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Eastern Europe at the Midnight Hour
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16614 |
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Section : |
SPECIAL SECTION
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| Issue
Date : |
11 / 1989 |
3,862 Words |
| Author
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Janusz Bugajski
Janusz Bugajski is a research associate at the Center for
Strategic and International Studies in Washington, D.C. He is
coauthoring a forthcoming book, East European Fault Lines:
Dissent, Opposition, and Social Activism. |
"Comrades!" exclaimed the party secretary at the Central Committee plenum, "we are facing grave economic problems and a dangerous spiral of social unrest. The country is literally standing at the very edge of the abyss. Comrades, it is time for the party to take a brave step forward!"
Eastern Europe faces some agonizing choices and destabilizing disruptions if economic disaster and social explosions are to be averted. Poland and Hungary stand on the edge of systemic reform in the Soviet bloc; their next stage of "socialist development" must involve a "capitalist restoration" if restructuring is to succeed. While their need for reform is overwhelming, the risks of transition to a free-market economy and a pluralistic polity are equally formidable.
Both states are embroiled in a structural crisis common to all communist economies; however, their dimensions, manifestations, and official responses differ. The Warsaw regime has barely begun to restructure the economy and remains fearful of provoking a tidal wave of social unrest. The alternative to systemic reform is equally grim--falling productivity, decreasing export earnings, accelerating inflation, and widespread industrial unrest. The authorities calculate that with the collaboration of Solidarity and a legal parliamentary opposition, the public can be sufficiently pacified during the painful reform process.
The piecemeal reforms enacted by Budapest in the last two decades have virtually exhausted their potential. Western funds have all but dried up, and the country faces rapid deterioration in productive potential and living standards. The problems are so severe that some party leaders have urged the imposition of an "economic state of emergency" to avoid the sort of labor unrest that ultimately forced Poland to turn over its leadership to the noncommunist labor union, Solidarity. In trying to preempt protests, the Hungarian government has opted for a modus vivendi with the budding opposition movement, while pledging to push through further economic decentralization.
Common concerns
In both countries wasteful and inefficient smokestack industries continue to dominate the economic landscape. Industrial stagnation and plant obsolescence have exacerbated non-competitiveness in the world market, and a growing technological gap has appeared vis-à-vis the capitalist economies. Despite repeated promises of budgetary restraint, enterprise independence, and free competition,
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