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13 April, 2016

Bulgaria in the trap of neoliberalism

In 1989 the Berlin Wall fell and the so-called “transition period” for Central and Eastern Europe began. The goal pursued was a radical change of society at economic, political and social level. In relation to this, Bulgaria endorsed a variety of development programs, which were manipulated by the two supranational institutions – the World Bank and the International Monetary Fund. The country was quickly encompassed by a wide network of non-governmental organizations (NGOs) whose number amounts nowadays to 38,000. The UN agencies, supranational authorities and NGOs organized and coordinated Bulgaria’s transition through the same methods, ideas and language, which were being used for the Third World Countries by that time.

by Daniela Penkova

PART 1 - From the “development” to the “democratization” of Eastern Europe

The concept of “development” was born on the 20th of January 1949. It was the day when Harry Truman held before the American Congress his inaugural presidential speech, in which he defined a wide number of countries as “underdeveloped” and entrusted the “developed” countries with the task to “work on the development”:

Greater production is the key to prosperity and peace. … We must carry out our plans for reducing the barriers to world trade and increasing its volume. Economic recovery and peace itself depend on increased world trade. … More than half the people of the world are living in conditions approaching misery. … Their economic life is primitive and stagnant. … The United States is pre-eminent among nations in the development of industrial and scientific techniques. … In cooperation with other nations, we should foster capital investment in areas needing development.

Concealing the American interests behind the mask of benevolence, Truman did not hesitate to announce a program for technical assistance, which “with the cooperation of the American business, private capital, agriculture, and labour in this country, … can greatly increase the industrial activity in other nations and can raise substantially their standards of living.” The world has vastly changed since then but there was no change in the condition of the developing countries, labelled to this day as “The Third World”.

After the Second World War the supranational twin institutions – the IMF and the World Bank – were born. During the same period were also founded most of the UN’s agencies – FAO (Food and Agriculture Organisation) in 1945, UNESCO (United Nations Educational, Scientific and Cultural Organization) and UNICEF (The United Nations Children’s Fund) in 1946, followed by the United Nations High Commissioner for Refugees in 1951. The United Nations Development Programme (UNDP), which is today’s greatest world network in the sphere of development, was founded in 1966.

The development supporting projects are characterized by a wide range of activities carried out by NGOs. Their propagation is a new phenomenon gaining force in the context of a real boom of the “industry of development”. This evolution began with the change of the policies of the World Bank after 1973 under the leadership of Robert McNamara who raised the credit volume thirty fold and made the bank a real intellectual operator supporting purposive social and cultural projects. During the 1980s the neoliberal economists reorganized the World Bank to become a global agent of the “Washington Consensus” striving to impose policies of deregulation and privatization in the indebted countries. The NGOs number made a headlong increase. They were expected to create their own niche of funds for social investments whose purpose was to soften the immediate consequences of the Structural Adjustment Programs (PAS). They were encouraged to become channels for support of the poor people and those facing social exclusion in the context of the new economic policy. Some NGOs were financed by American governmental agencies such as USAID (American Agency for International Development) with the sole purpose of disseminating the neoliberal ideas, thus becoming think tanks. They engaged in analysing the social policies in areas spreading out from social programs to political strategy, from the economy to science and technology, from commercial and industrial policies to military consultation. Since 1989 think tanks have found a new field for development in Eastern Europe where pragmatic experts and romantic intellectuals were attracted by the idea of autonomous citizen society overseeing the actions of governments, aiding the advance of the liberal democracy and protecting against “the return of communism”. Thus the problematic of development coincided to a great extent with that of the democratization and was no more confined to the Third World only but extended also to the Eastern countries and even the whole Western world where lots of think tanks had developed since the end of the 1990s, which were already participating in planning reforms demanding sacrifices such as the ones in pension and health insurance. The social state was sacrificed first.

There is a great similarity between the two terms – transition (used to denote the economic and political changes in Eastern Europe after the fall of the Berlin Wall) and development, since both assume export and adaptation of the political and economic models of the Western democracies.

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