Vol 2, No 1
10 January 2000
L E T T E R S:
Ms Smolens's comments of 13 December on Dr Vaknin's article of 6 December reflect the superficial analysis of someone who views the world in Marxist terms. Specifically, the "zero-sum" view of economics seems to be her underlying assumption, ie the EU must be out to make money at the Central Europeans' expense. The second underlying premise - that people acting in their self-interest are evil - is equally Marxist.
Let's deal with these unspoken premises first, then to the reality of foreign investment in Central Europe.
Economics is not a "zero-sum" game. Wealth is infinite and does not depend on "underpaying labor" and other Marxist drivel. The free market under a rule of law works because it depends upon each individual making determinations based upon their self-interest. Far from some despicable "Western malaise" as portrayed by Ms Smolens, this is the essence of social freedom and economic success. While the first manifestations of this freedom in CEE may seem shallow or even decadent, underlying moral and intellectual traditions will inevitably bend it toward something that is more inspiring and fulfilling.
As to the Western nations' intentions, they are obviously acting in their self-interest. The EU wants the Central and East European market. US firms, like mine, want to use the CEE to make money and get into the EU market. Is that evil?
According to the August 1998 study "Reality Meets Expectations: Foreign Capital in Privatization" by Maria Jarosz, Professor at the Institute of Political Studies, Polish Academy of Sciences (published online at http://www.masterpage.com.pl/outlook/8.html), the impact of foreign investment in Poland has had a very positive effect on the quality of life in Poland.
Western foreign aid is typically tied to domestic procurement; Phare money requires employment of EU companies, and US AID grants require use of American firms where feasible. Does this mean that the aid is ill inspired and serves no purpose? True, aid can display problems in concept and design, but the procurement rules try to help the aid-receiving nations while aiding donor nation firms. Such a win-win strategy is hardly immoral.
Ms Smolens's call to reject the EU is also an emotional response to the economic realities of Europe today. I tend to agree with her as to efforts to make the EU into a sovereign state; but on the trade issues, she could not be more mistaken. The countries of Central Europe on their own could not be an effective, free-standing trading bloc; these countries need to export to the EU. These countries also need investment and an influx of know-how to create more competitive exports. The growth of the auto industry in Poland is illustrative.
Finally, the EU accession process is forcing other changes that are making these societies more free and more stable and generally raising the quality of life. The alternatives are best viewed by considering the progress toward a just and prosperous society being made further to the East.
The Poles refer to the entire process as "rejoining Europe," and for all its blemishes, the process is the inevitable first step toward a better future for everyone in Central Europe.
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