Building a New Economy

Posted January 9, 2014

Categories: Blog, Eastern Europe, Featured, Uncategorized

At the beginning of the changes in 1989 in East-Central Europe, civil society activists were very interested in alternative approaches to economic development. They’d seen the failures of Soviet-style Communism up close, and they didn’t want to import the worst kind of McDonalds-style capitalism. In 1990, when I visited East German pastor and dissident Wolfgang Ullmann, he pulled the book Mainstreet Capitalism from his shelf to illustrate a point. It was a rather obscure book about ways of broadening share ownership in the United States and England. Ullmann, who went on to serve in both the German and European parliaments, was casting around for ways to transform ownership in East Germany “without deceiving our people and taking away their rights,” as he told me.

Eventually West Germany absorbed East Germany, and discussion of economic alternatives largely disappeared. Elsewhere in the region, a new economic consensus emerged around some form of “shock therapy” transition to capitalism. A few vestiges of worker self-management survived in Slovenia, agricultural cooperatives lingered in some places, and most states retained ownership of a few key industries and services. But the new generation of politicians were not interested in experimentation. They had their eye on eventual membership in the European Union and wanted to implement whatever economic reforms were necessary to facilitate accession.

Especially after the financial crisis in 2008 and the Eurozone crisis of the following year, many people in East-Central Europe are again looking for alternative economic strategies. The Czech political economist Ilona Svihlikova was only 12 years old when the Velvet Revolution took place in her country, so she did not participate in that earlier discussion of transition. But she is very busy thinking about how to create a new economy in the Czech Republic today.

“From the start, we entered the world market in the bad position that we had, and we refused to use any instruments to rise higher in the value-added chain,” she said in an interview in Prague last February. “We just got into the system in the position of a semi-peripheral power. At best, we have been a colony of Germany. That’s the reality. If you look at the structure of the economy, the pillars are in foreign hands.”

Three years ago, she created a new organization called Alternative from Below. “We try to find inspiration from other countries, from the United States, for instance, and the New Economy movement. The main pillar of our activities is to realize projects that try to help at least a bit, like cooperatives, like social entrepreneurship. We try to involve people in politics,” she told me. “We are trying to say to the political elite that their approach is wrong, that they need some kind of program, that they need to think differently. We try to spread community work throughout the Czech Republic, using different tools like participatory budgeting and local currencies. These are unknown things here.”

Participatory budgeting, a technique developed in Brazil to involve citizens in the creation of budgets at a local level, is particularly appealing for Czechs. “In all the towns and cities, there are ‘interesting’ things going on with public procurement,” Svihlikova explained. “If people had a look inside, they might get quite afraid. Most people who contact us are from opposition parties that have found out that something wrong was going on with public money, and they want to get to the bottom of this. They contact us to implement participatory budgeting in their town. It’s a long-term project, but you have to start somewhere. Some people say that Prague is too big for that. And I say, ‘No, you just don’t want it because you are afraid.’”

We talked about the perils of globalization, the political strategy of the new Czech president Milos Zeman, and the rebirth of civil society.


The Interview


Do you remember where you were and what you were thinking when you heard about the fall of the Berlin Wall?


I was 12. I don’t think I was much informed about the fall of the Berlin Wall. My parents followed the news very carefully, and my father was also listening to Voice of America. So I think they would have told me. What I definitely followed, even though I was only 12, was the situation here in the Czech Republic, in Prague, the events that happened on November 17. But the Berlin Wall? I can’t even say if it occurred on our TV news. Maybe it did. But as a child I just didn’t perceive it as important.


What do you remember one week later from the events here in Prague?


It was shown on TV, and my parents considered it important, even though it was presented as a small number of provocateurs threatening the “good” regime. And afterwards the situation got very dynamic. I started to write a diary. Everyday I wrote short notes about what was happening and about my father going to the demonstrations. Mom was with me at home, but my father was going there. What I remember best was this feeling that maybe something was going to change. However it was not an expectation of a radical change. It was more like: “maybe we could get a free press” or something like that. Then, everybody was quite surprised by what was going on, and there was much fear among people. They were afraid how the Communist Party would react and that the military would somehow get involved.


Do you remember talking about it with your classmates?


Not much, because they were 12 too and not so much interested. They knew there was something going on. And they made some jokes about different literature, because we were studying, of course, types of Communist literature. We also wanted to hear something about Havel, and the teacher didn’t know how to react. But they were taking it as children do, as not very important.

My family was always interested in politics. I was also very interested. So I followed it, all of it, quite closely. After the revolution, I started to read the newspaper every day. Which is maybe not so normal for a 12-year-old.


The classes in Russian switched over…


Yes. We had Russian as a language. It was obligatory. You couldn’t choose it. And practically from one week to the next, they cancelled the language. I wasn’t so bitter about it, because I had my problems with Russian. It was quite difficult for me. I preferred German. It had nothing to do with politics. It was just my liking for the language. Then we started having German as the obligatory language, and later on came, also, English.


When did you decide that you were interested in economics?


Oh, well, that was thanks to Vaclav Klaus. I have my excuse. I was very young, and I liked him because he presented some kind of vision. As for the others, I just didn’t get the feeling that they really knew what was going on. Three years later, I found out that his vision was not the right one, so I changed sides. But my interest in the economy was very much thanks to him. For my high school, I chose business economics and later on the university of economics, where I was no longer so keen on Vaclav Klaus.


Was there a particular moment when you lost your faith in Vaclav Klaus?


Losing my faith in Vaclav Klaus didn’t take very long. First, I was of course influenced by my parents. And my mother, from the start, didn’t like him at all. She wanted this more socialistic way, and she preferred what Ota Sik was doing in 1967-68, this reform way. And I had this personal experience when my father was – or tried to be – an entrepreneur. Based on this experience, he felt that things were going a different way than proclaimed. Especially with the privatization, a kind of elite was being built very fast. Probably one of the most important moments was when Vaclav Klaus said there was no such thing as “dirty money.” That was a breaking point for me. I just said, “What? What is he saying?” And I tried to make some excuses for him. However, that was the first moment when I thought, “This is not going to happen the right way.”

Later when I was 16 or17, because my parents were very politically oriented, I started visiting the meetings of social democrats. And Milos Zeman was there, criticizing the privatization. I got interested immediately, and I thought, “This is something different.” So, I had the opportunity to compare different visions or programs. And when I was 18, I could vote for the first time, and in my first election I supported the Social Democrats, not Vaclav Klaus.


Why do you think Vaclav Klaus’ economic plan was politically successful? We can speak about the economy later, but why do you think he was able to push through his vision?


It was thanks to his personal qualities. He was charismatic, and he was able to convince other people. Whereas the politicians from the other side of the spectrum – not just leftists but those with different opinions about, for example, employee stock ownership plans (ESOP) — were just not able to convince people. They didn’t have this power of persuasion like Vaclav Klaus did. He could just stand there and say, “I know what to do” with this self-confidence. He just spread it to others. Later on, many found out that he was totally wrong. But it was too late. So, he was the only man who was actually able to present some kind of vision, especially in the economy but also for the whole society. He was also politically very clever. He knew the necessary steps to create his own party and shape the agenda. The others, meanwhile, were just behind the events.


I met Milos Zeman 23 years ago, and he struck me at that time as being a reasonably charismatic politician. But he wasn’t able to persuade people as well as Klaus…


Not at that time. Vaclav Klaus was cleverer in the sense that he knew that he needed his own party, the Civic Democratic Party. Milos Zeman was a few steps behind because he was searching for a party. Only later was he drawn into the Social Democrats. That’s when he developed into the main opponent of Vaclav Klaus. But Vaclav Klaus was quicker.


Tell me what it was like to study economics here at that time. There was so much going on…


I probably would evaluate it differently now than when I was 18 and starting to study at a university. At that time, I was happy I could be there, because the criteria to get into a university were very, very strict. Because I liked languages the most I chose international trade. And this was the most difficult, because you needed three languages at a very good level. But I was totally happy when I was there. Studying economics was also quite prestigious. Nowadays, it is quite different. What struck me was that almost all the teachers wanted to just forget about the past. So, for example, during the whole five years of my studies, the name Karl Marx was mentioned only once. Almost all the teachers were of this neo-liberal kind. So it was very difficult to hear different opinions.

However I was lucky, I got two teachers who were critical. One was Vladimír Prorok, and he’s my colleague now in political science, and that’s why, later on, when I chose to continue my PhD studies, I chose political science. The other one was Jiří Chlumský , and he was one of the first to read and lecture on Joseph Stiglitz. When he criticized the Washington consensus, we were like, “Whoa!” Because he was saying something totally different than the other teachers. It was a shock for most of my schoolmates, who said, “What is he saying? He is a traitor. Is he doubting Vaclav Klaus?” But I loved him because he read so much and he was able to recommend books that I would never have heard of otherwise because they were on the black list. I was lucky I had this chance. But otherwise it was all “capitalism is great” and the same thing over and over. And it was the same teachers who previously taught Marxism and Leninism and nowadays were tough neo-liberals. And that’s the situation until today, unfortunately.


So it was one orthodoxy to another…


Yes, from one dogma to another.


What I remember from 23 years ago is that many students were interested in economics because they wanted to make a lot of money. Was that the case with a lot of your classmates?


Some of them, maybe. But I don’t think that that was so widespread. Most of them had their life priorities, like getting a good job at some transnational corporation and doing what they were told to do. People who were interested in making fast money did it without going to university, because you didn’t need any special knowledge for that. You just needed good contacts.


But they used university names, like there was that Harvard investment fund


Yes, sometimes they did that to show off, but I don’t think they really had any special knowledge.


Did that happen while you were at university? I forget the year when that scam took place, during the voucher privatization.


Privatization was at the beginning of the 1990s, and I went to university in 1996. So, that was at the time when dissatisfaction with the process was growing, and Milos Zeman started to be the main personality of the opposition and his Social Democrats started gaining popularity. Two years later, they won the election and he was able to create his minority government. However, the situation in Prague was always different from the rest of the Republic, and here it was really highly neo-liberal. There were no doubts, with very exceptions, and the University of Economics was really the core of it. Really, at least 90% of the teachers admired Vaclav Klaus. He was their main hero.


So it was kind of like the Chicago school…


Yes, definitely: Friedrich von Hayek and the principle that markets will solve everything.


Was it different in the political science department when you switched over to do your PhD?


Yes, the situation was different, because that was when the Social Democrats were already in power. Again I was lucky enough that the department of political science employed people that were very critical toward both the past and the current state of affairs. They were some of the best brains in the whole Republic. Because of my boss at the time, now my colleague, I was able to have some insight into system theory, chaos theory, and, of course, globalization. I started to be interested in globalization because I wasn’t sure I knew what the word really meant. In the end I wrote my thesis on it, so of course I had to read a lot. I continued with Stiglitz, and Zygmunt Bauman, and things like that. So the department for political science was something like a black sheep.


What was the specific topic on globalization that you wrote on?


I wrote on the political aspects of globalization, and I tried to implement this systematic view of what was going on. And I was cheeky enough to try to write down some scenarios of future development, and I was not so totally wrong.


In terms of anticipating economic crises?


Yes. And the power of this BRIC group, especially China.


When you graduated, was it difficult to find a job for someone who had a critical perspective?


Maybe I made it difficult for myself. I just couldn’t imagine with my opinions, which were quite firmly on the Left, that I could go to some company and write some reports for them and so on. I found that prospect quite disgusting. So I got a job in university. I was teaching economics and German – German is my first foreign language, English is my second. However, it was very badly paid. So I had to have more jobs, and I remember a time when I had six jobs altogether.


Six jobs?


Six. And my father became unemployed at that time, so it was really very, very difficult. I remember how tired I was, because I was switching between schools, teaching one lesson here and one lesson there, and translating of course, and all things like that. I remember having to catch the bus and there couldn’t be even a one-minute delay, because then my whole schedule would just collapse. So it was very difficult.


But eventually you got a job here. And that meant you didn’t have to do five other jobs.


It’s not so well paid, but yes, I only have to have one job, which is quite a luxury.


How are your students here?


This is a private university. However, sometimes the difference between the students from the public and private schools is quite exaggerated. The difference is not so big any more. Almost all students are working at jobs. Their studies are not the first priority for them.

One of the biggest problems is to make them read — books, I mean, not the Internet — and to make them think, which is very difficult. Critical thinking is not common here in the Czech Republic. This university is quite an exception. It has been critical of what has been going on. Most universities align with different political parties, mostly those in power, to get grants and to get enough money to survive. That’s not the way this university operates, and maybe that’s one of the reasons why it’s so small.


And the students come here in part because they are attracted to that reputation?


Yes, partly. They want something different. We have different views here on economics, on international relations. They come here because of the personalities who teach here. Maybe some of them are interested in our programs, which are unique. We teach here what no other university does, like economic diplomacy. Our rector actually founded the discipline of economic diplomacy in the Czech Republic. We don’t have many students. There are some private universities that are 10 or 20 times bigger than us.


Let’s talk about the economic situation here in this country. What do you think were the major mistakes made in the early period, in the early 1990s?


It was probably all a big mistake! For instance, the way property was privatized. That’s a technical thing, though. Maybe the major problem was that there wasn’t a vision. Or it was presented as a vision but it was not a vision for a sovereign state. From the start, we entered the world market in the bad position that we had, and we refused to use any instruments to rise higher in the value-added chain. We just got into the system in the position of a semi-peripheral power. At best, we have been a colony of Germany. That’s the reality. If you look at the structure of the economy, the pillars are in foreign hands. Like all countries of this type, we suffer a huge outflow of profits. Almost 98 percent of the banking sector is in foreign hands. Nobody cares much about economic structure. They had a very naïve theory that if they just “let it be,” the economy would somehow evolve by itself. They totally ignored the social aspects of the change. People were not important at all. What Vaclav Klaus wanted, and he was clever enough not to show it directly, was to build an elite quickly, an elite that would support Klaus’ first steps to achieve power. That was the biggest mistake.

Then there were technical mistakes, which I’m interested in but might be too technical for your readers — like what they did with the exchange rate or the way privatization took place. They totally destroyed the cooperatives, which were very strong. They totally destroyed agriculture. Nowadays we import billions of crowns of horrible food from Poland. They thought that the economy would evolve by itself without any state intervention, which left the Czech Republic in the position of a semi-colony. This situation remains the case today.


Do you think any country in this region was able to come in at a better position?


Slovenia, in part. They had a different system in Yugoslavia. The employees and the cooperatives were more active. Russia might have been able to, if there had been somebody in charge other than Yeltsin, who was completely in the hands of the Chicago boys. They could do whatever they wanted with him in part because he was an alcoholic. Russia of course would have been in a better position because it was strong enough, in a military sense, to say, “this is not what we want.” Putin tried this later, of course, but under different conditions and in a different way because you just cannot return to the past.

One of the most successful examples is China. I don’t want to suggest that everything that China is doing is fine. I don’t like the regime there. That’s a different question. But they never had a vision of simply remaining an exporter of cheap textiles. That was for them only one of the stages they had to go through. They had an intelligent vision of how China would in the end become a very powerful economic actor.

I don’t imagine that the Czech Republic will ever become such a powerful economic actor. But if it became a decent economic actor, that would be enough.


Both Russia and China have some leverage with respect to the world economy. One could argue that a small country, even with very smart leadership, simply can’t have that kind of leverage. So, what do you do in a situation like that? What could have been done?


There were some possibilities. There could have been a different kind of privatization and a different kind of exchange rate regime that wouldn’t have oriented us toward cheap exports. There were economists, especially connected to the trade unions, who were offering these alternatives. But it was difficult for Milos Zeman and the Social Democrats to do any of that when they entered power. The landscape had already been prepared by Vaclav Klaus, and that proved to be, not impossible, but difficult to change. More attention should have been made to agriculture and to cooperatives and to what Zeman talked about originally in the early 1990s — that employees should buy their own factories. This had been possible, at least partly. Of course, we probably would still have had great influence from abroad, from transnational corporations, but it could have been much smaller and we could have kept at least some parts of our domestic agriculture, domestic industry, and domestic capital — all which we lack now. We constantly face problems like the outflow of profits, which increases every year.


You talked about the difficult of changing the parameters that Vaclav Klaus established. Did accession to the EU also establish certain parameters of what was possible economically in the Czech Republic?


Definitely. It established constraints not only economically but across all kind of policies, starting with trade and going to norms and standards. We became more and more integrated into the European market, which I don’t think was so good since we had quite a good name in markets in the former Soviet Union and Latin America. We just withdrew from those markets, very stupidly. We’re now trying to get back.


Trying to get back into Latin America and the former Soviet Union?


Czech companies are returning to Russia and other places because the EU has many problems. But Latin American markets are quite closed because our current government was trying to save money by closing down embassies. You don’t actually save any money at all. You just limit your access to the markets. It was also so obvious to anyone interested in international trade that the choice of embassies to close, for instance Venezuela, was not our choice but the choice of an entirely different country — the United States. We had a good name there, and we could negotiate good contracts, especially in agriculture. It happened with some countries in Africa, too.

Now the pressure is increasing with the EU, especially for things like the fiscal compact. It’s not only our case, but the entire EU. I don’t think this is a good thing. The whole European economy is dominated by Germany. Germany is actually damaging itself. The policies that they are trying to force onto the whole EU are bad even for them, even though they don’t see it.


You mean their reluctance to back greater stimulus spending, either in Germany or in other countries in Europe?


German policy is too oriented toward fiscal consolidation, which can’t be done unless you have a long crisis with all the consequences as in Greece or Spain. In the end, it won’t help anyone, because your debt-to-GDP ratio will grow rather than decrease. They don’t even realize this simple thing.

Second, Germans can’t see that their orientation toward net exporters is bad, even for them. The wage deflation that they encouraged over the last few years has hurt even German citizens, but benefited  German banks. Their whole economic strategy is bad. But they think it’s good and try to push it onto the whole EU. It’s extremely risky.


At this point, what can be done given the influence of the EU and Germany, and the influence of globalization in general, not to mention transnational corporations, the World Bank, Washington policies, and the parameters inherited by this incoming administration?


As you present it, it looks quite hopeless! Well, I don’t think it’s hopeless. It just looks that way. I believe that there’s always a way if you want to search for it. When I asked myself this question, I came to the conclusion that there needs to be some practical projects that can show that it can be done in a reasonable way. You need international cooperation. Some problems are unique in the Czech Republic. But some are quite common, like the preservation of access to public goods, a certain level of social welfare, and so on. One of the pillars of activism is to be involved in international cooperation – through trade unions and other civic initiatives. You need to show that these are issues of common interests.

Three years ago, I founded Alternative from Below. We are trying to say to the political elite that their approach is wrong, that they need some kind of program, that they need to think differently. All the parties are very defensive. They say, “Oh, you want us to go back to the welfare state of the 1960s.” Come on, that’s not possible any more! Be realistic. Instead, we try to find inspiration from other countries, from the United States, for instance, and the New Economy movement. The main pillar of our activities is to realize projects that try to help at least a bit, like cooperatives, like social entrepreneurship. We try to involve people in politics. There is a strong gap between the elites and us. We try to spread community work throughout the Czech Republic, using different tools like participatory budgeting and local currencies. These are unknown things here. We spread knowledge about this — to people, initiatives, mayors, members of parliament, whoever is interested in listening to us. So, we are currently working on some practical projects, addressing the cost of living here in Prague. We have many seniors who have to choose between buying food and paying the rent. Nobody cares much about this.

As you said, there are heavy constraints. So we try to find partners and help from other countries, to form networks of civic initiatives. And there are people who are suffering more than we are, even in the EU. So we try to identify the common problems that we can all work on together. We don’t only work with leftist parties. We cooperative with different groups like the Green Party, the Pirate Party, the Christian Democrats (at least the left wing — the Christian Democrats have many wings including one that is critical of the church). We have people from 10 or 15 different political parties. I don’t want to be too proud, but I think Alternative from Below has a unique program. We offer an agenda that is absolutely unknown here.


Has there been any effort to establish a local currency?


Yes. Nowadays, we spend months explaining in different places what it is, because people don’t know. With my colleagues, we travel all around the Czech Republic. Every week we are somewhere else. It’s quite demanding. However, someone has to do it. Now we are working on a plan for several small towns near Prague. There’s a very intelligent mayor out there who has heard about it. He’s from the Social Democratic Party. He wants to help these small villages. Although they are in the neighborhood of Prague, they suffer from this outflow of money. People go to Prague, spend money there, and these villages are practically dead. A local currency is one of the instruments that could help. We’re trying to find money for this. The EU can support with partial financing. I love this local community work, because it brings you in contact with people. You have to go there, talk to people, talk to the tradespeople, and find out why people don’t spend money in the small shops. A local currency can really help improve the structure of the town or village or region.

We are also trying to develop help for people who want to start a cooperative. The rules are complicated, especially in agriculture, and they need some help. So, we do this kind of consultancy.

We have also been working on participatory budgeting. In all the towns and cities, there are “interesting” things going on with public procurement. If people had a look inside, they might get quite afraid. Most people who contact us are from opposition parties that have found out that something wrong was going on with public money, and they want to get to the bottom of this. They contact us to implement participatory budgeting in their town. It’s a long-term project, but you have to start somewhere. Some people say that Prague is too big for that. And I say, “No, you just don’t want it because you are afraid.”

It’s my dream that people in the Czech Republic become even a tiny bit as active and interested in their towns as people in Latin America. But it’s a different political culture here. It’s very passive. People are disillusioned by what happened. And they are inclined toward radical solutions. Whenever you ask people here, “What should happen?” they’ll say, “Throw all the politicians into the Vltava.” They don’t distinguish between the politicians any more, which is bad. What’s even worse than the disillusionment is that people don’t think they can change anything. That’s why we’ve started with these small projects from below to show them that they can influence something. I know this won’t change the world. I’m not Jesus Christ. But at least it will change a little part of their lives. It also has an educational function, as people learn how to proceed.

For the last 20 years, no one was interested in having an active citizenry. The parties’ attitude was: “Just vote for us and be quiet for the next four years.” It’s a very slow process to change the situation here. Unlike in Great Britain, we don’t have a lively civil society. It’s only starting to grow, very slowly, with many obstacles.


When I was here in 1990, it seemed that civil society was very strong. Hundreds of thousands of people had appeared on the street during the revolution. But it wasn’t only that. There were hundreds of new organizations, and people seemed very active.


That ended very quickly. Classical political parties emerged, starting with Vaclav Klaus, who knew how to make things professional. And these civil activities disappeared very quickly. People had big plans with grand ideas — revolution! — which isn’t bad in itself, but people have to learn from these small things. What they lack is this constant work. It doesn’t happen that you show up at a trade union demonstration and the next day the government falls. When they do something, when they get active, they expect results to be very fast. That’s what they learned from Klaus, to expect a fast switch, and if it’s not successful, to move on to something else. We have to explain to them that some things, like change in society, take time. Masaryk called it, “small black work.” In other words, you can’t expect any money or function or rewards from it. You just have to do it for yourself or your community.


It was also globalization that promoted that message. It created certain expectations that things have to be done faster and the results must come faster. It’s a very difficult framework to push against.


Yes, I know. I’m living in it. I’m doing it every day. So far, I haven’t given up.


Is Alternative from Below a membership organization?


We do have membership, if you want. But you can also be a free rider, so to speak. You can be a member of one of the initiatives. We don’t have a pyramid structure — I don’t like it and it’s not very effective. We’re quite flat, quite decentralized. That’s what I pressed for. But my colleagues have told me that we’re too decentralized. According to Czech political culture, there’s a leader and then we follow. I’m not keen on doing things like that, so we’re decentralized, like the Pirate Party in this respect.


Tell me about the Pirate Party. It seems to be a transnational phenomenon.


It’s not so strong here. At least not yet. It has quite a good working structure — flat and decentralized. Its problem is that it doesn’t know where to stand on many issues. They doubt that there is any difference between left and right, which only means that they don’t understand this difference. I know this very well because they asked me to be an advisor on economic policy. What they do there is total chaos. They have many good ideas, particularly on public administration and the use of technologies. However, when it comes to social issues, they just don’t understand. They are very young. They don’t understand the worries of, for instance, their grandparents, because they come from a different environment. Their ability to address people other than 25-year-olds is quite limited.


They seem to have a very libertarian economic philosophy.


Yes. They don’t really know who they are. They’re partly libertarian partly, partly anarchist. To make any consistent program will be impossible. They have a few issues that they agree on, but otherwise as a movement — when it comes to voting on issues like taxes — they will just break down as a movement.


How would you evaluate Milos Zeman’s policies right now?


He has a strong personality and will work as a deus ex machina. He will enter the political field, and other subjects who were just sleeping will have to react. He will wake them up to react, which on the Left needs to be done. If Czech politics is a chessboard, then he will be the queen. He will move up and down very actively. The others don’t have to just sit there and wait for him to capture them. They will move too. He will make them react to his projects.

As for policy, I don’t know what’s going on in his head. Probably he would like to have the Left parties cooperate more, which I think is good, but you have to be careful on the issues, which is always the case. What worries me is his attitude toward international policy, especially toward Islam. That’s something he needs to reevaluate, to put it mildly. He is a big friend of Israel — no comment on that. For me, that doesn’t mean you have to be an enemy of all the Muslim countries. He’s not bad on all of international policy – for instance, he has a balanced relationship with Russia. I don’t find anything bad with that. We need Russia for gas and oil. It’s in our interest to have a good relationship with Russia. We don’t have to be a servant and admire Putin. We should just have good, normal relations with this very big country.


For Alternative from Below, if you look ahead five years from now, and you achieve the kind of success you want to achieve — or even half the success – what would that look like?


First, I would like to see that people know what the situation is. They still don’t understand how serious it is. Only through their cooperation and civic initiatives will they be able to achieve some kind of change. I’d like to see Alternative from Below deeply connected with other European initiatives to create a common program and push this program onto the political agenda, especially of the European left. We should be cooperating with some parties, like die Linke in Germany. I would like to see some good projects in cooperatives, in participatory budgeting, in local currencies – these are things we can do now. It’s not easy. The constraints are there, but they are not so big that they can’t be overcome. The critics say, “Nothing can be done, and we must wait just until China eats us.” No, we don’t have to wait. We have some basic things we can do and be successful.


Have you rethought any of your assumptions since the 1990s? I know you changed your mind about Vaclav Klaus. But after that, have there been major shifts in your thinking on economics, community organizing, or the Left in general?


I reevaluated the process of globalization. At first, I thought of it only as the Internet and similar technologies. Later, when I was a PhD student, I learned how dangerous it was. I also reevaluated my position toward capitalism. When I was at university, I thought that capitalism was not bad as a system, and through some instruments it could be put into a much better shape. I don’t think so anymore. I don’t think it can be corrected, at least the way it is right now in the Western world. A different system has to be substituted for it. So, I became more radical. The older I am, the more radical I become. Usually, or so it is said, it happens the other way around. But I was much closer to social democracy when I was 18. And now I feel that the social democrats don’t have any ideas. They are without a program. They just stick around because they’ve been around for 150 years. But they don’t understand properly what is going on. What we need is a radical program — not a radical action like breaking windows. We need a party that really knows what is going on, like die Linke, and is able to present radical but realistic programs and is able to cooperate with other parties like Syriza in Greece.


In the United States, we are caught between these two conceptions: a range of initiatives percolating up from below and a more systemic approach from above. Both are criticized, the first for being too disparate and the second for being arrogant and imposed from above. Do you see a way of squaring that circle?


It’s necessary to find, well, I won’t say a “third way” because I hate that term. It was discredited by Tony Blair. We need both. We need these initiatives from below — otherwise I wouldn’t be doing them. We need them here because we don’t have a tradition of this, unlike the United States. But we also need some kind of systemic theory because you can’t change only from below. You need something also from above, which means new political structures and new theories: a new idea of what society should look like. We don’t have to fall back on Karl Marx. There are new thoughts, such as a partnership economy or a “care economy,” which is perhaps a more European concept. You have theorists like David Korten and Joseph Stiglitz. We just need to put it all together. And we also need international coordination, such as the recent meeting of different initiatives around this “great transition.” But we need to address the higher political levels as well, either to persuade politicians to do things a different way or to create a new party or movement.

We can’t avoid these changes. They will come.


Prague, February 14, 2013



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