The rise of populist politics all over Europe is a result of a decade of inadequate responses to the real problems of the citizens
The prosperity index is higher in countries where the GDP growth matches a more cohesive society. How can we encourage social trust in Central European countries in order to meet the demands of economic growth and build-up their prosperity further?
The political transformation in Central Europe involves three stages: regime change, the democratization of institutions and the consolidation of democracy. This last element, the consolidation, has not been successfully accomplished – the low adherence to values such as solidarity, social trust and trust in institutions suggest that, in this area, the transformation has not ended. The process was recently complicated by external factors: the global financial crisis, debt crisis and overall feeling of insecurity resulting from the refugee crisis.
In addition to external factors, there are internal trends that prevent us from achieving greater social trust. First, freedom is still understood as limited welfare support from the state. Second, politics has been reduced to providing security and the management of economic and social matters, without providing any real values. Third, the rule of law is weak, and there is the perception of social injustice, resulting from flawed judicial systems. Fourth, social stratification processes have led to new types of social inequalities. Fifth, when the fragile middle class weakens, the levels of trust drop down, and there is no guarantee of political stability. Sixth, the political scene is unstable. As a result, citizens are deeply dissatisfied with the state of affairs.
This gives space for fringe, radical movements to become mainstream. New political entities – which are not based on common values, but rather on dissatisfaction, fear and resentment – are gaining ground. They are moving further and further away from centrist politics, as we suspected would be the case, but they are also unpredictable. The rise of populist politics all over Europe is a result of a decade of inadequate responses to the real problems of the citizens. This has allowed populist parties to grow by offering rhetoric, simple truths and simple solutions to complex challenges – which will not magically solve all the problems, and which will further polarize our societies instead of bringing more social trust and prosperity.
In this difficult political climate, I am convinced that the way to improve social cohesion and social trust is the hard and boring work of continuing to reform our economies on micro and macro levels by providing more quality jobs, continuing to democratise institutions and improving the functions of the judicial system. Without these elements, there will be no trust.
Despite good economic indicators, Visegrad societies have voiced dissatisfaction with their economic standing. What can we do about it?
We need to address three interconnected challenges to overcome this dissatisfaction. The first one is dealing with the socio-economic situation of the citizens. The first part of this transition has been finalized. Our homework now is to implement a second step of the transition and move from our current model of economic growth, based on low-wage labour, to economic growth based on higher wages. How does one assure the raising the wages? We could introduce a pilot basic income program, something akin to what Finland does, but we are not as rich as Finland. Another option is consistent investment in education and research to boost innovative potential and create jobs with added value. Higher education is the pathway to social mobility. The ugly truth is that if you have a low level of education and are out of luck, your social mobility prospects are very limited. And if we want to eliminate these pockets of poverty, we must invest in of the society as a whole; we cannot focus only on selected groups.
The second challenge is the rule and law, which I see a precondition for entrepreneurship. There is no room for entrepreneurship without a well-functioning justice system and limited bureaucracy. Our problems are an overregulated state, a public administration which certainly does not functioning perfectly, the misuse of public finances and high levels of corruption and fraud. These are true barriers to entrepreneurship and obstacles for improving the everyday life of many people.
The third challenge is assuring better quality of key public services, especially healthcare, the educational system and social safety net.
The worst-case scenario is governments’ inactivity. The perceived economic stagnation coupled with the sense of injustice and dissatisfaction with basic public services is a recipe for social unrest.
Central Europe has built up its prosperity by moving from low-skilled jobs to more complex services. But today, it is facing the problem of brain drain. How can we address this issue?
Brain drain itself is not a problem. The problem is when talented and educated people are leaving forever. If it is a part of your professional career – to have more experiences, to be involved in international teams – then it is an added value for your country once you return. For highly qualified professionals, mobility is a welcomed part of their professional careers. The tragedy starts when such people do not wish to return. Central European governments are trying to lure the brightest people back, offering them jobs in the state administration. But income is not the only source of motivation, what counts is also the work culture. I wonder how fast state administrations can improve in the latter area and if it has energy to effectively attract this segment of the population back. After Brexit and in case more mobility restrictions are introduced within the EU, some workers would be forced to come back to Central Europe. No matter positive or negative incentives, some of the lower and higher qualified people will certainly return; we can only speculate about the numbers and proportions.
Iveta Radičová – Former Prime Minister of Slovakia
Read more in Visegrad Insight 1 (10) 2017 ‘From golden hands to golden heads’.