Thursday, September 24, 2009

In the Race Again - Notes on exceptionalism VII.

The Hungarian prime minister, Gordon Bajnai visited the United States, more accurately participated at the UN general assembly and used this opportunity for a longer visit, with a lecture given at Columbia University, a talk with Hungarians from New York and not the least fro a meeting with "business circles". He not only expressed his pride over his government's efforts and achievements (making its homework, it was the phrase he used) but stressed his conviction that Hungary will soon become again the front-runner of ECE in the never ending competition of its states.
Those few who followed this blog are already familiar with my opinion on this assumption and won't be astonished if I would again emphasize how dangerous this perception was, how disastrous effects it had on the societies of the transition countries. But - even though I should admit it wouldn't be entirely fair to criticize Bajnai's attempt outside the context of the need of attract foreign investment to Hungary in an environment where almost everybody forecasts a significant reduction of the capital in the world - it is hard to evade further comment of the whole concept of competition. Originally competition is inherent element of a market economy, but not the competition of entities like states, only individual ones, companies and individuals offering their labour or ideas. Competition is easy to perceive at this level and easy to connect to ideas like fairness, freedom etc. But to extend this idea to states is not so simple as the frequent use of this phrase in connection with ECE countries would suggest.
The starting point is already dubious: is competition between countries - in the sense as it is applied to markets - really exist? One can easily imagine the individual level of such competition, companies, farmers, workers acting in the framwork of a single market, consisting more than one countries, something like the European Union. But what is the place and role of the states in this structure? Can they compete similarly? Especially as this competition is never imagined as a substitute for the competition of economic actors, rather a complementary of it. States are usually seen as societies, more than a sum of the economic actors belonging to them. But as societies they are supposed to act in order to achieve a kind of equilibrium between different aims and interests, conceived as common good. While states are perceived as competing each other - in the sense Bajnai referred to this concept - only one element - however important it could be - brought to the fore: the economy. And even within the economy only a part of the actors are in fact in a competitive situation with their peers from other countries. It is easy, too easy without critically reflecting to the concept of competition between states, to elevate or transform partial interests of some economic actors into common good. Competing with other states on he field of economy can result in the neglectment of other sectors of the state's responsibility, the society, as those are not in a direct competition and therefore this concept can not integrate their needs. But as the interests of economic competitors is envisaged as the ultimate interest of the society - it can distort the original concept of common good.
Maybe economic growth in itself is raising and extending public good, welfare etc. But it is not a certainty, especially when the market, where competition is taking place, is broader than a single state and a single society. (And the Pareto-effectivness and equilibrium is hard to apply to such a blurred entity as a market economy that is not a society etc.) Not to speak of the experience of the last two decades, when rapid growth was not Pareto-effective as regional differences were growing not only in relative terms, but in absolute terms as well. A series of regions in ECE are now poorer than they were in 1989 (and they situation didn't improve during periods of steady growth), even if a small number of regions are much wealthier. The latter are usually regions in competition and the former are simply excluded from the market mechanisms. But it suggest that once again entering the race is nothing else than sacrifice these parts of a country for the sake of te prosperous ones. As it is quite consistent with lowering redistribution rates.

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