EU enlargement to the east: what left unification and the opening to the east (notably the relocations of industry) are being used in the current social confrontations in Germany to underpin a logic of dismantling of the social gains of what was the "social market model". The incorporation of central and Eastern Europe in the European Union will dispose neither of the alternatives?
redistributive state nor the "national" capital, nor the powerful trade unions, which the FRG had.
But the fear of being still more margin-
Jorving the European Union is, for the instant, the unavoidable horizon of the main political forces, both left and right, that have come to power in the countries of the former Bastern Bloc. Only nationalist formations and those particularly linked to peasant milieus espress worries about the socio-economic effecis of joining.
CATHERINE SAMARY
IRST and foremost, the professions of faith in favor of such an integration are the guarantees given to foreign creditors and investors, a way of saying that the past is well and truly over so as to attract capital.
For the social-democratized ex-
Communists it is moreover the condition of international recognition as "credible"
interlocutors. With the growing risk that the social and critical discourse towards western "modernity" comes exclusively from the right wing currents. Candidature to the EU also allows the legitimation in the countries concerned of austerity policies that accompany "systemic transformations".
The newly elected government in
Poland has demanded that the negotiations on their candidature are not adjourned or retarded by unresolved debates on the functioning of the EU: it is necessary to make the transition irreversible, they say.
And the acceleration of the transformations is legitimated by an "imperative":
entry to the EU sufficiently soon to render credible the measures aimed at adjustment to the institutions and mechanisms of the
EU.
Among the people some distrust is evident in the polls. Yet entry into the EU remains undoubtedly associated (rightly or wrongly) with the hope of living better in a wealthy Europe. In Slovenia, the most developed of the republics of the former
Yugoslavia, with the highest income per inhabitant of the whole former "socialist bloc", the most realistic partisans of inte-
22 International Viewpoint #325 November 2000 gration in the EU express their choice thus: "better to be the poorest in the town than the richest in the village". If some in eastern Europe share this "vision of the future" others believe more naively that integration with neoliberal Europe will bring them its average standard of living, just as German unification meant for the peoples of the eastern Länder the hope of sharing the standard of living of West Germans.
### Warning
Rare are those who, like Karol Modzelevski' , have warned against an integration without protection in the world capitalist order. Taking the example of German unification which, according to him, "has been an economic catastrophe" whose lessons should be drawn, he adds: "Germany is the richest country in Europe (..). The hundreds of billions spent by the federal budget to satisfy the eastern Länder have softened the social consequences of the crash of a socialist economy wrenched from one day to another into the economic system of the west, but have not stopped its ruin. If the Germans have perhaps the means to build an entirely new economy adapted to world demands on the ashes of the GDR, the other post-communist countries can hardly dream of that"?
With hindsight we can see that the cost of unification has been infinitely higher than forecast. What has been established "on the ashes of the GDR" is a sort of Mezzogiorno with much disillusionment among the peoples concerned. German alized and losing out still more by staying outside of the EU and the absence of a credible left alternative to the Europe of Maastricht weighs on consciousness. In the immediate the "European" choices (the very significant current vocabulary: one can only be "European" through being in the EU) legitimates "structural adjustment" policies based on the Maastricht criteria.
Agriculture represents a real sensitive area, a central dossier for integration into the EU, not only because of its weight in the economy, but because it concerns literally vital questions: the proportion spent on food has increased in the budgets of households which have become impoverished. Current market prices are weaker in the former Eastern bloc than in the EU, given a dramatic fall in solvent demand with the rise of poverty. An increase in the prices of basic food products (through an alignment with EU prices) would have socially explosive effects. It is generally a point omitted in the "cost/benefit analyses". However, several scenarios remain possible on the future of the CAP and the effects of integration will be multiple.
The perspective of EU aid to farming incomes and for the restructuring of agriculture is obviously an attractive element for countries whose farming production represented in 1990 20 to 50% of that of the then EU, according to the sectors? Nevertheless, it is also in the countryside where one finds the most concern about joining an EU which also implies a brutal confrontation with heavily subsidized and modernized agricultures. In reality, the greatest uncertainty reigns on what the benefits of joining would be. It could accelerate the threat to the CAP in the continuing Uruguay Round negotiations. The prices of the EU would come into line with world prices (which are close to East-European prices) and direct subsidies would replace (compensate for?) the loss of income resulting from these adjust-
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ments. Would the incomes of farmers in the former Eastern bloc then be aligned with those of the West? It's doubtful, since the price of their products would not have changed. Still, there will be access to restructuring funds. But on what conditions?
Like the other sectors, agriculture in the former Eastern bloc has been subjected to a "systemic transformation" seeking a "forced privatization" of the means of production. Yet it is far from being stabilized. Behind the new private companies, the old cooperatives are often maintained.* Indeed "the CAP certainly implies a very strong intervention", stress the experts, but in the general framework of a market economy without monopolization of upstream and downstream activities and under a control of income transfers. How would it be aid be divided by hectare and livestock in loss making state farms, and even in the productive cooperatives and the numerous cases where property in land remains very imprecise? * S At the opposite extreme, would integration in the EU leave unhurt the individual micro-properties which have multiplied and which for now cushion the social explosions by assuring self-subsistence in the countryside and a fallback position for the unemployed?
### Sensitive area
Agriculture is also a factor in another sensitive area: that of trade with the EU. One of the effects of the phase of dismantling of the old price systems, the opening of foreign trade and the suppression of Comecon has been a major reorientation of the foreign trade of the former Eastern bloc towards the EU — and a deficit in the current balances of most of these countries, now including the Czech Republic. Imports have rocketed. As for exports, much more limited, they are often accounted for by western firms carrying out subcontracting operations in the East. This is the case for clothing, whose share in the exports of the former Eastern bloc has doubled since 1988 — it represents a relative displacement of the relocations of European firms from Asia towards Eastern Europe. It is also true for the machine and equipment sector.
Moreover, if agreements of association have liberalized access to the EU market for the products of the former Eastern bloc, they include numerous exceptions subject to specific protocols and quantitative restrictions: this is true of textiles, the coal and steel sector, a certain number of basic products and products considered as "sensitive", notably in the agro-alimentary sector. Indeed the countries of Eastern Europe hold competitive advantages of the first order in these sectors. The measures of protection taken by the EU against imports of animal and iron/steel products coming from the east led to a fall in sales of around 10% in value in 1993. A two-faced language and policy then: Eastern Europe is to suppress its protective measures while they are strongly maintained in the west.
What could a left alternative be to an alignment based on the demands of neoliberal Europe? Karol Modzelevski warns against the effects of an unprotected inte-
... ..
LUCLAN Food price increases would be socially explosive gration into a capitalist world where efficiency is measured by the dismantling of social gains and "productivity" by the dismissal of employees.
The EU is confronted with some major contradictions in its policy of enlargement to the East:
* the choice of enlargement, it is argued, is first a political question: it is necessary to stabilize the continent. But the "systemic transformation" envisaged erects new walls of silver and thus also new conflicts to which the Yugoslav syndrome bears witness.
* Also, the EU demands a "structural adjustment" of the former Eastern bloc in line with its institutions and its "market model" but at the same time it makes a "capacity to support competition" a precondition for entry. Thus there should not be too much unemployment, nor too much degradation of the standard of living
European Union * and social crises in the East, for all this would count for access to structural funds. Yet at the same time the type of transition that the EU imposes is inexorably socially regressive. We have to develop another logic of security founded on stability through development and the convergence of real incomes. It is a cooperative logic of integration, which takes into account the different levels of productivity and respects the values of all. But this is in reality also true for the countries of the existing EU.
Some left currents oppose the enlargement of the EU, so long as it has not changed its nature, so long as it has not been democratized and made more social. In short, first one consolidates, then one enlarges. However, in the East they say: "let us have your problems... And opposition to an integration which is widely supported (rightly or wrongly) would be inevitably perceived as an attempt to build a "Europe of the rich", to erect a "fortress Europe"
Fight on several fronts
It is then essential to fight on several fronts:
* That of transparency and information in relation to the various peoples concerned (East and West) on the reality of the Union, on the effects of the economic policies carried out, on the debates which these policies arouse;
* that of solidarity and cooperative enlargement, which implies also defending the right of adhesion of the countries which support it - but then to show that, if the EU as it is conceived is incapable of welcoming the countries which want to join, it is necessary, with them, to change the Union.
* that of plurality of choices: we must reverse the order of the debates. What are the finalities of the union, the choices of societies? Then we can discuss some means (including monetary ones) for getting there;
* that of democracy which allows control over the big decisions. To the dictatorship of the centralized plan and the single party, neoliberal Europe counterposes social choices made by the financial markets or uncontrolled techno structures. It is necessary to oppose to this the invention of an individual and collective democracy that respects the rights of human beings and peoples. International Viewpoint #325 November 2000 23