rising numbers of organizations and people are involved in struggles for a more just tax system. Below we share the contours of three such campaigns, all of them winnable before the next U.S. president is elected.

Corporations: Daily newspaper headlines remind us that corporations are making record profits while their workers’ paychecks have been frozen for decades. These same corporations complain that the corporate tax rate, pegged at a mere 35 percent, is one of the highest in the world. And, corporations are lobbying furiously to cut that rate.

Read the rest of this post on Yes! Magazine’s website

Did Boston Marathon Bombers Choose Patriots’ Day to Cover Their Tracks?

At National Journal, Michael Hirsch wrote:

The timing of the Boston bombing, coming on Patriots Day in Massachusetts, might well suggest [a U.S. right-wing extremist group] says Jessica Stern, a terrorism expert at Harvard University. … “All these discussions about whether they’re going to take away our guns would be another reason to suspect anti-government groups. The other thing that points in the direction of right-wing nuts is the date.”

Patriots’ Day, which commemorates the battles of Lexington and Concord and is celebrated in Massachusetts on the third Monday of April, “has been for long time exciting day to be an extremist violent group,” says Stern. The Oklahoma City bombing of 1995, the Columbine high school massacre allegedly timed with Hitler’s birthday, and a more obscure incident in which authorities raided a compound occupied by a radical “Christian Identity” group called The Covenant, the Sword and the Arm of the Lord” in 1985 all occurred in April. “This whole week is a very important week for right-wing extremists,” adds Stern.

On the other hand, as Ms. Stern wrote in Time magazine, pressure-cookers packed with hardware-store shrapnel such as nails and ball bearings have

… been used around the world, including in the Mumbai attacks of 2006 [and] was recently promoted in an article titled “How to Make a Bomb in the Kitchen of Your Mom” in the summer 2010 issue of al-Qaeda’s online magazine Inspire. The Times Square bomber Faisal Shahzad followed the recipe, though Shahzad’s bomb would have killed many more people than the relatively small bombs in Boston.

The question arises: If the bombers were Islamist extremists, did they use the date and venue to deflect blame onto American white supremacists? Which gives rise to other questions: Would the former be aware of how important the day, week, month, and city are to the latter? More to the point, wouldn’t Islamist extremists they want to turn the violence into a statement by claiming responsibility?

Perhaps more likely though, especially since no one has yet brought the presence of Middle Easterners to our attention — except for innocent Saudis* lucky to escape with their lives and limbs — white supremacists chose the type of weapon to cast blame on Islamist extremists.

*To see how sympathetic some Saudis were to the suffering in Boston, visit the Saudi blog Riyadh Bureau.

Bands Like Laibach a Powerful Amplifier of Former Yugoslav Social Discontent

LaibachThe worlds of rock music and academia are not entirely separate. Noam Chomsky has appeared on stage with Rage Against the Machine. Poet Paul Muldoon and fellow Princeton professors play gigs as the Wayside Shrines. And, of course, plenty of students opt for courses that deconstruct Madonna, probe the historical impact of the Beatles, and so on.

But in Yugoslavia, and particularly Slovenia, a particularly close relationship sprang up in the 1970s between punks and professors. “At that time, classical political and social critique was not possible, so the political and cultural discontent and critique took the form of Rock music,” explains sociologist and politician Pavel Gantar. “Punk Rock music was a form of contestation. Later on, the State started to apply political oppression, and, as I said, intellectuals came out against this oppression. In the late 1970s, Rock music substituted for the absence of political and social criticism.”

Intellectuals came to the defense of punk rockers, and musicians expressed many of the sentiments that intellectuals couldn’t safely utter in public. The music scene in Yugoslavia soon became the envy of everyone else in the Eastern bloc, and many music fans in the West also began to follow bands like Pankrti and Laibach.

Laibach was a particularly provocative band. In Bulgaria, Zheliu Zhelev wrote a book about fascism that was in fact a veiled critique of communism. Laibach offered a much more in-your-face comparison. Adopting a totalitarian aesthetic that was equal parts communism, fascism, and futurism, it parroted the rhetoric of the Yugoslav authorities and thereby presented itself as a paragon of socialist realism. Defending Laibach, Slovenian intellectuals were also defending freedom of expression.

But by the 1980s, when Laibach appeared, intellectuals were already beginning to create the civil society movements that served as vehicles for social and political critique. Music remained a powerful amplifier of social discontent. But now there were proto-political formations that began to carve out space in Yugoslav society for alternative platforms.

When I interviewed Pavel Gantar in 1990, he was the head of the Liberal Party. The number one question in those days was the fate of Yugoslavia. Would it stay together as a loose confederation or as a more centralized federation? Or, as some began to hint at in those days, could the country stay together at all?

“We went to Belgrade and came back very disappointed,” he told me in 1990. “Rational discourse was not possible. We talked about interests and they are talking about Serbian soil and blood and fears and fights and so on. That’s why we think that Yugoslavia is probably not an option any more. But still the question remains: how to come to such solutions if we can’t stick together. Every solution is a bad solution in this game. We would stand for any solution which would not cost lives.”

Slovenia would declare its independence in June 1991. Pavel Gantar went on to join parliament and become its chairman in 2008. He was a politician for 18 years: six years as minister of environment and spatial planning, four years as minister for telecommunications, information, and technology, four years as an MP in the opposition, and then three years as speaker of the house of parliament.

When I caught up with him a few months ago, he was taking a hiatus from politics. We talked about his years supporting oppositional culture, the period he spent in government and parliament, and what Slovenia might have done differently during its transition. Below the most recent conversation is the original interview from 1990.

The Interview

Pavel Gantar

Pavel Gantar

Do you remember where you were and what you were thinking when you heard about the fall of the Berlin Wall?

I certainly remember the fall of the Berlin Wall. I was here in Ljubljana watching the direct TV transmission, and certainly, as far as I remember, we discussed this issue with our friends very closely and considered what is going to happen after that.

And what did you think was going to happen?

We believed that this was the end of the Eastern bloc, but at that time I was not quite sure how quickly the so-called reunification of Germany would come true. At that time, Yugoslavia was not a member of the Eastern bloc, but everybody knew that this would somehow stimulate the democratic processes in Yugoslavia.

At that the time you were teaching?

I was an assistant professor at the University of Ljubljana, in the faculty of social sciences. My professional area is urban sociology and urban planning. Ever since I enrolled in university, I was in involved in student politics, and later on in democratic politics. I was involved in student movements from 1968 to 1974. Then there was the period of communist oppression from 1974 until the end of the 1970s.

The different civil movements started slowly in Slovenia, basically with the rise of punk music in the late 1970s. There was a very peculiar alliance between the punk music scene and the intellectuals, who tried to justify the appearance of this punk music. Punk music was immediately attacked for being anti-socialist, obscene, pornographic, pro-fascist, and so on. Why punk music? Rock music was the only form of criticism tolerated at that time. Therefore social and political critique was spoken in the language of punk rock. There were a lot of intellectuals, including myself and Tomaz Mastnak and others, who engaged in the public media against the labels that were given to this music. And from that point on started all the different movements like the peace movement and the ecological movements.

There was a debate here on civil society based on the interesting articles of the UK scholar John Keene on why civil society matters for socialists and others, which posed the idea of taking the notion of civil society out of the prevailing conservative discourse to give it more of a socialist orientation. And this discussion of civil society was very important in Slovenia: we started with the idea of socialist civil society and then we evolved to the idea of civil society under socialism, which actually proved that, in a one-party system with limited pluralism, civil society can virtually not exist. It can only exist in private, as an alternative independent of the socialist or communist structure. These debates were the basis for the social movements.

I also became president of the culture organization called Skuc Forum, which developed different artistic forms and aesthetics through theater, music, movies, and so on. Most of the artists involved at that time were suppressed in different ways. But these men and women, who are now 30 or 40 years older, now form the core of Slovenian art. All of them have received high awards. But they started in isolation.

In the 1970s the idea emerged that if you cannot change the system you should try to organize your life independently of the system. You should develop alternative forms of socialization that express your interests, and you shouldn’t care about what happens around you in institutions. The idea of antipolitics of Gyorgy Konrad had a great impact upon us. Then there was conflict between the army and Slovenian civil society in the case of Janez Jansa. Then came the fall of the Berlin Wall and all these transformations. Slovenia had an opportunity to become independent and start a new chapter in history with a lot of good things and, of course, a lot of bad things.

I’m curious what elements of the student movement of the late 1960s proved to be enduring contributions to the debate in the alternative sector in Slovenia?

I would say, in terms of direct importance, none of them. But in the middle of the 1970s, the student movement and its serious suppression produced a very important experience for the actors in the movement. They realized that change is not so easily achieved. They understood the huge gap between the ideas of socialism and the reality of socialism. Losing these illusions was a very important experience for those who were active in the student movement and then later in the civil movement. We became more skeptical. We understood that, most likely, the change of the system was impossible. But no system is so perfect, so totalitarian, that you can’t develop your own forms of socialization. And that’s what we did. We tried to expand the area of freedom. We tried to stand up against the very orthodox aesthetic criteria of the formal culture of Party politics. In the environmental field, we stood against water pollution, the illegal and unethical conduct of some companies toward nature, and so on. We criticized the national army in connection with the anti-nuclear movements in Europe at the time.

In this way, I think the experience of disillusionment was important for those who participated in these movements and later in the civil movements. We recognized the distinction between society and state. This is very important. And it came out of the discussion of socialist civil society, which turned into a discussion how civil society can survive under socialism.

As a result of many of the protests of the 1960s and early 1970s, which were repressed in turn in each of the republics, Yugoslavia got the 1974 constitution. Many people have told me that the 1974 constitution basically met many of the demands of these movements for greater autonomy of the republics.

Yes, the issue of autonomy was certainly an issue for the student movements: autonomy of the university, autonomy of different social groups, and also autonomy of the republics. But autonomy of the republics was not itself the goal. It was more autonomy in terms of democracy. I think the federal party leadership changed the constitution because it realized that the very strong oppression of the different autonomy movements – the so-called nationalism in Slovenia, Croatia, Serbia – would not work, that they had to find a forum and formula that would in the future prevent such sort of nation-based politics in the republics. And they tried to do this by somehow easing the relations between the federal level and the republics. They were sure that they could keep this within strong institutional structures.

There was a debate in the Party about whether to allow some forms of political pluralism or to allow the more autonomous activity of the Party within the republics, and they obviously decided for the latter. Greater autonomy for the republics was basically a rejection of greater political pluralism. I don’t think they dreamed that later on this autonomy could bring about secession or the collapse of Yugoslavia. They thought they had all the serious political strings in their hands under the control of the League of Communists of Yugoslavia and the Yugoslav National Army. So they could ease up on the relations between the republics and the federation and at the same time maintain the political domination with the Party and the Army. It was a miscalculation.

It was not only a miscalculation. You’re suggesting that the choice between different types of autonomy — autonomy at the republic level versus greater political autonomy — ultimately determined how Yugoslavia would dissolve. It other words, it could have dissolved in a politically liberal way, but instead it dissolved in a national republic way.

Certainly this is true. The problem of Yugoslavia is, speaking very frankly, that Tito probably died 10 years too late. He was a sort of symbolic guarantee of the state, but at the same time he was a guarantee that nothing would change. If you look at the history of Yugoslavia, from the time it was established in 1920 up to 1990, what do we see? Yugoslavia existed as a democratic state for only for a few years—from 1920 to 1922. And then there was authoritarian rule up to the beginning of World War II. After that there was a dictatorship and the rule of the Party. Immediately when authoritarian rule started to loosen up, the so-called centrifugal tensions became stronger.

So basically Yugoslavia might have been a nice idea, but it never actually functioned as a democratic state. This was the difference between the collapse of Yugoslavia and the peaceful division between Slovaks and Czechs. Here it was much more based on nationalist ideas, particularly of the Serbs. At that time, the Serbs implicitly equated their own views and interests with the interests of the entire country. And that was unbearable.

I’m particularly interested in the punk music period. It’s so unusual for university professors to come to the defense of punk musicians.

At that time, I was a very young assistant. I started as assistant at the university during the dismantling of the student movement in the early 1970s. This dismantling encompassed all student movement institutions, including the independent community of high schools in Slovenia. Only one institution remained: Radio Student. Radio Student was the first student radio in Europe, established in 1970 as a part of the syndicalist program of the student movements. I also worked there, as a correspondent. Radio Student broadcast from noon to 3 pm, which wasn’t very much. The Communist Party considered Radio Student relatively apolitical and not a dangerous institution—so they left it alone.

But at a time when other institutions had been erased, Radio Student took on the role of expressing protest and cultural discomfort through music. They were the most important promoter of international Rock music in Slovenia. They played all the new Rock music, especially British punk music like The Clash, The Sex Pistols, and so on. This music was also broadcast immediately here, maybe with fewer administrative and political obstacles than in the UK, because here it was just foreign music and nobody cared about attacking the Queen of England.

I’m sure the Communist Party here was happy to promote music that attacked the Queen of England!

Yes. Three years ago, I had dinner with the Queen, and I recall thinking, “How nice this lady is! She really looks just like my mom. It’s very pleasant to talk with her.” And I remembered the Sex Pistols lyric, “God save the Queen, the fascist regime,” and I thought, “Maybe she didn’t deserve that!”

But back then, this punk music found its natural environment here. The people were disappointed. The young generation was without hope. There was growing tension in the economy. There was no future. Slowly some local bands were established, like the band Pankrti. The lead singer Peter Lovsin had a big interview today with the newspaper Dnevnik, where he said that he never consciously meant to be a revolutionary, that it was only by accident. But the provocative lyrics, like the ones about having no future, were absolutely critical. At that time, classical political and social critique was not possible, so the political and cultural discontent and critique took the form of Rock music. Punk Rock music was a form of contestation. Later on, the State started to apply political oppression, and, as I said, intellectuals came out against this oppression. In the late 1970s, Rock music substituted for the absence of political and social criticism.

And there was Laibach…

Laibach was post-Punk. Laibach came later, in the early 1980s. While Punk actually criticized the hopelessness of the situation, Laibach took all these development one stage higher. Laibach was actually mimicking socialism. They took socialism seriously. They held up a mirror to power, to the Party. And it was because of this that they were subversive. They didn’t say, “We don’t like this ideology.” No, they said, “We will seriously apply this ideology to music.” And the authorities were very surprised with Laibach.

And did the audience understand this?

There is always a question of whether or not you understand the music, whether or not it touches you. And of course this music touched a lot of youngsters. They made the effort. But no one can really say how it affected people’s lives. But basically Laibach fans were more or less oriented toward democratic movements. Laibach comes from a coal miner’s town in Trbovlje, where there is a strong proletarian tradition, which has both some sort of nostalgia about that time as well as criticism of the coal miner tradition, industrial society, and so on.

And in this post-punk era, was it necessary for intellectuals to come to the defense of Laibach as well?

Of course! Laibach was actually operating under the Skuc Forum. And I did a lot of activities to protect the group. This peculiar connection between Rock music of all sorts and critical intellectuals persisted all through the 1980s up to the 1990s.

I want to focus on one aspect of the 1980s and that’s the anti-politics aspect of Gyorgy Konrad’s work. As you point out, there was a point at which people said, “We will simply ignore the political reality and will create our own space.” It seemed to be two options coming out of Konrad’s understanding of anti-politics. One was that you ignore the official political sphere and you focus on the private sphere. The other was to take the Charter 77 approach and challenge the authorities not politically morally.

Yugoslavia and Slovenia at that time were, in terms of political freedom of expression, much more open than the Czech Republic or Hungary. So basically a Charter 77 movement was not really needed, because a lot of things could be said here. There were movements around the magazine Nova Revija and its famous issue number 57, where actually there was already the idea of an independent Slovenia. And there was the Trial of the Four in 1988 [that pitted the Army against the magazine Mladina], which had some resemblance to the movements in Czechoslovakia at that time. But again, Slovenia was a relatively free country in terms of expression, so political engagement took a different form.

And do you think that the anti-politics of that period still has resonance today? I find that in other countries, in Bulgaria for instance, where people still have profound suspicion of the political realm, even if it’s a different political system?

Yes, I think so. Some part of the so-called 99% movement in Slovenia, which had been camping last year in front of the national stock exchange, resembled this anti-politics, even if they were not aware of it. They were much more inclined toward the radical political ideas of the 1980s and 1990s from the United States, like David Harvey and some others, and not so much inclined to rethink the experience of the protest movements and anti-political ideas developed under socialism in 1970s and 1980s.

And when you assess the political temperament of the average person in Slovenia—not so much the activist or the 99% movement, but the average person—is there any anti-political residue from that period?

I would say there is an exhaustion with politics. There is a general non-confidence in politics. There is a general conviction that politics is something dirty, something you cannot rely on. The people are sick of politicians and politics. They tend to withdraw to the private realm. But it’s not the type of engagement used in anti-politics. It’s much more neo-corporatist, I would say, more focused on collectivities like trade unions, pensioners, teachers, and trolley drivers.

When we talked in 1990, the discussion was still about whether a confederal model was possible. And at the time I think the specific debate was whether Croatia and Slovenia should work more closely with each other or whether Slovenia should go off by itself.

This idea of a close cooperation of trade between Slovenia and Croatia was a very transitory idea. The idea of a so-called Yugoslav confederation designed on the model of the European Economic Community was much more viable, and I remember the Liberal Democratic Party (LDS) actually advocated this idea. It was represented as an idea by intellectuals in Belgrade and elsewhere, but it was rejected entirely. The intellectual movement in Belgrade demanded radical democratization: one person, one vote, and so on. But that wouldn’t have changed anything, and it would have meant the absolute predominance of Serbian politics and the centralization of the state.

You could ask, “What would have happened if Milosevic was not there?” Maybe there could have been some sort of window of opportunity to redesign the federation into a looser, more democratic community of nation states. But this may or may not have happened. You could say that it was almost inevitable that Milosevic as a movement would appear. So, we should not ask ourselves what would have happened if Milosevic had not appeared. Instead we should ask ourselves, “Why did it happen that Milosevic was the option for Serbia?”

Back in 1990 you said, “There would have been a very good possibility that Vuk Draskovic would have been in power” and that would have perhaps been even worse.

Even worse. Because he would have had a democratic legitimation at least at the beginning. So as I said, Yugoslavia was a beautiful idea. But never in its 70-year history—except for maybe two years—did it exist as a more-or-less democratic state.

Do you think that any action by any major actor at the time, between 1989 and the end of 1990, could have made a difference in terms of avoiding such a savage war? And I don’t mean simply what Slovenia could have done, or what Croatia could have done, but also what the European Union or the United States could have done.

I think everyone underestimated the potential for ethnic conflict in terms of the agreements of Milosevic and Tudjman on the division of Bosnia. This was the problem. Everybody overlooked that. What we knew in Slovenia is that we should exit. Slovenians at different levels tried also to convince some others that this was an option for them too, but they didn’t believe it. They waited too long. They should have learned their lesson earlier. The basic problem was that the disintegration of Yugoslavia was an opportunity for the nationalist idea in Croatia and Serbia. Their claims over such a large ethnic and physical territory: that was the problem. Only if Bosnia, when it declared independence, could have come under some sort of international protectorate, with the UN or the EU immediately sending forces down there. You can’t really blame European or American politicians for not doing this. Nobody probably could have done this.

It would have been unprecedented.

Unprecedented. In the end, it would have been impossible because the Soviet Union stood strongly on the side of the Serbians and Milosevic. Nobody was happy about what was happening. The European Economic Community at that time tried to keep Yugoslavia together. But it was difficult to prevent the disintegration. Only maybe if Izetbegovic had been more open to the Serbs and Croats, advocating a much more ethnically pluralist society instead of building a Bosniak party. But again I think this would not have prevented the situation.

As you point out, the discussion at Karadjordjevo between Tudjman and Milosevic had already taken place. So nothing Izetbegovic could have done would have been effective.

No, not by that time.

When you look back at the decisions that Slovenia made, after the brief war that took place and once sovereignty was established, is there anything that could have been done differently that could have ensured a better outcome?

Of course, yes, particularly two decisions. One was very bad, and this was the law on the restitution of property that had been seized and nationalized during the communist rule from 1945 to around 1957. According to this law, everything should be given back to people in terms of property, objects, and so on. And if the property was no longer available, then qualified people would get really generous payments. We’re still paying for this. It has actually produced new inequities. With the restitution in Germany, if the house was still there then you got it back. If it wasn’t there, your compensation was very small. The more you have had confiscated, the less you got back. If the communists confiscated from you 100 euros, you got 100 euros back. But if the government confiscated 1 million euros, then you only got back 100 thousand euro. But here, it has been one of the great redistributions of wealth. Many of the properties that were nationalized had mortgages. And those loans were held by companies that had been nationalized. So, if you were overburdened with loans and your property was nationalized, now you were given it back after 30 or 40 years without any debt. Or you would get compensation if your house was no longer there because it had been replaced by a highway or something like that.

So it was 100% restitution?

Almost. And particularly for the church. The archdiocese of Ljubljana was allowed to restore the ownership of large forests in some Slovenian regions. Some of these forests had been actually sold to the state in the early 1920s. Later, on the eve of World War Two, they were returned to the Church. When the Germans occupied Slovenia they renationalized these forests, and of course when the communists came to power the forests remained in state ownership.

I don’t understand that. So the Church actually sold the forest in the 1920s…

Yes, and because this had been renationalized by the German state and then the communists nationalized it again, and so then it was subject to restitution. And just recently the Catholic Church got back the only island in Slovenia, which is on Lake Bled.

So they had owned this island up until the communist period?

Yes, they owned the church on the island. Nobody had any objections that the church building goes back to the Catholic Church.

But they get the whole island?

The whole island, yeah. It’s crazy. And there’s been a reorganization of local communities and municipalities, which has been led by the conservative parties. They want to preserve as many of the municipalities as possible. We are now facing enormous costs connected to local politics. We have 210 municipalities, and some of them don’t even have a thousand inhabitants. They have more eagles than people!

When the restitution law was proposed, was there opposition to it?

There was opposition, but it was not sufficient to prevent this law. Some of the members of the opposition—particularly ex-communists and liberal democrats—didn’t vote for this. They actually abstained and thus allowed the law to be adopted.

Also, the voucher privatization was not very good. Everybody got vouchers, but of course some of them traded their vouchers as soon as possible. Later of course some of these companies were viable; some others were not. But speaking very clearly, some sort of privatization had to happen. It was not optimal here, but I would say it was much better than in Hungary or some other countries where they simply sold what they got to funds controlled by foreign investors.

Up until recently, the Slovenian model of economic reform was held up as an example

The Slovenian model, after 20 years, is at the stage when it should consider some constitutional changes to promote better development. For instance, we should make some changes concerning the referendum process, because referendums are so easily achieved that you can block any sort of legislative decision.

Can you give me an example?

For example, on pension reform. Everybody knows that we should change the age of retirement from 63 to 65, not because of the economic crisis but because we live longer. But the law, which is very mild in terms of a long transition period, had been turned back by referendum.

It passed in parliament, but it was blocked by referendum.

Yes, and there have been other laws as well.

And there’s no mechanism for parliament to overturn a referendum?

No. The referendum is the last word. It’s not that the referendum should not be allowed. But the problem is that there is no quorum. If 20% of the population votes in the referendum, this 20% of population decides. And a lot of the issues have not aroused the wider attention of the public, so the minority can control the issue through the referendum process.

Also, the election law should change, in terms of providing more competition and more equal chances in some regions. Politically Slovenia has become very polarized. Center politics has disappeared in Slovenia, and now it’s much more polarized to the left and to the right.

The polarization of politics is of course happening in many countries. What factors do you think contribute to this polarization, aside from internal factors? What do you think are the common factors that lead to this polarization?

I keep asking myself this, but unfortunately I have no answer. In the Slovenian case, I would say that when one actor, like Janez Jansa, who has personified right-wing politics, chooses polarization, it’s very difficult for the other side not to play this game. The economic crisis has also created conditions in which politicians call for clear-cut solutions, which are one-sided and polarize the people.

In Slovenia there is a historical reason as well. There is a longstanding conflict between liberals and conservatives, between the clerical politics on one side and liberal (sometimes only “liberal”) politics on the other side. This polarization has existed in Slovenia since the late-19th century.

When we talked in 1990 the central tendency in the liberal party was between those focusing on classical liberalism—the classic economic liberalism of the European tradition—and the liberalism that focused more on civil liberties, and also social benefits, or the American liberal tradition. Does that tension still exist here?

It’s not very strong. This was an issue for the liberal democrats even before they came to the power. But later on the ideas of the traditional social liberalism of the American variety has prevailed in the LDS. The so-called neo-liberal politics played only a minor role in the early stages of the LDS. Later on the neo-liberals have been located elsewhere, particularly in the Slovenian Democratic Party. In the UK and the United States too, the political expression of neo-liberal economic ideas is conservatism, so they have been much more been linked to conservative politics, not liberal politics.

You mentioned two things in terms of your own experience of being both an academic and an activist and then going into politics. You mentioned the experience of polarization and also the experience of the power of referendum. Are there other things that surprised you about the political experience?

I spent 18 years in professional politics: six years as minister of environment and spatial planning, then four years as minister for telecommunications, information, and technology, then four years as an MP in the opposition, and then three years as speaker of the house of parliament. So I have a really rich experience in politics, and a lot of things surprised me.

I was surprised until my last day of professional politics, and I’m surprised even now, by how aware we were in the first period that we were creating a new state. We were developing institutions to enable people—at least so we believed—to have a decent life. Particularly in the environment and with physical planning and urban planning, our idea was to connect Slovenia by building highways. We did that. We believed that water was one of the most important resources and should be preserved and developed. So we started a large water-cleaning program. We adopted all the legal structures according to the demands and requirements of the European Union. So, there was a sense that we were doing something to enable Slovenians to have a better life, so that they wouldn’t have to worry about the water they were drinking, and so on. And this period ended with Slovenia’s entrance into the European Union.

The following period coincided with Janez Jansa taking over the government. And this became more of a battle over who gets what out of development. This has actually brought this country to the brink of economic disaster, where we now have to apply to the European Central Bank and the European Union for help. All of this earlier awareness has been lost after entering the European Union and adjusting our institutions to the requirements of a modern democratic state. After that, there was no big goal any more. It was more like: we are where we want to be so now it’s time to get as much as possible out of it. And those who resist this approach have no political power. So Slovenia now has a very unpredictable future.

Do you think that if EU membership had been delayed a couple of years more, these challenges could have been met internally?

I don’t think so. I think that this problem has been somehow present this whole time. After we joined the European Union, we thought that nothing bad could happen to us. It’s a psychological problem. But again, I’m somehow optimistic. I believe that we will find a way out of this period. And in many ways Slovenia is not doing bad.

Are you willing to back into politics?

I don’t know. Never say “never again.” I’m very happy with my position. I’m very glad not to be around politics right now. After 20 years of democracy in Slovenia obviously this is a time of generation change in Slovenian politics.

When you think back to your own positions back in 1990 or so, have you rethought any of your positions in any substantial way?

Not really in a substantial way. I rethought some of my decisions, for sure, but not in a substantial way. So, for instance, I would have made some environmental policies more quickly.

What about your understanding of liberalism as a philosophy?

I never understood liberalism in the market way. I saw it as a complex of ideas of basically European origin plus some later American features. I still persist in believing that thinkers from the 18th or 19th century cannot really fully answer questions today. But of course, you can also see how these issues and problems have been developed during this history, and that’s useful. So I’m not a dogmatic liberal-thinking politician. I know that the liberal set of ideas is maybe the most unorganized and controversial set of ideas ever. So if someone says to me that he is liberal, then I just start to consider what he could really mean by that.

Do you think the concept of an open society—which is fundamentally a liberal conception–is under attack in a substantial way? Do you see the possibility of an actual rollback to a very dangerous time, and I’m thinking here of FIDESZ in Hungary and…

Yes, certainly, I think so. This concept of open society is absolutely essential, particularly for the kind of democracy that can evolve out of authoritarian or totalitarian rule. I was so upset when I found that in the program of the LDS about six or seven years ago there was no mention of open society. Fortunately, I redrafted some of the chapters and put it back.

This is a really important issue, because the solution that is offered, whether by FIDESZ in Hungary or the Slovenian Democratic Party and Janez Jansa here, is a closed society: keeping society under control and depriving the people of possible alternatives. That’s a very dangerous idea. Sometimes people all too easily accept this idea, because they think that they will get security. At the end of the day, however, they will have neither openness nor security.

The last three questions are, quantitative. When you look into the future, the next couple of years for Slovenia, how do you assess the prospects on a scale from 1 to 10, with 1 being most pessimistic and 10 being most optimistic?


When you look back into the past from 1989 until today, and you assess everything that has changed or not changed here in Slovenia, how would you rate that on a scale from 1 to 10, with 1 being most dissatisfied and 10 being most satisfied?


And when you look at your own personal life over the same period, 1989 to today, same scale, 1 to 10, 1 being most dissatisfied, 10 being most satisfied?

I would say 8.

Ljubljana, October 17, 2012

Interview (1990)

Could you describe your present activities?

You should know that I am a member of the presidency of the Liberal party here in Slovenia. It is an interesting issue of how the party I belong to became a liberal party, what liberalism means for us, politically, economically. The history of this party also describes the democratization processes here in Slovenia and also the dilemmas that appeared after the first so-called free elections. If I start at the end of the story, one thing which is more or less obvious for us: the path from the one party system, basically totalitarianism, to a pluralist system, democratic elections and so on, is not such a one directional path. After the elections, we have still problems and issues with democratic institutions. Partly we are witnessing a new appearance of totalitarianism within the so-called democratic parties. We see some danger of the over-emphasis of the focusing on issues of national sovereignty which, I am speaking personally, endangers the rights of individuals.

One very important issue, to illustrate, is the question of national army. Now it is a very important issue in the so-called democratization process. Before the election, there was the idea that we should try to achieve some sort of internationally recognized status of Slovenia as a de-militarized zone, a zone where there is no army and so on. Almost all so-called opposition parties before the elections were for this zone more or less but after the elections, after Demos came into power, they very strongly changed their attitude and they see the national army as a very important attribute of national sovereignty.

The Liberal party’s view is that we should now build our economic and political future more on the formal institutions guaranteed through checks and balances so that political options should prevail in their totality and not so much on substantive issues which might be national sovereignty or the army. This liberal option is: we don’t believe in great projects. We don’t believe in socialism. Our organization has done a lot to show how to dismantle this system. We don’t believe in projects in big capital letters: Socialism, Nation, even Democracy. What we are really trying for is a sort of a actual political and economic system which would prevent any political group and any political issue from dominating all the others. And here our prime concern, therefore, is human rights. Human rights considering the citizens of Slovenia and Yugoslavia and trying particularly now in the debate centered around the new constition, we will strongly support maximum human rights guarantees, all sorts of checks and balances built into the constitution.

In the sphere of the economy, we clearly see that the so-called socialized socialist economy didn’t work. But on the other side, we see that there is no one way, no easy solution. We also know that the market economy or regulated market economy has had crucial setbacks. But nevertheless we don’t think that here we can organize an ideal economic system. What we are striving for is to create a situation which would enable people to take their initiatives in the economy with all necessary measures, particularly concerning ecology, social issues and so on. I would describe our liberalism more as human rights liberalism than economic liberalism. Although we think that we have to de-nationalize and re-privatize the economy but with some guarantees that would not allow the management and owners free disposal and so on.

The other very important topic is Yugoslavia. We also function differently on the topic of Slovenia-Yugoslavia. Before the election, the parties involved in Demos were standing for the independence and sovereignty of Slovenia as soon as possible. But we stood for cooperation which we operationalize in terms of a Yugoslav economic association which would have a common market, common elements of external politics, some financial and banking institutions. But the republics should be in other ways independent to act. Now, after the elections, Demos took this idea of cooperation. Now the situation is so that Demos will probably fight for cooperation between Slovenia and Croatia which we still don’t consider a good solution. Because good relations between two republics in which one is very small like Slovenia, various sorts of differences can come out. But now the situation concerning Yugoslavia is very different. As it looks, we went to Belgrade to see if there is some sort of possibility for restructuring Yugoslavia and then we found out quite clearly that there is not. Not because we don’t want it, but because Serbia doesn’t want it.

At the moment.

Yes, but this moment could last a very long period. Even after the elections. We talked with the opposition groups and they have the same position as the ruling party. We spoke of some sort of pact between Yugoslav nations and they were talking about war and redrawing the borders, dividing the territories – Macedonia, Bosnia and so on. So actually it is not the issue that Slovenia and Croatia are for greater independence but that Serbia is now determined that if they can’t rule over all Yugoslavia, they will advocate some sort of separatism to dominate south-eastern parts of Yugoslavia. Concerning the elections in Serbia, the opposition parties there think that Milosevic will prepare a new constitution, give the constitution to a referendum, certainly he will win a overwhelmingly majority and after that immediately organize the elections in a period of months with no chaance for the oppositional parties to prepare a fair pre-election campaign. But even if some other party comes to power, it will not display a different view on this issue. Particuarly if Draskovic comes to power. The Democrats and the Liberal Forum, whose basic ideas are close to ours in terms of liberal democracy, have no chance of coming near to power. So paradoxically if we are left to choose between confederation of Croatia and Slovenia and an independent Slovenia, we are inclined more toward independence.

What about these more democratic Yugoslav options?

This is what we were striving for. We produced this document about the Yugoslav economic association which is based on the following assumptions. All republics should have free elections. After the elections, the major political powers that come out of these elections should come together in some sort of round table and see the options. As you know, Yugoslavia’s beginning was already marked with bad marks. And that after the war, Yugoslavia was based on some rational assumptions which may work on a symbolic level but not on a level of practical political life. Its very rude what I will say, but: the fact that Yugoslavia is composed of very different cultural worlds (I’m not saying that the cultural wworld that Slovenia belongs to is higher, I’m a cultural relativist). So I’m not saying that the Serbs are in comparison to Western culture something less. Rather, I would claim quite the opposite. But the fact is that they are different worlds. The more I think of Yugoslavia, the more I believe that the causes of conflicts are based in the cultural sphere not in political or economic disagreements. But in the very differnt ways that people think that life should be organized. On the other side, the south-eastern space – from the alps to Greece – could present a terrain of mutual cooperation, but it must be based on mutual interest of the republics, of the nations. We think that Yugoslavia is possible if it is based on “a pure and rational calculation of interests.” So if every republic thinks that it will be better for it to join Yugoslavia, then Yugoslavia is possible. There are very few issues of interest: dispersion of population (Croats living in other republics) and the economy

There seems to be a basic contradiction between the ideals of liberalism (rational self-interest) and the irrational forces of nationalism that today exist within Yugoslavia. What will come of this clash

We went to Belgrade and came back very disappointed. Rational discourse was not possible. We talked about interests and they are talking about Serbian soil and blood and fears and fights and so on. That’s why we think that Yugoslavia is probably not an option any more. But still the question remains: how to come to such solutions if we can’t stick together. Every solution is a bad solution in this game. We would stand for any solution which would not cost lives.

Even if you become independent you will still have to deal with Serbia. Serbia will not suddenly become transfered to another part of the globe.

That’s the point. There are different options. But the problem is: the Serbians say “if you Slovenes don’t want to stay in Yugoslavia, you are free to go.” But that is not the situation in Croatia. 10 per cent of the population there are Serbs. Serbia are claiming historic territory including almost all of Bosnia and part of the Dalmatian hinterland. There are two possibilities in Serbia-Croatia relations: one is violent conflict, the other is some sort of agreement between Croats and Serbs. And this would allow that Yugoslavia would become some sort of confederation. But what would be the price of such an agreement? If the price would be that Kosovo goes to Serbs, and also part of Macedonia, then we would not go for such compromise. Because this was the politics before the war. Two big brothers were dealing between themselves and the smaller nations paid the price – Slovenia, Macedonians, Albanians.

Superpower relations.

Yes. Here human rights issues are involved. If we go apart, we would leave the Albanians to themselves. But if we stay in Yugoslavia, can we help the Albanians? That’s why I said that there is no good solution.

I don’t think anyone wants to see a partition solution as between Indiaa and Pakistan. That would mean population traansfers and the creation of homogenous populations. And the loss of life.

We claim that as well. Such a scenario involving moving a large section of population would be the worst for us. We are strongly in favor of ethnic minorities. They are entitled to the same rights as the majority population. And we do see them as a sort of element, abstractly speaking, which increased the variety of society. What is really boring is one nation. Sometimes we make jokes with Austrians: it’s really boring there! Yugoslavia is something you have to experience, sometimes dangerous, dynamic compared to the stagnant Austria.

In terms of Serbia, it will perhaps become more dangerous if isolated, if it feels cornered or trapped.

As I can see, Serbia is not very much interested in the Western parts of Yugoslavia. They are interested in part of Croatia, part of Bosnia-Herzogovina, and Macedonia. What we can see in Europe, tensions have been removed from East-West relations and transfered to the Balkans. If you see those Balkan countries treat national minorities you will see that Serbs are the most democratic! Compared to Romania, Bulgaria, Turkey, Greece, Albania. Sometimes I think that these Balkan nations are only waiting for Yugoslavia to fall apart and then they will jump for Macedonia. Part of the territory will go to Greece, the major part divded between Serbia and Bulgaria. Albania is simply too weak though it has 1/3 of the population in Macedonia.

You mentioned earlier some of the principles of classic political liberalism, checks and balances, etc. I’m wondering if you also hope to follow another liberal principle: the triangular relationship between state, business and labor developed in the U.S. in the 20th century?

Yes. I worked on this interwar period in U.S. history in my Ph.d. But Slovenia is very small and prone to corporatist solutions – in which labor and government come to some agreement, some undefinable unity. We would not be able to see how these interests are articulated. Already in the last 20 years, the Slovenian government wanted to rule the country as a big corporation with everything owned by the government. Some sort of unstructured corporate division which developed some para-governmental structure: this is what we want to prevent

Like Slovenia as a company-town.

Yes, we would like to prevent this. The other issue: precisely because we are small, the social space is very intensive. A lot more is happening in a small social space. Slovenia is in those terms a modern society. Therefore we stand for a strictly proportional system of voting which would allow that political and other preferences are presented through the institutional systems, in opposition to the majority system in which you have a reduction of interests before they enter into the institutions. But basically we do accept this scheme that social policy should be determined by these three actors: government, business and labor. But we want to see clearly defined positions. Now, the government is becoming even stronger than the last two years before the elections. Before it didn’t have the legitimacy as a one party government. Now it is a multiparty government but institutions remain the same. So it has political legitimacy and all the powers from the one party system. Which is very abnormal. On the other side, we have a business shattered by the bad position of the economy. We have a considerable industrial tradition, we don’t have big industrial cities or urban industrial working class. Aproximately 50 per cent of the working class is working farmers. Either they are employed in small industrial companies in the country or small cities or they move from the villages daily to the cities. The industrial urban working class is supposed to be the social basis for strongly organized labor either politically or in trade unions. But trade unions are not very important social factors here. Workers-farmers are culturally and politically inclined toward the country way of living and toward more rightist parties. Slovenia is not good soil for liberalism either. You had the domination of two big collectivist ideologies here: Catholicism and Communism. The urban middle class educated is very tiny.

You want to create countervailing forces without the social basis for such forces and in the face of a government clearly not interested in creating such opposition. What can you do?

The point is, as I said, when we think in these macro-sociological categories, the situation looks rather pessimistic. But I don’t really believe very much in terms of political parties and social bases. What is very charasteristic for our party, liberal intellectuals or even leftist-liberal intellectuals are certainly a minority in terms of the population as a whole but not a minority in terms of providing concepts and ideas. They have knowledge and skills of mobilizing the population. If you would order all liberal writers to stop all their writing, then the papers would simply have no articles! Right now we have 40 members of parliament out of 240 total. We are the strongest single party in parliament. That’s not so bad. In those terms, it is a question of party strategy. If it is able to organize, but not in a party way: it is chaarasteristic of liberal intellectuals not to want to belong to a party. What we do with this party is to create a supporting mechanism for the members of parliament and to make some channels for information and so on. We don’t want to be some kind of populist party with 50,000 members. We don’t need this.

One problem for liberals in the West, however, is that they often can’t win in elections because they have this faith in the power of ideas while other parties believe in the power of power.

We think that if we can manage to have some 15-20 per cent of the elected bodies, we would have a fairly good chance of providing stability. We wouldn’t say that publically: we say that we want more publically. But 15-20 percent, we think we can get that. Lawyers and professionals like that support us. Managers too. So we are not so restricted to only so-called liberal intelligentsia.

Are there major differences of opinion between branches of the party, between human rights liberals and economic liberals for instance?

We had the very same structuring in the Liberal party as characteristic in European Liberal party with this opposition of the two groups. Up to now, we don’t see this opposition as damaging to the party. On the contrary, it constitutes an internal dynamic of party life.

No Peace Dividend? Not So Fast

This blog post originally appeared on The Hill’s Congress Blog.

Obama administration’s budget included a promissory note. It will take them a few more weeks to tell us what they plan to spend next year on the Afghan War. Their intention to bring that war to an end, though, is clear.

Nobel Prize winning economist Joseph Stiglitz and his Harvard colleague Linda Bilmes are predicting that this will produce “little in the way of a peace dividend for the U.S. economy once the fighting stops.” They base this bleak assessment on the kinds of meticulous calculations that anchored their 2008 book The Three Trillion Dollar War: on the huge sums we will and must be spending to care for wounded veterans, for example, and the money squandered when war support functions were massively and unnecessarily shifted to private contractors.

They are surely and unfortunately right that what we will save by ending these wars has already been “spent” on the future, baked-in costs of misguided decisions made during those wars. But that doesn’t mean that the prospect of a “peace dividend” is gone.

That’s because the ending of the wars is coinciding with a broader defense downsizing, propelled by the battle over the budget deficit. And the effects of automatic budget cuts known as “sequestration” on the Pentagon budget will actually produce a smaller downsizing than any of the previous postwar periods: smaller than after the Cold War, or the Vietnam War, or the Korean War.

There is more downsizing to do, therefore, on a military budget that, adjusted for inflation, climbed higher during the post-9-11 period than any budget since World War II. During this period the idea of making choices among military priorities was simply shelved. And this budget grew on top of the separate budget that has funded the post-9-11 wars. With an economy starved from lack of public investment, we need that peace dividend. Will we get one? You wouldn’t think so, from the looks of the administration’s Pentagon budget request this year, which fails even to stay within the limits set by sequestration.

Jeff Attaway/Flickr

Jeff Attaway/Flickr

But there’s better news in what the new Defense secretary has been saying. Chuck Hagel’s first major speech April 3 at the National Defense University referred to the “inevitable downturn in defense budgets.” He criticized past weapons spending programs that produced “systems that are vastly more expensive and technologically risky than what was promised or budgeted for.” Hagel has committed to a serious reexamination of his Department’s spending practices, a “Strategic Choices and Management Review,” that will actually tie our national security strategy to the budget available to pay for it.

It will identify actual priorities from among the long list of missions the Pentagon has claimed for itself in recent years. The last major Pentagon reorganization, he noted, came during the height of the Cold War, when “[c]ost and efficiency were not major considerations.” He promises that the new review will take seriously the proposition that “DoD is incentivized to ask for more and do more,” and work to change this budget-busting combination.

Will he succeed? No telling, as yet. The first Obama administration (and last Bush administration) Defense Secretary, Robert Gates, had some of the same intentions, most of them unrealized. But the post-sequester world is different. In this world we know it really is possible to shrink the Pentagon’s budget, despite the best efforts of the defense industry, its congressional allies, and much of the Pentagon staff itself to keep it climbing ever higher.

To get to a Pentagon budget that is sized for our new postwar world, the downsizing momentum needs to keep going. While the war budget declines, we need to make sure that the “regular” Pentagon budget comes down with it. This is where a peace dividend can be found. We can’t give up on that goal so easily.

Pemberton is a research fellow at the Institute for Policy Studies and co-author, with Lawrence Korb of the Center for American Progress, of the Unified Security Budget for the United States.

Domestic Attacks Like the Boston Marathon Bombing Add Insult to Injury

Along with those killed in the Boston Marathon bombing, the numbers tossed around of how many will lose limbs are in the dozens. It’s tragic enough when veterans return from foreign wars with limbs missing. But, as Iraqis, Afghans, not to mention Cambodians, know, limbs lost on one’s home soil only add insult to injury.

If the Boston Marathon bombing is the result of an attack by a nation’s own citizens, it reflects poorly on that nation’s security and its civil society. If it’s the result of an attack by foreign extremists, we’re enraged by the harm that comes to innocents and humiliated that our security has been breached. If 9/11 has any small favor to thank goodness for, it’s that the lethality of its component incidents left us without many walking wounded to inflame the wound and rub our face in the security failures.

Should the Boston Marathon bombing be the work of foreign extremists, much as I personally am enraged by thought of their supporters celebrating, we need to be on guard against hate crimes and refrain from profiling. Nor should we surrender to the fear that engulfed us after 9/11 and enact yet more layers of security and measures that further limit civil liberties. Whereas those responses are on the back end — the reactive and defensive — we need to respond with the leading edge: foreign policy.

Should the suspects prove to be from the Middle East, retaliatory drone strikes or JSOC attacks will only add fuel to the fire. Meanwhile, the immediate aftermath of a tragedy is no time to interject commentary that even hints at blaming the victim. But our first line of defense is acknowledging that U.S. policies — such as stationing forces on Arab soil, failing to pressure Israel to halt their oppression of Palestinians, invading Iraq invasion, and unleashing drone attacks on Afghanistan, Pakistan, Somalia and Yemen — stoke fires and create enemies.

Ultimately, our best defense is not a good offense: it’s keeping the number of people we need to defend ourselves against to a minimum.

Structural Adjustment: Former President Ben Ali’s Gift to Tunisia (Part One)

Cross-posted from the Colorado Progressive Jewish News.

Tunisia's Baguette Revolution, January 2011

Tunisia’s Baguette Revolution, January 2011

Faced with a deepening socio-economic crisis that has only intensified since the collapse of the Ben Ali government in January, 2011, it appears more than likely that Tunisia is about to enter into a major agreement with the International Monetary Fund (IMF) for a $1.7 billion loan. As is almost always the case, the loan is conditionally based upon Tunisia fulfilling what the IMF calls structural adjustment criteria, a part of which has already been implemented – eliminating the subsidies on fuel which has increased their cost.

All this is being done in the classic IMF fashion with as little public discussion as possible either with the Tunisian government – its Constituent Assembly – or with civil society, which have had no input whatsoever into the process. For an international organization that talks the talk about ‘transparency’. its long held traditions of secrecy, especially where it concerns granting sizable loans to semi-peripheral and peripheral countries, is much more the norm.

That said, in this new post-Ben Ali era, confused and directionless as it is economically and politically, one thing that the Tunisian people have won is their freedom of speech. As a result, alas (for IMF, Tunisian Central Bank and Finance Ministry bureacrats), it has been more difficult to hide the details and conditions for this loan than in the past. A growing number of Tunisia’s talented political and economic researchers have been able to break through the traditional wall of silence to unearth the details of the loan and press the Tunisian government to do what it really seems to want to avoid – engage in a public, wide-ranging discussion on the loan itself, and more basically, on the direction of the economy itself.

Many of the revelations about the loans have appeared in Arabic, French and English at the Tunisian alternative media website, Nawaat.org, which has broken key elements of the story to the Tunisian public, enough so that government has been pressed to publicly respond. It is precisely this kind of discussion which has been missing from the Tunisian public since the Ennahda-led government came to power in the October, 2011 elections.

During the Ben Ali years in power (1987-2011), Tunisia was often cited as an IMF poster-child, i.e., IMF structural adjustment might have caused ‘problems’ elsewhere – but in Tunisia, at least according to IMF publicity, it seemed to be working. This particular illusion was blown to bits so to speak by the emergence of the massive social movement that brought down the Ben Ali government. When the mask was ripped off, it turns out that not only had IMF structural adjustment policies not helped Tunisia, they were a major contributor to the country’s socio-economic crisis. IMF statistics on Tunisia were, if not entirely fabricated, way off.

The rosy picture the IMF painted of the Tunisian economy was more hype than truth. In fact the policies failed. How interesting and typical that within the IMF there has virtually been no self-criticism for how it contributed to Tunisia’s economic crisis, as if structural adjustment had nothing to do with Ben Ali’s collapse. Worse – the policies continue. The proposed loan follows closely in the footsteps of those that came before. There is no change in the country’s post-Ben Ali economic policies from those that existed prior to his downfall.

If this hypothesis is accurate and, from everything I can tell, it is, there are consequences. As the last uprising was essentially caused by Tunisia’s embracing of neoliberal economic policies and nothing, or precisely little, has changed. Another major crisis cannot be that far off. History strongly suggests the relationship between neoliberal economic policies and political repression ‘go together like a horse and carriage’ as the lines from an old song go.

Nor has Ben Ali’s extensive repressive apparatus been dismantled; it remains largely intact, for awhile in cryonic suspension, but now coming back to life again. Having tasted the wine of freedom and empowerment – the fruit of unprecedented peaceful mass protest – it is unlikely that the Tunisian people will wait this time another quarter century before taking measures into their own hands once again. I do not write these words as some kind of ‘threat’, simply from my reading of history.

In any case, what follows is the first part of a three- (or maybe four-) part series. This first part looks at the Tunisia’s initial uneasy relationship with the IMF in the 1980s, Bourguiba’s resistance to the policies, and Ben Ali’s embrace of structural adjustment. Part Two will examine the results of Ben Ali’s neoliberal policies on Tunisia (1987-2011) and Part Three will take a peek at the current proposal, well on its way to being implemented. RJP)

Tunisia’s Baguette Revolution

For ‘outsiders’ the photo seems admittedly a little odd: a man armed with a ‘baguette,’ [i] as if it were a machine gun and not simply baked flour, pointing it at a Tunisian security force down the street on Ave. Habib Bourguiba. But Tunisians of any age understand it. The photo is from early January 2011, just before a million person march on Tunis forced the five-star kleptomaniacs, Tunisian President Zine Ben Ali and his wife Leila Trabelsi, from power.

The foreign media, including here in the USA, suggested that Tunisia’s January 2011 uprising was a ‘Twitter’ or ‘Facebook’ Revolution, but it was much more basic than that – it was about bread and roses ­– about pervasive economic stagnation, high unemployment, low wages and seething repression. At the time, no one was talking about whether women should wear veils or bare their tits, or thought the uprising was about trashing marabouts and trade union headquarters, or desecrating Jewish cemeteries.

Taking their cue from the poor man[ii] facing down Ben Ali’s security apparatus, hundreds of Tunisians picked up their baguettes and took to the streets. Symbolizing the failure of the Ben Ali years, the baguette was also reminder of the Bread Riots of 1984 which shook the country to its foundations, leading to a full scale national revolt that very nearly brought down what was then the 18-year rule of the country’s first president, Habib Bourguiba.

Tunisia Caught in the Global Crisis of the 1980s

True, the 1984 Tunisian economy was in the doldrums, although the current fashion – to blame the slowdown on the Tunisian economic model of state capitalism, with its strong social contract – misses the point.[iii] The global economy had been in the doldrums for a decade hitting the commodity, low-end manufacturing sector in the semi-periphery and periphery with a special vengeance in the early 1980s. Tunisia was caught up in the storm. In particular, the European economy, had gone through a decade of recession and high unemployment which, in turn, had a profound impact on Tunisia, as so much of the Tunisian economy was geared towards exporting to Europe (France and Italy in particular) and welcoming European tourists.

In the early 1980s, Tunisia’s economic situation deteriorated, the state’s tax base shrank. With some hesitation, the Bourguiba government was pressured to do what so many other Third World countries had to do at the same time: go begging to the IMF or World Bank for a loan. This Bourguiba did, and the IMF, being accommodating, agreed to offer Tunisia a substantial loan. But there were conditions: the usual structural adjustment conditions which have done so much over the years to widen the gap between poor and rich countries, to undermine and destroy the economic potential of many of the Asian, African and Latin American countries that accepted the deal.

Bourguiba Agrees to End Bread Subsidies; the Nation Rises in Protest; Bourguiba Withdraws the Proposal

These conditions included cutting government spending, reducing or eliminating capital controls and protective tariffs, depreciating the dinar (Tunisia’s currency). Part of the deal necessitated the Tunisian government ending its subsidies on wheat and semolina (ingredients in bread). Caught in the vice, Bourguiba agreed.

The price of bread doubled overnight. The price increase triggered two weeks of angry nation-wide protest demonstrations. As they had done once before in 1981, the security forces and military – led by then Interior Minister, Zine Ben Ali – crushed the bread riots. When it was all over, more than 80 Tunisians lay dead, hundreds wounded. Having not yet slipped into approaching senility, Bourguiba had the presence of mind to reinstate the subsidies and fired the ministers responsible for encouraging the loan. The political situation stabilized, but the economic downward spiralm, caught in the global structural crisis, continued.

Such bread riots were not unique to Tunisia. They took place all over the Third World in the 1980s as the world’s poorer countries were forced to lift subsidies on food, medicine, and education, to freeze public sector wages and benefits in exchange for World Bank/IMF loans.

For the next three years, until he was overthrown by his interior minister, Bourguiba resisted lifting subsidies. But in 1986, Tunisia ran short on foreign exchange. The crisis was triggered by plunging oil revenues (down 40%), declining tourism receipts, and a serious drought which badly affected the agricultural sector. Bourguiba grudgingly agreed to an IMF loan that required lifting subsidies on bread. With the 1984 bread riots (and a 1978 union initiated national strike) in the back of his mind, Bourguiba permitted wages to simultaneously rise to compensate some for the higher bread prices. Again people took to the streets in protest, but not with the intensity of 1984. [iv]

Enter Zine Ben Ali: ‘Our Man In Tunis’; Start of the Tunisian-IMF Love Affair

The government survived the crisis, although it was the beginning of the end of Bourguiba. Bourguiba’s successes were based upon a strong state participation in the economy, free public education, democratization of the role of women, and subsidies for basic food stuffs and fuel. As the tax base of the state eroded and the state fiscal crisis deepened, the social contract that Bourguiba had committed to for thirty years weakened and with it, the social base of his government narrowed.

Increased repression, especially against the country’s growing Islamicist movement (which itself was able to take advantage of the growing economic crisis) only narrowed Bourguiba’s support base that much further. On November 7, 1978, Habib Bourguiba was removed from power in a ‘palace coup’ on November. There was very little protest. Bourguiba was unceremoniously pushed aside with his former interior minister, the same man who had crushed the 1984 bread riots, Zine Ben Ali, took the helm.

In a matter of weeks, the new government’s attitude towards the World Bank and International Monetary Fund shifted from hostility and suspicion to a warm embrace. Using an old basketball trick – faking to the left, while moving with the speed of light to the right. At the beginning of his rule, Ben Ali promised openness and democracy. He gave Tunisia a quarter of a century of IMF structural adjustment and an increasingly repressive government, much crueler and all-embracing than anything Bourguiba had constructed. He went far to deconstruct much of the social edifice that Bourguiba had tried to build and would have done more had he had the opportunity. When finally chased from power in 2011, he left a country economically and socially polarized, half of the economy in the hands of the two ruling families (the Ben Alis and the Trabelsis), a repressive apparatus of more than 200,000 in a country of ten million, and an enormous debt burden. As is virtually universally acknowledged, much of Tunisia’s economic and social decay of the Ben Ali years lays at the door step of the International Monetary Fund.

Even before consolidating his hold on power, as one of his first acts, Ben Ali gave Washington a call and opened negotiations with the IMF for exactly the kind of structural adjustment-based loan Bourguiba had resisted.

Thus wrote Canadian political scientist Michel Chossodovsky:

Barely a few months following Ben Ali’s installment as the country’s president, a major agreement was signed with the IMF. An agreement had also been reached with Brussels pertaining to the establishment of a free trade regime with the EU. A massive privatization program under the supervision of the IMF-World Bank was also launched. With hourly wages on the order of €.75 an hour, Tunisia had also become a cheap labor haven for the European Union.[v]

In retrospect, the implementation of Ben Ali’s economic program was a classic example of what later Naomi’s Klein would refer to as the ‘Shock Doctrine’ to the Tunisian realities. In the Ben Ali case, a political coup – that by the way included the promise of greater democracy – became the pretext for a far-reaching economic restructuring of the economy. It included classic structural adjustment themes: reducing the state sector in the economy, lifting subsidies, ‘loosening’ the social contract, weakening the country’s education and healthcare system, keeping wages low, lifting capital controls, privatization of state resources, etc., etc. – all the policies that have made IMF structural adjustment the antithesis of Third World development over the past thirty years. It all happened quickly before the Tunisian public understood the degree to which their lives were about to be changed.

It was not only that subsidies would be ended and much of the country’s state-owned economic structures be privatized, the country’s entire economic model that had existed since independence was dismantled in the process. The ‘old authoritarian’ economic model instituted by Bourguiba that included state involvement in the economy, a social contract that included subsidies on basic needs, free quality education and a somewhat protectionist approach to foreign investment and involvement in the country’s affairs, came unglued. In its place ‘a new authoritarian’ model based upon classic neoliberal economic principles was immediately and aggressively implemented before the Tunisian people could fathom what was going on.[vi]


[i] A ‘baguette’ – a French long, thin loaf of bread; although Tunisians use the same term, they have fashioned their baguettes a little differently than the French versions.

[ii] Hard to tell, but from the picture he certainly doesn’t look like a Tunisian billionaire or high-tech yuppie, just a ‘pauvre type’ …like so many others in Tunisia.

[iii] That model was about to be dismantled; the main work was done by Zine Ben Ali once he came to power

[iv] Anwar Alam. “Islam, Bread Riots and Democratic Reform in North Africa”

[v] Professor Michel Chossodovsky. “Tunisian and the IMF Diktats: How Micro-Economic Policy Triggers World Wide Poverty and Unemployment”

[vi] The terms ‘old’ and ‘new’ authoritarianism are taken from Stephen J. King’s work The New Authoritarianism in the Middle East and North Africa, Indiana Series in Middle East Studies: 2009


Tunisian Bloggers Refuse IMF Loan

Fakhfakh Says Tunisia Sees $1.8 Billion IMF Loan

Emphasis Added: The Foreign Policy Week in Pieces (4/12)

Mental Illness a Prerequisite to Run for Public Office

It’s unbelievable what people would do to be in power. I know: It happens everywhere. I can’t believe that normal people in their right mind would run for elected position. There has to be something wrong in their value system to go through what they have to go through. What I saw here was much worse: so much humiliation to run for office.
– Vihar Krastev

Escape From Ignorance and Chalga, John Feffer, Focal Points

No End to Atonement in Sight

Germany apparently remains eternally wounded, dependent upon the healing power of remembrance. Germans must live with their trauma and occasionally reopen the wound to prevent it from festering. … “History or, to be more precise, the history we Germans have repeatedly mucked up, is a clogged toilet. We flush and flush, but the shit keeps rising,” Günter Grass concluded in his 2002 novel “Crabwalk.”

‘Our Mothers, Our Fathers’: Next-Generation WWII Atonement, Roman Leick, Spiegel Online

From Marijuana and Heroin in Vietnam to Anti-psychotic Drugs in Afghanistan

… there has been a giant, 682 percent increase in the number of psychoactive drugs — antipsychotics, sedatives, stimulants and mood stabilizers — prescribed to our troops between 2005 and 2011. … The data suggest that military doctors may prescribe psychoactive drugs for off-label use as sedatives, possibly so as to enable soldiers to function better in stressful combat situations.

Wars on Drugs, Richard A. Friedman, The New York Times

Iron Lady Surpasses Hitchens’s Record for Most Disrespectful Obituaries of a Brit

… when I was a child she was just a strict woman telling everyone off and selling everything off. I didn’t know what to think of this fearsome woman. … It always irks when rightwing folk demonstrate in a familial or exclusive setting the values that they deny in a broader social context. They’re happy to share big windfall bonuses with their cronies, they’ll stick up for deposed dictator chums when they’re down on their luck, they’ll find opportunities in business for people they care about. I hope I’m not being reductive but it seems Thatcher’s time in power was solely spent diminishing the resources of those who had least for the advancement of those who had most.

Russell Brand on Margaret Thatcher: ‘I always felt sorry for her children’, Russell Brand, The Guardian

Giving the C.I.A. Its Head in Pakistan

[American ambassador to Pakistan Cameron] Munter was reporting daily back to Washington about the negative impact of the armed-drone campaign and about how the C.I.A. seemed to be conducting a war in a vacuum, oblivious to the ramifications that the drone strikes were having on American relations with Pakistan’s government.

How a Single Spy Helped Turn Pakistan Against the United States, Mark Mazzetti, The New York Times

Robin Hood Tax, Not Corporate Greed, Should be Focus of Climate Finance Meetings, Say Activists

Robin Hood Tax Action, Washington DCIPS joined other members of the U.S. Robin Hood Tax campaign in Washington DC, where officials from the finance and climate ministries of select developed countries met to discuss how to mobilize private sector investment in developing countries to address climate change. Chanting, “Human need, not corporate greed! Robin Hood Tax now!” protesters dressed as polar bears, farmers, and bankers engaged with officials entering the meeting to urge them to support a Robin Hood Tax.

This demonstration drew attention to the fact that trillions of dollars of public money have been spent to bail out Wall Street while government officials pay short shrift to untapped and extremely promising innovative sources of public money like a Robin Hood Tax. In doing so, officials risk putting corporate profits over the needs of climate-impacted people.

Robin Hood Tax Action, Washington DC

Both the financial crisis and the recession have left a massive hole in public finances, threatening job creation, community services, and the ability to address climate change. While Wall Street has already bounced back, ordinary people are still trying to recover from problems caused by corporate abuse in the financial sector. The Robin Hood Tax calls for the institution of a small tax of less than half of one percent on Wall Street transactions in order to generate many billions of dollars each year toward crucial public goods and services, like healthcare, education, and helping the world’s poor confront the climate crisis.

VIEW RECENT ARTICLE ON CLIMATE FINANCE BY JANET REDMAN: http://www.fpif.org/articles/wall_streets_climate_finance_bonanza

Robin Hood Tax Action, Washington DC Robin Hood Tax Action, Washington DC Robin Hood Tax Action, Washington DC

To Wolfowitz, Iraq Was Just a Chance for the U.S. to Demonstrate Its Power

Andrew Bacevich’s Letter to Paul Wolfowitz at Harper’s has been generating significant attention. Bachevich reminds us that Wolfowitz was a protégé of nuclear strategist Albert Wohlstetter, who believed states should act to prevent war, not just react to aggression. At one point, Bacevich writes

So even conceding a hat tip to Albert Wohlstetter, the Bush Doctrine was largely your handiwork. The urgency of invading Iraq stemmed from the need to validate that doctrine before the window of opportunity closed. What made it necessary to act immediately was not Saddam’s purported WMD program. It was not his nearly nonexistent links to Al Qaeda. It was certainly not the way he abused his own people. No, what drove events was the imperative of claiming for the United States prerogatives allowed no other nation.

… to unshackle American power. Saddam Hussein’s demise would serve as an object lesson for all: Here’s what we can do. Here’s what we will do.

In other words … Iraq: the demonstrator model war.

For more on the relationship between Wolfowitz and Wohlstetter, read Anthony David’s 2007 American Prospect piece The Apprentice. Also, see what may be Wolfowitz’s last extensive interview in 2003 in Vanity Fair.

Wall Street’s Climate Finance Bonanza

Government officials from an elite group of developed countries meeting in Washington, D.C. at the invitation of U.S. climate envoy Todd Stern appear to be on the brink of instigating yet another corporate handout and big bank giveaway—this time in the name of fighting climate change.

Robin Hood Tax - photo courtesy of tcktcktck.orgIf it follows a recently leaked agenda, the meeting will focus on using capital markets to raise money for climate finance. The goal is to fill the void left by the United States and other developed nations that have failed to meet their legal obligations to deliver funding to poorer countries for climate programs.

In this corporate-oriented approach, countries would provide generous loan guarantees and export subsidies that sweeten investments for private firms and give them the chance to net big profits while leaving governments (and the taxpayers they represent) to cover the losses if investors’ bets don’t pay off. Wealthy countries would then be able to claim that they had moved billions of dollars of new climate investments.

Unfortunately, the projects best placed to benefit from large-scale private investment and market mechanisms—like mega-infrastructure projects and fossil fuel-powered ventures that hide behind a “low-carbon” label—are likely to be those that have fewest sustainable development benefits. In many cases, the funding will channel windfall profits to corporations that would have invested profitably even without these new channels of support.

The sad fact is that this has happened before. Nations spent five years negotiating the Kyoto Protocol—the only multilateral treaty to regulate emissions of greenhouse gasses and spell out binding targets for reducing climate pollution. But before the treaty was finalized in 1997, the United States led a push to replace the enforcement mechanism—a fine for missing reduction targets paid into a clean development fund—with a market mechanism meant to lower the cost of compliance for polluting companies. The accompanying clean development mechanism (CDM) was born so that companies in the industrialized world could purchase ultra-cheap carbon pollution credits from developing nations to offset their continued pollution at home.

In the end the United States pulled out of the Kyoto treaty. But by shifting a global regulatory regime into a market-based regime centered on enticing private-sector investment with promises of profitability, Washington left its mark.

A decade and half later, carbon markets have collapsed, developing countries are awash with carbon credits for which there is no demand, and the planet keeps getting warmer.

Meanwhile, the clean development mechanism has led to private sector investment in spurious projects like mega-hydropower dams and coal-fired power plants that have delivered little in the way of sustainable development outcomes—and in some cases have further harmed the environment and human health.

Passing the Buck

And now Washington is at it again, hijacking the debate about how to support the global transition to a low-carbon, climate-resilient economy—and keeping the public, the press, and even developing countries out of the conversation. They’re repeating the same tired story that rich governments are broke and thus have to call in the private sector to finance climate change solutions.

In today’s economy, mobilizing private finance means going to the capital markets to raise money. But relying on financial markets for funding to support renewable, clean energy or to resettle climate refugees would subordinate climate action to the speculative whims of bankers.

Americans have visceral reminders of the consequences of leaving decisions about critical needs to the market—the more than 1.6 million families locked out of their homes and the $2.5 trillion in taxpayer dollars handed over to bail out Wall Street and U.S. car companies are just two. Europeans can point to the recent bailout after the carbon bubble burst. If a global climate finance bubble were to burst, we wouldn’t just lose our houses; we might have lost our chance at averting catastrophic global warming.

Governments in the developed world shouldn’t pass the buck to the private sector. They must act now. They can start by cutting subsidies for fossil fuels, including for natural gas “fracking” in the United States, and set binding regulation for reducing climate change pollution. Then governments can adopt innovative ways to raise public money, like taxing pollution from shipping or financial transactions. Indeed, even a very low financial transactions tax would generate substantial revenue and deleverage capital markets.

And of course, if there is any hope of creating a new paradigm of climate-sound development, there will have to be a role for the private sector. But the micro, small, and medium enterprises of the developing world would be preferable partners to the multinational firms that have been responsible for sucking wealth and resources out of countries for decades, leaving pollution and poverty in their wake.

At some point—and for the sake of the future generations who will bear the results of our decisions, we hope it’s sooner rather than later—the government officials who place their bets on private finance will have to learn that putting corporate profits over the needs of climate-impacted people is a risk the rest of us are not willing to take.

Antonio Tricarico is director of the New Public Finance program of the Italian organization Re:Common based in Rome and a former economic correspondent at the Italian newspaper Il Manifesto.

Janet Redman is the co-director of the Sustainable Energy and Economy Network at the Institute for Policy Studies in Washington, DC.

Editorial support by Peter Certo and Oscar Reyes of the Institute for Policy Studies.

** This piece originally appeared in Foreign Policy In Focus

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