3E Intelligence

Five years ago, when the Eastern European countries joined the EU, the media sang praises for the New Europe which would be more liberal, more open and more competitive than its Western neighbours (“Old Europe”). Now it looks like Old Europe will have to save the economies of the “modern” Europe from bankruptcy. What went wrong?

The economic crisis we are facing is the crisis of a market fundamentalism which was wholeheartedly embraced and promoted by most of the Eastern and Central European member states. Huge financial investments, low labour costs and even lower tax burdens made countries like the Baltics, Slovakia or the Czech Republic the favorites of the ”Lisbon Agenda lovers”.

Unfortunately, now that the old neo-liberal formulas have been discredited, the economic growth model of these countries has fallen flat on its face too. It could have been very different if the new member states would have looked to the future instead of to the examples of the Western past when building their new economies. Instead of trying to create tax havens and stimulating the delocalisation of car and other manufacturing industries via low labour costs, they could have become the leaders of the green industrial revolution which would have protected them better against the storms of the current and future economic downturns.

But then again, they probably lacked the visionary political leadership, the enlightened entrepreneurs who looked further than quick richness and the strong civil society to educate and prepare its citizens for a different European path to quality of life instead of more consumption.

What is even more worrying is that these countries, whose European aspirations and dreams have now been broken, could well become the breeding ground for a new authoritarian radical populism which could turn Jeremy Rifkin’s “European Dream” into a new European nightmare.

If this happens, the responsibility of the old member states will be overwhelming. Not because they did not bail out the troubled Eastern countries when they got into to trouble but because they send them unto the wrong road (the neo-liberal Lisbon-agenda-inspired growth path) in the first place.