From the USSR to the EU

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My first trip to Bulgaria was in January of 1967 when, with two other penniless hippies, I alighted from the train in Sofia at about 4 a.m. Even to this day I don’t remember being colder in my life than when I landed. Not that leaving the Orient Express meant leaving a pleasure dome; we had been riding in back, sitting on the floor with some Gypsies, who had brought along some sheep to help us keep warm.

Why, you might ask, would I want to return to such an obscure country? I might answer rhetorically: “Why not?” I’ve long believed, after all, that no matter where you go, there you are.

A more direct answer is that I was invited by myoid friends Richard Harteis and William Meredith. Meredith is Poet Laureate Emeritus of the United States; Harteis also is a well-known poet and author. Both men were given Bulgarian citizenship some years ago in recognition of their achievements. Poetry is a surprisingly big thing in Bulgaria, and the boys were happy to introduce me to everyone from the president on down. On every level, in every market, the buzz was about Bulgaria’s anticipated entry into the European Union in 2007.

European Union?

All the relatively backward countries of Eastern Europe want to join the ED, believing it will somehow guarantee prosperity. Everyone sees the advantages of membership, which boil down to more freedom to travel and work within the EU and an easier flow of goods across borders. It’s true that their workers would be able to double or triple their wages by transplanting to the West. And it’s true that it would become easier to export goods to other EU countries. These are excellent things. But they’re offset by a long list of EU follies.

What these countries aren’t considering is the extra costs that Brussels will impose with its regime of hyper-regulation. Rich countries can better afford sterile rulemaking and other waste than poor ones can. And the Europeans are forgetting that they’re not just competing with one another, but with the rest of the world (read: China and India). Bonding to your neighbors in a blanket of political Gunite is a disadvantage, not an advantage, in a competitive world.

My guess is that the ED itself won’t last. To see why, look at its stated purposes: 1. Prevent wars by subverting nationalism .and replacing it with transnationalism; 2. Promote prosperity and interdependence by lowering trade barriers. The EU will be a disaster on both counts.

After a century of war driven by nationalism, Europeans were eager to try anything to avoid more slaughter. One idea they bought was that citizens of a transnational union would forget that they’re French, German, Lithuanian, or one of 25 other nationalities. The effect of union, however, is precisely the opposite. As you force people into a political cage where some groups are being subsidized by others, they become more sensitive to what their group is giving and getting, they feel greater solidarity with those who share their culture and history, and they get daily practice at blaming other groups for their disappointments. They become, in a word, more nationalistic.

As for promoting prosperity, the way to enhance the payoff from trade and travel (this will come as a shock to the politically oriented) is to eliminate taxes and regulations – and to do so unilaterally. When a government imposes duties, quotas, and other restrictions on foreigners who want to sell, it places those same burdens on its own citizens who want to buy. In effect, the government enforces a trade embargo against its own country. Why do governments do this? Usually to enrich some favored constituency (at the expense of everyone else), or to punish some other country, or just to look busy.

A government that wants to escape its self-embargo doesn’t need to negotiate with anyone. It can cure the problem easily on its own. Requiring a treaty or a political merger to reduce tariffs and quotas is like waiting for permission to stop beating your head against a wall. As an aid to prosperity, then, the EU is a clumsy and unnecessary device at best. Add in its extra layers of

taxes and regulation, and it’s actually counterproductive.

It wasn’t so long ago that everyone just assumed Europe was going to unite
into something like a bigger, modern-day Roman Empire. People seemed to think this somehow would make Europe stronger. But does Krazy-Gluing together dozens of disparate countries, with conflicting interests¬†and cultures, make for a stronger whole? No more than attaching to the Chinese government helped Hong Kong. What made Hong Kong great was its freedom; now it’s just
another city in China. Uniting disparate cultures
only makes them stronger for one thing: waging war, whether it’s a battle against an enemy outside the union, or a conflict exploiting the revitalized nationalism inside.

The idea that Europe is stronger because it’s united is yet another idiotic notion from popUlar journalists like Thomas Friedman. He applauds union, and everyone claps along because he’s a widely read celebrity. (His record is unblemished. Everything he’s ever written, at least that I’ve read, is idiotic – but very stylishly done. Always confused, but always elegant.) Still, almost everyone supports the idea of union. But what is a union of disparate cultures under one government? An empire. And empires, more than other political structures, require centralized control- at the inevitable expense and with the inevitable resentment of the controlled. In the modern world, they’re inherently unstable.

In fact, as information technology improves and allows more decentralization, and as wealth increases and the nastiest weapons become affordable for even small countries, there are likely to be more independent political entities, not fewer. Iraq, for example, is breaking into at least three states. And Chechnya is just one of a number of countries that will eventually separate from Russia. Scotland, Wales, and Northern Ireland could yet leave the United Kingdom. Spain and France still have breakaway movements in their provinces. I sincerely doubt that D.S. borders 100 years from now will much resemble today’s. Separation, not union, is the megatrend.

Fortunately, the ED empire may never get the chance to coalesce, because the French and Dutch voted against ratify- ing the EU constitution – a fat, laughable hodgepodge of collectivist sentiments destined for the garbage heap of his- tory. Rather than being a brief, easily read document that sets out how the government operates and what it can and can’t do, the ED constitution runs 300 pages. No, I haven’t read it. And I doubt there are a thousand Europeans outside government who have. But any political document put together by a huge committee drawn from vastly differing cultures can’t help but be a tangle of incomprehensibilities and contradictions.

Doubts about the fate of the ED carryover to the euro. Notwithstanding its recent strength against the dollar, the euro will eventually reach its intrinsic value. Its holders will find that if the U.S. dollar is an “IOU Nothing” issued by a bankrupt government, the euro is a “Who Owes You Nothing.”

Before the EU, every European government was accustomed to supplement- ing its revenues by creating currency out of thin air. With a transnational central bank in charge of the euro, this luxury is no longer available to these governments individually. Eventually one country will withdraw from the EU because of an ostensible need to control its own economy (i.e., defraud its own subjects through currency inflation). Then another will withdraw and re-establish its own currency, and another, and another. Who will be left holding all the euros? The same people who lose at Old Maid.

The ED is a marriage of convenience between people who will find they have very little in common except some mistaken economic and political theories. If I were the Bulgarians, or anybody else, I wouldn’t join.

Of course, when I met with the president of Bulgaria, the question of his country joining the ED was only one of several we saw differently.

Me and the President

One of my hobbies is approaching government leaders with a radical, common-sense plan to liberate their economies. I never expect the plan to be accepted, but tales of the reactions I get from heads of state make for fun cocktail chatter.

I didn’t have particularly high hopes in Bulgaria because, despite President Georgi Purvanov’s youth (he’s only in his forties), he impressed me as rather humorless. Europeans generally place a big premium on being “serious.” And any idea or building less than a hundred years old risks being dismissed as “no! serious” – which may be why so many

Does Krazy-Gluing together dozens of desparate countries, with conflicting interests and cultures, make for a stronger whole?

 

Europeans seem as old as serious buildings. Of course this presented a problem for your correspondent, because I’m notorious for taking very, very few things seriously. I felt I’d already made a concession to seriousness by not wearing my Bart Simpson tie.

As you probably suspect, there’s not much to tell about our meeting. I didn’t even get thrown out. After the usual pleasantries, we turned from blah-blah to business.

I asked, “Have you been to Dubai?” “Yes.” ,

“How did you like it?”

“It’s not a direction in “which Bulgaria wishes to go.”

The Prez appeared to have read my brochure on the topic and harbored some philosophical disagreements with Ine on the nature of Man and the State.

Then Mr. President said Bulgaria should have a “strong, effective, and working” government. Since I don’t believe in government as an institution, we certainly couldn’t agree on the necessity of a strong one. Since I think government is only rarely effective at anything worthwhile, that point was out. And since I don’t believe government works, that left us three for three.

Philosophy aside, Purvanov’s bias against change is understandable. Why should he rock the boat, and perhaps break a few rice bowls, by making the place more like Hong Kong or Dubai, however smart that might be? Stocks and property both have gone through the roof, and the conventional wisdom is that things can only get better. And that view, I believe, has merit: almost all the old Soviet bloc countries, including Bulgaria, have gone to a flat tax, ranging from just 13% in Russia, to about 33% in Lithuania. This is a big draw for many reasons. Now if only those governments would discard their VATs; which average around 20%, they’d be off to the races.

A Slice of Life

My experience in Bulgaria was overwhelmingly favorable because the circles I moved in were sophisticated – writers, artists, poets, businessmen, and ex-nomenklatura. Many evenings we’d stay up until all hours drinking, smoking cigars, and talking philosophy. But, truth be told, that’s pretty much my experience everywhere, unless I’ve hopped a westbound freight with my hobo friends. A rootless cosmopolitan can easily delude himself that the world is a better place than it actually is, because he’s surrounded with others like himself. It’s easy to forget that the denizens of trailer parks in the boonies greatly outnumber owners of penthouses in the city.

So let me relate a bit of local color, to convey a more rounded view of the Balkans. You don’t get the essence of a place by reading stuff published by the International Monetary Fund or by breathless travel mags.

While I was in Bulgaria, a cruel but rather comical scandal was unfolding in Romania, just across the Danube, involving a young orthodox priest. The Romanian Orthodox Church is still fairly strong throughout Eastern Europe and rabidly popular among hoi polloi, who still believe Dracula lurks in the mountains of Transylvania. This viewpoint is pretty much universal in that region.

Anyway, it seems a 29-year-old priest crucified a 23-year- old nun, in the presence of several other nuns, on the ground that she was possessed by the devil. Press reports indicate that the young woman was bound hand and foot and denied food and water for several days before her ritual execution. It’s a nice touch that the bearded young priest who crucified her also said a mass for her soul afterward, saying, “God has performed a miracle for her. Finally Irina is delivered from evil.” The serious young priest was further quoted as saying, after the mass, “Over there, in your world, the people must know that the devil exists. Personally I can find his work in the gestures and speech of possessed people, because man is often weak and lets himself be easily manipulated by the forces of evil. I don’t understand why journalists are making such a fuss about this. Exorcism is a common practice in the heart of the Romanian Orthodox church, and my methods are not at all unknown to other priests.”

It’s going to take a while to overcome some of these cultural artifacts. And it’s the culture, more than the lack of roads, electricity, and plumbing, that will keep Eastern Europe lagging behind the French Riviera, where therapeutic crucifixion is rare.

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