Category Archives: Politics
On 1st July 2013, the European Union will gain a twenty-eighth member: Croatia. This broadly banana-shaped republic with one of the most stunning coastlines anywhere in the continent will become only the second constituent member of the former Yugoslavia to sign up to what is still in nominal terms the most affluent economic bloc in the world.
However, Croatia – a nation of just 4.28 million people – will be acceding to the EU under very different circumstances to those countries which rode the credit bubble wave of the 2000s and enjoyed massive but ultimately fatal injections of credit into their economies. With the European Union struggling to expand its institutional balance sheet fast enough to prop up the collapsing eurozone periphery, Croatia is unlikely to enjoy any obvious short- or even medium-term financial benefits of membership.
This matters because Croatia is currently undergoing a severe economic crisis despite not being part of the EU or eurozone: an estimated 30% of Croatians now live in poverty, with the Akcija Čista hrana or Clean Food Movement operating as an alternative food bank: specially-labelled grocery bags of food are left adjacent to municipal bins for usage by the country’s poorer citizens. Things are so bad that Croatia has spawned a not insignificant Occupy movement of the kind more usually associated with large cities in the neoliberal United States or United Kingdom.
Given that many of Croatia’s strategic assets are likely to be acquired by its European partners following accession, we at Mediolana are left wondering: has the country really embarked on the right course? Could Croatia have charted a different path by following the old Yugoslav model of being close to several power blocs whilst retaining that vital element of political (and ultimately, economic) independence? Would partnership agreements with the EU, the Organisation of Islamic Cooperation (neighbouring Bosnia and Herzegovina is an observer member), ASEAN and Mercosur have constituted a new, more viable future?
Contemporary audiences with no memory of the 1980s might associate the nickname ‘Iron Lady’ with a world volleyball icon rather than a Cold War politician, but for anyone with recollections of that decade – particularly those raised in the United Kingdom – one association for that epithet towers above all others: Margaret Thatcher, the nation’s prime minister for no less than an historic eleven years (1979-1990).
Thatcher is characterised by many – and not merely her ideological enemies – as having smashed the post-war consensus that defined the UK in the post-1945 period. Through her championing of monetarism and her emphasis on the individual and the family (as opposed to a purportedly ‘extinct’ society), the iconic Conservative leader bulldozed the existing social contract and created a harsher and more anomic Britain defined by relentless competition bordering on social Darwinism.
This thesis is a seductive one; when reading of free school milk programmes now enjoyed by children in emerging markets, or of privatisation programmes with results other than merely making the already-wealthy into neo-feudal lords in helicopters, it is tempting to conclude that Mrs. Thatcher really did change Britain beyond recognition – and not always for the better.
But taking the Really Long View, we at Mediolana wonder whether a decade plus of handbag-themed politics at 10 Downing Street was actually as radical as the political science textbooks (and not a few commentators) would have us believe:
1. Thatcherism = Reaganomics? When Thatcher’s reign came to an end on that memorable late November evening in 1990, Britain was a country where university education was not merely free, but where students’ cost of living was significantly subsidised by annual free gifts of money in the thousands of pounds. The idea that the United Kingdom would somehow wish to emulate the USA’s higher education model – now transmogrifying into a seriously ominous economic bubble – was not even a glint in a policymaker’s eye.
2. Relentless Monetarism? Mrs. Thatcher famously averred that she was not for changing course, but this is actually precisely what her administration did in the mid-1980s when faced with the stark reality that velocity theories of money, like Keynesianism before them, were not quite the panacea that was initially anticipated.
3. The State Will Wither Away? As Mark Mazower (presently Professor of History at Columbia University) drily notes in Dark Continent - his epic history of twentieth century Europe – the proportion of the UK’s economy under state auspices was almost identical at either end of the Thatcher era. It could have been even higher had Britain’s North Sea oil boom been invested in a Norway- or Qatar-style sovereign wealth fund instead of being frittered away on higher social security costs which were (with no little irony) due to the structural unemployment created by the monetarist fad.