Special edition, May 2011
Diplomaatia Good-bye, Ron! Pages 2-7
Toomas Hendrik Ilves, Carl Bildt, Kurt Volker and Kadri Liik write about the life and legacy of Ronald D. Asmus.
A tale of two revolutions Pages 8-9
Jüri Luik points out the differences and similarities of the Arab and East European revolutions.
Russia and the rules of the game Pages 10-14
David Kramer drafts a strategy for Belarus. Lauri Mälksoo weighs up Russia’s view of international law.
Democracy in the age of populism Pages 15-16
The internal contradictions of democratic societies are more worrisome than outright autocracy, argues Ivan Krastev.
The Baltic states and values-based policies Pages 17-23
The Baltic states must move from being the objects and beneficiaries to the subjects of values-based policies, says Edward Lucas. Paul Goble and Mart Laar look at the experiences of the past and the challenges ahead.
Navigating the crises Pages 24-27
Conventional wisdoms confirmed or upturned – Anders Åslund finds both in his analyses of the economic crisis in the Baltic states.
Making values count When we at the ICDS started discussing this year’s Lennart Meri Conference and chose the title “Making values count” we wanted to ask whether the idealistic and values-based mood in international politics that 20 years ago was strong enough to allow the Baltic states to regain their freedom and later join NATO and the EU could still be found in European foreign policy. Then the North African revolutions happened and added a whole new dimension to the topic. And two weeks before the conference, the tragic death of Ron Asmus added yet another. Ron’s whole life and work was about making values count – and he was remarkably successful at translating values into policies and politics. 1
Today’s world is different from that of the 1990s in ways that make values-based politics more complicated. It is fragmented and hard to handle. Many dividing lines have been blurred, many old alliances have collapsed or become redundant. All too often we have had to witness good intentions lead to disastrous results, and good things become their own opposites. In many countries, populations do not trust their leaders, and leaders have all but given up their attempts to offer leadership. However, it still seems that the democratic community’s best hope of successfully navigating through this fog of rapid changes
involves a return to values. We need to remind ourselves who we are, what we stand for and what kind of a world we want see. Firmly rooted democratic identity, coupled with good understanding and analysis of the events in the world, will form a basis for wise policies. The world is changing not only in terms of politics, but also in terms of technology. During the dramatic days of the Baltic singing Revolution, fax machines were a rare novelty and mobile phones – put to good use by some inventive leaders – were the size of a suitcase. Today’s Arab revolutions could not have happened the way they did without
what we call social networks or new media: blogs, Twitter, Facebook, the ubiquitous use of the internet. However, Twitter, like an old fax machine, is just a means of communication. In order to make a difference, one needs a message. Democratic values, good knowledge and analysis of situations, prudent policies based on these – that would create a basis for a message that could inspire people in our own democratic world as well as beyond it.
Ron Had there been no Ron Asmus, we would be, if not a different country, then certainly living in a dramatically different security climate here on the Eastern littoral of the Baltic Sea.
As the dull and changeless world of communist Europe became suddenly a focal point of interest, our days became longer, our excitement greater.
Toomas Hendrik Ilves, President of Estonia
Toomas Hendrik Ilves has earlier been Estonia’s foreign minister, ambassador to the US and a member of the European Parliament. In the 1980s he worked for Radio Free Europe.
When Ron Asmus died on the 30th of April this year I lost a friend of 27 years, a man I knew for years as a buddy and colleague during the Cold War and who later, completely unpredictably, became one of my and indeed Estonia’s closest collaborators in the long trek from ‘former Soviet republic’ to full-fledged NATO and EU member. When I went to work as an analyst in the Research Department of Radio Free Europe/Radio Liberty (RFE-RL) in 1984, one of the first persons to stick his head into my cubicle/office was an ebullient, red-haired American who worked in the adjacent office in the basement of the Radios, as everyone called them. “Hi, I’m Ron, welcome to the cellar”. The basement was where the new and generally 30-something analysts were put. As part of the Reagan-era boost in Congressional funding for RFE-RL, the Research and Analysis Department (RAD) had been beefed up as well; young(ish) research analysts were hired to deepen and broaden academic coverage of the target areas, at that time Eastern Europe and the Soviet Union. Ron had just come on board to cover the ‘DDR’, along with Barbara von Ow, who later went on to be the East European editor of Süddeutsche Zeitung.
reports in English about developments in what were called ‘Target countries’. Today, when reporting from these countries is routine, we have forgotten how little of what went on in Eastern and Central Europe ever made the news in the West. Universities and think tanks provided monographs but little on current events, Western correspondents posted in Moscow reported on who stood next to whom on the Lenin Mausoleum on May Day. Intelligence agencies wrote classified analyses for their own authorities, which never reached a broader audience. It was the role of the Research and Analysis Department of the Radios to fill the gaping lacunae in public understanding of this part of the world. With the Reagan era funding increase, the Radios hired a batch of young analysts who knew their respective areas. These represented a new generation of analysts, to use a term that today has been inflated into meaninglessness.
“Hi, I’m Ron, welcome to
These were Western-educated, mainly Western-born students of their home countries who could no longer be written off as ‘embittered right-wing émigrés’ for whom Western academic standards were unknown and who allegedly had their own home country axes to grind. Janusz Bugajski from Poland, Jiří Pehe and Vlad Sobell from the erstwhile Czechoslovakia, Dzintra Bungs from Latvia, Saulius and Kęstutis Girnius from Lithuania, Vlad Socor from Romania, Roman Solchanyk and Bohdan Nahaylo from Ukraine, this writer and later Riina Kionka from Estonia and Ron Asmus, the son of German immigrants to the United States were all as adept in English as any colleague from the old WASP establishment. Yet we were all native speakers of our respective ‘target countries’ and never given to the patronising smugness that so permeated ‘area studies’ in earlier years.
There were many of us. The Reagan administration, in its commitment to significantly increase spending on U.S. efforts to debilitate the USSR and its satrapies in Eastern Europe had decided that in addition to boosting military expenditures also to better fund RFERL. Later this was to be called ‘soft power’. One area to benefit was the Research Department, whose role was to write analyses and
We loved our jobs, and neither of us could get over the luck of being able to write about and research what we were intensely interested in anyway.
Today in Estonia, where the term ‘analyst’ connotes more often than not a pretentiously self-important and thoughtful mien accompanying an opinion piece based on little evidence or analysis and a fair dose of vitriol and ‘visionary’theorising, to call someone an analyst is often more a term of an ironic derision. The standards demanded by RAD, however, left no room for posing. No ad hominem attacks; no attacks, period. All papers were based on open sources; no rumours; no scuttlebutt. If you had a theory you had to prove it to the deputy director, who didn’t take kindly to theorising, and would test us by offering an alternative hypothesis. If you couldn’t rule it out, you couldn’t theorise. The goal, after all, was to provide short (up to four pages, single space), useful, up-todate academic quality papers for the policymaking establishments of the West. Read by virtually all Western foreign ministries and think tanks dealing with the East, RAD reports were a service that probably did more to burnish the reputation of the Radios than the broadcasts, which were of course in languages few in the West understood. While none of us probably noticed when we were in the middle of it, most of us today recognise the Research and Analysis Department of the RFE-RL, headed by the late George Urban, former editor of Encounter, as the most exciting intellectual cauldron of its time, unmatched today by any institute or think tank dealing with Eastern and Central Europe. And Ron was one of the best analysts working there. Ron and I became pals. After work we would go off to the Englischergarten beer garden, grouse about our superiors and tell funny stories of the ludicrousness of the communists in the countries we respectively covered. Or we worked late. We loved our jobs, and neither of us could get over the luck of being able to write about and research what we were intensely interested in anyway, areas – the communist dictatorships in East Germany and Estonia – that were not quite the attention-grabbers in the West. And that this was our job. As the dull and changeless world of communist Europe suddenly became a focal point of interest, our days became longer, our exciteDiplomaatia · May 2011
ment greater. We used to joke that we were indeed odd people because the goal of our jobs was to make ourselves redundant, useless, i.e. unemployed. It was a goal worth working for. As the glaciers of Soviet run communism melted and fractured, so too the Research Dept. Ron left the Radios first. As the DDR collapsed and then disappeared, so too the need for an expert on what quickly became just a poorer part of a democratic, reunited Germany. Ron returned to the U.S. to work for the think tank The Rand Corporation as did Roman Solchanyk. Working on the security side of German reunification, i.e. ensuring that a unified Federal Republic would also remain in the Alliance, began Ron’s transformation from DDR expert to security policy guru. Others as well went off to new challenges faced by a liberated Europe. Jiří Pehe became Vaclav Havel’s foreign policy advisor. Janus Bugajski went to Washington to CSIS. Estonia meanwhile re-established its independence. I had, in 1988, been yanked by the management to the broadcasting side, against my wishes, and as I was promised, just temporarily, but then all hell broke loose in the Soviet Union and I was asked to reconsider and stay on. After the re-establishment of Estonian independence, my successor in RAD, Riina Kionka, left as well to join the Estonian foreign service. RAD slowly withered. Ron and I stayed in touch with the then still new-fangled wonder of e-mail. In 1993, after I was posted to Washington as Estonian ambassador, I flew to California to visit Ron at Rand in Santa Monica. Ron and Steve Larrabee were in the process of finishing a ten volume analysis of the pros and cons of a possible enlargement of NATO commissioned by the German government. The powerpoint presentation they had prepared only talked about Poland, Hungary, the Czech Republic and Slovakia. A version of this analysis by Ron, Richard Kugler and Stephen Larrabee appeared in short article form in Foreign Affairs in 1993. “What about us?” I asked. Larrabee and Asmus looked at me blankly. “We hadn’t thought about that.” It wasn’t on the cards right now. Germany had not asked. Indeed, no one asked. NATO enlargement to the Baltic countries was not on anyone’s agenda within the Alliance. Some governments, especially Germany’s, was adamantly opposed, and at that time even to enlargement of the European Union to include Estonia, Latvia and Lithuania. Yet Ron thought about these issues and realised the dangers to European security if the remaining democracies, those not invited to join the Alliance, were to remain outside. He was one of the first to sense the fears we had felt for some time: a one-time only expansion that did not include us would send a dangerous signal that our independence was a temporary development and that we were not that important to the West. His first thoughts on the issue were published in the security policy journal Survival in an article “NATO Expansion: The
Next Steps” in 1995, causing howls of indignation all around when he suggested that the day Poland becomes a NATO Ally, Estonia should become a member of the EU. It was an idea picked up by Richard Holbrooke, the new Assistant Secretary for Europe (viz. my obituary for Dick Holbrooke in Diplomaatia nr 89). What to do with ‘the rest of us’ became one of Ron’s paramount concerns after the Visegrád enlargement itself. Ron and Stephen Larrabee’s article, “NATO and the Have-Nots: Reassurance after Enlargement” in Foreign Affairs in 1996 raised the profile of that problem even higher. Having become one of the leading thinkers on NATO expansion in the pro camp and with NATO enlargement to the Visegrád countries moving on to the political agenda in 1996, Ron left Rand to become, at Madeleine Albright’s request, Deputy Assistance Secretary of State in the second Clinton Administration, where his brief was simple: to expand the Alliance. By this time I once again had been yanked by the scruff of my neck to a new job, this time to run the Foreign Ministry. Suddenly I found my old friend from over a decade earlier to be my primary interlocutor on one of Estonia’s two most existential issues, EU and NATO membership. To name Ron as the ideologue on NATO enlargement (as some have), misses the point. Ideologues were many, but he was the architect and general contractor rolled into one. Ron did it, worrying about and working on all the key as well as the minor issues. He lobbied the Congress, nudged recalcitrant East Europeans to do their homework, set up the ‘Membership Action Plan’ to ensure the prospective new members’ military affairs were in order. After ratification of the Polish NATO accession treaty ran into snags in the U.S. Senate over ‘historical issues’, Ron came see Lennart Meri and me to strongly advise us to set up already in 1999 a commission to study war crimes committed on Estonian soil. Ron’s concern was that the reputation of Estonia be fully open and clear regarding the Nazi occupation to avoid the problems the Polish treaty had encountered in Congress. Lennart agreed to do it but expanded the Historical Commission to include both the Soviet and Nazi war-time occupations.
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“We hadn’t thought about that”. The political drama of the 1999 enlargement of NATO to Poland, Hungary, Slovakia and the Czech Republic is best described in Ron’s own book, Opening NATO’s Door. Ron also left in manuscript form a book on the Baltic enlargement that I hope will find publication. With his strong Democratic Party credentials, Ron left the State Department when the Bush Administration came into office and moved to Brussels to head the Brussels branch of the U.S think tank, The GermanAmerican Marshall Fund or GMF as it is better known, the premier brain trust of transatlantic relations. No longer an official of the U.S. Government, Ron became a member of the Committee to Enlarge NATO, a non-partisan group of leading thinkers and political figures committed to making Europe ‘whole and free’. Democrats on the board or helping it included Madeleine Albright, Zbig Bzrezinski, Phil Gordon (currently Assistant secretary of state for Europe); Jeremy Rosner and Page Reffe. Republicans included Bruce Jackson, Robert Kagan, Richard Perle and Julie Finley (later U.S. ambassador to the OSCE): Liberals and Neo-cons who rarely agreed on anything… except that NATO needed to expand.
Ron, even if we
never knew him or all that he
Ron was equally concerned that the presence of an OSCE mission in Tallinn would be used as an excuse to block Estonian membership. With his sidekick and comrade-in-diplomacy, Walter Andrusyszyn, senior U.S. diplomat and later National Security Council adviser to the President, Ron spent countless hours working with Estonia as well as with EU and NATO members of the OSCE and the High Commissioner for National Minorities, Max van der Stoel, to close the Mission, which had long outlived any purpose, save to sully Estonia’s reputation.
send a dangerous signal that our independence was a
Larrabee and Asmus looked at me blankly.
We shall all miss
A one-time only expansion that did not include us would temporary development.
“What about us?” I asked.
On the government side, too, Baltic membership remained on track after the change in administration in 2000. Fortunately for all of us, Baltic States’ membership in NATO was genuinely a bi-partisan cause in the U.S. Walter Andrusyszyn, as a career Foreign Service officer, continued to work on expansion. Nick Burns, Victoria Nuland and Kurt Volker, the three people who served as U.S. ambassadors to NATO, were all committed to the cause. Ron meanwhile found new causes to which to apply his analytic rigour and political acumen: bringing in the Wider Europe to the Western Fold, strengthening democracy and rule of law in Ukraine, Moldova, Georgia and Azerbaijan. Ron and my paths ran together, and intertwined, it seems, almost permanently. Georgia became a primary concern of his. Partially from his desire to see the Wider Europe as part of the democratic security architecture, partially because like so many of us, he saw in Georgia’s courageous and bold reform process a flicker of that same hope we had seen in our part of the world a decade earlier. Out of that interest and his knowledge of the country came Ron’s last book, A Little War That Shook the World: Georgia, Russia, and the Future of the West, which is a gem of concision and analysis in the best RAD tradition.
Less noticed perhaps in Estonia, Ron worked hard against the increasing antagonism between the U.S. and Europe, especially in the wake of the Iraq War. Running one of Europe’s best annual foreign policy conferences, the Brussels Forum, Ron was always ahead of the thinking in the foreign ministries on either side of the Atlantic. Sometimes, too, we disagreed. When he initiated a letter from East Europeans expressing concern over the apparent lack of interest of the Obama administration in Eastern Europe, I told him it would be counterproductive. The time for collective open letters from Eastern Europe is over, I argued. We did that when we weren’t real countries; now we were. He saw it differently. Time will tell who was right. We shall all miss Ron, even if we never knew him or all that he accomplished. We shall miss him because our membership in the Alliance was never a given. Had there been no Ron Asmus, we would be, if not a different country, then certainly living in a dramatically different security climate here on the Eastern littoral of the Baltic Sea. Eastern Europe’s relations with its Western Partners would have been different. Relations with the U.S. as well. No one I have met was as committed a transatlanticist as Ron Asmus. As an American son of German immigrants, his whole life it seemed was dedicated to making stronger the bonds that allowed the West to win the Cold War and to bring countries like Estonia into the democratic camp. I used to wonder, where are our generation’s great men to mould Europe’s architecture, men and women who are great not only in their own countries but everywhere, men like George Kennan, George Marshall and Dean Acheson, Robert Schuman and Jean Monnet, who created the post-World War II consensus, that turned war-ravaged Western Europe into the political, economic and security powerhouse it became; those rare individuals who had the clarity of vision and sense of purpose to do what they did in the late forties and early fifties. Now, when I look back on the past twenty years I can name at least one of the great men of our time: Ronald Dietrich Asmus, who brought my country and ten others back into a Europe, genuinely whole and free… and secure. Thank you, Ron.
Ron Asmus, two Personal Tributes Ron leaves a large void, but he leaves an even larger legacy.
Minister of Foreign Affairs
Director, International Centre for Defence Studies
Carl Bildt has served as Sweden’s Minister of Foreign Affairs since 2006. He was Prime Minister of Sweden from 1991 to 1994. From 1999 to 2001, he served as the UN Secretary General’s Special Envoy for the Balkans and was High Representative for Bosnia and Herzegovina from 1995 to June 1997.
Kadri Liik has been the Director of the International Centre of Defence Studies since 2006. Before then, she worked as the foreign news editor of Estonia’s largest daily paper, Postimees, and as a Moscow correspondent.
… we were all lucky to have Ron. During a critical period in our history, Ron Asmus was the transatlantic link. Of course, there were the official meetings, the official communiqués and the official channels to deal with all the issues that arose during the critical decades of transition and transformation. But these things are always empty without the depth of understanding and the common purpose that can only be created by personal relationships and personal trust. No single individual meant as much to the transatlantic relationship in these respects as did Ron Asmus. He was the one who had the true vision of a Europe that was whole and free, democratic and dynamic. And he spent the critical period of his life working to make it happen.
natural and logical. For those living through those times, it was very far from it. Without the dedication of Ron, and all those he inspired, it might well have turned out differently.
We perhaps cannot credit Ron with bringing down the Soviet Union. But we must give him greater credit than any other individual for driving the developments that shaped the new Europe we were able to build in the decades thereafter. The enlargement of NATO was by no means an uncontroversial idea. In the beginning, there was more opposition than support in Washington, and opposition was even more pronounced in key European capitals.
But his dedication did not stop at the borders of the present European Union or NATO. The dream of a democratic Europe in firm alliance with a democratic America had wider horizons. He was prepared to dedicate himself as much to Georgia as others had been prepared to dedicate themselves to Germany.
But Ron, and a circle around him - his friend Richard Holbrooke should not be forgotten either - pushed the idea with vision and determination, and were soon able to turn the Clinton administration around to it, so in turn committing the administration to turn the various reluctant European administrations around too. In retrospect it all looks so
I don’t think we could classify Ron as a diplomat in the more classical meaning of the word. For him, formalities were far less important than realities, and operating outside official channels often far more effective. He was a democratic activist of the best sort, driven by the conviction that our democracies can only thrive and survive if we get
He built strong links of friendship and trust with nearly all the emerging leaders of all the emerging democracies. They came to see him as the true friend to their ambitions and wishes that he undoubtedly was. There was not a door that did not open when Ron knocked on it, for a chat, for some coordination, or for a small bit of plotting.
together for common defence and common endeavour. For him the transatlantic relationship was not just a question of formalities, but also one of true friendships. The two books that he left behind, on the process that lead to the enlargement of NATO in 2004 and on the Russian invasion of Georgia in 2008, sum up much of what he and the network he created worked for during these critical decades. They will remain essential reading for anyone seriously interested in the modern history of our continent.
Ron was worried that our efforts were losing steam
… Without people driven
But Ron was worried that our efforts were losing steam. During the past two years, we talked numerous times about the need for a new narrative to drive our efforts. The return to Europe was not enough. Asia was commanding more and more attention in Washington, and the inward-looking tendency was beginning to reassert itself in Brussels. Without people driven by common ideas and common visions things might just stagnate, and Ron was thinking a lot about the ideas and visions that would be required.
by common ideas and
common visions things might just stagnate.
We must give Ron Asmus greater credit than any other individual for driving the developments that shaped the new Europe.
His Europe was a Europe of Kiev and Tbilisi as much as it was a Europe of Lisbon and Oslo. And his world would be a more problematic place without a large, strong and democratic Europe in firm friendship with the United States. Ron leaves a large void, but he leaves an even larger legacy. I am proud to have been among his friends.
On April 4, 2004 Estonia was celebrating its entry into NATO with a huge reception in Tallinn’s main concert hall. People congratulated one another and there were happy faces all around. The joy was deep, but not ecstatic – after all, we knew that this was coming. There was no longer any drama, just the celebration of a goal achieved and a dream fulfilled. At one point, a discussion began in our group as to when we really did start believing that Estonia would one day be admitted into NATO. “In early 2002, when the consensus on the next round of enlargement really emerged,” said someone. “In 2001, when President Bush gave his Warsaw speech,” recalled someone else. I scored better than anyone. “In September 1997,” I said. “September 1997?! What happened then?” the ambassador of a Nordic country asked in amazement. “She met Ron Asmus,” laughed an Estonian diplomat who was in a position to know. She was right. By the autumn of 1997, I had spent two years as the Moscow correspondent for various Estonian media channels. NATO enlargement and the heated debates surrounding it were understandably my everyday bread and butter there. And while covering NATO’s Madrid Summit, I learned that there was an almost mythical American called Ron Asmus, who – or so Estonian diplomats claimed - had almost single-handedly inserted a positive mention for the Baltic states into the Summit declaration. So when I attended a security conference in Vilnius the same autumn and saw a man whose name tag betrayed him to be Ronald D. Asmus, I approached him and asked if this was a true story. Ron first looked surprised, then laughed and confessed that the real story was somewhat more complicated: getting everyone to agree with the wording had cost the whole American diplomatic team quite a few sleepless nights. But the result, yes, could be considered a victory for the Baltic states.
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We talked more – about Estonia, about Russia, but mostly about NATO’s possible future enlargement and the chances of Estonia getting in. “I don’t know if you will be admitted, but we want it to happen and we are working on it,” was the message that stuck with me. On my way back to Moscow, sharing a carriage with Russian sailors on the Kaliningrad-Moscow train while speeding through desolate Belarusian countryside, I thought it all through. I understood that if the Americans really wanted us to be in NATO, they most probably would make it happen. And I trusted Ron’s words that they wanted it. By the time a chilly Moscow morning dawned behind the train windows, I had a firm conviction that unless some unexpected and dramatic development threw the dynamic of international relations from its course, we would end up as members of NATO – sooner or later. I turned out to be right, even though one unexpected and dramatic event actually did happen: on September 11, when the positive post-Cold War mood vanished overnight, the world looked suddenly very dangerous again and NATO enlargement was something that – we felt – would be egoistic even to mention to the Americans. Still, the enlargement went ahead and can now be seen as probably the most successful post-Cold War foreign policy endeavour of the United States, brilliantly carried through by different administrations.
So I had no choice but to tell him what I honestly thought was the real reason: “We have the best people.” Watching post-Soviet Russia and post-Soviet Estonia taking their first independent steps in the 1990s, I had come to the conclusion that what countries actually need is luck. The first government to take over after the fall of totalitarianism has a very crucial task. It is this government that by its deeds and behaviour actually defines democracy for its people. It’s not just another government, it is the first one. It sets the rules and taboos. If it makes the right choices, these can result in quick success, but its failures will hamper the country’s development for a much longer time than the failures of a government of a mature state.
“I don’t know if you will be admitted,
To live up to this role, a government needs to consist of people with far more courage and farsightedness than the usual standard in the governments of today’s Europe. And it was pure luck if a country had the right people in the right constellations, willing to participate in politics and capable of convincing voters. I thought – and still think – that in that respect Estonia had the luckiest start of all. We had Lennart Meri, Mart Laar, Jüri Luik, Toomas Ilves… They were all ready for their jobs (or almost) and – another crucial thing – they got along with each other (or almost). They were the right people in the right place at the right time. Not every country was that lucky.
but we want it to
happen and we are
working on it,” was
Among the wider public in Estonia, the possibility of joining NATO was regarded with disbelief – right up until the time of getting the invitation. The historical trauma of being traded to the Soviet Union when Molotov and Ribbentrop carved up Europe was still very much alive. The assumption that the West was bound to make a deal with Russia once again, with us in the role of small change, was almost common wisdom – and if it needed any reinforcement, there was plenty available in the Russian media channels that regarded the world as a place governed by a few power centres which should agree on important things and had better not offend one another by making a fuss over small countries in geopolitically inconvenient locations.
Although our eventual inclusion in NATO should be an argument for reversing such pessimistic assumptions, much of the ‘weare-so-small-we-cannot-change-anything’ attitude is still alive and well in Estonia. For that reason, I wish I could make Ron’s book on NATO enlargement compulsory reading among my compatriots. His detailed account of events makes it very clear that the new members of NATO were not chosen by secret deals, but by an intensive diplomatic process involving endless hours of talking and thinking. Most importantly, the thinking could be influenced by us. And it was. Here I should recall another memorable part of my first conversation with Ron. “What do you think, why has Estonia been so successful?” he asked. At the time, my English was not good enough to quickly provide me with a decently modest and diplomatic answer. 5
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This was the logic behind my immodest claim that Estonia had the best people. Ron gave me a long look. “I would never say it on the record, but actually it is true. Estonia does have the best people,” he said. Unlike his earlier statement regarding the possibility of our NATO membership, I did not trust these words immediately. It actually took me years. Only when Ron repeated the same thesis in the foreword of the Estonian version of his book did I realise that he had meant what he said and that he really considered Lennart and Toomas to have influenced his thinking. In my own writings now, I occasionally use Ron as an example to try to convince the Estonian audience that there are actually people out there who are interested in learning how we see things. And that in fact it is possible for us to shape our own future. I guess that compared with the task of injecting enough optimism to overcome the Estonians’ sceptical inertia, winning Ron over to support our NATO membership must have
been easy. Ron really believed that NATO and its enlargement could make the world a better place and that even countries that are tiny and inconveniently located deserve some security. Being extremely bright, he had no difficulty finding ideas that could contribute to making a policy out of those principles. In addition, he was honest. He would not give false promises, but was open to discuss a country’s strengths and weaknesses. Emotionally committed, intellectually clever and honest - that is a rare combination by any standards, but in policy circles it is very rare indeed. I sometimes think that being a Baltic diplomat or foreign correspondent during the 1990s must have offered each of us some quite unique insights into our partners’ minds and morals. The Baltic states’ wish to join NATO and the European Union was always a very uphill struggle. It challenged so many conventions that at many Western dinner tables it was inconvenient even to discuss it (questions that somehow concern Russia tend to receive a subdued treatment up to this day, do they not?). As a result, it was probably bound to show us who our real friends were. Many outwardly nice and supportive people gave a different performance behind closed doors. One would meet arrogance, paternalism, manipulation, even contempt. Estonians, for example, remember a high-ranking diplomat of a big continental European country organising a secret meeting with our foreign minister in order to demand that we give up our wish to join the EU – “because that would give you back-door access to Western security guarantees and we cannot afford that!” And there was the senior diplomat of a Nordic country who bent over backwards to convince the Americans not to send a tiny number of troops to participate in the most innocent military exercise in Estonia, because it might have irritated Russia. And there are countless people who have demanded that “Russia’s legitimate interests in the Baltic states be honoured.”
But there are no such stories about Ron. People occasionally received tough messages from him, but never lies, deception or manipulation. And no paternalism. Ron was never one of those know-it-all Westerners who arrived to teach and demand. He was always the one who asked, who wanted to learn facts and to understand opinions. He treated other people – even novice journalists like me – as equals. Besides winning him personal friends, such an approach also contributed to successful policy: by consulting people he made them co-responsible stakeholders. If there was any maturity in the diplomacy of the Baltic states in the 1990s, it was much more likely to have occurred as a response to such consultations than to some other people’s arrogant paternalism. I would even guess that besides the memories of the Cold War, the experience of 1990s diplomacy was a factor that significantly contributed to the pro-American attitudes of the new NATO members that some European countries later found so irritating. Lennart Meri considered Ron to have been the ‘leading ideologue’ of NATO enlargement. There are many people in many countries who would happily sign this statement. Ron was definitely the right person in the right place in the right time. Just as Estonia was lucky with its first set of leaders, we were all lucky to have Ron. The world will be a less happy place without him.
Many of those people are still active in politics and we meet them time and again. Some of them have later apologised, most pretend that those inconvenient exchanges never happened. Estonians also pretend they never happened, but we remember nonetheless. Sometimes, when the night is late and the mood gets existential, these stories are told with sadly ironic smiles.
Emotionally committed, intellectually clever and honest – that is a rare combination by any standards, but in policy circles it is very rare indeed.
Values – and Valuable Lessons The inspiring example set by Ron Asmus, the new openings presented by the death of Osama bin Laden, and the hopefulness presented by the revolutions in the Arab world offer lessons for the transatlantic community.
On May 1, 2011, blackberries and i-Phones across Washington DC buzzed with the announcements of two deaths. The first, coming in the early hours of the day, was the tragic news that Ron Asmus had died the day before in Brussels. The second, coming in the evening, was the news that U.S. Special Forces had killed Osama bin Laden in Pakistan. To the ordinary onlooker, these two events are as unconnected as any other two events anywhere on the globe. But to those who think about democratic values and transatlantic policies, a deep thread connects the two – and provides food for thought about the future.
Kurt Volker, Ambassador
Kurt Volker is a Senior Fellow at the Center for Transatlantic Relations at the Johns Hopkins University’s School of Advanced International Studies, as well as a business consultant. A long-time career diplomat, he was U.S. Ambassador to NATO from 2008-2009.
It is only when our foreign policies and values align that we achieve real sustainability in our foreign policies, and can achieve truly meaningful accomplishments.
Ron Asmus was one of those foreign policy thinkers who believed deeply in democratic values – freedom, democracy, free markets, the rule of law, human rights. These are the values that underpin societies in both Europe and the United States, and thus sustain the transatlantic relationship. Yet he also knew that these are universal values – not merely American or European – but values that reside in the hearts of people throughout the world. It is only when our foreign policies and values align that we achieve real sustainability in our foreign policies, and can achieve truly meaningful accomplishments. Thus one of the higher purposes of foreign policy – whether American or transatlantic – is to seek to help people around the world enjoy the same chances of freedom, prosperity and security that those of us fortunate enough to have grown up in free societies have enjoyed all our lives. Ron therefore dedicated himself to cause after cause in line with this values-centred agenda: the Baltic Charter, NATO enlargement, stopping ethnic cleansing in Bosnia and Kosovo, supporting democracy and European integration for Georgia and Ukraine, and supporting civil society in the broader Middle East and North Africa. And he did so without regard to ethnicity, religion, partisanship, or anything else that would divide people. Rather, as Edward Lucas recently wrote in his “Eastern Approaches” blog, he did so with an inclusiveness and a big heart that is notable for the void now left in his wake. Ron’s passing, therefore, marks a passage of another kind: we have entered a period when few leaders are left who think longterm and proactively, who are passionate about the democratic values that underpin our societies, and who are committed to building that common, inclusive transatlantic platform from which to advance these values in the world. It is a challenge to all
the rest of us who remain to re-launch that positive agenda. And it is a challenge underlined by the second death announcement of May 1, 2011. Osama bin Laden stood for the opposite of everything that was positive in Ron Asmus’s life and works. He cultivated hatred. He abused the unfortunate. He abhorred freedom and instead sought to impose a rigid, pseudo-Islamic ideology on others. He would enforce such an ideology with the most brutal violence. He opposed the rights of women, and indeed fundamental human rights for all people. By orchestrating the mass murder of innocents on September 11, 2001, bin Laden launched an era of war, global terrorism, fear, retribution, deprivation, and more. While terrorism surely preceded the 9/11 attacks – one need only think of the Munich Olympics, Lockerbie, Lebanon, Northern Ireland, the US Embassy bombings and more – bin Laden’s massive act of violence on 9/11 served to amass the disparate and longstanding threads of this terrorist phenomenon into a seemingly single global issue. It rallied disenfranchised youth and extremists to the cause of al Qaeda. And it mobilised democratic states to seek to protect themselves. Regrettably, in some ways, these means of protection – from internal security screenings to the wars in Iraq and Afghanistan, to detentions and renditions – added fuel to the fire of terrorist recruitment. Yet as much as Ron Asmus’s death was a heavy blow to the forces of decency and democratic values in our transatlantic community, bin Laden’s death was a new opening. Here, with the demise of this polarising figure, we again have a chance to disaggregate our thinking about the many challenges we face in the world. Islamist terrorism will not end overnight. But it may no longer be seen as a monolithic menace. We may again be able to distinguish the subtleties.
Islamist terrorism will not end overnight. But it may no longer be seen as a monolithic menace. We may again be able to distinguish the subtleties. Diplomaatia · May 2011
If we are to judge NATO’s performance in the Middle East and North Africa, sadly our Alliance comes up short. …a post-modern sensibility about using military force only to ‘protect civilians’and ‘deliver humanitarian relief’ is a cruel self-delusion. Some extremists will vow to fight on, and new terrorist attacks may occur as a result. But for the majority of Muslims in the world, Bin Laden is no longer some folk hero, but a radical extremist whose violent and intolerant ways ultimately led to his death. That is no inspiration. By contrast, the real inspiration comes in the form of peaceful protests across the Arab world, by people who do not demand an extremist Islamic caliphate – but instead demand fundamental human rights and political freedoms. All of this – the inspiring example set by our friend Ron Asmus, the new openings presented by the death of bin Laden, and the great hopefulness presented by the revolutions in the Arab world – all of this offers lessons for the transatlantic community today. First, and most fundamentally, is the need to be clear and unwavering in support of our core democratic values. This is what leads to our greatest accomplishments. It is what inspires others to bring about positive change. It is what distinguishes our community from the dictators, extremists, criminals and other charlatans who restrict the freedoms and trample the rights of others. Second, this means being willing to confront hard choices. It is not always convenient to stand by fundamental human values. It does not always lead to stability or ‘good relations’ with undemocratic regimes in the short term. In the face of dictators like Gaddafi, willing to use force against his own population, a post-modern sensibility about using military force only to ‘protect civilians’ and ‘deliver humanitarian relief’ is a cruel selfdelusion. It assuages the consciences of the West, while leaving Libyans on the ground to continue to suffer. The Berlin airlift, the Cuban missile crisis, and nuclear deterrence all carried enormous risk and cost. But the Cold War would not have been won without them.
Diplomaatia · May 2011
It is easy to trade freedom in the search for an elusive ‘stability’ But when basic human values are suppressed, it will surely lead to instability in the long term regardless. If there is one lesson we should learn from the Arab Spring, it is this: the denial of basic freedoms can push people to extremes, while the realisation of basic freedoms can be the best antidote not only to authoritarianism, but to extremism as well. Third, even when change seems impossible, it is important to get the strategic positioning right. No one predicted the revolutions of 1989 or 2011. But in 1989, we were positioned the right way. We stood clearly on the side of freedom and democracy. We knew we wanted to see the occupying Soviet forces withdrawn. We knew we wanted to see free and fair elections, and to replace the Soviet-imposed regimes throughout Central and Eastern Europe. We knew we wanted the independence of the Baltic states restored.
ous, while depending on the United States to do the unpleasant business at hand. But the reality is that we are the least convincing and the least effective when we are divided, and the most compelling and successful when we are united in purpose and action. To be sure: at the moment, we differ wildly within our transatlantic community over our assessments of the strategic environment and the desirability of various actions. But it is worth forcing the debate, arguing as necessary, and forcing a genuine conclusion. Half-measures and lowest common denominators take us nowhere. And a divided transatlantic community is even worse, sending mixed signals about the values at stake and our resolve in advancing them.
are suppressed, it
will surely lead to
instability in the long term regardless.
In 2011, by contrast, our positioning was the opposite: we were seen to be on the side of the regimes, not the people demanding fundamental rights. We were seen as hypocrites – supporting our own freedom, but not that of others. We hesitated on the notion of free elections – would they produce outcomes we favoured? We put a higher priority on shortterm national security interests than on long-term change and the protection of human freedoms. We wavered on whether it would be acceptable for dictatorial regimes that abuse human rights and freedoms but cooperate with US interests to be replaced by new, unknown governments. As a result, when the revolutions of 1989 swept across Europe, we knew what we supported and we knew how to act. But when the revolutions of 2011 swept across the Middle East, we did not know how to act. The result may be that a new generation of Arabs – one that seeks democratic change, freedom and greater justice – may be as cynical about Western hypocrisy as the generation they replace. Certainly, recent opinion polls in Egypt seem to bear out this concern. We should take these warning signs to heart, before it is too late. Fourth, and finally, we need to stick toge ther. It is tempting for America to distance itself from Europe – either to be more militarily effective, or to force Europe to carry more of the load. It is tempting for Europe to distance itself from the United States, to portray itself as more law-abiding and virtu-
To be able to stick together, America must provide and share political and military leadership. To say that America will “hand off to NATO” turns the idea of NATO on its head – that the preeminent military Alliance between Europe and North America is one in which the United States is an outsider. And at the same time, Europe can hardly benefit from an inclusive transatlantic Alliance if it is unwilling to bear its share of the military and political burdens. The maintenance of an effective transatlantic community depends on the commitment of both sides of the Atlantic. If we are to judge NATO’s performance in the Middle East and North Africa today against these four lessons to learn, sadly our Alliance comes up short. We have waffled on values – touting them in Libya, but standing silent in Bahrain or Syria; we have sought to avoid hard choices rather than make them; we have positioned ourselves on the wrong side of history; and we have allowed our community to become more divided, rather than more united as we confront the greatest challenges and opportunities our nations have faced since the fall of the Berlin Wall. It is not too late to change course. And perhaps the two shocks we received on May 1, 2011 – the death of a great Atlanticist, and the death of a hateful terrorist – will finally prompt us to do so.
The Story of Two Revolutions We should put our heads together in Central and East European countries and think of how to share our experiences with our Arab friends.
The tragic act of self-immolation by a young Tunisian man, Mohamed Bouazizi, on the main square of Sidi Bouzid in Central Tunisia, became a harbinger of a great storm. The Arab revolution had begun. First came the collapse of Tunisian President Ben Ali’s regime, but when people took to the streets of Cairo, it was clear that these developments were of historic proportions. The West was very cautious in the beginning – it was believed that any declarations on our part could carry the process in an unknown direction. Later, we had to side with the protestors who upheld democratic principles – a policy, which has finally landed us in a war in Libya.
Jüri Luik, Ambassador
Jüri Luik has been Estonia’s Permanent Representative to NATO since 2007. Before that, he was Ambassador to the United States for four years. He led the Estonian Government Delegation in the Accession Talks with NATO from 2002– 2003. In addition, he has held the posts of Defence Minister (1993–1994; 1999– 2002) and Foreign Minister (1994–1995).
Those who saw the mass media coverage of the 1989 revolutions in Eastern Europe (those who are too young can watch it on YouTube) cannot help but draw parallels between the events of 1989 and the current revolution. It is all so familiar – the enthusiasm of young people; the immense energy of the masses; the scared and confused looks on the faces of the representatives of old regimes. Still, we should not jump to conclusions. Let me state right away that I share the view that developments in one culture cannot be transferred to the context of another culture. When we look at the events in Arab countries, we must take into account the specifics of their societies, including the role of Islam and the social positions of women and the youth. Yet despite all of that, I believe that people’s yearning for human rights and democratic freedoms is universal, and while the roads that lead to them are always different, they are comparable on the basis of the similarities of their final objectives. The Arab revolutions still await analysis. At the moment, the events are too recent. But it can already be said that the threats spread by autocrats to gain support from the West have not materialised. First, the revolutions have not turned against the US or Israel, although the autocrats have lost their power and the people have had more opportunities to show their true colours. The uprisings have not stemmed from religious, but political and economic demands. So, on the contrary, Western nations are conducting their operation against Libya at the Arab League’s request which, as such, enabled the Security Council to adopt its resolution on Libya. In the Arab world, societies have become strongly urbanised; tribal loyalty is no longer as important as it once was; the con-
We had to side with the protestors who upheld democratic principles – a policy, which has finally landed us in a war in Libya.
flicts have not evolved into tribal warfare, as was predicted at least for Libya and Yemen. Roger Cohen has pointed out that the Arab revolutions have disproved the patronising myth about common Arabs who have no use for democracy.
Two revolutions: the same goal What, then, are the main differences between the two revolutions? While the revolutions in Arab countries in the 1950s and the 1960s were mostly inspired by national opposition movements and were directed against the colonisers, today’s protests primarily target their own corrupt power elites. The attempts by the authorities to lay the blame for the events on Israel or on the US have not struck a chord with the people. In 1989, Europe was engaged in a process of restoring nation-states and terminating occupation – the fight was against a foreign presence. The puppet governments of the Soviet Union were not considered to be powerful enemies; the real enemy was the ‘central power’ and the Soviet armed forces. There is no equivalent to that in the Arab spring. On the contrary, national armed forces have rather played the role of defenders of the people, especially in Egypt and in Tunisia. The rise to power of the armed forces in Egypt was called a ‘victory for democracy’ and the protestors chanted loudly that their armed forces protected them.
The threats spread by autocrats to gain support from the West have not materialised. Mubarak. Those who did not play ball with the authorities, for example, the Muslim Brotherhood, scare off other parties with their radical views. So, the hunt is on for a new national leader with a clean record and an unblemished reputation. In both revolutions, the authorities lost their legitimacy in a similar way. The stagnant regimes gradually exhausted their fear factor and were reduced to a farce. Their presence was no longer intimidating; instead they seemed to have slipped into routine and lethargy. It is obvious that the regimes whose leaders have been in power the longest are most under threat. Let us keep in mind that Mubarak rose to power in 1981, Gaddafi in 1969 and President Saleh of Yemen in 1978. Lesser risks affect the royal families of the region, excluding Bahrain where the conflict is rather between Sunni and Shia Muslims. The royals clearly enjoy a greater legitimacy among the people, the more so as the monarchs of Jordan and Morocco are considered to be direct descendants of Mohammad himself.
I share the view that developments in one culture cannot be
transferred to the
context of another culture.
Arab nations do not have a phenomenon similar to Gorbachev – the authorities, being under pressure, are trying to play for time by starting to implement reforms only now. It is unclear if reforms can help at this stage, or whether or not they will open the gates for even more drastic revolutionary upheavals. Paraphrasing a remark by Henry Kissinger about the Shah of Iran, it could be said that when the house is on fire, it is too late to redecorate. The Arab revolutions did not have any undisputed leaders. In the Soviet Union and in Warsaw Pact nations, it was the intelligentsia, including writers, scientists and philosophers, who spearheaded the revolutions. The most well known was, of course, the Czech revolutionary who later became president – Vaclav Havel. Many Arab countries have opposition movements with their own political leaders. There are as many as eight or nine opposition parties in Egypt, but they are disconnected and their supporter base is fragmented. Many party leaders have compromised themselves by their relations with
In the Arab revolutions, the youth played a key role. The proportion of young people in Arab countries is as high as 60%. Young people in Europe were motivated by an abstract yearning for freedom and this was also a crucial factor among Arab nations. A public opinion poll among the youth in Arab states (ASDA’A Burson-Marsteller Arab Youth Survey 2010) showed that 80% of respondents in Egypt, Iraq, Jordan and Lebanon cited “living in a democratic country” as their greatest priority. However, the economic situation was also a significant driving factor (the same poll found that these respondents believed that the rising cost of living and unemployment were the two greatest challenges facing the Middle East). Young people in Arab countries, be they poor or not, are definitely more familiar with the market economy than the youth in East Europe were. This makes Arab youth increasingly more impatient and they expect their new leaders – whoever they are – to take immediate steps to revitalise the economy. So, the people who are anyway more willing to take Diplomaatia · May 2011
to the streets also hold the highest expectations regarding their new leadership. As we can see, many differences have emerged already. More importantly, however, although there are different roads to revolution, the final goal of them all is to build a democratic society. The road to it is long and you start off by having to survive the stage of transition. I believe that we should put our heads together in Central and East European countries and think of how to share our experiences with our Arab friends. Obviously, we should not force our advice on them in any way, but rather offer it in case there is interest. We must take into account the fact that due to their history of colonisation, Arab nations are deeply sceptical of any recommendations from Europe. It is certain that they expect in particular economic assistance, not advice. If we were to give advice, we should suggest failsafe methods that produce results regardless of the cultural context.
Advice from Central and Eastern Europe Let me start with a key recommendation, which is also a warning: a revolution must be carried through to completion. People often let themselves be deceived by an illusionary victory, which the very same members of the former regime, or someone else, can easily reverse. A good example of this is Iran where one dictatorship was, broadly speaking, replaced with an even more brutal one. A democratic state must have adequate legislation in order to function properly – this does not only mean a constitution, but also laws about property ownership, elections and civil control. Cautionary examples include Slovakia, where Meciar stayed in power after the revolution, and Yugoslavia, which continued under Slobodan Milosevic’s rule. The same phenomenon has been evident in many CIS nations and especially in Belarus. The most tragic revolution to be given up halfway through is, of course, the revolution in Russia – it was there that young democrats focused exclusively on economic reforms, which the absence of any political changes has rendered meaningless. Even the existence of several parties as such does not guarantee success – a strong president can ‘unite’ his people quite quickly.
People often let themselves be deceived by an illusionary victory, which the very same members of the former regime, or someone else, can easily reverse. forces could reinstate dictatorial rule, start a civil war or both. The greatest threat of all is, of course, presented by religious fundamentalism. Extremists can usually be pacified by making them minority partners in a coalition government (although preferably not by offering them the seat of interior minister). It is promising that not a single secular or religious party has excluded the possibility of forming a coalition with one another during the course of the Arab spring. Third – and this will be the most difficult task – a new political elite must be ‘built’. After all, the streets have not ‘furnished’ the protestors with charismatic leaders who could shape the development of society. In addition, official opposition movements have already compromised themselves and, in all likelihood, will be unable to gain trust on a wider scale. A fine example of this is Yemen, where the opposition parties’ conclusion of an agreement with the president on the transfer of power prompted harsh criticism from the protestors on the streets – they trusted neither President Saleh nor the opposition. So it is inevitable that the leaders who have lived in exile offer the most promise for uniting old and new regimes and that the officials of international organisations seem to be the most trustworthy in this respect. It is not accidental that the names of ElBaradei, former Director General of the International Atomic Energy Agency, and Amre Moussa, SecretaryGeneral of the Arab League, have come up in Egypt. But even international figures have their limitations – they are not that well known in their home countries and their status as ‘foreigners’ might also hold them back. In addition, they are not tabula rasae; for example, before taking up his current post, Moussa was Foreign Minister of Egypt. One very prominent example of the ‘rebirth’ phenomenon among the old rulers is Libya’s opposition leader Jalil, who used to be Gaddafi’s Minister of Justice, but whose fighters are today defended by NATO’s air armada.
put our heads together in
East European countries and think of how to share our
our Arab friends.
Second, extremists must be driven off. All revolutions, including those of 1989, attract radical forces which aim to rise to power and could pose grave dangers. Extremists can swiftly launch a civil war. Clearly, such a risk is indubitably greater in countries where regional, tribal or national divides already exist. Again, Milosevic provides a cautionary example. When in power, extremist
Fourth, a free media has to be created – it is the only tool for ensuring democratic continuity, for curbing corruption and for em-
All revolutions, including those of 1989, attract radical forces which aim to rise to power and could pose grave dangers. 9
Diplomaatia · May 2011
powering suppressed groups in society. In CEE countries, a free media emerged quite quickly, providing a substantive guarantee for further democratic development. Journalists have called the Arab spring a ‘technological revolution’ because Facebook and Twitter have played significant roles in it. But the importance of traditional media, especially satellite TV, should not be underestimated. In particular, Al-Jazeera played a crucial role in conveying news about the first – Tunisian – revolution to other countries, reaching far more people than the social media can. Al-Jazeera became such a key player in supporting resistance that Hillary Clinton praised the network at a hearing before Congress, comparing it favourably with US TV channels. And fifth, the fight against corruption. In the CEE revolutions, the corruption issue was not prevalent. There was no private sector, which meant that the system itself was corrupt, as demonstrated by the existence of special shops and restaurants for party functionaries. Consumer society with its pleasures, excluding the most basic foodstuffs and consumer goods, did not become a specific point of contention in CEE countries; instead there was an abstract yearning for the market economy and its benefits – in Estonia, for example, this feeling was fuelled by Finnish TV. It is hard to imagine this today, the more so as there seems to be only one country left in the world, whose citizens have no access to the global flow of goods – North Korea. Arab nations have no restrictions of this kind. Saudi Arabia and the United Arab Emirates, for example, have gained prominence as huge centres of consumption. Of course, when dealing with corruption, i.e. the undeserved use of social rewards, it is vital to take into account the fact that Arab countries lay great emphasis on extended families, which include the nuclear family together with more distant relatives. Everyone has a moral obligation to help his kin, especially under the conditions of massive unemployment. Repressions will not change anything; instead, the entire system must be transformed. For example, the fewer licences you have to obtain for house construction, the fewer windows of opportunity corrupt officials will have to solicit bribes. Fortunately, the anti-corruption forces of today have one advantage: the protestors have also included the fight against corruption in their list of demands.
No conclusions yet Finally, we have to admit that we do not know where this state of turmoil will take us. It could all be just a passing episode; it could be a fundamental shift in history. It is possible that the changes will affect only a few Arab nations. In this case, Egypt will be a key player – with its huge population and strategic position, it has a profound influence on the developments in the Mediterranean region and in the Middle East. One in every four Arabs is Egyptian. Where Egypt goes, the whole region follows. The European Union should seriously consider how the Union for the Mediterranean could contribute to help the region. At the moment, this initiative remains in a frozen state, with Mubarak still its co-president. The EU should have a strategic debate about the tools we have to help these fragile countries in their transition. We should think of ways of giving advice and assistance by proving their usefulness, rather than by pouring unsolicited advice into reluctant recipients.
We have to admit that we do not know where this state of turmoil will take us. It could all be just a passing episode; it could be a fundamental shift in history.
Time to Act Against Lukashenka Rather than bailing out Lukashenka, now is the time to squeeze him even more in the hope that additional pressure in the form of new sanctions might be the final nail in his coffin.
Belarus strongman Aleksander Lukashenka’s grip on power has never been as precarious as it is these days. Often called Europe’s last dictator, Lukashenka has run this former Soviet country of nearly 10 million people into the ground through irresponsible economic policies and repressive political measures. Belarus desperately needs outside loans and help, and yet none is in the offing from the West, and even neighbouring Russia is playing hard ball. Rather than bailing out Lukashenka, now is the time to squeeze him even more in the hope that additional pressure in the form of new sanctions might be the final nail in his coffin.
David J. Kramer, Executive Director of Freedom House David J. Kramer has been Executive Director of Freedom House since 2010. He held several positions at the US State Department in the George W. Bush Administration, including Assistant Secretary of State for Democracy, Human Rights and Labor. Prior to that, he was Deputy Assistant Secretary of State for European and Eurasian Affairs. Before joining the government, he worked for various think-tanks, including the Center for Strategic and International Studies.
Lukashenka’s support is waning, as reliable exit polls last December showed he failed to win a majority of the vote.
Policies over the years under Lukashenka are responsible for the steep decline in the country’s hard currency reserves, a plummeting currency, rising inflation, and growing shortages of non-perishable goods. Lukashenka has kept some 80 per cent of the economy under state (i.e., his) control and recklessly raised salaries for public officials ahead of last December’s presidential election to buy support for his re-election, dangerously boosting inflation in the process. Now he and, unfortunately, the population are paying the economic price. Not even a tragic bombing on the Minsk me tro on 11 April could distract attention from Belarus’plight. Indeed, suspicions immediately arose as to whether Lukashenka and his security services had some role in the explosion. After all, nothing distracts a population’s attention from a looming economic collapse like a terrorist attack – at least that’s what a desperate leader might want. “Only idiots and scoundrels would make such judgments,” Lukashenka declared, refuting allegations that he and his government were the ones responsible for the deadly attack that killed 13 people and injured 200. Authorities have arrested five suspects in the bombing but have failed to provide any details about their identities or credible motives. Miraculously, law enforcement officials have also linked the suspects to two earlier explosions in 2008 and 2005. Naturally, Lukashenka has indicated that outside forces and/or what’s left of the opposition in the country may have been responsible. In short, the bombing seems to provide a perfect pretext for Lukashenka to crack down even more against the opposition and journalists. Cracking down, after all, is how Lukashenka stays in power. He is a habitual human rights abuser who beats, imprisons, and even “disappears” his opponents and critics. As demonstrated in the presidential election of last 19 December and its aftermath, he rigs elections, orders brutal attacks on peaceful demonstrators, and is determined
to remain in power at all costs. His latest round of human rights violations dwarfs even the brutal standards he has set over the course of his decade-and-a-half reign. And now with suspicions about his possible role in the bombing, Lukashenka is an out-ofcontrol menace.
retaliation; this is unlikely as Lukashenka desperately needs the income from the transit fees. And yet others, instead of imposing new sanctions, would rather hold up any IMF loan in the hope that that might do the job; should Russia bail Lukashenka out, however, that plan would fail.
How should the European Union and the United States handle the situation? By ratcheting up pressure against Lukashenka through sanctions against state-owned enterprises. Such sanctions worked in 2007-2008 when the U.S. sanctioned the largest Belarusian state-owned (also Lukashenka-owned) enterprise, Belneftekhim, in November 2007. Two months later, Lukashenka began releasing the six political prisoners then in jail. Neither a visa ban nor asset freeze imposed in 2006 had worked in freeing these prisoners; it took sanctions against Belneftekhim to achieve this.
Lukashenka’s support is waning; as reliable exit polls last December showed he failed to win a majority of the vote. That tens of thousands turned out in downtown Minsk to protest also indicates that Lukashenka’s hold on power is slipping. His resort to brutal force may have been the only way to avoid losing complete control over the situation. His personnel changes at the top of his administration immediately after the election suggest growing suspicion about which people can be trusted. We should sow doubts in his mind as much as possible, for he’s a paranoid leader prone to make mistakes, and if he suspects that no one around him can be trusted, he may discover that his days are numbered. Tougher sanctions, which most opponents of Lukashenka favour, thus could not only win the release of the political prisoners but they might also be the last straw for Lukashenka amid Belarus’ economic troubles.
We should avoid Lukashenka’s
games of playing Russia and the West against each other.
The EU and U.S. have re-imposed a visa ban and asset freeze against more than 170 Belarusian officials deemed responsible for the latest election-related fraud and violence. And yet there is no reason to think these steps will win the release of the nearly four dozen political prisoners this time either, as shown by Lukashenka’s continuing arrests and harassment of activists and journalists, show trials of leading opposition figures like Andrei Sannikov, and the recent bombing. The U.S. has re-imposed sanctions against Belneftekhim, which were lifted after the release of the political prisoners in 2008, but the EU has refused to take similar measures. The EU must follow the U.S. lead and go after not only Belneftekhim, but other large enterprises such as Belarus Potash Company, a major exporter of fertiliser. Some European leaders worry that tougher measures will push Belarus into Russia’s arms. In 2006-8, the EU and U.S. imposed sanctions against Lukashenka based on how he abused his own people, not on whether Minsk and Moscow had good or bad relations. We should avoid Lukashenka’s games of playing Russia and the West against each other. Others worry he will cut off Russian gas exports that transit through Belarus in
Having refused to recognise the results of the election as legitimate, the EU and U.S. should refuse to deal with Lukashenka and his government and call for new elections. They should also support an effort by Senator Dick Durbin (D-IL) to boycott the International Hockey Federation World Championship, which Belarus is scheduled to host in 2014 and which Lukashenka, a former hockey player and ardent fan, sees as legitimising his regime. And there should be calls for a full, transparent investigation of the April 11 bombing. Freedom and democracy should be the common cause uniting the EU and U.S. together with those inside Belarus who are fighting for a better, more democratic future. We must keep up the drumbeat. Lukashenka’s regime is not serious about engagement. It is a regime that only understands pressure and strength – that’s the way to get Lukashenka’s attention. It is a regime that a decade ago “disappeared” four prominent opposition figures for crossing it; their wherea-
Lukashenka is a paranoid leader prone to make mistakes, and if he suspects that no one around him can be trusted, he may discover that his days are numbered. Diplomaatia · May 2011
bouts remain unknown. It sells arms to such places as Syria, Venezuela, Sudan and Iran, revenue from which lines not only the state’s coffers but Lukashenka’s pockets. It handed out passports to Saddam Hussein’s sons Uday and Qusai and gives refuge to Kyrgyz strongman Kurmanbek Bakiev, who was deposed by his own people a year ago. Lukashenka’s regime, in other words, is not only a threat to its own people but beyond its borders too. By practically any measure, Belarus under Lukashenka is truly the last dictatorship in Europe, a view reinforced by developments on 19 December and since. We must remember that tens of thousands of people turned out in downtown Minsk unprecedented numbers - to protest against a fraudulent election and the Lukashenka regime. They knew they were risking serious injury and worse at the hands of Lukashenka’s repressive security services. And yet they stood for freedom and human rights. We should be standing with them. When President George W. Bush signed the original bipartisan Belarus Democracy Act in 2004, he declared, “[T]here is no place in a Europe whole and free for a regime of this kind.” At the same time, there is very much a place in Europe for a democratic Belarus – but such a possibility is unlikely as long as Lukashenka remains in power and we in the West provide him succour as we did last year. Our support should be for the tens of thousands of brave people who turned out to protest Lukashenka’s rule and the many more who rejected his candidacy in the last presidential election. They are the future of Belarus, and they need our support and solidarity urgently. Left unchallenged, Lukashenka would become a defiant model for other authoritarian leaders and would expose the West as an impotent force unable to meet challenges in its own neighbourhood. Now is the time for the EU and U.S. together to act decisively. Delay will only lead to further suffering for the long-suffering people of Belarus.
Freedom and democracy should be the common cause uniting the EU and U.S. together with those inside Belarus who are fighting for a better, more democratic future.
International Law in Foreign Policy Documents of the Russian Federation: a Deconstruction When Russia refers to international law then what exactly does it refer to? The bombing of Yugoslavia in 1999 (the ‘Kosovo intervention’) marked a watershed in the relations between NATO and the Russian Federation with repercussions that have lasted until today.1 In Russia, the conflict confirmed the Cold War-era common wisdom that NATO was a geopolitical threat and was constructed against the interests of Russia. The Kosovo intervention also triggered intense debates about international law – when is the use of military force legal under the UN Charter and whether the respective law of jus ad bellum needs any reform?
Lauri Mälksoo, law professor
Lauri Mälksoo has been Professor of International Law and Head of the Institute of Constitutional and International Law at the University of Tartu since 2010. Research for this article was supported by the European Research Council’s starting grant to study contemporary concepts of international law and human rights in the Russian Federation.
The years that followed brought the UN-approved intervention in Afghanistan and the non-UN-approved intervention in Iraq. In the spring of 2011, 12 years after Kosovo, NATO forces are engaged in Libya, once again with a UN mandate – one, however, that establishes a no-fly zone but does not directly authorise the use of force in general, a detail that has already caused controversy in the non-Western part of the world, not least in Russia. The questions of the legitimacy – as well as the practicality – of the use of force are as acute as ever and the debates about it just as fierce. Diplomats at the UN have argued that international law is metaphorically a ‘language of international relations’.2 Since the creation of the League of Nations in 1919 and the adoption of the Kellogg-Briand Pact in 1928, the questions of the legality of use of military force and the architecture of collective security have become central elements in the body of international law. Of course, to argue that international law is a language of international relations is to take a normative stance. International law does not have to be such a language – nor does it have to be the only or the most important language of international relations. For realists, the language of international relations continues to be the struggle for power. Nevertheless, it is quite useful to use the metaphor of ‘language’ for the analysis of the collective security aspects of international relations. Global languages are usually spoken with different accents. This analysis is about present day Russia’s ‘accent’ when it speaks the language of international law. Russia has recently adopted three important foreign policy, national security and military strategy documents. The Foreign Policy Concept was adopted on 12 July 2008, the Strategy of National Security on 12 May 2009 and the Military Doctrine on 5 February 2010. Common to these documents is the extensive and occasionally even obsessive reference to international law. For instance, the Foreign Policy Concept refers to the importance of international law on at least 13 different occasions. The general pattern followed in
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these documents is clear: Russia sees itself as a country that values international law very highly; whereas it sees elsewhere, particularly in the US, alarming signs of unilateralism and of violations of international law. The importance of international law is also emphasised by other states and blocks of states. For example, Article 3 para. 5 of the consolidated treaty on European Union emphasises that the EU will contribute to the “strict observance and the development of international law, including respect for the principles of the United Nations Charter.” US President Barack Obama also stressed the importance of international law in his Nobel 2009 speech. However, Russia’s insistence on international law in these documents surpasses Western statements in its intensity and repetitiveness.
Diplomats at the UN have argued that international law is metaphorically a ‘language of international relations’.
But did the Eastern European democratic revolution change much in terms of universal international law? An honest treaty text-oriented answer would be: no, or not so much. At least among Eastern European elites, Russia does not currently enjoy the reputation of being the guardian angel of international law.
However, as in life generally, what one thinks about oneself and what others think about you may differ somewhat. At least among Eastern European elites, Russia does not currently enjoy the reputation of being the guardian angel of international law. As far as respect for international law is concerned, there is a certain discrepancy between Russia’s self-image (as reflected in the above three documents) and how the country is perceived in a number of European countries, Rather, the Russian Federation is partly accused of the same evils that it accuses the US of: playing the game of power politics too easily, using international law selectively, and wrestling the arms of weaker neighbours.
According to the same document, there is a global tendency of, “ignoring by individual States and their groups of major principles of international law. Russia advocates full universality of the generally recognised norms of international law both in their understanding and application. (…) Attempts to lower the role of a sovereign state as a fundamental element of international relations and to divide States into categories with different rights and responsibilities, are fraught with undermining the international rule of law and arbitrary interference in internal affairs of sovereign States.”
Of course, it may well be that this negative perception is partly there because the elites in Eastern European countries tend, for historical reasons, to be critical of Russia no matter what it does. However, for a more objective reference point, one could take a look at the jurisprudence of the European Court of Human Rights. Russia’s record in this court is good only to the extent that the government complies with its judgments. Apart from this, the nature and scale of human rights violations that the Strasbourg system has to deal with, create a rather negative impression of Russia’s compliance with the human rights field of regional international law. Moreover, the OSCE has repeatedly criticised the state of rule of law and democracy in Russia. But of course, one can also argue – as some have done in Russia - that these organisations are somehow biased.
“Adherence to international law is important for safeguarding the interests of our country, its nationals and legal entities. Russia intends to: ensure compliance by the international stakeholders with their international obligations both to Russia and to the world community as a whole; combat violations of international law by States, international organizations, non-governmental organizations and individuals.”
What is behind this discrepancy between Russia’s self-image and its perception abroad, as far as international law is concerned? The aim of this article is to reflect further on Russia’s claim to be particularly respectful of international law, and to put this claim in a historical and comparative perspective. In the time of perestroika, someone wittily asked: if power belongs to the people, then to whom does it actually belong? We may paraphrase this question here: when Russia refers to international law then what exactly does it refer to?
2. Extensive References to International Law Let us first illustrate the previous introductory points with some concrete examples. To start with the Foreign Policy Concept of the Russian Federation, it makes the case that, “coercive measures with the use of military force in circumvention of the UN Charter and Security Council cannot overcome deep social, economic, ethnic and other differences underlying conflicts. [They] undermine the basic principles of international law…”
If other countries and international actors still decide to violate international law, they will face a negative reaction from Russia:
Moreover, the Foreign Policy Concept suggests that countries violating international law should not attempt to justify their actions by ‘creative interpretation of international law’. According to the document, Russia intends to: “counter the attempts by individual countries or groups of countries to revise the universally accepted norms of international law enshrined in universal documents such as the UN Charter, the 1970 Declaration on Principles of International Law concerning Friendly Relations and Cooperation among States in accordance with the UN Charter, as well as in the CSCE Final Act of 1975. Arbitrary and politically motivated interpretation by certain countries of fundamental international legal norms and principles such as non-use of force or threat of force, peaceful settlement of international disputes, respect for sovereignty and territorial integrity of States, right of peoples to self-determination, as well as the attempts to portray violations of international law as its ‘creative’ application, are especially detrimental to international peace, law and order. Such actions erode the basis of international law and inflict a lasting damage to its authority.” The most ambitious question in contemporary international law is the regulation of the use of military force. In the decades
since the adoption of the UN Charter in 1945, states have come up with extensive interpretations of the only exception to the prohibition of the use of force (Article 2 para. 4 of the Charter) – the right to self-defence (Article 51). Here, Russia argues against the broadening of the concept of self-defence. Russia, “regards Article 51 of the UN Charter as an adequate and not subject to revision legal basis for the use of force in self-defence, including in the face of existing threats to peace and security such as international terrorism and proliferation of weapons of mass destruction.” Another document, the Strategy of National Security was adopted by the President on 12 May 2009 and will be applicable until 2020. Approximately one year passed between the adoption of the two documents. However, during that year the August 2008 war between Georgia and Russia happened. While the 2008 document takes international law for granted, the 2009 strategy takes a more reflective stance, admitting that existing legal instruments and mechanisms are incomplete.3 The main position, however, remains the same: Russia will support the rule of law in international relations and pursue its foreign policy strictly in the framework of international law. Russia continues to criticise the fact that NATO has expanded its borders and that NATO has illegally taken upon itself global functions – things that should be done through the UN Security Council. The Strategy maintains that Russia’s level of willingness to co-operate with NATO will depend on whether the military alliance respects international law in its activities. Finally, one may briefly mention a third document, the Military Doctrine of the Russian Federation, adopted on 5 February 2010. Perhaps the most important element here is Russia’s concept of the legality of the use of military force. Point 20 of the Military Doctrine lists the uses of military force that Russia considers legal: self-defence against aggression, use of force authorised by the UN Security Council for the maintenance of international peace and security or by other structures of collective security, and finally, the protection of Russian citizens abroad. All these uses would be interpreted, according to the document, “according to generally recognised principles and norms of international law and international treaties of the Russian Federation”.4 Later on, it is specified that protection of Russian citizens abroad means protection from a ‘military attack’ upon them.5
3. Which Aspects of International Law Do Countries Emphasise? Historically, international law has developed in stages. Thus, major landmarks in its development were the Peace of Westphalia in 1648, the Congress of Vienna in 1815, the Versailles Peace Treaty in 1919 and, finally the creation of the United Nations in 1945. Something significant also happened in 1989-1991, especially in Eastern Europe, but the exact international legal implications of these changes have remained unclear.
The more conspicuously Russia’s foreign policy documents emphasise ‘international law’, the less they put emphasis on ‘human rights’ (as a special part of international law). Diplomaatia · May 2011
Did the democratic revolutions in Eastern Europe change something in international law or not? Certainly, the changes in Eastern Europe had a major impact on the development of regional international law in Europe – for the European Union, the Council of Europe’s human rights protection system and the OSCE. But did the Eastern European democratic revolution change much in terms of universal international law? An honest treaty text-oriented answer would be: no, or not so much. For example, the long-planned reform of the United Nations failed again in 2005. Moreover, after 9/11, the main focus of the West seems to have moved from democracy and human rights to anti-terrorist activities, i.e. from something proactive to something reactive. In the 1990s, optimistic scholarly attempts were made to translate the effects of the Eastern European democratic revolutions on international law. For example, in a landmark article, New York University’s international law professor Thomas M. Franck, argued that international law had come to recognise an ‘emerging right to democratic governance’.6 (The sovereignty-centred argument of international law throughout the preceding centuries had been that whatever form of government a country chooses remains its own business and other nations have no right to interfere.) In another noteworthy article, international law professor Anne-Marie Slaughter (currently directing the policy planning department in the US State Department) argued that states with a liberal domestic order will constitute a special privileged circle of trust in the international community, a circle that is more likely to respect international law and whose members are more likely to solve their disputes with each other in a peaceful way.7 Essentially, the 1990s saw the re-emergence of the Kantian concept8 that the international community should be (re-)constituted of democratic republics. Fernando Tesón, another international law scholar from the US, has strongly advocated humanitarian and pro-democratic interventions and forcible sanctions against tyrannical regimes.9 Some have called for the creation of a League of Democracies, going beyond the UN which tends to accept each state as it is (North Korea and Sudan are member states). In these opinions and developments, one can detect some background to Russia’s Foreign Policy Concept complaint about “attempts to (…) divide States into categories with different rights and responsibilities.” A crucial philosophical dilemma has been whether to look at international law from the perspective of the rights of states or from the perspective of the rights of individuals. Nowadays, most theoretical approaches to international law constitute some sort of compromise between the two approaches. While the state remains the central subject of international law, the individual has usually also been raised to the status of a subject of international law. Yet this shift from an entirely state-centred perspective of international law to an approach which also accommodates individuals and non-state actors, has been far from universal. Moreover, even accepting both states and individuals as subjects of international law does not answer the question of what to do in a concrete situation when a decision maker has to choose between the rights of the state and those of persecuted individuals or groups. The more 13
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conspicuously Russia’s foreign policy documents emphasise ‘international law’, the less they put emphasis on ‘human rights’ (as a special part of international law). If the documents do mention ‘human rights’, they usually also criticise ‘double standards’ in their application, which is a way to say defensively that those who feel like criticising Russia should first look in their own backyards. A number of leading international law textbooks in Russia still have a hard time in recognising individuals as subjects of international law.10 It is not just that Russia’s theoretical concepts of international law tend to be state-centred (Grotian) as opposed to individual-centred (Kantian).11 This in itself would not be anything outside the global mainstream; theoretical approaches in the West proceed from the same presumption. Even so, a lot depends on how statehood is conceived domestically. Is the state there to serve its citizens or is it some sort of Hegelian Absolute, a goal in itself and the highest (mandatory) value for the respective community? This question is at the core of today’s debates about who violates and who respects international law. From the liberal perspective, if ‘international law’ is constructed on ethically questionable premises (potentially enabling, via the concept of state sovereignty, the killing, persecution or repression of one’s own citizens), why make a fetish out of its observance? The biggest criticism of the liberal concept of international law is that its main purpose may not even be to do justice – rather, it may be to have peace. Even an unjust peace may be better than violent crusades in the name of liberal justice (or socialist revolution or any other ideology, for that matter). Pro-democratic or humanitarian interventions may seem morally right to liberal doctrinaires; yet such interventions can be highly destructive from the point of view of international peace, order and stability. They create the damaging impression that ‘everything is permitted’ for liberal states. These states are exceptional and when they go against the letter of international law, it is meant to be a violation or precedent for the others. Among other things, such interventions give a bad example to non-democratic or less democratic great powers (who by their own illiberal domestic concept of law may have less faith in the international rule of law anyway). In any case, when Russia emphatically refers to international law, it refers to international law as crystallised in 1945. The approach is strictly textual-formalistic and clearly prioritises sovereignty over human rights interventionism. In raising the shield of international law (of 1945), Russia is also, in a way, making a point against codifying the results of the Eastern European democratic revolutions of 1989/1991 into future international law. Russia’s argument is that whatever the West or Europe (minus Russia) may value
Essentially, the 1990s saw the re-emergence of the Kantian concept that the international community should be (re-)constituted of democratic republics. politically is not necessarily universal. Most importantly, it has not become new international law, which binds everyone. One must admit that Russia has a strong argument from the point of view of strict formalist legal logic: while the spirit of the Eastern European revolutions of 1989-1991 has been introduced into European (i.e., regional) international law, it has not been successfully universalised. International law continues to be based on state consent; there is no reform without consent and approval. Russia itself is halfway in (Council of Europe, OSCE), and halfway out (NATO, EU) of European/Western regional international legal arrangements. So far, the most significant recent attempt to introduce the Kantian (human rights-based) influence into the Grotian (state-centred) tradition of international law has been the report compiled by the UN Secretary General’s High-level Panel on Threats and Change, of December 2004. (In this high-level panel, the whole region of Eastern Europe was represented only by former Russian Prime Minister, Mr Yevgeni Primakov.) First, the report makes clear that nowadays, sovereignty can no longer be absolute: “Whatever perceptions may have prevailed when the Westphalian system first gave rise to the notion of State sovereignty, today it clearly carries with it the obligation of a State to protect the welfare of its own peoples and meet its obligations to the wider international community.”12 In the context of the regulation of the use of military force, the report endorsed the Western-initiated idea of the responsibility to protect: “We endorse the emerging norm that there is a collective international responsibility to protect, exercisable by the Security Council authorizing military intervention as a last resort, in the end of genocide and other large-scale killing, ethnic cleansing or serious violations of international humanitarian law which sovereign Governments have proved powerless or unwilling to prevent.“13 This endorsement cuts into the Hegelian concept of state sovereignty as an absolute right; in this context as the absolute right of the veto power-holding permanent members of the Security Council. The 1945 text did not put any moral or ethical limits on the use of veto power. However, the endorsement by the UN’s High-level Panel of the con-
This shift from an entirely state-centred perspective of international law to an approach which also accommodates individuals and non-state actors, has been far from universal.
cept of the responsibility to protect shakes a little the concept of veto power as absolute power. What would have been the implication of the responsibility to protect in the case of the bombing of Yugoslavia in March 1999? NATO countries at least presented their case to the UN Security Council and only withdrew the matter after the realisation that Russia (and probably China) would have vetoed any ’Western’ intervention anyway. At that time, Russia did not bother to present its own case too extensively; veto power was veto power. If the responsibility to protect doctrine had already been recognised in 1999, there would have been a need to study all the relevant facts in the crisis from its viewpoint. (Somewhat ironically, Mr Primakov, member of the High-level Panel, was Russia’s Prime Minister in the time of Yugoslavia/Kosovo crisis in 1999. One wonders who then had the responsibility to protect the population of Kosovo?)
If the documents do mention ’human rights’, they usually also criticise ‘double standards’ in their application.
Russia’s message is: what we value also happens to be international law. The talk of human rights and democratisation is just a Western political programme, not international law.
However, even with the adoption of the UN High-level Panel’s report, the fact remains that no state has been able to initiate an amendment of the UN Charter. For lawyers, the UN Charter is a ‘hard’ legal document and the High-level Panel’s report is a political document, at best a ‘soft’ instrument with potential legal significance. After initial ideological confusion in the 1990s, Moscow seems to have made a clear decision that it is not interested in the revision of the main emphases of the international law of 1945. Of course, my intention has not been to argue that the UN Charter leaves human rights unprotected. On the contrary, the Charter contains significant references to human rights. Yet in the most critical context where sovereignty and human rights may collide – the use of force for humanitarian purposes – the wording of the Charter (Article 2 para. 4 and Article 51) gives preference to state sovereignty and the discretion of each and all of the UN Security Council’s five permanent members. Of these five, as we know, not all are ‘liberal’ states. In any case, Russia’s message is: what we value (e.g., a strong state, protection of sovereignty), also happens to be (international) law; what the West preaches is at best regional international law (Eastern Europe could ‘return’ to the West after 19891991) but, universally speaking, the talk of human rights and democratisation is just a Western political programme, not international law. It has sometimes been said that post-Yeltsin Russia has become a revisionist power (the sentence is usually uttered somewhat pejoratively.) Whether this is true or not, depends on one’s historical viewpoint. If we accept the revolution of 1989/1991 as a normative starting point then, yes, PutinMedvedev Russia has a revisionist agenda. Yet Russia’s argument is that the fruits of the revolution of 1989/1991 remained local (East European); they were not translated into universal international law. For Russia, the core of international law is constituted of a Hegelian interpretation of the 1945 UN Charter. Whatever Kantian human rights professors may have dreamed about the future in the 1990s, none of this was translated into a revision of the UN Charter. Seen from this historical vantage point, it is the liberal prohuman rights interventionists of the post 1989/1991 era who appear as revisionist powers. In any case, it has become increasingly clear that Russia will not easily allow the revision or re-interpretation of the core of international law to the further disadvantage of (its) state sovereignty. Russia is acting like a classical status quo power, with no interest in changing international law.
USSR did not need to use military force to protect its citizens abroad; it had (almost) no citizens abroad. The only problem is that the very same text of the UN Charter that arguably prioritises state rights over the rights of the individual, which Russia refers to as a shield against Western interventionism, is not so favourable towards the idea of using military force for the protection of citizens abroad.14 The protection of citizens abroad is not universally accepted as a legitimate cause for the use of military force under the UN Charter; indeed during the Soviet era, the USSR criticised such claims by the US, Great Britain and Israel as illegal. Apparently, tempora mutantur et nos mutamur in illis. What remains is a contradiction that says we generally remain conservative as far as the use of military force is concerned; except in the case where our special interests (nationals abroad) are affected.
4. Conclusions International law is an important tool and a restrictive framework in the regulation of collective security and the use of military force. As such, it is laudable if a state emphasises its importance and criticises attempts to circumvent it – as the Russian Federation has done in its recent foreign policy documents. Nevertheless, simply emphasising the importance of international law does not answer the question of what aspects of international law the respective state want to be protected most, or what developments in international law it sees as a threat. We should not forget that the most reactionary European regimes of the 19th century – members of the Holy Alliance – fought any political change with arguments based on international law and referred to the legitimacy of absolute monarchies as a legal principle.
That there is at least
one important aspect where Russia cannot go back to 1945: the
A tough question for the international community continues to be how to change aspects of international law when normative expectations change in parts of the community.15 Is everyone’s consent needed and how will this consent be achieved? Will there be new winners and losers if a new order is established?
country’s borders are now quite different.
Leaving aside the chicken-and-egg question of what constitutes reform and counterreform, it is clear that there is at least one important aspect where Russia cannot go back to 1945: the country’s borders are now quite different. This has created a new situation for Russia – some millions of ethnic Russians living abroad. Many of them are also Russian citizens. It is in this context that Russia’s concept of the use of force actually differs from the Soviet concept. The
In terms of reforming international law since the end of the Cold War, the West and Russia have together experienced one modest breakthrough and one relative failure. Advancements in the field of human rights law can be called a relative success.16 It is true that Russia’s attitude towards (European) human rights standards remains ambivalent and the last word has not been said on the topic. However, at least Russia has joined, and remains in, the Council of Europe human rights protection system. The often difficult normative debate between the West and Russia already takes place within the new normative structure which includes post-Communist Russia. Notwithstanding numerous backlashes reported in the media, this has been an achievement when seen from the historical perspective.17 The situation invokes less optimism in the field of collective security and developments in international law concerning the use of
military force. The universal system of collective security envisaged in the UN Charter never started to work with full effectiveness.18 In many respects, the permanent members of the UN Security Council simply went their own ways, systematically blocking each others’ initiatives. Somewhat unexpectedly for many, the collapse of the USSR in 1991 did not entirely reverse the antagonistic tendencies between the two former superpowers. If there was a moment in the 1990s to translate the achievements of the Eastern European democratic revolutions into universal international law, it was not used, or not used energetically enough. The new democracies in Eastern Europe could have been more active and efficient in advocating reforms in international law, but their legitimacy and capacity to lead was in doubt for some time because they were seen as having been too dependent for too long. On the other hand, international law continues to be based on consent and mutual compromise. International law cannot be easily ‘imposed’ from above. Its main doctrines and solutions are already some centuries old. Therefore, fundamental reforms are by definition not easy to carry out. However, the history of collective security and the UN demonstrates that there is a link between the relative success and relative failure of the post-Cold War reform of international law. Countries which respect human rights and at least strive to be democratic and open tend to trust each other more in terms of security as well. Herein lies also one answer to the legal relationships between the West and Russia in the future – further democratisation and increasing respect for human rights in Russia will inevitably lead towards more trust in ‘hard’ security matters as well. If that happens, the antagonism between Russia and NATO and the rhetoric about foreign ‘violators of international law’ will decrease or even fade away one way or another. 1 See also Ronald D. Asmus, A Little War that Shook the World. Georgia, Russia, and the Future of the West, New York: Palgrave Macmillan, p. 87 et seq. 2 International Law as a Language of International Relations (ed. United Nations Organization), Kluwer Law International, 1996. 3 Strategy of National Security, P. 8. 4 Military Doctrine, p. 20. 5 Military Doctrine, p. 27. 6 Thomas M. Franck, The Emerging Right to Democratic Governance, 86 American Journal of International Law 1992, pp. 46-91. 7 Anne-Marie Slaughter, International Law in a World of Liberal States, 6 European Journal of International Law 1995, pp. 503-538. 8 See further Immanuel Kant, Zum ewigen Frieden, 1795. 9 Fernando R. Tesón, A Philosophy of International Law, Boulder: Westview Press, 1998. 10 See further Lauri Mälksoo, International Law in Russian Textbooks – What’s in the Doctrinal Pluralism?, in: Göttingen Journal of International Law Vol. 1, No. 2, 2009, pp. 279-290. 11 See more on the distinction between the Grotian, Kantian (and Hobbesian) approaches in Hedley Bull, The Anarchical Society. A Study of Order in World Politics, 3rd edition, New York: Palgrave, 2002, p. 23. 12 www.un.org/secureworld, para. 29. 13 Ibid., para. 203. 14 Cf the most authoritative scholarly commentary on the UN Charter - Bruno Simma (ed.) The Charter of the United Nations. A Commentary, 2nd edition, 2002. 15 See e.g. Antonio Cassese, Joseph Weiler (eds.) Change and Stability in International Law-making, Berlin/New York: De Gruyter, 1988. 16 See also Daniel C. Thomas, The Helsinki Effect: International Norms, Human Rights, and the Demise of Communism, Princeton University Press, 2001. 17 See further Lauri Mälksoo, The History of International Legal Theory in Russia: A Civilizational Dialogue with Europe, 19 European Journal of International Law 2008, pp. 211-232 and The Science of International Law and the Concept of Politics. The Arguments and Lives of the International Law Professors at the University of Dorpat/Iur’ev/Tartu 1855-1985, 76 British Year Book of International Law 2005, pp. 383-502. 18 See further Peter G. Danchin and Horst Fischer (eds.), United Nations Reform and the New Collective Security, Cambridge University Press, 2010. 19 See further Immanuel Kant, Zum ewigen Frieden, 1795.
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Democracy in the age of populism, or the self-enmity of democracy The world is no longer structured around a clear-cut opposition between democracy and autocracy; rather, it is the internal contradictions of democratic societies that are worrisome. What is to be feared is the self-enmity of democracy.
In February 2011, British newspapers carried nervous headlines. An opinion poll on identity and extremism had discovered that a huge number of Britons were ready to support an anti-immigration, nationalist party, so long as it was not associated with violence and fascist imagery. France received its shock a month later when an opinion poll showed that if the elections were to be held on that day, the far-right leader Marine le Pen would win the first round. And while the rise of the far right in Britain and France is still limited to opinion polls, in Denmark, Sweden, the Netherlands and Austria, it has already been expressed in national elections. Anti-immigration sentiments are reshaping European politics. Contrary to the expectations of some political observers, the economic crisis has not weakened, but rather appears to have strengthened, the appeal of identity politics.
Ivan Krastev, analyst Ivan Krastev is the chairman of the Centre for Liberal Strategies in Sofia, Bulgaria, a permanent fellow at the Institute for Human Sciences in Vienna, and Editor-in-Chief of the Bulgarian Edition of Foreign Policy. He is also one of the founders and a trustee of the European Council on Foreign Relations, and a member of the Council of the International Institute for Strategic Studies, London.
In Central and Eastern Europe, where immigration is still not a major issue, populist uprisings take the form of anti-elite and anti-Roma rage. In Hungary, the centre-right government of the former dissident Viktor Orbán made many in Europe uneasy when it seemed to use its constitutional majority to curb the powers of independent watchdogs, to reintroduce censorship of the media and to nationalise private pension funds. In Bulgaria, an extra-parliamentary political movement has twice in the last decade won parliamentary elections on an anti-elite ballot. The country thus looks like a poster child for the trend of making elections less a choice between policy alternatives and more about the public execution of parties in power. There is a feeling that Europe has reached what Gerschenkron (1962) called a ‘nodal point’, a point where in a relatively short period of time it will witness, experience and perhaps even participate in aesthetic, ideological, strategic and finally institutional redefinition of the meaning of democracy. Something more essential than the replaceable parts of the democratic machine has worn out. Democracy - meant to be the self-government of equals - is now universally valued and no plausible alternative exists to a society governed by the will of the people, expressed in free and fair elections. At the same time, democracy is in crisis in Europe. At present, European societies have only vague hopes but clear fears as they observe the emergence of the threatened majority as the major political force in European politics. In the 1990s,
Anti-immigration sentiments are
reshaping European politics. 15
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many Europeans were shocked to realise the important role demographic fears played in the process of the disintegration of the former Yugoslavia. At present, demographic statistics are becoming a major factor in West European politics too. European political debates are preoccupied with the birth rates of the various immigrant communities, the percentage of immigrant youth who drop out from school and the number of minority children in secondary schools. Ageing European publics are torn between the need to welcome immigrants in order to preserve their welfare state and the fear that the inflow of immigrants will destroy the cultural identity of European societies. The central political paradox of our time is that the same factors that contributed to the success of democracy are the very ones that threaten it today. The crisis of trust in democratic institutions in Europe is the outcome not of the failure of the democratisation of European societies, but of the success of democratisation. “As I was browsing through The Open Society and Its Enemies again after many years,” wrote the Polish political philosopher Leszek Kołakowski (1997, 162) three decades ago, “it struck me that when Popper attacks totalitarian ideologies and movements, he neglects the reverse side of the threat. By this I mean what could be called the self-enmity of open society – not merely the inherent inability of democracy to defend itself effectively against internal enemies by democra tic means alone, but more importantly, the process by which the extension and consistent application of liberal principles transforms them into their antithesis.” Kołakowski’s emphasis on the self-poisoning nature of open societies is critically important to understanding the current troubles in the house of democracy. The crisis that European democracies are facing today is not a temporary phenomenon – a result of the negative effect of the economic crisis or the failure of leadership in western societies. The current crisis is rooted in the fact that European societies are more open and democratic than ever before. But it is precisely this openness that leads to the ineffectiveness of, and lack of trust in, democratic institutions. The moment has probably arrived when ‘democracies of trust’ have been replaced by ‘democracies of mistrust’, as Rosanvallon (2008) has it. And the question is no longer how elites can restore the trust of the people; the question is how a liberal democracy can function in an environment in which the elites will be permanently mistrusted, regardless of what they do or how transparent are the mechanisms of government.
In the 1960s, many liberals feared that democratic institutions were hostage to the authoritarian culture in which they were immersed. Today the problem is the opposite one. Citizens’ rights are protected better than ever, people have access to more information than ever, they are free to travel and practise their lifestyles, but there is a growing fear that the democratisation of society that has taken place in the last 40 years has led to the paralysis of democratic institutions. Democratic societies are becoming ungovernable, and it seems that they have lost the notions of common life and public interest. Trust in politicians has hit rock bottom. The extension of citizens’ rights and freedoms has not produced a feeling of empowerment. Democratic institutions are more transparent than ever, but they are less trusted than ever. Democratic elites are more meritocratic than ever, but they are more hated than ever. Managing mistrust is what democracies are about today. The rise of populism and the mistrust of the elites have reduced European politics to a
The central political paradox of our time is that the same factors that contributed to the success of democracy are the very ones that threaten it today.
The current crisis is rooted in the fact that European societies are more open and democratic than ever before. clash between the anti-corruption rhetoric of the public and the anti-populist rhetoric of the establishment. There is no new collective utopia to capture the public’s imagination. Simply, a majority of people tend to view all that governments do as corrupt, while governments tend to respond to any demand for policy change with accusations of populism. Instead of bringing new life to the political left or the political right, the current economic crisis has challenged the very notion of the left-right structure of democratic politics. Europe and the world have gone populist. But it is a strange version of populism – people revolt not to enact a clear vision of what they want to change, but to exact revenge and punishment. The rebels of today do not oppose the status quo of yesterday – they seek to preserve it. This pro–status quo radicalism can best be seen on the streets of Paris, where last year students protested against an increase in the pension age, even though the pension age in France was one of lowest in Europe. One has the feeling that Europe is populated only by immigrants and current or future pensioners. What most people fear is not the status quo; what they fear is change. The situation is 1968 in reverse. In 1968 students on the streets of Europe declared their desire to live in a world different from that of their parents, now students are on the street to declare their desire to live in the world of their parents. In order to make sense of the current state of democracy it is necessary to rethink the unintended consequences of the five revolutions that have shattered the Western world since 1968. First is the socio-cultural revolution of the 1960s that put the individual at the centre of politics. Second is the market revolution of the 1980s that de-legitimised the state as an economic actor. Third are the Central European revolutions of 1989 that reconciled the socio-cultural revolution of the 1960s (resisted by the Right) and US President Reagan’s market revolution of the 1980s (rejected by the Left), and encouraged the belief that liberal democracy was the end of history and the natural state of humanity. Fourth is the revolution in communications brought about by the spread of the Internet, and fifth is the revolution in the neurosciences that made political consultants believe that manipulation of emotions and not rational discussion is at the heart of democratic politics. In their early stages, all five revolutions were critically important for deepening the democratic experience. The socio-cultural revolution of the 1960s dismantled the authoritarian family and gave new meaning to the idea of the free individual. The market revolution of the 1980s contributed to the global spread of democratic regimes and the collapse of
communism. The revolutions of 1989, while not the end of history, were a turning point in Europe’s experience of democracy. They did succeed in reconciling liberalism and democracy in Europe. The Internet revolution gave a new impulse to civic activism and radically changed the way people think and act. And the new science of the brain brought emotions back into the understanding of politics and political deliberation. It is these same five revolutions that are the centre of the current crisis of democracy. The social-cultural revolution of the 1960s also led to the decline of a shared sense of purpose. The politics of the sixties devolved into the aggregation of individual claims upon society and state. Identity began to colonise public discourse: private identity, sexual identity and cultural identity. The backlash against multiculturalism is a direct result of the failure of the 1960s to come up with a shared view of society. The rise of anti-immigrant nationalism is a dangerous trend, but it represents much more the desire for community and common life than simply the resentment of foreigners. It also signals that the clashing demands within modern societies cannot be negotiated and resolved by an attempt to reduce politics to the politics of rights. The market revolution of the 1980s made societies wealthier than ever, but it broke the positive connection between the spread of democracy and the spread of equality. From the late nineteenth century until the 1970s, the advanced societies of the West were all becoming less unequal. Reagan’s revolution of greed reversed this trend and led to an obsession with wealth creation, and cultivated the anti-government passion that is at the core of the crisis of governability in Western democracies today. The people’s revolt against the elites that is at the core of the today’s populist condition is a direct result of the fact that the majority of citizens tend to perceive the political and social changes accompanying the neo-liberal decades as a time of emancipation - not emancipation of the masses, but emancipation of the elites. In the brave, new market-regulated world, the elites broke free of ideological, national and community constraints. The rise of the offshore elites was the dark side of the success of the market revolution of the 1980s.
that the border between democracy and authoritarianism is the least protected border in Europe. The euphoria, and afterwards the frustration, that the colour revolutions in the post-Soviet space succeeded in generating is the best evidence that the utopia of normalcy that was at the heart of the revolutions of 1989 is ill-suited to the world of the twenty-first century. The Internet revolution fragmented the public space and redrew the borders of existing political communities. The paradox of the Internet revolution is that while it guaranteed the open flow of information, it also stimulated the emergence of echo chambers that threaten to fragment the public space. While the Internet revolution empowered people to stand against those in power, it did not contribute to strengthening the deliberative nature of the democratic process. Least noticed were the effects on reshaping people’s views of democracy of new studies of the brain and new marketing technologies. The new science of the brain led to a better understanding of how people think, but it also became an instrument to manipulate people. When mourning the decline of the public intellectual or the anti-intellectual nature of today’s democratic politics, it should be remembered that one of the key discoveries of the new brain science, in the words of Drew Westen (2008, 112), is that “the dispassionate mind of the 18th century philosophers allows us to predict between 0.5 and 3 per cent of the most important political decisions people will make in their lives.” The revolutionary discoveries in the brain sciences resulted in a radical break from the tradition of ideas-based politics. Karl Rove (US President George W. Bush’s political advisor) has replaced Karl Popper as the new prophet of democratic politics.
The rebels of today do not oppose
In short, the world is no longer structured around a clear-cut opposition between democracy and autocracy; rather, it is the internal contradictions of democratic societies that are worrisome. What is to be feared is the self-enmity of democracy. It would be a major mistake to analyse the current rise of populism in Europe as a kind of pathology or as a temporary phenomenon. Populism is here to stay, and in the age of populism, the tensions between the directions of the democratisation of society and their impact on the effectiveness of democratic governance will be the principal tensions shaping the future of democracy.
the status quo of yesterday – they
seek to preserve it.
By declaring democracy the normal state of society, the Central European revolutions of 1989 dramatically raised expectations about democracy’s deliverables, thus sowing the seeds of the future dissatisfaction. It was common after 1989 to believe that the introduction of free elections and the adoption of liberal constitutions were enough to secure peace, enhance economic growth, and reduce violence and corruption. But the reality turned out to be more complex. China has demonstrated that authoritarian states have the capacity to deliver high levels of growth over a long period of time. The failure of democratisation in many Third World countries has demonstrated that free elections are not enough to bring order and prosperity. The experience of Eastern Europe signals
References Gershenkron, A. (1962). Economic Backwardness in Historical perspective. Cambridge Mass.: Belknap Press, Harvard University Press. Kolakowski, L. (1997). Modernity on Endless Trial. Chicago: Chicago University Press. Rosanvallon P. (2008). Counter-Democracy: Politics in an Age of Distrust. New York: Cambridge. Westen D. (2008) The Political Brain: The Role of Emotion in Deciding the Fate of the Nation. New York: Public Affairs
Diplomaatia · May 2011
Baltic independence in 2011: is 20 years a little or a lot? All of us need to recognise that history is contingent, that it is not over, and that bad things can happen in the future just as often as good.
Twenty years! It seems almost incredible that it has been 20 years since Estonia, Latvia and Lithuania achieved the recovery of their de facto independence. For those of us who lived through those exciting times half a lifetime ago, it seems both only yesterday and a world away.
Paul Goble, analyst Paul Goble is a veteran specialist on ethnic and religious affairs in Eurasia. He has served in a variety of capacities in the US government, including the CIA and the State Department, where he was a desk officer for Estonia, Latvia and Lithuania in 1990-1991; at Radio Free Europe and the Voice of America; and at various think tanks, including the Carnegie Endowment for International Peace.
But now in this “round” anniversary year, it is time to make an assessment of what has been achieved over that period, what has not been accomplished either because it is difficult or because it is impossible, and what remains to be done both by the peoples of those three countries and by their friends abroad. Such an assessment acquires a special urgency because this anniversary inevitably recalls another anniversary –the 20th anniversary of the first period of independence of the three Baltic countries during the last century, a period during which Estonia, Latvia and Lithuania achieved a great deal but nonetheless had their effective independence suppressed as a result of a criminal deal between Stalin and Hitler.
Western officials who deal with the Baltic countries
makes a mistake,
often say “all’s well that
ends well,” a comment
but when the US
that both excuses the West
makes a mistake,
for not having done more
earlier and that suggests
Obviously, I do not want to draw a direct parallel between 1940 and 2011. Too many things have changed in the world for that. But remembering that even 20 years does not make anything “irreversible” is something that should come naturally to citizens of the Baltic countries and to their friends and supporters abroad. At the very least, such reflections should help us overcome complacency and a sense that the future is assured.
Twenty years ago, Estonia, Latvia and Lithuania were under Soviet occupation, with tens of thousands of Soviet troops on their territories, Communists were either in power
Remembering that even 20 years does not make anything “irreversible”is something that should come naturally to citizens of the Baltic countries. Diplomaatia · May 2011
There are clearly three ‘impossibilities’ and three ‘difficulties’. The three impossibilities, of course, are size, location, and demography; the three difficulties are national integration, memory and forgetting, and meeting the challenges of globalisation and international integration. Let us be blunt: Estonia, Latvia and Lithuania are small countries. They are smaller than most US states, and they have populations smaller than many US counties. That has three obvious consequences: First, they have little margin for error. Second, they are typically dependent on others. And third, they are often ignored or their interests sacrificed by other countries in the name of reaching agreement with larger and ‘more important’ states.
It is easy, especially at a time of anniversaries, to overlook or at least play down the problems, given how much has been achieved. And consequently, before considering the current and future challenges and what our responses should be, I do want to celebrate what in fact has been achieved. The best way to do that is to recall what the situation in Estonia, Latvia and Lithuania was 20 years ago and contrast that with the situation today.
or in powerful positions, and the USSR appeared to be reconstituting itself in a way that would allow Western governments to support its existence for a long time to come. Twenty years ago, the governments in place in the three Baltic countries were not recognised by any foreign state. The United States and some other Western countries did not recognise the Soviet occupation as legitimate, but they maintained ties with representatives of the pre-war governments rather than with the governments in place, a fundamental distinction that is often forgotten. And 20 years ago, Estonians, Latvians and Lithuanians lived under a decaying Soviet economic political system; one that combined the worst forms of economic life with an arbitrary, authoritarian and often brutal political regime; one that openly celebrated the supremacy of the occupiers over the occupied. What is the case today? The Soviet troops are gone along with the Soviet Union; the Communists are out of office, completely discredited even if their crimes have not yet been adequately judged; the three Baltic countries are members of the United Nations, recognised by the overwhelming majority of the world’s countries, and full members of both the European Union and NATO; and Estonians, Latvians and Lithuanians live under conditions of democracy and free markets, enjoying all the advantages of both. Not surprisingly, this remarkable, indeed unprecedented turnabout has led to a kind of “end of history” mentality in both the three Baltic countries and among their friends abroad. The leaders and the peoples of the Baltic states routinely and properly celebrate what they have achieved And Western officials who deal with the Baltic countries often say “all’s well that ends well,” a comment that both excuses the West for not having done more earlier and that suggests there is little more that needs to be done. But as the West learned to its dismay on September 11th, and as everyone in the Baltic states should never forget given their own past, history does not end, culture and geography cannot be repealed, and the human condition is not transformed by external change. And because all this is true and at the risk of being the skunk at the garden party celebrating this anniversary, I would like to devote this essay to these challenges, to what has not been accomplished either because it is difficult or because it is impossible.
there is little more that needs to be done.
20 years after the recovery of Baltic independence, the ethnic composition of the population is not the most important demographic problem there. When I was spending much of my time in the Baltic countries nearly 20 years ago, I often pointed out that however important the peoples of these countries were and felt themselves to be, they had to recognise that their size made living by their wits far more important. I often remarked to the Estonians (but the same thing could have been said to the Latvians and Lithuanians) that the fundamental difference between their country and the US was this: when Estonia makes a mistake, I would say, Estonia suffers, but when the US makes a mistake, Estonia suffers. (Tragically, the first half of this equation remains true, but the second has changed. Having run through the American margin for error, it is now the case that when the US makes a mistake, Estonia suffers but so does the US – a pattern that is going to intensify as the relative power of the US declines in the coming decades.) Related to that is another observation that I and some others had occasions to make. Being small, these countries much resemble the 90 pound weakling on the beach. When the 250 pound lifeguard goes by, they have three options, two of them good and one of them very bad: the good options are to dig in the sand and hope the lifeguard doesn’t notice them or to take out a gun to shoot him through the head on the first shot. The bad option is to kick sand at him.
neighbourhood, one where their interests have been ignored or trampled on by others. Unfortunately, there is little sign that the neighbourhood is getting better despite all the hopes of 20 years ago. On the one hand, some of the Europeans in whom the Baltic leaders and peoples put so much confidence have proved to be indifferent or worse, sometimes publicly telling the Balts and other East Europeans to keep their mouths shut and far more often pursuing their own traditional national interests at Baltic expense, especially when it comes to energy supplies from the Russian Federation. And on the other, the situation in Russia is deteriorating and deteriorating rapidly. Not only do few in the Russian Federation accept the settlement of 1991 as legitimate and final, but many in that country are openly attracted by radical nationalism verging in some cases on fascism, especially as it becomes obvious that the Russian Federation is at risk of collapse and disintegration in the near future. Because that is so, the coming disintegration of that country is likely to be more violent and bloody than was the end of the USSR, a trend that will have a serious and frightening impact on the neighbours as well. The Russian invasion of Georgia in August 2008 and the West’s half-hearted opposition to it suggest to many in the Russian capital that ‘a good little war’ is just what they need to generate domestic support and to put off, if not prevent, disintegration. There is no guarantee that Moscow will not try this strategy again, especially if it is handed a plausible casus belli by neighbouring states, and even if it will ultimately be a disaster for Russia itself. Let me be clear: Saakashvili behaved foolishly, but Russia’s Vladimir Putin behaved criminally. That needs to be accepted. Unfortunately, in the eyes of many in the West, foolishness is the greater crime, especially if there is this kind of power imbalance. And that is something smaller powers need always to be remember.
Leaders sometimes tend to believe that attracting
attention is the
Unfortunately, Baltic leaders like many other leaders of small countries – Georgia’s Mikhail Saakashvili spring to mind – are often professional sand kickers, seeing this as a way to get attention and even support. But in doing so, these leaders are operating on a mistaken assumption: they believe that attracting attention is the same as attracting support. That is not always the case: indeed, by trying to involve other countries in this way, they advertise their own weaknesses to their opponents.
And the third such condition is demography. When people talk about demographic problems in the Baltic countries, they almost inevitably focus on only one of them: the difficulties of coping with the consequences of the Soviet occupation on the ethnic and linguistic make up of their populations. For Lithuania, these problems have been minimal, but for Estonia and Latvia, they have been extremely serious. Ensuring that all the residents of these countries speak the national language and that those who came under the conditions of occupation pass through a process of integration both legal and psychological has been difficult, but the reality is that both Tallinn and Riga have achieved wonders, especially given the pressure they have been under from Russia and the West to ignore the fundamental and internationally recog-
same as attracting support.
The second permanent condition is geography. The late Estonian President Lennart Meri liked to say that he would rather have Canada for a neighbour. Indeed. But Estonia, Latvia and Lithuania do not have a choice about their neighbours, and to be blunt, they live in what is a notoriously bad
The definition of what it means to be an Estonian or a Latvian or a Lithuanian is changing and doing so in ways many may be uncomfortable with.
nised right of occupied countries not to offer citizenship to those moved in by the occupying authorities. Being a citizen of Estonia or Latvia, countries whose economies have done relatively well at least in comparison to Russia’s and whose citizenship now means citizenship within the European Union and all the benefits that entails, means that ever more ethnic Russians are choosing to take Estonian and Latvian citizenship, if not yet to give up their own ethnic identities. That presents some serious challenges, to which I will return below. But the reality is that today, 20 years after the recovery of Baltic independence, the ethnic composition of the population is not the most important demographic problem there. There are now three more significant ones. First is the hollowing out of the countries. Rural areas are being depopulated and an ever greater share of the population lives in the capitals. Not only does that make the defence of these countries more difficult, but it changes the sources of identity in ways that do not sustain ethno-national identity but rather promote a more cosmopolitan set of values. Such a development is not necessarily bad in and of itself, but it means that the definition of what it means to be an Estonian or a Latvian or a Lithuanian is changing and doing so in ways many may be uncomfortable with. Second is the departure of the young. Now that these countries are in the European Union and part of the West, an increasing share of young people is choosing to work and live abroad. Many of them will return, at least that is what they say, but many will not. That constitutes a serious brain drain and makes the prospects for the survival of these countries as countries more problematic. If they cannot hold onto the young, these countries face an uncertain and very likely unpleasant future. And third is the problem I have called elsewhere “the revenge of the middle aged.” As everyone who lived through 1991 will recall, the Baltic revolutions were led by the very oldest and very youngest in each of the three countries, by those who could remember their countries as they were before the Soviets came in 1940 and by those who had come of age as the Soviet system wound down and who were thus least affected by it. In the early 1990s, this led to a situation in which Estonia had the oldest president and the youngest prime minister in Europe at one and the same time. But in the intervening years, things have changed. Now, the oldest generation has left the scene, either because of the impact of the actuarial tables or because of a desire to take an often well-deserved rest, and the youngest, having experienced politics and often occupied senior positions earlier than would normally be the case, has left politics to pursue business interests which seem far more promising. As a result, politics in all three countries is now dominated by the middle aged, by precisely the group that was the most affected by Soviet occupation and often is most informed by Soviet values. That does not mean that these people have a Soviet agenda, but it does mean that they often approach what are clearly anti-Soviet values in a Soviet fashion. In short, some of them Diplomaatia · May 2011
at least might be described as ‘anti-Soviet Bolsheviks’ Their existence clearly disturbs many in these countries and that in turn helps to explain why all three have turned to the emigration for their presidencies in recent years. But that is clearly a pattern that cannot long continue, and a reckoning with this shadow of the past is obviously ahead. These three ‘impossibilities’ blend into the three enormous difficulties: national integration, memory and forgetting, and meeting the challenges of globalisation. National integration is in some ways the hardest of the three. It is not enough to have everyone speak the same national language, carry the same passport, and do without dual citizenship. It is critically important to decide what the nation is and what it should be. That does not mean establishing a Procrustean bed of identity definers, but it does require a shared set of values and judgments about the past, the present, and the future within which the political system can operate.If a large portion of the population does not understand and accept that 1940-1991 was a period of occupation, and does not believe that 1991 was a final settlement, then politics becomes not so much impossible as poisoned. That can be seen from the experience of Europe after 1945. One of NATO’s greatest contributions was to take foreign policy off the table for European countries early on. That destroyed the basis of the communist appeal for large segments of the population in France and Italy and ultimately made possible the rise of the European Union.
All three Baltic countries need to ensure that the rising generation knows what the occupation was and why the non-recognition policy was so important. ing, as many in the West often do, that one should look forward not backward. All three Baltic countries need to ensure that the rising generation knows what the occupation was and why the non-recognition policy was so important. The latter in fact constitutes not only international recognition of the occupation, but serves as a kind of birth certificate for the rebuilding of these states by offering them the legal basis for their citizenship and other legislation. Take that away and you reduce the Baltic countries to what the Russians like to claim they are – three more former Soviet republics. (Allow me a personal aside here: one of my biggest efforts 20 years ago was to ensure that there was as much distance as possible in time between the recovery of Baltic independence and the disintegration of the Soviet Union. Had these two events happened at the same time, the West likely would have viewed the Balts as part of the larger process rather than as a distinctive development. The consequences of that would have been horrific.)
A nation that does not remember
its history will
Unfortunately, the new NATO about which we have heard so much does not seem to be playing the same role in the Baltic countries. Many in all three appear to think that 1991 was not the end of history, but rather something that can and perhaps even should be reversed, an attitude that poisons social and political life and makes the further integration of the nation more difficult. And that is even more threatening because so many people now seem unwilling to recognise the truth about the occupation.
soon cease to be a nation, but a
nation that lives in the past will
At the same time, however, this concern with maintaining knowledge of the past must not ossify into a ‘short course’ of propositions that trivialise that past or that prevent people from evolving in ways of their own choosing. Maintaining that balance is going to be hard, but it is not impossible, as many other countries –including small ones –have shown.
soon lack a future.
That reflection leads naturally to the second, the problem of memory and forgetting. It has long been a commonplace that “the unexamined life is not worth living” but that a constantly examined life cannot be lived. Extrapolating from that we can say that a nation that does not remember its history will soon cease to be a nation, but a nation that lives in the past will soon lack a future. That in turn means that the issue of memory and forgetting is at the centre of the life of all nations and especially of nations like Estonia, Latvia and Lithuania which have undergone so much trauma. It is critically important that institutions like the Occupation Museum should not be marginalised or transformed into a watered down version of its intention. Too many young people in the Baltic countries do not know their history, and the versions offered by Russian media outlets are anything but true. Moreover, it is absolutely necessary that judgment be rendered on that history and on those who made it, instead of say19
Diplomaatia · May 2011
And finally there is the problem of coping with the problems of globalisation. I would like to focus on just two aspects of this. On the one hand, the Baltic countries because of their drive to re-join Europe were asked and have agreed to yield sovereignty in many areas where they had not yet fully re-established it after the occupation. This has led to a number of serious legal problems and even more to psychological uncertainties with which none of the three is dealing especially well. For example, how do you institutionalise democracy at a supra-national level before you have done so fully at the national level? When there are conflicts between the two, how do you prevent them from corroding support for democratic procedures in the other? On the other, globalisation, the notion that there should be the free flow of people as well as goods and capital, is inherently threatening to national identities and even
the nation state. Nowhere are these threats greater than in the case of small countries like Estonia, Latvia and Lithuania. The obvious analogy is this: if you put a drop of blue ink into a large bottle of water, the water may be slightly tinted but the blue itself will disappear entirely. In the enormous sea of the world, the smaller nations are thus at risk –and it is likely that at least some of their members will react badly to this development, all the more so because some larger countries, including their traditional enemies, have been all too willing to use these tectonic shifts to their own advantage. All this means that Estonians, Latvians and Lithuanians have a great deal of work to do not only to ensure their national survival but to ensure that what survives will be recognisably their nations. And it means that people of Baltic heritage and other friends of the Baltic nations have a great deal of work to do, so much so that none of them should allow these celebrations to get in the way of an honest assessment of that fact.
pear as dramatic. But they are important. In 1991 on January 13th -- which is by the way my birthday -- my wife bought me a birthday card which I think has a message for all of us. The card read: “Anyone can survive a crisis; it is the day to day things that get us down.” Our work is now the day to day kind, and if we do it and do it well, we may be able to avoid disaster and thus be in a position to celebrate many more anniversaries of what was truly the Baltic miracle.
The work ahead is harder than the work we have done already.
Let me suggest three things that we must do now in order to ensure that those who come after us will be able to celebrate the 40th and the 60th anniversaries with as much pleasure as we are doing today. First, all of us need to recognise that history is contingent, that it is not over, and that bad things can happen in the future just as often as good. The events of 1991 are no guarantee that the future will be otherwise. That should be obvious as the three Baltic countries mark the second 20th anniversary of their independence, but tragically it all too often is not. Second, all of us also need to understand that trends in the Baltic neighbourhood are anything but good: Russia is again moving in a terrible and frightening direction, and the West is complaisant, certain that somehow deals can be made and everything can work out, the very attitudes that led to the submersion of the Baltic countries 70 years ago. No one can do more to fight that than those of us who love the Balts but live in the West. We know, and we must testify. And third, again all of us must recognise that the work ahead is harder than the work we have done already. This role may not be as glamorous, and the tasks may not ap-
The Baltic countries because of their drive to re-join Europe were asked and have agreed to yield sovereignty in many areas where they had not yet fully re-established it after the occupation.
Making values count The promotion of national self-respect through adherence to values is both a principled and pragmatic goal.
The Baltic states have made their own case successfully using values and values-based concepts; now they should show that they really meant it when it comes to others. The change comes because Estonia, Latvia and Lithuania are no longer just the objects of other people’s calculations, but the subjects of their own. No longer need their politicians wonder, “what will Europe think?” or “how will NATO react?” (though old reflexes mean they often still do). The three countries are now part of these organisations. It does not even make much sense to ask: “what will the old members think?” The division in both NATO and the EU is not between old members and new, but between effective and nominal ones.
Edward Lucas, journalist Edward Lucas is International Editor of The Economist. He has covered the Central and East European region since the mid-1980s.
Take the governance of the 17-member euro zone, for example. Estonia’s finance minister, Jürgen Ligi, sits at the table, deciding over bailouts, debt restructuring and new rules for banks. With him sit the Slovak and Slovene finance ministers. Waiting nervously in the anteroom for news of the insider countries’ discussions are the Swedes, Danes and British, side by side with the Poles, Czechs and Romanians. That is a new constellation of power, to which Europe has not yet got used (nor, I think, has Estonia). These are not technical questions. At the heart of the euro zone are values: questions of morality and trust. How will the people who manage the currency share the pain between reckless borrowers and reckless lenders? Will they keep the currency hard (risking political upheavals and economic collapse on the periphery); or soft (meaning the subtle theft of the savings of millions of innocent people)? Inside NATO, it is the same story. How much blood and treasure are the Alliance’s member states willing to expend to curb the Libyan leadership’s vengeful assault on its own people? If that mission works, it will be a triumph for principle; if it fails, the Realpolitiker will be sniggering. Twenty years ago, the Baltic states were on the outside, wondering nervously what the insiders would do if the Soviet Union tried a real crackdown. Now they themselves are on the inside, faced with difficult calculations about ends and means. The Baltic states are not just decision-makers in multilateral outfits. They also have the power to make unilateral decisions with wide-reaching resonance. This is not wholly new - at the beginning of Latvia’s restored
The division in both NATO and the EU is not between old members and new, but between effective and nominal ones.
independence it established formal consular relations with Taiwan, infuriating the authorities in Beijing.1 Outside analysts tried hard to make sense of this - was it an echo of cold-war solidarity, when the Baltic states found friends in outfits such as the Taipeibased World Anti-Communist League? How did it fit in with a similar move in Macedonia? And with Latvia’s flirtation with the nominally independent apartheid-era ‘homeland’ of Bophuthatswana?2 The truth was simpler than the theories: these moves were the result of inexperienced diplomacy and personal preference among a few Latvian politicians, and within a couple of years became just a footnote to history.
cial, and they will fall at a time when Estonia is no longer in need of every penny of outside support. The Realpolitiker will argue that China is an important counterweight to Russia, which remains the paramount security threat in the region. That is true in a sense: if you make national security the overriding value, then you can tell the Dalai Lama you are busy. But it is rather like responding to Russia’s psychological warfare offensive by trying to Putinise the Estonian media: by doing so, you betray the principles that brought you freedom in the first place, and that you are presumably defending. That is why this year’s theme of ‘making values count’ is so apposite for the 2011 Lennart Meri Conference. Never before have the Baltic states, and Estonia in particular, had the luxury of making their own decisions in a context unconstrained by the exigencies of national survival. If Estonia chooses to stick up for Georgia, or Moldova, against those who would abandon them, it may pay a diplomatic price, but it will still be a member of the EU, NATO, Schengen, the OECD, the euro zone and so on. If Estonia chooses to have a Polishstyle ‘reset’ with Russia it can. It can choose whether to impose narrow or broad sanctions on Belarus, whether to take up or drop the cause of Finno-Ugric minorities inside the Russian Federation, and whether to blast, bless or blether about the NATO mission in Libya. Estonia can decide to have no foreign policy at all (Belgium-style) or (like Norway) to get engaged enthusiastically in faraway places of which it knows nothing. It can be sanctimonious like Sweden, fearful like Finland, or mercantilist like the Netherlands.
have no burning reason to choose
But as the Baltic states have become more seasoned diplomatic actors, the excuses of innocence and inexperience have evaporated. So have the arguments (never strong) of weakness and necessity. Take the issue of Tibet. Will Estonia’s leaders meet the Dalai Lama when he visits this summer? Though the Tibetan leader still, just, received at the White House, and met Angela Merkel in 2007, in the new democracies of Europe he is finding it harder and harder to find anyone in an official position to talk to him. His diary on a recent visit to the region featured only the mayor of Wrocław - a fine Polish provincial city, but a poor harvest for one of the world’s most inspiring political and spiritual leaders.
Attitudes on Tibet have always varied in the Baltic region: Lithuania has consistently been bolder in supporting the Tibetan cause, inviting the Dalai Lama in 1991 (he was the first foreign leader to address the Lithuanian parliament) and sending a government plane to pick him up. Others have been less enthusiastic. In 2001 the Tibetan leader did not get a meeting with the then Estonian president Lennart Meri (and gained one only at the last minute with the then Prime Minister Mart Laar). Yet now spines should be stiffening, not softening. Baltic leaders have no burning reason to choose pragmatism over principle. Twenty years ago, it could at least be argued that it was of crucial importance not to annoy what used to be called the “Red Chinese authorities” because they could have vetoed the Baltic states’ membership of the United Nations or have sided with Russia in putting pressure on the Baltics on citizenship and language issues. Clearly meeting the saintly Buddhist now will annoy Beijing, especially as it will be seen as a sign of particular impudence at a time when China’s stock is rising in the world. But the costs at most will be finan-
In short, values matter in times of victory, just as they sustain you in times of desperation. When you are weak, values matter - because you have no other choice. A principled stand gives you the hope that others will rally to your cause; it dispirits your enemies and cheers your friends. In extremis, the best you may be able to hope for is that history will recognise their efforts. It was that which sustained a generation of Soviet-era dissidents, who doubted that their struggle and sacrifice would topple the evil empire, but wished to show posterity that someone had at least tried to resist, and - they hoped - inspire future generations to do more, in perhaps more promising circumstances. Otto Tief and his fellow ministers must have doubted that the oncoming Red Army would respect their government; yet it remains of great value to Estonians now that the blue, black and white flag flew even briefly over Toompea castle between the end of the Nazi occupation and the renewal of the Soviet one. Under Soviet occupation, those who believed in the independence of the Baltic states had little to sustain them beyond idealism and principle. For practitioners of Realpolitik, life is a bit easier. You can justify almost anything in terms of pragmatism. In the case of the Baltic, it was easy for Western politicians and officials to pooh-pooh the Baltic issue as a distracting nuisance. Unlike the Poles, the Estonians, Latvians and Lithuanians were not big enough to bother the Kremlin or redraw the map. They had few votes in Diplomaatia · May 2011
Britain or America. And the political benefit of maintaining a purely irritant policy was small. As the haggling over the Helsinki Final Act showed, when big geopolitical interests were at stake, the Western countries were only too happy to dump the central bit of their Baltic policy - the non-recognition of the Soviet annexation.
toppled communism, we embraced them as new democracies in reborn countries. We have brought them into the Euro-Atlantic family where they are now safer and freer than at any time in their history. The Baltic states exemplify the value of principled persistence. Their passionate commitment to the spread of freedom and security to countries such as Georgia inspire us all.
Even when it was clear that Baltic independence was not a dead cause, attitudes among the Realpolitiker if anything hardened as the Soviet Union collapsed. From a pragmatic point of view, it seemed vital to focus on bolstering Mikhail Gorbachev against the hardliners in Moscow. That strategy, its proponents argued, paved the way to the peaceful collapse of communism in countries that mattered, like East Germany. It ended the risk of nuclear war and closed down regional conflicts on faraway continents. The Baltics were a sideshow, and a potentially costly one.
It is right to beware such edited memories. When a policy works, it is easy to find moral reasons for its triumph. Realism often parts company from principle amid failure, and the two approaches are united by success. When a policy fails, it is easy to highlight the moral shortcomings, conceptual and personal, associated with it. But that does not mean that the choices behind those policies are irrelevant or phoney. The Baltic states got into NATO because a handful of people, luckily in positions to make a difference, did the right thing. Some of them are household names, such as Bill Clinton. Others worked in the background but are fondly remembered by those who dealt with them. Ron Asmus, who died on April 30th aged only 53, is one such. The warriors in the Baltic cause did not pursue it for careerist or pragmatic reasons. They did so because they believed in it.
After 1991 it was the same story: why make Boris Yeltsin’s life more difficult by backing the Baltics, with their prickly approach to history, borders, language and citizenship? Surely it was better to focus on getting Russian troops out of Eastern Europe, rather than pandering to nationalists in countries that would never be fully independent of Russia anyway? Extending NATO membership to defenceless and unreliable countries in Russia’s front yard looked like advanced lunacy. What is interesting about this is that the Realpolitiker made their arguments, vainly. History moved on without them and they have had to rewrite their narrative accordingly. Their version of events now would probably go something like this: The West could do little or nothing to save Estonia, Latvia and Lithuania from annexation in 1940 or reoccupation in 1944; and it would have been futile to try. During the Cold War, émigrés from the Baltic states were occasionally useful in espionage activity, but mostly irrelevant. Instead Western policymakers rightly concentrated on détente, which avoided nuclear war and ultimately created the conditions in which Mikhail Gorbachev could try to reform the Soviet Union. When Communism collapsed, the West had to balance concern for democracy in Russia with consolidating the gains made in the Kremlin’s former empire. The result was a measured decade-long expansion of both the European Union and NATO, with the result that the Baltic states are now in both groups, albeit as small and junior partners. Their history demonstrates the need for pragmatic and patient policy, not senseless sentimentalism. Their job now is to be realistic: to shut up and not cause trouble. Rewriting history to suit one’s own standpoint is not just a failing of the Realpolitker, of course. It is important not to be sentimental. Victory does not come because everyone was a hero. A purely values-based account of the past would be partial and self-serving too: The flame of freedom never died in the Baltic states, or in the other captive nations. We fought the Cold War not only in our own defence, but to liberate them. We assailed the Evil Empire on all fronts— economic, political and cultural—corroding its self-confidence by highlighting its failures. The peoples of the occupied Baltic states were great allies in that fight, and the non-recognition policy underlined the fact that the Soviet Union was based on lies and mass murder. When our combined efforts 21
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Principle does not exclude pragmatism: the practical argument is a welcome ally when it is available. Making Baltic freedom the litmus test of Mr Gorbachev’s reform credentials was a good example. It was not just the morally correct course to support the greatest victims of the Molotov-Ribbentrop pact; doing so also set a clear test by which outsiders could judge the Kremlin’s credibility. Treat the Balts truthfully and honourably, and we can believe what you say about other things. Try to justify the lies and mass murder of the past towards the Baltics, and we will not be convinced by your thoughts about a common European home.
When a policy works, it is easy to find moral reasons for its triumph. When a policy fails, it is easy to highlight the moral shortcomings, conceptual and personal, associated with it. so clearly the admittance of new members to the Alliance did not provoke automatic Armageddon. Manufactured hysterics in Moscow lost their force over time. The idea that the Baltic states were indefensible was challenged too—even in the days before formal contingency plans were drawn up: Russia might have an inherent superiority in ground forces, but NATO’s air and naval weight meant that any Russian conventional attack would be costly and risky. It was even possible to argue that the Baltic states were not just consumers of security, but potential contributors to it: they offered bases for air surveillance radars that were farther east than any other NATO territory. Their human intelligence assets were impressive: where else in NATO could you find flawless Russian-speakers with a deep personal knowledge of the Soviet military mindset? These issues are old memories for the Baltic states now. But they are not irrelevant. The best arguments combine principled and pragmatic approaches. Tibet may seem irrelevant now, but standing up for universal values and against bullying or divide-and-rule tactics is a good idea in any case. If China can bully the West on Tibet, then why not on the defence of Taiwan, or on its mercantilist policies in Africa and Latin America, or on the geopolitics of the Pacific? If China can stop Mr Obama having a photo-op with the Dalai Lama, then it is clear that America’s national willpower and commitment to principle is not what it was.
Values matter in times of victory,
just as they sustain
It was the same story in the 1990s. The principled argument (which initially worked only in America, Iceland and maybe Denmark) was that bringing the Baltic states into NATO was simply the right thing to do, because Europe (particularly Germany, but also Britain) owed a debt from the late 1930s: we had dug the abyss into which you fell. It took some time for that argument to work, but its moral force was unassailable. It gained ground when Russia said that expansion would be “impermissible”: that neatly disproved the argument that Russia was so benevolent towards its former empire that NATO membership for the ex-captive nations was unnecessary and strengthened the moral imperative for protecting those whose freedom of choice was being constrained.
you in times of desperation.
But the Baltic states and their friends made pragmatic arguments too: a grey zone on Europe’s eastern fringe was a recipe for instability. Nobody wanted that. Russia had already swallowed NATO expansion for Poland, the Czech Republic and Hungary,
In short, the promotion of national self-respect through adherence to values is both a principled and pragmatic goal. It is futile in the long run to run a policy solely based on immediate rewards, whether in foreign affairs or anything else. But big countries can afford to behave badly for longer: if they devalue their currencies by printing money, outsiders will still trade in them and save in them for many years, simply because there is no other obvious choice. Big countries can be cynical and cowardly, because they are strong enough to defend themselves if necessary. They have a history of power and glory that will attract loyalty however miserable the current government; and they will
Never before have the Baltic states had the luxury of making their own decisions in a context unconstrained by the exigencies of national survival.
mostly have a state machine that is strong enough to function regardless of bad political decisions at the top. Small countries don’t have that luxury. They are more vulnerable to cynicism because their human and physical resources are scantier and subject to more competition. They depend on individuals to follow abstract principles at home, and on other countries to honour agreements. Why should anyone living in Estonia believe in the state, pay taxes to it, obey its laws, or defend it in wartime if it does not embody some values shared by the public? It would be simpler to emigrate (either physically, by living elsewhere, or mentally, by withdrawing loyalty to public institutions, and living a strictly private life). Similarly, why should other countries bother with Estonia’s welfare if it shows no interest in principles or values? At the heart of the EU, NATO, OECD and the euro zone is trust: an assumption of like-mindedness on everything from reliable public statistics to the willingness to go to war if needed. The more Estonia adheres to and proclaims the values set out in its declaration of independence, in its constitution, and in the international treaties it has signed, the more those values count - at home and abroad. It is a miracle of history that it is now more than ever in a position to do so. The Baltic states are back on the map because they and other people cared about values. If they now adopt the ways of the Realpolitiker, they undermine their credibility and ultimately their independence. 1 Czeslaw Tubilewicz, Taiwan and Post-Communist Europe: Shopping for Allies (London: Routledge, 2007). 2 See Michael Lawrence and Andrew Mason “The Dog of The Boers: the rise and fall of Lucas Mangope in Bophuthatswana”, Journal of Southern African Studies, Vol 20, No 3, September 1994: 447-461.
On Values-Based Foreign Policy It is not difficult to be principled and idealistic in good times, but how did European nations react when their ethics were put to the test during World War II?
In recent decades, there has been a lot of talk about values-based foreign policy, or to be more accurate, about the lack of it. While it is not detected in, or even expected from, great nations and superpowers, there is a general consensus that the foreign policies of small states should be based around the phenomena of values. This is why we have considered small nations to be more credible partners over time – it seems that they could make the world a better place. Leaving aside the issue of which nations have ever actually pursued values-based foreign policies, let me focus in what follows on whether and how small nations have upheld their values in troubled times. Clearly, it is not difficult to be highly principled and idealistic in good times, but your ethics are really put to the test in complex situations. For many European nations, a key test period was World War II, some aspects of which I would like to highlight in this article.
Mart Laar, Minister of Defence
Mart Laar has been the Minister of Defence of Estonia since April 6, 2011. Since 1992, he has been elected to the Estonian Parliament in five subsequent elections. He has twice served as Prime Minister (from 1992–1994 and from 1999–2002). In 2006, the Cato Institute awarded him the Milton Friedman Prize for Advancing Liberty.
The fate of Estonia and the other Baltic states in World War II has been thoroughly researched. It seems that nothing new can be said about it. On the other hand, the public has recently gained access to a series of documents that have cast an interesting light on the mentality and attitudes of some larger Western nations regarding the occupation of the Baltic states and its nonrecognition. It is common knowledge that the Soviet Union put pressure on Western nations to act on the issue, but what is less well known is the intensity of the pressure. Documents, now made public, reveal that the so-called Baltic issue accounted for a quite substantial – to my mind even an unexpectedly large – proportion of the relations between the Allies and the Soviet Union. Strong pressure from Stalin persuaded the Western Allies – and their foreign ministries in particular – to give in but ultimately concessions were not made for purely political reasons. It has to be admitted that the Western nations did not dare to actively stand up for the Baltic states and that they accepted Soviet demands in silence, but they did not sell out the Baltic states completely. The Atlantic Charter played a crucial role in this – Western politicians did not want to take the risk of ignoring it unequivocally.
It has to be admitted that the Western nations did not dare to actively stand up for the Baltic states and that they accepted Soviet demands in silence, but they did not sell out the Baltic states completely.
It is no great secret that after the conclusion of the so-called treaty on military bases, Estonia’s foreign policy lost all traces of values … Estonia cannot level the severest reproaches at other nations for their conduct. The analysis of values-based policies also requires us to take a closer look at the behaviour of the small nations, overcome by one or another totalitarian power during World War II. It is a fact that when the Soviet Union and the Western Allies had re-established a working relationship, the governments-inexile that operated in the West found themselves under increasing pressure to adapt their policies on the Soviet Union. Unlike the Baltic representations, which were only recognised by larger Western states, the Polish and the Czech governments-in-exile had at least been officially recognised by the Soviet Union. So, already in 1942, they were urged to make unambiguous statements officially recognising the 1941 borders of the Soviet Union, including the incorporation of the Baltic states. Moreover, the Soviet Union did not issue these demands directly, but via Western states. Consequently, the head of the Russian section in the British Foreign Office met with Czech President Beneš on January 29, 1942, to acquire his views on a post-war Europe, including Russia. Among other things, the Baltic issue quickly popped up and Beneš said that as a member of a small nation he, of course, sympathised with the Baltic states and their aspirations for independence. At the same time, as a realist, he continued, it could not be expected that such a great state as Russia would simply relinquish its access to the Baltic states and its control over them. Considering the fact that the Russians apparently did not pursue a policy of national oppression, Beneš asserted, Czechoslovakia had to accept the transfer of the Baltic states to Soviet sovereignty. Beneš expressed similar views at a meeting with US diplomats. However, Soviet demands met fiercer opposition from the Polish government-in-exile, which had a more than difficult relationship with its new Ally anyway. The Poles did not want to hear anything about the permanent annexation of their territories by the Soviet Union, which had occupied them in Diplomaatia · May 2011
1939, although the West offered the Poles compensation for them. In addition, they did not particularly want to recognise other conquests Stalin had made from 1939–1940 on the basis of the Molotov–Ribbentrop Pact. The stubbornness of the Poles created major headaches for the Western Allies. In December 1942, the leader of the Polish government-in-exile, General Sikorski met with US President Roosevelt, who tried to broker a quick deal between Sikorski and Stalin. Roosevelt was of the opinion that Stalin would be content with the incorporation of Estonia, Latvia and Bessarabia, and with taking Petsamo from the Finns, but that he would leave Vilnius and Lvov to the Poles. Sikorski affirmed that under such conditions, he would be ready to sign an agreement with Stalin anytime. He added that although he felt sorry for Estonia and Latvia, Poland did not plan to fall out with Russia because of them. As for Lithuania, Sikorski said categorically, Poland could not be indifferent to its fate. The Poles felt so close an affinity with the Lithuanian nation in both historical and cultural terms that it motivated them to defend Lithuania’s independence in any circumstance. These documents do not make an easy read. However, before we start shaking our fists at Poland or Czechoslovakia, we should first take stock of our own conduct. It is no great secret that after the conclusion of the socalled treaty on military bases, Estonia’s foreign policy lost all traces of values. Although Estonia was partly forced to engage in some activities, for example, to celebrate the anniversary of the Great October Revolution or to remain passive about the launch of bombers that targeted Finland from Estonian airfields, those who sat in Moscow opera houses with Soviet leaders while the Winter War was raging, or who participated in Red Army parades did so quite voluntarily. Having taken these deeds into account, Estonia cannot level the severest reproaches at other nations for their conduct. None of this seems to prove the claim that the foreign policies of small nations rely on values to a much greater extent than those of great powers. Although Western nations did not in any way abide by values-based foreign policies, the Soviet Union ultimately failed to induce the United States and Great Britain to recognise de jure the occupation and the annexation of the Baltic states. I
would have supposed that this would not have been much of a problem for Stalin. Interestingly enough, this was not the case. Documents now published demonstrate that the activities of the Baltic diplomatic representations in Great Britain and in the United States posed an unexpectedly great challenge to the Soviet Union, which took great pains to terminate their operations. Soviet intelligence agencies certainly had an exaggerated view of the capabilities of Baltic diplomats, leading them to dread the outcomes of the diplomats’ actions, but this misjudgement only profited the Baltic states in the end. The same applies to the agencies’ outrage when tens of thousands of refugees succeeded in getting out of the country and reaching Sweden. In their reports, the Soviet intelligence agencies devoted considerable attention to refugees and their activities. In addition, they were convinced that it was refugees who ruined the relationship between Sweden and the Soviet Union in the post-war era. Soviet diplomats tried their best, but they still could not either label the refugees as ‘Fascists’ or suppress them. Whether Western nations were motivated by self-interest or by values in pursuing this kind of policy is, of course, a separate issue. But the fact is that the non-recognition of the occupation of the Baltic states provided the groundwork for the restoration of their independence fifty years later. So, a state may be great or small, rich or poor, strong or weak, but it can still endorse a values-based policy. Whether we like it or not, a values-based foreign policy can only emerge in a state that has developed a broad base of values for this policy to rest upon – values that it wants to represent. It is futile to expect the adoption of a valuesbased foreign policy in a state that embraces a totalitarian ideology or, alas, from a state that neither appreciates its democratic principles nor defends them. There is no values-based foreign policy to be found in states where wealth is held in the highest regard and where a ‘get-rich-quick’ mentality eradicates all other values. Modern welfare societies in the West translate most values quickly and effectively into the language of money. The dismissal of values is justified by their potential decelerating effect on wealth creation because, after all, if we do not do business with one totalitarian regime or another, someone else will and we will lose out on revenues. In this modern world of ours,
Documents now published demonstrate that the activities of the Baltic diplomatic representations in Great Britain and in the United States posed an unexpectedly great challenge to the Soviet Union. 23
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... a values-based foreign policy can only emerge in a state that has developed a broad base of values for its policies to rest upon. it is extremely difficult, not to say impossible, to refute this argument. Still, small nations should develop a practical and logical approach to this issue: by giving up all values in our foreign policy, we might one day find ourselves in a position where greater nations no longer want to pursue altruistic and values-based policies, even though we expect it from them and somehow take it for granted, at least with respect to us. That is it: it does not matter whether we like it or not; it does not matter what setbacks it may cause on the diplomatic front or in the economy – we must uphold a values-based foreign policy to the greatest extent possible. Because these are the ways of the world: others will help those who are also willing to help others, not only themselves.
Lessons from the Baltic Financial Crisis, 2007-10 What happened during the Baltic financial crisis, and how was it resolved so quickly?
In the fall of 2008, Central and Eastern Europe became a flashpoint in the global financial crisis. The ten new eastern members of the European Union were in a state of severe overheating in all regards. Inflation surged everywhere and to double digits in Bulgaria, Estonia, Latvia, and Lithuania. Wages and real estate prices skyrocketed, rendering these countries ever less competitive, which further undermined their current account balance. Output plunged and unemployment soared.
Anders Åslund, economist Anders Åslund has been a Senior Fellow at the Peterson Institute for International Economics since 2006. He is a leading specialist on the East European economies, especially Russia and Ukraine. He has served as an economic adviser to the governments of Russia, Ukraine and Kyrgyzstan.
The three countries with the greatest overexpansion, Estonia, Latvia and Lithuania, were feeling a credit crunch already in 2007, as their banks reduced their lending, leading to a sudden and sharp fall in real estate prices. As a consequence, both consumption and investment, and thus output, plummeted. The ensuing credit losses threatened the sustenance of the banking system. The financial crisis was already well advanced when the big blow occurred: the Lehman Brothers bankruptcy on September 15, 2008. All of a sudden, world liquidity dried up, and vulnerable Eastern Europe faced a ‘sudden stop’, being left with no credit or liquidity.1 Overall, the output contraction has been great (figure 1). The Baltic financial crisis was a standard credit boom-and-bust cycle leading to a current account crisis. There is little to say in defence of the overheating and the policies that bred it. But loose monetary policy was a global phenomenon and it was difficult for these small and very open economies to defend themselves against abundant capital inflows. The positive surprise, however, is that after about two years, in the second quarter of 2010, the crisis in the region had more or less abated. Public attention has moved from Latvia, Estonia, and Lithuania - the three countries that had suffered the biggest output contraction - to the PIIGS (Portugal, Ireland, Italy, Greece, and Spain), in particular to Greece. The issue was no longer why Latvia must devalue, but what Greece could learn from Latvia. What lessons can be drawn from the resolution of the financial crisis in the three Baltic states for the rest of the European Union and the world at large? What happened during the Baltic financial crisis, and how was it resolved so quickly? This article aims to bring home the lessons from this episode before it
The Baltic financial crisis was a standard credit boom-and-bust cycle leading to a current account crisis.
fades from public memory, because nothing is more easily taken for granted than success. The resolution of the crisis in these three countries was decisive and successful, and by the second half of 2010 they had all returned to economic growth. Only one country, Latvia, required a standby programme with the International Monetary Fund and the European Union. It was concluded in December 2008. The direct cause was the collapse of Parex Bank, the biggest domestically owned bank in the region. This programme continues, but quite successfully.
of the population, and the banks would be great, because the local currency was mainly used for tax payments, wage payments and retail transactions. The absence of devaluation salvaged the banking system in the worst exposed countries. The beneficiaries would be limited to large exporters, and their benefits would not last for long, as the pass-through of inflation inevitably would be large - because commodity prices are international and many international enterprises set the same prices for a region rather than individual countries. Moreover, devaluation could only be forced by a combination of a bank run and a currency run by ordinary citizens.
The issue was no
longer why Latvia must devalue, but
The lessons from this crisis are many and we shall draw them from our two recent books.2 Some may seem obvious, while others are not. The Baltic countries have proven that much old wisdom, sometimes forgotten, still holds.
The prosaic conclusion is that different exchange rate policies offer varied risks, and that each country needs to make its individual choice among them. Devaluation poses risks of large bank crashes and bankruptcies, while a pegged exchange rate entices excess capital inflows before a crisis. Estonia ran a persistent large budget surplus of 2-3 per cent of GDP in the good years, but even so it suffered a total GDP decline of 19 per cent, showing that no fiscal policy can salvage an economy from external financial crisis. During a crisis, a pegged exchange rate compels a country to carry out more reforms, while devaluation often amounts to a postponement of reforms. Which policy causes the greatest cost is not evident, but for very small and open economies the arguments for fixed exchange rates appear dominant.
what Greece could learn from Latvia.
No country devalued. One of the most striking outcomes of the East European crisis is that none of the four countries with pegged exchange rates - Latvia, Lithuania, Estonia, and Bulgaria - were forced to devalue despite claims by a broad chorus of economists. Instead, these countries pursued what they called “internal devaluation,” cutting wages and public expenditure, which rendered their cost levels competitive and allowed them to turn their large current account deficits swiftly into substantial surpluses. Not one single country in the region changed its exchange rate policy during the crisis, underlining that both inflation targeting and pegs remain viable exchange rate policies. Great integration renders devaluation ineffective. A corollary is that in current macroeconomic discourse, depreciation is a much overadvertised cure. Regardless of exchange rate policy, monetary policy and bank regulation, no small open economy can safeguard itself against sudden capital inflows and outflows. Large currency mismatches are inevitable in small and open market economies with many currencies. No bank regulation is strong enough to take care of this, and if it were, banking could simply migrate to a neighbouring country. A substantial depreciation causes large balance sheet losses, especially hurting banks. It made little sense for these countries with far-reaching euro-isation to devalue. Any devaluation would be huge, because the local currency was used for few purposes, rendering all local currency markets very thin. The blow to state finances, the standard of living
A series of recent IMF papers show the new openness—or confusion. One empirical study argues that intermediate exchange rate regimes have generated the best growth performance.3 Another paper shows that exchange rate flexibility helped buffer the impact of the crisis.4 During the boom years, the currency board countries in Eastern Europe had better fiscal balances and higher growth than the countries with floating exchange rates, and the Baltic cases show that internal devaluation is a viable option.5 The pragmatic wisdom from the early 1990s has been restored: there is no universally preferred exchange rate policy. The best choice depends on the concrete circumstances of the country in question.6 No risk of a deflationary cycle in a small open economy. The international economic literature warned about the risk of a deflationary cycle ensuing after severe wage and budget cuts in crisis countries.7 The evidence shows that no such risk existed. In Latvia, public wages fell by an average of 26 per cent in 2009, and private wages by 8 per cent. Unit Diplomaatia · May 2011
labour costs in manufacturing declined by 21 per cent from mid-2008 until the end of 2009 (figure 2). Even so average deflation in 2010 over 2009 was merely 1.1 per cent, and by the end of 2010, Latvia had an annualised inflation of 2.5 per cent.8 In early 2011, Estonia’s inflation exceeded 5 per cent. The explanation is that the prices in these small open economies were set by adjacent markets to such an extent that inflationary passthrough eliminated all risks of deflationary cycles and rendered devaluation ineffective. Once again, inflation is becoming a major concern. The goal of euro accession is valuable. Euro accession as a goal is beneficial in at least three ways. First, it disciplines policy, especially of the four countries with currency boards. Their desire for full European integration with early adoption of the euro led them to focus on two nominal anchors in their ambition to accede to the EMU as early as possible: a fixed exchange rate and a budget deficit below 3 per cent of GDP. These two anchors brought stability and clarity to their economic policy. Second, for small, fast-growing countries on the European periphery, higher market interest rates than in the euro zone were natural. Then, it is cheaper in nominal terms to borrow in euro, and euro-isation with ensuing currency mismatches was close to inevitable for these open economies with no capital regulation. The only sensible way to reduce currency risks and currency mismatches is to adopt the euro. Finally, only membership of the EMU would provide these economies with the full liquidity support of the European Central Bank. International liquidity is crucial. After the bankruptcy of Lehman Brothers on September 15, 2008, global credit froze. Access to liquidity was key to escaping deep recession. The US Fed performed a very important service by offering swap loans to a large number of countries around the world.9 The European Central Bank (ECB), on the contrary, hardly provided any swap loans, except to Sweden and Denmark long after the height of the crisis. The new eastern EU members were left without access to liquidity other than from their own central banks and that which their trading partners were prepared to offer. The ECB did nothing to stabilise the economies of these euro candidate countries. It could have offered swap credits to eastern EU economies outside the euro area, but it did not.10 The Baltic countries suffered the most. Because of the extraordinary dearth of liquidity, national savings ratios skyrocketed – in Latvia from 20 per cent of GDP in 2008 to 31 per cent of GDP in 2009, explaining most of the decline in output.11 Large and early international assistance is vital. The scarcity of liquidity rendered early and 25
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big international financial assistance vital. Given the very low levels of public debt before the crisis in all countries but Hungary, the East European financial crisis was essentially a liquidity crisis and not a solvency crisis, and that was evident from the outset. Consequently, the international community should follow Walter Bagehot’s advice to lend freely but demand collateral in the midst of the crisis. In hindsight, it appears strange that anybody was concerned about the IMF giving a country like Latvia 12 times its quota in credits, or that the international finance package to Latvia amounted to 37 per cent of its GDP in 2008. Substantial globalisation means that larger volumes of credits will be needed. Instead more of the credit should have been given earlier to avoid the sharp output contraction, and other countries, primarily Lithuania, could have benefited from international financial support, but feared intrusive demands for devaluation. New cooperation between the IMF and the EU worked well. As is usually the case in a financial crisis, the IMF took the lead in the international rescue efforts. It had learned its lessons from the East Asian crisis in 1997-98. It revived the old Washington Consensus of a few rudimentary financial conditions, such as tenable exchange rate policy and reasonable fiscal and monetary policy, but abandoned multiple structural demands. In addition, it allowed well-governed countries larger public deficits during the crisis and offered much more financing, including for budgets, than before with the understanding that this was a temporary current account crisis. It acted even faster than usual. The European Commission entered into a partnership with the IMF in Eastern Europe. It let the IMF take the lead, while providing substantial financing - more than the IMF in the case of Latvia - and it checked the work of the IMF. For the recipient countries, it was an advantage to have two parties to deal with, avoiding the possible arbitrariness of IMF staff. In July 2009, the European Commission disbursed funds to Latvia when the IMF held back.
the whole current account deficit. This runs counter to Guillermo Calvo’s view: “Large current account deficits are dangerous independently of how they are financed.”12 Foreign-owned banks have proven beneficial. Foreign-owned banks have been a major bone of contention in Eastern Europe, where about 80 per cent of banking assets belong to foreign-owned banks. Foreign investors preferred to buy large banks with significant market power in Eastern Europe, which were on average less profitable but better capitalised than banks that remained domestically owned.13 With access to cheaper funding at home than local banks, they became more profitable than domestic banks over time,14 which made them committed to stay. About one dozen West European banks have specialised in Eastern Europe, both inside and outside the EU. They have rightly been blamed for hav-
Nothing is more easily taken for granted than success.
The source of financing matters. One of the least relevant pre-crisis indicators was foreign indebtedness. Even the current account deficit said surprisingly little about the risk of financial crisis. The case in point is Bulgaria, which had the biggest current account deficit of all of 25 per cent of GDP in 2007 and a foreign debt exceeding its GDP. Even so, Bulgaria did not suffer any more than other European countries during the crisis. The dominant explanation is that Bulgaria had huge net foreign direct investment that financed
None of the four countries with pegged exchange rates Latvia, Lithuania, Estonia, and Bulgaria - were forced to devalue despite claims by a broad chorus of economists.
Large majorities favoured wage cuts over devaluation as the lesser evil, because the benefits of devaluation would mainly accrue to wealthy exporters.
ing lent too much in the good times, but they were also the first to sense the impending crisis and reduced their loan expansion from mid-2007. In the midst of the crisis, credit shrank considerably throughout the world, as only some central banks could expand liquidity. The ECB expanded its credit supply to salvage the European banking system in the fall of 2008, also propping up their subsidiaries in Eastern Europe. Without foreign-owned banks, Eastern Europe would not have had access to this important lifeline. Tellingly, the only significant bank in Eastern Europe that went under was Parex Bank, which financed itself with credits from the short-term European wholesale markets that froze during the crisis. Amazingly, not one foreign bank withdrew from any eastern country during the crisis, and they steeled themselves against bearing substantial losses themselves. Today after the crisis, integrated international banks appear advantageous, but effective, pan-European bank regulation is needed.15 Bank collapses have been minimal. Apart from Parex Bank, no significant bank has gone bankrupt in any of the eastern EU countries. There are three explanations to this surprising tenacity. First, leverage was limited in all these countries, and toxic assets such as credit debt obligations were basically not allowed by national bank regulators. Second, thanks to the absence of devaluation in the worst hit countries, the balance sheet losses were contained. Third, for the big West European banks these losses were bearable. As a consequence, the public cost of bank losses has been far smaller than anticipated. While
the International Monetary Fund (IMF) initially expected bank losses amounting to 15 to 20 per cent of GDP in Latvia, they were limited to some 5 per cent in 2008–09, essentially the initial cost of the recapitalization of Parex Bank.16 Moreover, this is a gross cost, much of which may be recovered when the government eventually sells Parex Bank. Distinguish between public and private debt! The point is often made that if debts are excessive, it does not matter in the end if they are public or private, because private debts tend to become public in a crisis.17 But the nationalisation of private debt is not necessary, and the Baltic countries largely avoided it. After the crisis, private foreign debt remains considerable in many countries, but it can be refinanced without significant problems. As before the crisis, their public debts are far below the Maastricht limit of 60 per cent of GDP, while the average in the euro zone is 80 per cent of GDP.
the benefits of devaluation would mainly accrue to wealthy exporters. After many years of high economic growth, people were prepared for some suffering. These states had recently become free and were prepared to stand up for their nations, and they were all used to crisis from the post-communist transition. Radical, early and comprehensive adjustment is beneficial. As the global financial crisis hit the United States, President Barack Obama’s chief of staff Rahm Emmanuel made the pointed statement: “A crisis is a terrible thing to waste.” This is borne out by a substantial academic literature that crisis often offers opportunities for profound changes.18 The Baltic countries have lived up to that wisdom. All three carried out fiscal adjustment of close to 10 per cent of GDP in 2009 alone. Their experience of fiscal adjustment has brought out the universal advantages of carrying out as much of the belt-tightening as possible early on. Hardship is best concentrated in a short period, when people are ready for sacrifice, what Leszek Balcerowicz calls a period of “extraordinary politics.”19 The Balts succeeded because they concentrated the fiscal adjustments on the first year of combatting the crisis. Later rounds of belt-tightening have been more limited but politically more cumbersome. Expenditure cuts are preferable to tax hikes. The logic is simple. During a crisis people understand that the government cannot do as much as before, but they find it more difficult to understand why they should pay more taxes for fewer public services or why the state should not tighten its belts as much as they do. The Baltic experience, with more than three-quarters of the fiscal adjustment from public expenditure cuts, shows that they are politically preferable to tax hikes20 (figure 3). It remains to be seen, but it is likely that the expenditure cuts will also promote faster growth in the future. Alberto Alesina and Silvia Ardagna have offered substantial statistical evidence for the thesis that “fiscal adjustments…based upon spending cuts and no tax increases are more likely to reduce deficits and debt over GDP ratios than those based upon tax increases.”21
understands the severity of the
crisis and wants a government
that can handle
Internal devaluation is possible and viable. A strange myth has evolved that affluent democracies are politically unable to undertake large cuts in public expenditures and wages, in evident ignorance of the big fiscal adjustments that Finland and Sweden carried out in the early 1990s. Latvia, as well as its Baltic neighbours, showed that these vibrant democracies were perfectly capable of reducing their public expenditures by about one-tenth of GDP in one year, 2009. Social calm prevailed. Since these large cuts had to be selective, they facilitated structural reforms, not only reducing capacity but also often improving the quality of public services. The cuts made possible reforms of public administration, health care and education, most of which had been long prepared, but previously been deemed politically impossible.
it as forcefully as is necessary.
Equally laudable was the political economy of this crisis. Instead of the widely predicted social unrest, the Baltic public has accepted their considerable hardship with minimal protest. Multiple factors contributed to social peace. Large majorities favoured wage cuts over devaluation as the lesser evil, because
Foreign-owned banks have been a major bone of contention in Eastern Europe, where about 80 per cent of banking assets belong to foreign-owned banks.
Diplomaatia · May 2011
Equity is important. The most popular budget adjustments were the cuts of salaries and benefits of senior civil servants and state enterprise managers as well as the reduction in public service positions. The Latvian prime minister accepted a salary cut of 35 per cent. The most unpopular measure was the valueadded tax (VAT) hike, and resistance was fierce against raising income and profit taxes. Six of the ten eastern EU members had flat income taxes before the crisis, and none of them has abandoned such taxes, while the Czech Republic has introduced them, and Hungary is intent on doing so. Populism is not very popular in a serious crisis. This is the bottom line because the population understands the severity of the crisis and wants a government that can handle it as forcefully as is necessary. The crisis has augured the biggest strength of the liberal centre-right in this part of the world ever. In the elections to the European Parliament in June 2009, in the midst of the crisis, centreright parties won a majority in all the ten eastern EU members, and all but Slovenia currently have centre-right governments. Two of the most ardent anti-crisis governments, Latvia’s and Estonia’s, won parliamentary elections in 2010 and 2011, respectively. Voters have rationally chosen parties that have appeared to have a realistic means of crisis resolution to offer. The big losers in recent elections have been the oligarchic parties that have tried to exploit populism. The one big failure has been the reversal of pension reform. An oddity of this crisis – exactly as in the early post-communist transformation – is that the share of GDP going to pensions has risen sharply. Moreover, public pensions have expanded at the expense of private pension schemes. Two governments – in Latvia and Romania – tried to cut pensions, but these decisions were reversed by their Constitutional Courts. Several countries – Hungary, Latvia, Poland and Romania – have reduced the funding of private cumulative pension schemes and used these funds to finance public pensions. Meanwhile, the value of private pension funds has plummeted with stock prices, and rendered them less popular. Hungary has even nationalised private pension funds.
The Balts succeeded because they concentrated the fiscal adjustments on the first year of combatting the crisis. Later rounds of belt-tightening have been more limited but politically more cumbersome. columnist Paul Krugman claimed that, “Latvia is the new Argentina.”22 A fundamental problem is their reliance on a brief list of ‘stylised facts’, never bothering to find out the real facts and therefore suggesting policies poorly adjusted to the actual problem. The financial crisis in the Baltic countries has been remarkable for everything that did not happen. There was no significant reaction against globalisation, capitalism, the European Union, or the euro. No major strikes or social unrest erupted, while the population rose against populism and unjustified state privileges. Politically and financially, crony businessmen were the biggest losers, whereas the political winners were the moderate but resolute centre-right forces. The sensible public wanted decisive action from their leaders to resolve their problems. This political economy was reminiscent of the early post-communist transition, when radical reform and democracy went hand in hand. The ideological wind was clearly liberal and free market but also socially responsible, favouring a somewhat purer market economy and a moderate retrenchment of the social welfare state. Balts did not object to the welfare state as such, but they wanted social welfare to be trimmed, to become more efficient, and to work for those truly in need rather than being diverted to the wealthy. It has proven politically possible to cut public expenditures, salaries, and employment, as well as to rationalise health care and education.
The international macroeconomic
discussion was of
little use and even harmful.
International macroeconomics failed. The international macroeconomic discussion was of little use and even harmful. Whenever a crisis erupted anywhere, a choir of famous international economists claimed that it was “exactly” like some other recent crisis— the worse the crisis, the more popular the parallel. When the Icelandic economy blew up in early October 2008, a herd of economists claimed that the same would happen to Latvia, although Iceland had a floating exchange rate, a high interest rate, and an overblown domestic banking system. Soon, prominent economists led by New York Times
In the end, this crisis is likely to benefit both Eastern and Western Europe and thus the European Union. Western Europe will have to learn from Baltic states, erasing the current division between first- and second-class members within the European Union. The Baltic countries have persistently had much higher growth rates than the West European countries, and economic convergence between them in terms of GDP per capita has been impressive for the last nearly two decades. Thanks to the East Europeans, the West Europeans have slashed their corporate profit tax rates and have also been enticed to liberalise their labour markets. Now, they will also learn fiscal policy from the east. Rather than being laggards, the Balts are becoming leaders in economic policymaking.
Crony businessmen were the biggest losers, whereas the political winners were the moderate but resolute centre-right forces. 27
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1 This notion was coined by Rudiger Dornbusch, Ilan Goldfajn, and Rodrigo O. Valdés, “Currency Crises and Collapses,” Brookings Papers on Economic Activity 26, no. (1995): 219-93; and elaborated upon by Guillermo A. Calvo, “Capital Flows and Capital-Market Crises: The Simple Economics of Sudden Stops,” Journal of Applied Economics 1, no. 1 (1998): 35–54. 2 Anders Åslund, The Last Shall Be the First:, The East European Financial Crisis, 2008-10 (Washington: Peterson Institute for International Economics, 2010); Anders Åslund and Valdis Dombrovskis, How Latvia Came through the Financial Crisis (Washington: Peterson Institute for International Economics, 2011). 3 Atish R. Ghosh, Jonathan D. Ostry, and Charamlambos Tsangarides, “Exchange Rate Regimes and the Stability of the International Monetary System,” IMF Occasional Paper no. 270 (Washington: International Monetary Fund, 2010). 4 Pelin Berkmen, Gaston Gelos, Robert Rennhack, and James Walsh, “The Global Financial Crisis: Explaining Cross-Country Differences in the Output Impact,” IMF Working Paper 09/280 (Washington: International Monetary Fund, 2009). 5
Åslund, The Last Shall Be the First: 111–12.
6 Stanley Fischer, “Exchange Rates: Is the Bipolar View Correct” in Stanley Fischer, IMF Essays from a Time of Crisis: The International Financial System, Stabilization, and Development, (Cambridge, MA: MIT Press, 2005): 227–54. 7 Edward Hugh, “Why the IMF’s Decision to Agree on a Latvian Bailout Programme without Devaluation Is a Mistake,” RGE Monitor, December 22, 2008; Michael Hudson, “For States in Crisis, Austerity Is Not the Only Option,” Financial Times, July 8, 2009: 9. 8 Central Statistical Bureau of Latvia, www.csb.gov.lv (accessed on March 3, 2011). 9 Maurice Obstfeld, Jay C. Shambaugh, and Alan M. Taylor, “Financial Instability, Reserves, and Central Bank Swap Lines in the in the Panic of 2008,” NBER Working Paper 14826 (Cambridge, MA: National Bureau of Economic Research, 2008). 10 Adam S. Posen, “Geopolitical Limits of the Euro’s Global Role,” in The Euro at Ten: The Next Global Currency, eds. Jean Pisani-Ferry and Adam Posen (Washington, Peterson Institute for International Economics, 2009): 93. 11 Bas B. Bakker and Anne-Marie Gulde, “The Credit Boom in the EU New Member States: Bad Luck or Bad Policies?” IMF Working Paper 10/130, Washington: International Monetary Fund, 2010: 24. 12 Guillermo A. Calvo, “Capital Flows and Capital-Market Crises: The Simple Economics of Sudden Stops,” Journal of Applied Economics, 1, 1: 47. 13 Olena Havrylchyk and Emilia Jurzyk, “Inherited or Earned? Performance of Foreign Banks in Central and Eastern Europe,” IMF Working Paper 10/4 (Washington: International Monetary Fund, 2010). 14 John Bonin, Iftekhar Hasan, and Paul Wachtel, “Bank Performance, Efficiency and Ownership in Transition Countries,” Journal of Banking and Finance 29, no. 1 (2005): 31–53; R. De Haas and I. van Lelyveld, “Foreign Banks and Credit Stability in Central and Eastern Europe: A Panel Data Analysis,” Journal of Banking and Finance 30 (2006): 1927–52. 15 Peter Zajc, “A Comparative Study of Bank Efficiency in Central and Eastern Europe: The Role of Foreign Ownership.” International Finance Review 6 (2006): 117–56; Rainer Haselmann, “Strategies of Foreign Banks in Transition Economies,” Emerging Markets Review 7, no. 4 (December 2006): 283–99. 16 International Monetary Fund, Republic of Latvia, “Third Review under the Stand-By Arrangement and Financing Assurances Review,” July 6, 2010, 25, www.imf.org. 17 Carmen M. Reinhart and Kenneth S. Rogoff, This Time Is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press, 2009). 18 Allen Drazen and Vittorio Grilli “The Benefit of Crises for Economic Reforms,” American Economic Review 83, no. 3 (1993): 598–607; Mancur Olson, The Rise and Decline of Nations (New Haven: Yale University Press, 1982). 19 Leszek Balcerowicz, “Understanding Postcommunist Transitions,” Journal of Democracy 5, no. 4 (1994) : 75–89. 20 This argument has been made well by Vito Tanzi and Ludger Schuknecht, Public Spending in the 20th Century (Cambridge: Cambridge University Press, 2000). 21 Alberto F. Alesina and Silvia Ardagna, “Large Changes in Fiscal Policy: Taxes Versus Spending,” NBER Working Paper 15438 (Cambridge: National Bureau of Economic Research, 2009). 22 Paul Krugman, “European Crass Warfare,” New York Times, December 15, 2008; Paul Krugman, “Latvia Is the New Argentina (Slightly Wonkish),” New York Times blog, December 23, 2008; Edward Hugh, “Why the IMF’s Decision to Agree on a Latvian Bailout Programme without Devaluation Is a Mistake,” RGE Monitor, December 22, 2008; Nouriel Roubini, “Latvia’s Currency Crisis Is a Rerun of Argentina’s,” Financial Times, June 11, 2009: 9; Simon Johnson, “Latvia: Should You Care?” The Baseline Scenario, June 5, 2009; Niklas Magnusson, “Rogoff Says Latvia Should Devalue Its Currency,” Bloomberg, June 29, 2009.
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