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The European Union at 50
Eastern Europe, dominated by the inability to find a (legal) export-oriented
growth model, which is the underlying cause of the official negative current
account balance. The balance of trade of the reform countries will be by the end
of 1995:
Table 7.1: trade balances in Eastern Europe
a) 1995
Poland - 4000 million $
Slovakia - 800 million $
Slovenia - 500 million $
Czech Republic - 4000 million $
Hungary - 3270 million $
Total - 12570 million $
All too often, the shadow economy balances such trends. From 1992 onwards
through to the end of 1995, these 5 transformation countries will have a
cumulative trade balance of 33.5 thousand million $. No tigers are thus in sight
in this part of the world.
The present author agrees with the general perspective, provided by students of
the present international political economy, like Joshua Goldstein: the underlying
logic of the capitalist world economy is a logic of conflict, intrinsically linked to
the mechanisms of unequal exchange between the power centers of the world
economy, and if the next 25 years are not being used for the creation of durable
peace on earth, we could be threatened by a repetition of the same long-term
cataclysms that already led to the Thirty Years War, the Napoleonic Wars and the
World Wars of this century.
Even the integration of the 'Near European East' - that is to say, the Czech
Republic, Poland, Slovakia, Hungary and Slovenia, will be a painful process. For a
long time to come, the balance of trade and the balance on current account will
be negative, a powerful force in the motivation of economic and political
nationalism against the West. The 'extractive economy' (Tausch and Prager,
1993) is a term used to describe a situation, when exorbitant energy
consumption is used to produce a shrinking or stagnating, or at least not very
rapidly growing amount of welfare. Our hypothesis is that Poland and other
former or continuously communist countries play precisely such an 'extractive
role' in the emerging cycle of the world economy.
The East, unable to reap the benefits of technical progress and being forced to
export what there is, is thrown back to the old patterns of the extractive
economy. No major advances in the energy/income balance are in sight. We
witness a heavy or even increased reliance of the export sector on the extractive
branches of the economy, and the inability to change the price mechanism,
partially because losses in the terms of trade and the 'scissors' of lagging (legal)
Entelequia. Revista Interdisciplinar · CAEI Arno Tausch / 165