Monopolization, corruption and the end of democracy

By Srećko Pulig (, 25.02.2013.
Translated by Vladimir Bogićević

From Serbia news arrive that about a hundred workers and small shareholders from all across the country, gathered at the demonstrations in Belgrade, demanded for the Privatization Agency, local counterpart of the Croatian Privatization Fund (CPF), to be abolished. One of the reports begins like this: “Without job, without money, without much hope to achieve justice and to reclaim property of social enterprises where they once worked, and which are today mainly in bankruptcy, liquidation, or with assets sold and capital drawn into far islands firms, about a hundred workers and small shareholders of Kragujevac, Vršac, Zrenjanin, Subotica and Belgrade companies protested yesterday before the Privatization Agency, and then before the Presidency. The list of demands is not long, but it strikes at the core of privatization disaster wherein about a half million people lost their job”  (from Miloš Obradović’s article).

Hence the workers, some of which are on the labor market for years, demanded for the Privatization Agency, which took part in, carried out and controlled all the privatizations, to be shut down. It was just its job to keep track of whether a privatized firm still operates, whether new owner invests or dissipates its property: but the results of such state qadis, that take, give and judge at the same time, are well-known all across ex Yugoslavia. Now if only someone, beside few tycoons denounced to satisfy transitional justice, would be criminally charged. At the gathering also spoke Milenko Srećković from the Freedom Fight movement (Pokret za slobodu), a civic organization established to support numerous worker demands, which already introduced itself in Zagreb too. He attacked the dominant discourse of “fight against corruption” noting that while a few suspicious buyers of destroyed companies are being arrested, those who allowed their operations in state institutions are not being mentioned at all. Meaning not only individual politicians and their business sponsors, but the whole system of state institutions through which all those favoritisms, nepotisms and clientelisms had to be pulled. And they will have to be in future as well, whatever the name of offices that allow that would be, because private control over all the more concentrated money flows, not to say just over economy, is not feasible without it today.

Srećković reminded this gathering that the Privatization Agency did not investigate the origin of the money, so the companies were often bought by criminals, and that it did not control whether new owners maintain the continuity of production or sell whatever they can and put companies into debt beyond the limits of the normal. Activists of the Freedom Fight movement remind of what is most important: that the workers in those situations do not keep quiet, instead pointing to irregularities and injustices, but the state bodies, including the Agency – and we already know all about policy of the media attached to the economic and party power – then totally ignore them. Answer to the question of who did, not just allow, but in fact foster the processes of extinguishing production and selling out factory assets, groundless mortgage borrowings and establishing the shell companies for the sake of intentional pushing into bankruptcy, is the same in Belgrade as it is in Zagreb: that was fostered by “our”, so old and so different, allegedly deadly irreconcilable states.

Belgrade protesters call for criminal responsibility of all former Privatization Agency’s directors and of others responsible to be investigated, and then for this institution, with such a disastrous effect on economy, to be immediately abolished. If it is simplified, but not completely groundless, to say that Slovenia is Croatian and Croatia Serbian picture of the future, then we can conclude that Belgrade protesters, as much as their protest could seem Don Quixotian to some, might as well succeed in their efforts. Let us just remember how pompously Privatization Fund, essentially cynically called “Croatian”, was abolished here in 2011, but only to be replaced by the Government Asset Management Agency (GAMA). Which all precisely recall the maneuvers of shutting down the old and establishing new – allegedly clean and unburdened – institutions as enterprises that, by the way, don’t even need to know what is the value of real estate they took over to manage. Our then Deputy Prime Minister in charge of economy, Petar Čobanković, was after all brutally honest when he said something like how our privatization came into disrepute, so it needs facelifting: “CPF had negative connotations, as also the entire privatization. It was the time of transition, wherein there were no experiences, but all countries had their own ways. Today we have extensive experience in that, and its results are both the Act on Government Asset Management and GAMA”. So, those who privatize have accumulated experience and don’t rush into the unknown any more but, since they are prepared, initiate the cycle of new privatizations wiser, with all the worse consequences on endangered population.

What we should do is to constantly point, like our comrades in Belgrade, to the limits of so-called anti-corruption policies, which did indeed manage to put even our Prime Minister, and in Serbia the biggest tycoon, into arrest, but at the same time the system allowing such phenomena does not just stay unchanged, but is still being promoted as the full democracy of Euro-Atlantic type. Perhaps it's time for us to embrace, instead of stubborn denial, the banal truth that our authorities are not unsuccessful, but the catastrophe lived by the majority is synonymous with the success of the minority they serve, at home and abroad. Corruption occurs in various sectors, in both notoriously political and economic ones, but only the naive – and there are no such any more, except ex officio – could separate these sectors. Local politicians did allow and create local too powerful private owners of industry yesterday, of  public goods tomorrow. Now instructions come from European politicians, and important owners are less and less local as well. But some tendencies stay unchanged. Corruption is significantly linked to the processes of concentration of  proprietary and nonproprietary power, in centers estranged from people. Corruption in its contemporary, now for us equally relevant, Western forms flourishes especially in the moment when public goods are to be taken away from citizens and given to corporations to private management. It is actually a necessary constitutive ingredient of political economy of privatization policy. Its systemic function in what we could crudely call slow-motion coup of authorities against their population is in real undermining of democratic contents, not just of democratic forms.

Authorities that exclude all broader strata of population from management will be the first to shout tomorrow, when they will introduce new exceptional measures, that democracy is in danger. We must answer them from whom: from those who did politically allow deregulation and privatization of everything, who are coming up with always new forms of oppressive organization and management, and who will finally, in our Brussels future, undemocratically circumvent local level by supranational agreements and institutions.

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