session abstracts 7 - helsinki.fi · proto-economic-nationalism in the early nineteenth century 9...

XIV. International Economic History Congress, Session 7

Economic Nationalism in East Central Europe Organisers: Helga Schultz, Prof. Dr., University Viadrina at Frankfurt/Oder, Germany Eduard Kubů, Dr., Charles University Prague, Czech Republic 09 June 2006

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Table of Contents The double edged sword of economic nationalism 5

Helga Schultz, Frankfurt (Oder), Germany

Proto-economic-nationalism in the early nineteenth century 9

Thomas David and Elisabeth Spilman, Lausanne, Switzerland

Cultural Aspects of Economic Nationalism in Bohemia 11

Catherine Albrecht, Baltimore, USA

Regional policy in Empires and Nation States. East Central Europe before and after 1918 13

Uwe Müller, Frankfurt (Oder), Germany

Slavism in National Czech Enterprises in the First Half of the 20th Century. 17

Eduard Kubů, Jiří Novotný and Jiří Šouša, Prague, Czech Republik

Conflict and cooperation: Czechs and Germans in the First Czechoslovak Republic 19

Christoph Boyer, Salzburg, Austria

Agrarianism and ethnicity - an East Central European survey 23

Anu Mai Kõll, Stockholm, Sweden

Cooperatives as a basic tool of economic nationalism 25

Torsten Lorenz, Frankfurt (Oder), Germany

Economic Anti-Semitism in Hungary after Trianon 27

Ágnes Pogány, Budapest, Hungary

Anything but Simple: Romanian Oil Industry between National Economic Interests and Economic Nationalism 31

Bogdan Murgescu, Bucharest, Romania

Economic Nationalism in Romania (1866 - 1944) 33

Angela Harre, Frankfurt (Oder), Germany

Flux and Reflux: Interwar and Postwar Structuralist Theories of Development in Romania and Latin America 37

Joseph L. Love, Illinois, USA

Economy and Nationalism in Yugoslavia 39

Žarko Lazarević, Ljubljana, Slovenia

The Soviet Lithuanian Nomenclature in the trap of economic nationalism 43

Saulius Grybkauskas, Vilnius, Lithuania

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The double edged sword of economic nationalism Helga Schultz, Frankfurt (Oder), Germany:

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 9-25. Economic nationalism has always had a changing face, especially in East Central Europe, the wide expanse between Russia and Germany that reaches from the Baltic to the Black and the Adriatic Sea and has been dominated throughout history by dif-ferent neighbouring empires, from the early Christianisation to the fall of the Soviet Bloc. Although economic nationalism was a universal policy outcome of nation states, East Central Europe was highly influenced by it because of its backwardness, its be-lated nation building and its ethnic mixture. These particular historic conditions cre-ated a specific face of economic nationalism and have generated a particular field of research. Nevertheless, this field still seems to remain neglected. The mainstream economists and economic historians, who adhere to the neoclassical theory, see economic nation-alism simply as a barrier to the ongoing globalisation, to be overcome by the distribu-tion of free trade and democracy especially in the new member states of the European Union. Therefore, economic nationalism was not viewed as noteworthy populist re-minder of the past. Against this background Pickel and Helleiner expounded eco-nomic nationalism as the inevitable counterpart to globalisation, not only because it provokes nationalistic reactions but also because globalisation is by no means the pure economic business of multinational companies. It is driven by nation states and inter-national institutions, which are in turn dominated by nation states.1 This is the idea of Knut Borchardt, which he exposed in a lecture to the Bavarian Academy of Sciences in 2001, that globalisation would always occur in waves and would be accompanied by protectionism rather than by liberalism, even in its expansive phases. Borchardt then spoke of the first wave of globalisation at the end of the nineteenth century, which was linked to the rise of the modern nation state. In this sense economic nation-alism could be understood as productive answer to globalisation.2 Economic nationalism can be seen as a double-edged sword that combines economic emancipation and oppression against the “others”. In the region inhabited by people of multiple ethnicities since medieval times and where nationalities formed social layers, 1 Helleiner, Eric/Pickel, Andreas (eds.): Economic nationalism in a globalizing world, Ithaca,

N. Y./London: Cornell University Press 2005, pp. 6/7. Pickel, Andreas: Explaining and ex-plaining with Economic Nationalism, in Nations and Nationalism, 9 (2003), pp. 105-127.

2 Borchardt, Knut: Globalisierung in historischer Perspektive, München: Bayerische Akademie der Wissenschaften 2001.

6 XIV. International Economic History Congress, Session 7

economic nationalism was more than just a policy, it even existed before the nation state. It is not only linked to the policy of autarky and state interventionism but also to the social movements and the every day life of the communities. Economic national-ism shaped a specific economic culture in East Central Europe. It spread widely throughout the region on the wings of Romantic nationalism and was nourished by Lis-tian, populist and Marxist ideals. New and fruitful branches of economic thought in touch with economic nationalism sprouted from it, such as development economics and dependency theories. During the sixties John Montias differentiated between the two faces of economic na-tionalism, i. e. the development strategy and its irrational flipside “stemming from political animosity or other non-economic considerations”.3 Even on the non-economic side of the coin Breton exposed a special kind of rationality, so to say the rationality of cultural capital. Nationalism as an immaterial good would compensate for welfare losses.4 As in the research of political culture, the term economic culture concerns the cognitive, affective and evaluative orientations in the sense of values, myths and behaviour patterns. These normative convictions developed from specific economic structures and traditions. They shape economic institutions and policy while enjoying relative independence from economic systems and cycles, which meant that economic culture could survive the transformations. Economic nationalism as a par-ticular culture of economy is closely connected to nationalism. This economic culture finds its historic foundation in agrarian societies with a lack of indigenous bourgeoisie. In large parts of the East Central Europe the aristocracy was also of foreign nationality. Under these conditions, as Miroslav Hroch explained, pro-fessionals of peasant origin such as teachers and priests became the leaders of the na-tional economic movement. The system of values derives from three main elements, firstly the high estimation of peasant culture as a source of national identity, secondly the preference of national solidarity and equality over western individualism and thirdly the prevalence of an organic state idea in connection with the essential com-prehension of the nation. The goal of this nation-centred economy is not to maximise individual benefits but to maximise the total benefit to the nation. The independence, unity and the property status of the nation are the components of this total benefit. This is to be defended and to increase at the expense of individual profits and economic efficiency if necessary. The precepts of the classical political economists such as Adam Smith and David Ri-cardo are reversed thus it is not the invisible hand of the market that maximises general prosperity by boosting individual interests. It is the task of the people and the nation state to improve the total benefit of the nation, which secures general prosperity and as

3 Montias, John Michael: Economic Nationalism in Eastern Europe. Forty Years of Continuity and

Change, in: Journal of International Affairs, 20/1 (1966), pp. 45-7, 61. 4 Breton, Albert: The Economics of Nationalism, in: Journal of Political Economy, 72/4 (1964),

pp. 376-386.

Economic nationalism in East Central Europe - Abstracts 7

such growing individual welfare in the future. Both ways promise welfare and prosper-ity to individuals and in general, however not in the same order. Economic nationalism in East Central Europe was essentially in the search for alterna-tive ways that modernisation was able to overcome backwardness. Corporatism became important. Institutions like cooperatives and banks transferred from the west were re-shaped. The main objective was closely linked to development of the national economy, principally by industrialisation. State interventionism and protectionism therefore were the preferred policy tools. Associated with both aims was the pursuit of expanding na-tional property by nostrification, nationalisation and colonisation. Beyond industrialism another branch of development ideology emerged, which we can describe as agrarianism. This was the most radical alternative to western moderni-sation. In general industrialism was the ideology of the urban elites or even of the lib-eral nobility on the periphery as it is the strategy, which allows the ruling elites the most power. Agrarianism became the ideal of the peasant movements. Central Euro-pean agrarianism embedded the peasant question in nation building and the struggle for national self-determination. During the interwar years, agrarian parties came into government in the countries of the region and formed their own Green International Union. Like industrialism, agrarianism had changing and often different political faces. By merging the anti-capitalist and anti-western approach with Russian popu-lism it swept from socialism to strong nationalism.5 After a decade of war, genocide and refugees the states of East Central Europe be-came more ethnically homogenous than most countries. The domestic source of eco-nomic nationalism was lost at considerable cost, yet all the state related features of economic nationalism developed strongly under communist rule. Not only were there reconstruction efforts after the war but also the campaigns for socialist industrialisa-tion placed under the national flag. Ever increasingly nationalism had to substitute class-consciousness.6 Nationalist enthusiasm had to compensate for the lack of mate-rial welfare, as Breton outlined.7 Economic nationalism under socialist rule was not only an ideology for the people but also state policy. The elites, who were at the be-ginning sometimes in personal contact with the planners of the interwar period,

5 See Kõll, Anu Mai: The Agrarian Question in Eastern Europe: Some answers from the Baltic

Region, in: Batou, Jean/David, Thomas: Nationalisme économique et industrialisation de la péri-phérie européenne: de la Révolution industrielle à la Deuxiéme Guerre mondiale, in: Batou, Jean/David, Thomas (éd.): Uneven Development in Europe 1918-1939, Geneve: Droz 1998, pp. 201-230.

6 Zarnowski, Janusz: Arbeiter und Nationalismus in Polen vom Ende des zweiten Weltkrieges bis in die Gegenwart, in: Beiträge zur Geschichte der Arbeiterbewegung (BzG), 1994, pp. 47-56.

7 Breton, Albert/Breton, M.: Nationalism revised, in Breton, Albert (ed.): Nationalism and rationa-lity, Cambridge: Cambridge University Press 1995, pp. 98-115.


shaped the socialist economy in this spirit.8 The system of a centrally planned econ-omy offered the appropriate means for a forced industrialisation and the state monop-oly of external trade promoted autarky. All attempts to break through these barriers for the advantages of cooperation in the COMECON failed.9 Obviously, the commu-nist ruling elites were no less nationalistic than their predecessors and successors. Even in the East Central European countries membership in the European Union will neither end their national economies nor weaken their ties to their national identity. The peoples of the European East fought for their own national economy against the dominant empires, as newly formed nation states in the interwar times, and inside the Soviet bloc. These struggles and successes are part of their collective memory. Eco-nomic nationalism therefore has a historic and cultural dimension and is much more than unenlighted populism.

8 Szlajfer, Henryk: Promise, Failure and Prospects of Economic Nationalism in Poland: The

Communist Experiment in Retrospect, in: Teichova, Alice: Central Europe in the Twentieth Cen-tury: An Economic History Perspective, Aldershot: Ashgate 1997, pp. 43-59.

9 Delhaes, Karl von: Autarkietendenzen versus “sozialistische Arbeitsteilung”, in: Berliner Geo-graphische Abhandlungen, 53, 1990, pp. 71-80.

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Proto-economic-nationalism in the early nineteenth century Thomas David and Elisabeth Spilman, Lausanne, Switzerland:

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 89-108. This contribution adds to the number of research projects that have rejuvenated the study of this theme, by demonstrating that economic nationalism provided a develop-mental policy for the countries on the semi-periphery by attributing a larger chrono-logical framework to economic nationalism and by emphasing the national dimension of the concept. In this paper we will focus on the proto-economic-nationalism that emerged in the countries on the European periphery in the first half of the nineteenth century. The period between 1780 and 1860 gave birth to the dual revolution: the Industrial and the French Revolution. The Industrial Revolution dramatically widened the gap between the core of advanced nations in Western Europe and the periphery of under-developed countries in Eastern Europe. As the countries on the periphery wrestled with the economic and political ramifications of their deteriorating position vis-à-vis the core, they searched for alternatives to the contemporary developmental model. Proto-economic-nationalism provided such an alternative by allowing the state to take the initiative in modernising the country within a national framework rather than un-der the influence of international market forces. At the same time the spread of the ideals from the French Revolution engendered the formation of national movements extolling the virtues of greater autonomy or even independence from the foreign rul-ers. However, by 1860 in Eastern Europe nationalism in its modern form had still not appeared. This pre-modern group consciousness can be characterized as proto-nationalism. Under these conditions proto-economic-nationalism constituted a means to maintain or to achieve some degree of political and economic independence in the international arena. Our definition of proto-economic-nationalism can be summed up as a body of eco-nomic policies, which were aimed at bringing backward countries on par with the de-veloped nations. In order to achieve this goal the state makes the national economy as opposed to individual enterprises or firms the basic unit of reference in international economic relations. However, this development strategy occurs within a specific con-text. We can identify three delineating attributes. First is the rejection of laissez-faire. It may include the use of tools, which allow a certain degree of autonomy in national economic policy towards both private interests and the world market, such as protec-tionism, foreign exchange restrictions and the creation of public enterprises. Secondly, it follows a program of industrialisation. Thirdly and most importantly is the central role of the state.


In order to describe proto-economic-nationalism, we have decided to focus on three countries: Poland, Hungary and Romania. Not only are they some of the largest coun-tries in the region, but they are similar enough to accord us with a basis for compari-son and they are representative of the region as a whole. All three countries lagged behind Western Europe throughout the period under consideration, but to different extents. They were predominantly agrarian countries, although they had all developed to varying degrees industrial sectors around 1860. At the same time they present var-ied socioeconomic, political, cultural and historical traditions, which allows us to de-pict a broad spectrum of possible choices. We are dealing with three entities of differ-ent size and population. One of the countries under examination — Romania — was predominantly Orthodox Christian, Poland was Catholic and Hungary was both Catholic and Protestant. They had achieved various levels of both social and political development. Proto-economic national policies in Eastern Europe came to differ from country to country. This was partly as a result of the given country’s peculiar political, socio-economic and historical background. This evolution went hand –in- hand with the de-velopment of societal actors e.g. state, business, agriculture and labour and their inter-action in a constantly changing international milieu.

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Cultural Aspects of Economic Nationalism in Bohemia Catherine Albrecht, Baltimore, USA

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic national-ism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissenschafts-Verlag 2006, pp. 173-184.

Economic nationalism developed in the Bohemian crownlands of the Habsburg mon-archy in the mid-nineteenth century. Among the Czechs in Bohemia, economic na-tionalism was an integral part of the national movement. The ideas and activities as-sociated with economic nationalism were intended to support nation building, within the context of a multiethnic society. Economic nationalism focused on developing the internal conditions necessary for industrialization and modernization within Czech society. Because the Czechs did not control the state apparatus of the Habsburg mon-archy and because the Bohemian diet had limited influence on matters of economic policy, Czech economic nationalism was oriented toward voluntaristic activities that would support economic development. Compliance with any of the measures recom-mended by Czech economists and national leaders was voluntary, not the result of state policy or law. Popular support for economic nationalist policies therefore de-pended on symbols, public pressure, clearly articulated goals, and positive reinforce-ment of the behaviors that were valued in national terms. These cultural aspects of economic nationalism contributed to the widespread acceptance of economic devel-opment as a national goal. They not only encouraged compliance but also integrated disparate social groups into a national economy that directly benefitted the national elite. In the long run, the linking of economic competition and ethnic identity exacer-bated the national conflict in Bohemia. Culture influenced economic nationalism in Bohemia in three primary ways. First, underlying economic nationalism is the idea that acceptance of ethnic identity in the business world (expressed primarily through language use) would reduce barriers to full participation in the market and open up paths to upward mobility. In a multieth-nic society, equality of language would level the playing field and makes direct and fair competition between nationalities possible. In addition, more members of the nation would engage in productive economic pursuits if allowed to express their eth-nic culture in the marketplace. Reducing barriers would encourage individuals to gain education, technical knowledge, and experience that could be applied to the pro-ject of economic development. The form of ethnic nationalism prevalent in East Cen-tral Europe in the second half of the nineteenth century assumed that it was more natural for people to embrace their own ethnic identity than to assimilate to a different culture. As a result, economic nationalists expected that cultural freedom in itself would release the energies needed for entrepreneurship and capital accumulation.


Second, cultural expressions of economic nationalism provided an explanation for why and how economic development would benefit the nation. Economic nationalists situated the principles of economic development (as understood in the nineteenth cen-tury) in a national context. They explained how modernization could be achieved without undermining distinct national cultures and placed the changes society was experiencing in the nineteenth century in a historical context that emphasized linear progress. Economic nationalists exhorted their followers to embrace typical nine-teenth-century bourgeois values, which they believed could provide a moral compass by which to make economic decisions. Narratives of economic development, which emphasized self-sacrifice and discipline in the present for a future benefit to the na-tion, also mapped the way to an technologically modern future. And third, economic nationalism used cultural symbols to define the nation and the “other” by positing competing economic claims. Language, visual displays, signage, and rhetorical strategies all were used to define the group and exclude national oppo-nents. Economic nationalism provided easily identifiable targets to blame for eco-nomic problems. For German Bohemians, growing Czech prosperity and upward so-cial mobility were seen as putting pressure on the fixed assets of German national property, which included cultural heritage as well as real property. Developed in in-teraction to each other, Czech and German communities in Bohemia developed dis-tinct variants of economic nationalism. German Bohemians tended to focus on the distribution of existing resources and sought protection against the loss of wealth and the erosion of their political, cultural, and economic status. Czechs, on the other hand, promoted an ideology that sought to create new wealth and promote upward mobility, particularly during periods of economic prosperity. The cultural aspects of economic nationalism sought to communicate common na-tional goals, provide a guide to personal and social identity in the marketplace, and encourage compliance with activities that would support the development of a modern economy. Cultural messages conveyed common values and goals and used public pressure to acclaim those who actively supported economic nationalism and embar-rass those who did not. Thanks to widespread propaganda and publicity, members of the nation could participate in the economic struggle vicariously as well as directly. Economic nationalism gave meaning to the many difficult, unpleasant, or mundane tasks associated with economic development. The linking of economic and cultural competition in national politics also deepened the animosity between Czechs and Germans and contributed to the separation of the two nationalities in Bohemia.

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Regional policy in Empires and Nation States. East Central Europe before and after 1918 Uwe Müller, Frankfurt (Oder), Germany

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 109-125. The paper deals with the intentions and motives of economic policy and tries to com-pare the different nations and states in the phases of the multinational Empires before the First World War the with new nation states that came after it. The main hypothesis is that the specific ethnic structure of East-Central Europe, the nationality policies and economic nationalism considerably influenced the introduction, the aims and also in-directly the results of regional policy in East Central Europe. The principal decisions of regional economic policy are obviously caused by non-economic motives. Furthermore, there are extremely different pictures regarding the connection between the economic policy and regional development in the minority areas. Germans and Hungarians believed themselves to be the upholders of civilisa-tion, including the source of money transfers and were angry at the thanklessness of the Slavic people. Among Poles, Slovaks, Romanians and Ukrainians there was doubtless the feeling, that they were neglected, exploited and economically discrimi-nated against by Berlin, Vienna, Budapest and Lvov. After 1918 the first phenomenon applies to Poles and Czechs and the latter to Ukrainians and Slovaks relating to War-saw and Prague. All these myths promoted the expansion of economic nationalism and the continued influence on the concepts of national histories today. Accordingly the paper questions: when and why did regional disparities become the cause of state interventions? What was the role of the connection between regional and ethnic diversity, the relationship between the powers of the dominant and the op-pressed nations and the self-image of the state regarding its national character? Are there differences between the multinational Empires before 1918 and the young nation states that appeared after the First World War? When was regional policy used as an instrument to defuse national conflicts and why were these attempts either successful or fruitless? This article begins with some short remarks about the connotations of “regional pol-icy” in this context, on the trends of regional development in the period of industriali-sation and on the special preconditions of East Central Europe. It then focuses on the attempts to enforce regional policy in the two parts of the Habsburg Empire and in the German Reich. We will see that in our case the western model of the development of the modern state interventionism should be seen alongside the national factor. Next I will discuss the regional policies of the Polish and Czechoslovakian, which had ac-


quired with new borders, but also inherited problems and we will observe similarities and differences with the Empires of the pre-war period. Finally I will reach conclu-sions about the importance of the specific ethnic structure, the nationality policy and economic nationalism on the regional policy in East Central Europe before and after 1918. Regional policy in a modern sense is defined as a systematic promotion of economi-cally and socially underdeveloped areas within a political unity. Regional policy usu-ally comes under the framework of the nation state. In handbooks on economic policy, the beginnings of regional policy are usually connected in the first instance with the rise of Keynesianism in the nineteen-thirties. Economists also stress that regional pol-icy was only pursued more vigorously after the end of the Second World War, be-cause a location of industrial policy had been deployed very effectively during the war and society could not yet tolerate high levels of unemployment. However, some eco-nomic historians have noticed that regional policy was already a result of the so-called interventionist turn of the eighteen-eighties in Central Europe. They see the phenome-non not only in the context of an unemployment problem, but as a reaction to the so-cial question in general. I would add to this that the national question was one of the most important reasons for straying from the path of liberal economic policy, espe-cially in East Central Europe. Industrialisation brought increasing regional disparities and general a quickening in changing the regional structures. This led to growing disparities between industrial and agrarian regions, to the “deindustrialisation” of some old industrial districts (mostly during the second phase of industrialisation) and to a catch-up process in a few agrarian districts through the development of intensive agricultural and food in-dustries. These processes were accelerated by the transport and communications revo-lution. That is why in the Central European Empires, with their highly integrated mar-ket areas, industrialisation produced a growing gap between West and East in the first phase of industrialisation. From 1870 until the turn of the century a change in the trend took place in the Habsburg Empire and the most important macroeconomic data of her regions began to converge. Ethnic diversity was not the only feature of East Central Europe, but national and so-cial demarcations were often identical to ethnicity. In Great Poland, Galicia, Upper Hungary (later Slovakia) and Transylvania the large estates owners, merchants, arti-sans, peasants and farm hands differed not only due to their social status, but also be-cause of their national identity. These outlying regions within the Empires were char-acterised by more or less relative backwardness. Both the ethnic-social and the ethnic-regional differences could also be found in Kresy the Eastern Borderlands of the Sec-ond Polish Republic and in many respects in Slovakia after 1918. In the Austrian-Hungarian and in the German Empires the strength of the ruling na-tions was the most important reason for the relatively early efforts of the governments to promote underdeveloped regions in comparison to Western European nation states. However, this motive simultaneously produced economic nationalism along with all its inefficient consequences. Therefore not only the unfavourable political structures


of Austria and the powerful trends of migration from East to West in Germany were responsible for the rather limited effects of early regional policies. After the First World War the new political units in East Central Europe, Czechoslo-vakia and the Polish Republic, had more similarities with their predecessor states than they often wanted to admit. They were multinational states, which suffered great re-gional disparities as a result of a developed western and a backward eastern region. As before 1918 the Czechs in Austria now the Germans lived in regions with above aver-age income levels. However, this was exceptional because the Slovaks, Hungarians, Ukrainians, Byelorussians and Lithuanians lived in the outlying and underdeveloped peripheries of the new states. Nevertheless, regional convergence was at best a secondary aim of economic policy in Czechoslovakia and Poland, at least during the nineteen-twenties. The most important reasons that this problem was neglected were the unfavourable economic trends of the world economy and the greater urgency of other tasks. However, it is also obvious, that “the economic consequences of joining two areas of very different levels of de-velopment were not understood and as a result, were underestimated.”10 In the field of nationality policy the Czechoslovakian as well as the Polish leaders concentrated eco-nomic actions on strengthening the position of the new dominant nations against the economically strong ethnic groups, thus against the Germans and also partly against the Jews and the Hungarians. Walker Connor, an expert in comparing nationalism research, observed that large re-gional inequalities are accepted in homogenous nation-states, while this is typically not the case in multinational states.11 A comparison of the late Empires and the young nation states seems to confirm this thesis. Of course, we should not forget that in Czechoslovakia and Poland the nation-state or the existence of a Czechoslovak nation was only a matter of their self-presentation: in reality they were multinational states with one dominant and several other nations. However, the perception of the national situation was probably more important for the development of policy than the national situation itself. Accordingly after 1918 in the new nation states regional policy was also regarded in a national context. It could be used to open up internal peripheries and to strengthen the new nation state against national minorities. Here the policy of the Empires func-tioned as an example for the young states. On the other hand, the founding of inde-pendent states was regarded as the basis of the growing welfare of the nation. In the ideology of nationalism, national mutuality was more important than class interests or inherited regional disparity. So, in Poland and Czechoslovakia the economic policy

10 Pryor, Zora P.: Czechoslovak Economic Development in the Interwar Period, in: Mamatey, Vic-

tor S./Luza, Radomír (Eds.), A History of the Czechoslovak Republic. 1918-1948, Princeton U-niversity Press 1973, p. 210

11 Connor, Walker: Eco- or Ethno-Nationalism, in: Connor, Walker: Ethnonationalism – The Quest for Understanding, Princeton University Press 1996, p. 150.


had to show that it steadily increased the welfare of the nation and that it strove for justice and equality in social and in regional dimensions within the national commu-nity. In all East Central European states the use of regional policy interventions was mainly dependent on specific situations of national conflicts and on the existing political structures. The economic strength of national economies determined the possibility of effective state interventions, but the political leaders’ assessment of the dimension of the national threat and about the chance of success was decisive for the use of eco-nomic instruments in nationality conflicts. Approximately since the eighteen-eighties the Magyar elites were feeling threatened thus successfully used the economic policy for the assimilation of non-dominant nationalities. The national paranoia of the Ger-mans was greater still, but the national successes of economic interventions remained lower because of internal contradictions and a more powerful opponent. The Austrian Germans in Cisleithania were merely the strongest of several minorities and therefore they could only try to defend the status quo through barter transactions with other mi-norities. So in the Empire’s regional policy was both initiated by national questions and limited in its effectiveness by the national question. In Czechoslovakia and Po-land in the nineteen-twenties the political leaders did not regard regional disparities and the situation of national minorities in the underdeveloped regions as problems that should be given priority. However, this does not mean that the influence of national-ism on the economic policy was low as for instance is suggested by the land reforms and nostrification. In the nineteen-thirties generally increasing state interventionism caused political leaders to take regional disparities into account. Nevertheless, the case of regional policy confirms the thesis that the history of eco-nomic policy at least in East Central Europe could not be sufficiently described as a field between the poles of laissez faire liberalism and state interventionism or between capitalism and socialism. Economic nationalism should be understood as an inde-pendent dimension in the historical picture. This applies not only in the context of re-lationships between Western and Eastern Europe or to the problem of backwardness and the response of protectionism. Economic nationalism also marks many fields of internal economic policies.

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Slavism in National Czech Enterprises in the First Half of the 20th Century. Eduard Kubů, Jiří Novotný and Jiří Šouša, Prague, Czech Republik

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 185-206. When we think about the nature and the possibilities of the advancement of Slavic economic relations, as drafted by the followers of Neo Slavism, and the development of Slavic economic co-operation after the First World War, we can observe the fol-lowing facts: Firstly the Neo Slavic concept of Slavic economic mutuality shows obvious features of economic nationalism expressed both in its objectives and means of implementa-tion. It was a peculiar type of emancipation- economic nationalism based not only on an ethnic relationship, common linguistic and cultural roots, but also on regional prin-ciples in Central, Eastern and South-East Europe. Nevertheless, it was not the eco-nomic nationalism of a highly confrontational character working for total negation of non-Slavic competition (boycott), but a principle of positive co-operation between Slavs in the fields where Slavic companies and entrepreneurs had been handicapped until that time. Its emancipation role is obvious. However, the rival did not have a clearly defined national face. Within the Czech sphere, it includes mainly Bohemian German, respectively Jewish entrepreneurs and Viennese bureaucracy, similarly to the Slovenian region or the Polish region of Galicia. The Croatian or for example the Slo-vakian nation emancipation were aimed against Hungarian predomination. On the contrary, in the environs of national Slavic states with underdeveloped economies, either in Serbia, Bulgaria or Russia, the enemy was foreign capital coming both na-tionally and territorially from Germany and France. Secondly the project of the Slavic Bank was based on the business experience of Czech banks and on a serious analysis of the market situation as well as the condition of national societies of the individual regions. It could indisputably bring concrete results, increase profits in the business environment that had the main say in its forma-tion. Czech banks disposed of sufficient capital resources and were able to meet the demands made on them without any serious problems. They were supposed to partici-pate in the project with around 2.5 million roubles, which equalled 6.5 million Austro-Hungarian crowns. The main obstacle to their developing capital expansion both at home and abroad at that time was not the capital itself but qualified staff. In connec-tion with presentation of individual Czech banking institutes at the jubilee exhibition in 1908, “Národní listy” wrote: “Today the issue of the establishment of Czech bank branches is no longer a matter of capital more but only a matter of qualified labour.“ A benefit from the project was also awaiting the Czech industry, especially the agrar-


ian machinery producers that had been already successfully in exporting to the agrar-ian Slavic countries and the Slavic regions of Austro-Hungary. The project as a whole represented one of the emancipation strategies of the young rising generation of busi-nessmen and it is necessary to say that it was realistically intended, but was essentially only an alternative emancipation strategy. Other, surely more important, alternatives were the domestic economic nationalism in confrontation with the Bohemian German enterprises in the Czech Lands, the co-operation with Viennese big business and par-ticipation in its profits, for example through consortium investments, and last but not least co-operation with the state through public procurement and loans. Thirdly the project had several weaknesses, which hindered its ability to act as an ef-fective emancipation tool. The hopes pinned on it were evidently unreasonable. The possibilities of development in trade communication in the form of concentrated eco-nomic co-operation between the national Slavic communities were moderate consider-ing the similar profile of the produced goods. These communities were, with the ex-ception of the Czech community, socially and economically seriously underdeveloped and by nature agrarian. As opposed to the Czech Lands, where the project of Neo Slavic co-operation enjoyed support of part of the national and economic elite, sup-port provided by the elite in the other Slavic nations, especially in Russia and Poland, was considerably lower. The essential constraints of the project implementation that eventually caused it to be kept on the sidelines of the real business life mainly con-sisted of the unfavourable development of the international situation and the problem-atic relations between some of the national communities. Those factors also foiled the proposed institutionalisation of Slavic economic co-operation. Fourthly during the inter-war period, Slavism was not a phenomenon that would have been expected to help to regularise mutual economic relations, as well as political and cultural relations between the Slavic national communities and thus support them in their emancipation movement. It primarily served as a de facto promotional element used by individual economic subjects for exports to Slavic countries. The new situa-tion can be described as a shift from the principle of multilateral Slavic mutuality, solidarity and co-operation according to the principle of bilateral co-operation among the Slavic states, which consisted of purely economic reasons in the state policy and in a major part of business. The process was a result of the political reality of the First World War as well as of the continuously deepening mental approximation of the Czech society to the European West. The Slavic orientation, originally noticeable in Czech society, made way to Masaryk’s and Beneš’s conception of the Czechoslova-kia’s position in post-war Europe. Slavism was fiercely apposed by Westernism, both politically and economically. Today it survives in the Czech society mainly as a cul-tural idea resulting from the national revival.

19

Conflict and cooperation: Czechs and Germans in the First Czechoslovak Republic Christoph Boyer, Salzburg, Austria

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 207-218.

The issue of nationality. Nationality and the economy The issue of nationality was a fundamental element in the political, economic and so-cial life of the First Czechoslovak Republic. The general problem was the presence of a strong native German population in a state, which defined its identity as the state of the Czechoslovaks. However, the reality was characterised by a complex mixture of national antagonism and binational cooperation. Conflict was a predominant feature in the first years of the First Republic, it diminished somewhat into the background in the second half of the twenties and it became stronger once again in the thirties when Germans in Czechoslovakia were suspected of being the „fifth column” of the Na-tional Socialist Reich. The issue of nationality was also virulent in the economic sphere. The struggle be-tween the Czechs and the Germans over their national property („nationale Be-sitzstände”) was embedded in the context of the overall national struggle. The German national agitation denounced the “aggressive Czechisation”, whereas, from the Czech point of view, the nationalisation of the economy was a legitimate attempt to gain full sovereignty in the new nation state and to reverse the Habsburg policy of Germanisa-tion. The Czech policy of economic nationalisation was directed against all forms and variations of German economic influence, thus against enterprises from the German Reich as well as against the economy of the Germans in Bohemia and Moravia. The economic assets of the native Germans significantly exceeded their share of the popu-lation, but they were less imposing in reality than they appeared in the statistics be-cause the German industries were relatively underdeveloped and their productivity was low. Nevertheless, in the political perspective Germans in Czechoslovakia were never completely able to shake the image of being unreliable, in this respect they were perceived alongside the impact of capital from the Reich as an equal menace. The Czechoslovakian policy of nationalisation included extensive measures, which were aimed at strengthening the Czech position in the “German enterprises” on the territory of the Republic. Influence was exerted via taxation policy, by the allocation of state commissions, capital participation of Czech-national banks in subsidiaries of German enterprises or by the placement of representatives of Czech national parties


on their administrative boards (Verwaltungsräte). Nationalisation was supported by the mainstream Czech political parties, by the government and the administration, by Czech political and economic associations, by Czech industrial enterprises and the Czech banks. An important actor was the National Council (Národní rada), which was the central organisation of the Czechoslovak nationally oriented regional associations, which worked towards the completion of the national state in every respect. Nevertheless it would be wrong to overemphasise the dimension of conflict and the ethnic struggle in general. Both national economies were tied to each other by mani-fold links such as demand, supply, credit and cartels, which were in danger of being damaged by economic nationalism. In the field of language and school politics na-tionalism could become virulent with considerably less risk of material losses. The paper presents three case studies, which support the central argument that in Czech-German economic relations national antagonism was intermingled with a strong element of cooperation. They focus on the conflicts between the two ethnic groups in respect to personal or organisational influence and the networks, which led, organised and represented the two ethnic economies.

The organisations of industry After the foundation of the First Republic two industrial organisations were estab-lished according to nationality: The Central Association of Czechoslovak Industrial-ists (Ústřední svaz Československých průmyslníků: ÚSČP) and the German Central Association of Industry in Czechoslovakia (Deutscher Hauptverband der Industrie in der Tschechoslowakei: DHI). It was not long before it became clear that the opinions of the German association about the central questions of economic policy - economic order, tax policy, public finance and trade or currency policy - were on the whole identical to those of the Czech association; the divides of social conflicts fell between the classes, not between the national groups. The cooperation between the two indus-trial associations began in 1922; in 1928 the German Central association in corpora joined the Czech association. The amalgamation was favoured by the general soften-ing of the national conflict during a period, in which the German activist political par-ties joined the cabinet and there was an improvement of bilateral political relations with the Reich. During the thirties the harmony between politics and economy was endangered by the rise of Sudeten German National Socialism. Nevertheless, even as late as summer 1938 the German association DHI was reluctant to follow in the footsteps of the Sude-ten German Party and cut the narrow links to the Czech association on the basis of shared economic interests.

The Chambers of Trade and Commerce The ministry of trade and commerce appointed the members of the leading bodies of the Chambers of Trade and Commerce (the administrative commissions), thus fixing the national quota. But, besides national interests, many competing claims had to be


taken into account in the appointment process like e.g. claims from industry, trade, commerce and finance, from big business and small business as well as the demands of political parties representing different economic groups. The consequence of this complex constellation of manifold interests was an often arduous and lengthy process of bargaining. In the long run the Germans lost ground in this bargaining process and, consequently, in the administrative commissions. But this was not caused by Czech national policy but by other reasons: firstly the Czech political parties, which represented economic interests, were rather keen on extending their influence in the chambers whereas in the German milieu a comparable impetus was not to be found. Secondly there was a strong impulse in 1936 to strengthen the element of small business. Because the Czech position in the handicraft and the small trade sector was stronger than the Ger-man position the favouring of small business implied the strengthening of the Czech milieu. Thus, the significant long-term decline of the German component in the administra-tive commissions was not caused by Czech national rancour. The explanation has to be sought in the almost automatic working of the appointments mechanism which produced a bias in favour of the Czech element as a side-effect within the context of Czechoslovak party politics.

The industrial élites Another important dimension of the economic struggle were the measures against the overrepresentation of Germans in the leading positions of the Czechoslovak industry. Because of their administrative, technical and economic know-how these technicians, engineers, leading managers and directors were of immense strategic importance for the economy of the republic. Some members of the business elite were natives of Bo-hemia or Moravia and Czechoslovak citizens, many of them were Austrian citizens and many were immigrants from the German Reich, the state which Czechoslovakia feared most. In the eyes of the Czechs, all Germans regardless of their citizenship tended to be perceived as potentially dangerous. An especially delicate matter was the Germans in those enterprises, upon which the defence of the country was based. Nationalistic currents in public opinion, the National Council as an umbrella organisa-tion for Czech national associations, the lobbies of Czech employees and profession-als and the military exerted considerable pressure to change the composition of the industrial elite on grounds of nationality. The policy of improving the national com-position showed marked results, especially in the thirties. Nevertheless, in many cases it proved to be impossible to remove Germans from leading positions because there was no Czech substitute. Industry was in general very sceptical about measures that threatened the existence of managers and experts. Finally, the risk of complications with the Reich and Austria prevented rigorous restrictions.


Summary The mainstream of Czech politics in the First Republic seems to have been permeated by an anti-German inclination. However, this sentiment was not translated into a comprehensive and consistent policy program. Although there was the occasional ag-gressive conflict over the extension of „national property” and a rather shortsighted chauvinism on both sides of the ethnic frontier, cooperation and compromise pre-vailed in the end. This was true especially in the economy. Damaging the „German economy” would in many cases have meant damaging their Czech counterpart as well, whereas cooperation across ethnic frontiers proved to be profitable for both sides. This taming of nationalistic feelings may not always have been a matter of the heart, but was apt to generate a rather stable modus vivendi.

23

Agrarianism and ethnicity - an East Central European survey Anu Mai Kõll, Stockholm, Sweden

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 141-160. What is the relationship between economic nationalism and agrariansim in East Cen-tral Europe? In this article, a few aspects of this relationship is studied. First, national-ism is identified as an emancipatory, bottom-up movement in this part of the world. It contributed to the tendency to define politics according to ethnical boundaries rather than class boundaries in the late 19th and early 20th century. The majority of the population in the area was agrarian and thus had a strong influ-ence as democracy was introduced after World War I. The agrarian roots of national movements in turn could have had a strong impact on agricultural policies. This see-med also to be the case in the first post-war years, but after the initial land reforms little was done for the peasants, and in many cases the land reforms were not carried out to full extent. The structural problems of agriculture are shortly adressed, and the land reforms and their class versus ethnic content are evoked. The attitude of peasant organisations towards trade protectionism, one of the salient features of economic na-tionalism, is studied as well. Large questions however remain to be studied more in depth. The agrarian policies of the East-Central European states ought to be studied more in detail. Why did the gov-ernments abstain from addressing the obstacles to agricultural growth? And why did peasant organisations go along with the minority and ethnical policies of economic nationalism? In the choice between class and nation, they seem to have chosen the nation. The example of Estonian agrarian parties is used to illustrate these problems, but more research is needed to give a more solid and varied picture of the complicated relationship between economic nationalism and agrarianism.

25

Cooperatives as a basic tool of economic nationalism Torsten Lorenz, Frankfurt (Oder), Germany

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 127-139. The thesis of this contribution is that the idea of cooperative self-help in Eastern Europe was adapted through the prism of romantic nationalism and this specific adop-tion was fostered by the ethnically mixed settlement and the interlocking socio-economic conflicts, typical of the region. Economic nationalism in the cooperative movement therefore often gained dynamism from the consciousness of a double – economic and national – backwardness and the perception of a foreign domination. Cooperatives were spread by the national elites, as they recognized their enormous potential for mass mobilization, while the masses readily accepted them as a means for solving everyday problems. The cooperative movement became a gateway for the dissemination of the national idea to the masses and a basic tool of nationalism.

27

Economic Anti-Semitism in Hungary after Trianon* Ágnes Pogány, Budapest, Hungary

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 219-229. In my paper I would interpret economic nationalism as a process of creating homoge-neous ethnic economies on a given territory. On the other hand economic nationalism can also be considered as an economic ideology that attempts to mobilise the masses on ethnic grounds in order to create a homogenous and integrated national economy. Before 1918 Hungarian economic nationalism was mainly directed against the eco-nomic aspirations of ethnic minorities living on the territory of multinational Hungary and against strong economic competition from the more advanced Western half of the Empire. However the situation significantly changed after the dissolution of the Austro-Hungarian Empire. As a consequence of the Trianon peace treaty of 4th June 1920, Hungary ceased to be a multiethnic state. In contrast to 1910 when the propor-tion of the population, whose mother tongue was Hungarian, hardly exceeded 50 per-cent, in 1920 due to demographic changes Hungarian speakers formed 90 percent of the population. During the interwar period economic nationalism turned increasingly against the Jewish population, who were the weakest minority in Trianon Hungary. In my paper I present economic anti-Semitism as a form of economic nationalism, which endeavoured to create a homogenous national economy by ousting the Jews from the economy. Economic nationalism was an attempt to finance the modernisation of the economy and to assist the social integration of the lower classes with the aid of the confiscated Jewish fortune. Before 1918 the Hungarian government considered the Hungarian Jewry as partners in the process of economic and social modernisation and an ally in implementing the Magyarisation policy as a result of the Jews’ vigorous acculturation and linguistic Magyarisation. After the war this attitude fundamentally changed. Hungarian Jews were no longer allies in the economic development of the country; instead they were regarded responsible for the national disaster i.e. loosing the war and with it two thirds of the former Hungarian territory. The history of Hungarian economic anti-Semitism can be divided into three periods. In the first period, between 1920 and 1937 the economic role of the Jews was only gradually restricted in the form of a quota system with the long-term aim of removing

* Short version of the paper presented at the Session 7 of the XIV International Economic History

Congress, Helsinki, 23.08.2006. The author thanks for the valuable financial help received from the Hungarian Scientific Research Fund (OTKA K60693) enabling participation in the congress.


the Jews over the course of many generations. During the twenties the acute existence crisis of the intellectuals was to be eased by restricting the admission of Jews to uni-versities according to racial criteria. The second period between 1938-1944 saw com-prehensive social and economic reforms planned at the expense of the Jewish popula-tion. A hidden program of Aryanisation was prepared and anti-Semitic laws, known as “Jewish Bills”, were passed in order to create a homogenous ethnic labour market. The third period started with the German occupation of Hungary in March 1944. Dur-ing these months the complete take over of the Jewish wealth was accomplished. The nationalisation of the Jewish wealth financed the enormous war costs and the expendi-tures of the social measures.

The quota system The quota system was first applied to the intellectual professions. The middle classes in Hungary had been suffering a serious existence crisis since First World War. The level of unemployment among university graduates was unusually high even for European standards. The bill entitled “numerus clausus” allowed the government to cap the number of students, who enrolled at the universities and established an admis-sion quota system, which operated according to the size of the “races and nationalities of the country”. Although the statute did not explicitly restrict the number of the Jew-ish students, it was clear that it was designed to do so, because Jews were the only minority whose ratio in higher education was much bigger than their demographic proportion in the early twenties. Economic anti-Semitism was not only present at the universities; it also appeared dur-ing the twenties in the professional organisations of the right-wing intellectuals, which tried to restrict the activities of Jewish professionals already with university degrees. Attempts to segregate medical practices on ethnic grounds were particularly aggres-sive. Radical right-wing associations of physicians pressed to secure jobs in the medi-cal civil service only for Christian doctors at the start of their carriers. The campaign only had partial results. Due to the enlargement of the social insurance system fi-nanced by the state budget a great number of new positions were established in the second half of the twenties. By 1930 the ethnic segregation of the medical practice became clearly pronounced, three-quarters of the Jewish physicians had a private practice, whereas two-thirds of the Christian doctors were public employees. Right-radical professional organisations eventually gained more power among the engineers and lawyers from the latter half of the thirties and the displacement of Jewish profes-sionals became more marked during the Second World War.

From discrimination to destruction 1938-1945 There had been several economic concepts concerning the Aryanisation of the Jewish property in Hungary drawn up long before 1919. As a result of special social devel-opments significant parts of the middle classes and of the economic elite were of Jew-ish origin. According to various contemporary estimates 20-25 percent of the national wealth and of the national income was concentrated in Jewish hands. However it was


distributed very unevenly, producing big income differences, even among the Hungar-ian Jewry. Some economists and politicians considered that the expropriation of the accumulated Jewish wealth would secure the needed financial base for a social and economic modernisation. Hungarian economic anti-Semitism aimed for social change through the redistribution of the Jewish fortune. These demands found broad accep-tance and popularity because they contained not only a negative discrimination, at the expense of the Jewish population, but also positive discrimination. According to vari-ous concepts these schemes promised material and social advantages for special social strata, which could either be the intellectuals, the Christian middle class or the lower classes, with emphasis on the agrarian proletariat. In March 1937 the president of the National Bank of Hungary, Béla Imrédy prepared a memorandum for Prime Minister Darányi, in which he conceived a social and eco-nomic programme to be mainly financed by Jewish wealth. Imrédy wanted to improve the standard of living both in the Christian middle classes and the destitute agrarian strata at the same time. He proposed government investments, new welfare measures and the extension of the social insurance system to the rural population, in order to create new employments in the civil service and income for the unemployed young Christian university graduates as physicians, teachers, social workers and in other civil service jobs. These measures were suitable for increasing the living standard of the rural population as well. Imrédy also suggested a public work program to generate income for the unemployed. The hidden program of Aryanisation was partly realised in the Five Year Economic Plan, which Prime Minister Kálmán Darányi started on the 5th of March 1938 in Győr. The radical acceleration of the social and economic change was the explicit purpose of the First Jewish Law passed by the parliament in May 1938. The bill stressed ex-plicitly that the principal objective was to constrain Jewish professionals and reduce their number and influence in Hungarian society. The Second Jewish Bill of 1939 was aimed at the “restriction of the public and economic functioning of the Jews.” The Hungarian parliament and the government passed 21 anti-Jewish laws and 267 de-crees between 1938 and 1944. The biggest part of the legislation was of economic significance. The motives were the impoverishment and the complete plundering of the Jewish population. The social change at the expense of the Jews was also used to reduce the social dis-content among the population. From 1938 on a comprehensive welfare program was launched, a network of welfare advisors was established in the countryside and wel-fare expenditure was more generously financed in the budget. More than 570,000 hec-tares of Jewish landed property was dispossessed by the Kállay government. The es-tates were taken to ease the land-hunger of agrarian proletariat and to stabilise the so-cial base of the government. Nazi Germany did not put pressure on Hungary until the summer of 1940. Her policy concerning the German Jewry set the example to be followed and it encouraged the Hungarian anti-Semites. Pressure on the part of Germany played a much smaller role than internal efforts to weaken the financial situation of the Jews and getting their for-


tune, even later on when discriminative measures were passed and Aryanisation was launched.

Under German Occupation Before 1944 the Hungarian governments opposed the complete redistribution of the Jewish fortune in spite of the increasing pressure from a part of the population and from the ever more popular extreme right political movements. Conservative princi-ples and practical considerations made Horthy and his advisors distrustful of the ‘total settling of the Jewish question’. The radical and immediate displacement of the Jews from the economy was regarded as very dangerous and unworkable because it could lead to the complete breakdown of the economy and society. Following the German occupation of Hungary in March 1944 these considerations were swept away. Horthy gave the Sztójay government free hand concerning the Jewish question. Already on the first meetings of the cabinet on the 22nd and 29th of March a series of decrees were passed that allowed the total deprivation of civil rights and complete looting of the Jews. The dispossession was made complete by the decree of Szálasi in November 1944 stating that “all of the Jewish wealth was to taken over by the state as the fortune of the nation.” The social and economic changes already envisaged by the Jewish Bills, which could only advance slowly until 1944, now gained a strong momentum. Jewish companies, stores and stockpiles were quickly transferred to Christian hands. 240,000 households, saving deposits, real estates, rents and shops became distributed in Hungary. Millions made a profit from the possession of the deported people. Parallel to the utilisation of the Jewish wealth the ministries implemented measures to improve the social insur-ance system of the Christian citizens. This was only possible at the expense of the Jew’s wealth to finance these huge expenditures, as the budget was already overbur-dened by enormous war costs and payments to Germany. The history of economic anti-Semitism in Hungary contradicts the widely held view that the extermination of the European Jews was a result of an irrational anti-Semitism. According to the research of many authors one can find cool and rational economic considerations behind the deportation. The fulfilment of the project set by the economic anti-Semitism yielded significant material benefits. The dispossessions and deportation of the Hungarian Jewry made German occupation more popular and helped to finance war needs. The Aryanisation of the Jewish property made various welfare programs possible.

31

Anything but Simple: Romanian Oil Industry between National Economic Interests and Economic Nationalism Bogdan Murgescu, Bucharest, Romania

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 231-250. Economic nationalism was one of the main features of Romanian economic policies for more than a century, at least from the 1880s until 1989. Although economic na-tionalism was and still is often praised in Romanian historical writing, its impact was not as positive as claimed by its champions. In fact, in spite of economic nationalism, or perhaps due to it, the development lag between Romania and most European coun-tries has increased during the period under consideration. In this paper I re-examine the record of economic nationalism in one of the key industries of modern Romania: the oil industry. Economic nationalism regarding Romanian oil emerged around 1900, in connection with attempts of Standard Oil to obtain exploitation concessions on state-owned oil fields. Although initially the opponents of the deal with Standard Oil were in fact fa-vouring the exploitation of oil on private properties in cooperation with German capi-tal, nationalist policies regarding oil gradually became a major political theme cham-pioned by the National Liberal Party. After World War I the Liberals attempted to increase the share of Romanian capital in the oil industry, but this nostrification policy opened a confrontation with major transnational oil companies, backed by the United States and by the United Kingdom. In the paper, I examine both the arguments of the partisans and opponents of economic nationalism, and its consequences, considering especially the relation between production, prices and employment. A special section of the paper is dedicated to the re-emergence of economic nationalism regarding oil during the communist rule, especially under Ceauşescu, while a post-script outlines late echoes of economic nationalism in current debates regarding the privatisation of the Romanian oil industry. As a general conclusion, the paper outlines that the economic policies of the Roma-nian state were utterly inadequate, and that economic nationalism had a major part in this inadequacy. It precluded drilling on state-owned land and the construction of a pipe-line before World War I. It slowed down growth in the twenties and diminished export returns during most of the interwar period. Quite more, although Romania was rich in oil, heavy taxation of internal consumption and the lack of a coherent industri-alisation policy made interwar Romania to have one of the lowest motorisation rates in Europe; this, at its own turn, hampered productivity and general economic devel-opment. If we agree that overcoming economic backwardness has been the major economic interest of modern Romania, then we have to conclude that, in spite of the intentions of its champions, economic nationalism in general, and specifically the na-


tionalist economic policies regarding the Romania oil industry were detrimental to the achievement of this goal.

33

Economic Nationalism in Romania (1866 - 1944) Angela Harre, Frankfurt (Oder), Germany

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 251-264. This abstract deals with explanations of economic backwardness given by Romanian scientists (1866 - 1944). It is evident that Romanian economics followed their own dynamic. Fighting the lack of a genuine economic vocabulary, Western and Eastern theories were not just copied, but integrated, abandoned, transformed and enriched with regional enquiries. Already during the 1930-ies Romanian economic thinking extended its sphere of influence beyond the Balkans and affected academic debates all over the world. Scientists such as Raul Prebisch and André Gunder Frank - the fathers of the Latin American dependencia1 - stood in the tradition of the Romanian econo-mist Mihail Manoilescu. And it were Dimitrie Gusti and Henri H. Stahl, who investi-gated Romanian Carpathian villages - becoming the fathers of rural anthropology worldwide. Unlike the Western model the Romanian modernization caused the national move-ment to split up into two separate wings: into an urban (liberal) and a rural (conserva-tive) one. During the 19th century just the great boyars profited from the growing corn prices on the European market. Living of their large land estates, they progressively transformed Romanian agriculture into a capitalist economy similar to the latifundia system of Latin America. The emancipation from the Ottoman export monopoly (meant to assure the supply of Constantinople and its hinterland with corn) was a main concern of the conservatives, struggling for the state’s sovereignty. It caused, conse-quently, the adoption of free trade as one of the doctrines of 19th century economic nationalism. These boyars favoured the second serfdom and were opposed to democ-racy in order to stabilize their traditional dominance. Their ideal of an aristocratic na-tion state cannot but be called neo-feudal - trying to force the peasant masses to stay on the landowner’s domains. The great boyars combined economic liberalism with political conservatism and an aristocratic elitism. Although, they succeeded to take nationalism out of the hands of isolated scholars and to transform it into a political instrument causing a first and very limited wave of national mobilization among elitist social circles. Small boyars, whose land estates were too insignificant to withstand the great land-owner’s concurrence, became opposed to the elite’s claims. They had to look for al-ternative sources of income and became predominantly interested in Romania’s indus- 1 Dependencia: which claimed for reforms on the international market in order to improve the sta-

tus of the Third World during the 1970ies


trialization. In contrast to their dominant antagonists, the small boyars did not suffer so much from the Ottoman export monopoly, but felt threatened by western European industrial “dumping prices” and the political weight of the great boyars. As a result they favoured an ideology that combined political liberalism (democracy as a means to threaten the political authority of the ruling, conservative circles) and an economic anti-liberalism, fighting the concurrence of Western Europe. Their Western orienta-tion enabled them to copy a modern party organization more effectively than the con-servatives. Public meetings and mass demonstrations of city dwellers - integrating large parts of the urban population into the national movement - became typical for their election campaigns and frightened the small, conservative upper class.2 Three major ruptures occurred within the Romanian social (and therefore ideological) structures after the First World War: (a) The conservatives just disappeared as a po-litical factor and were (b) replaced by the neoliberals as the ruling elite. (c) At least, a new counter-elite arose with the peasantist movement. The separated (economic) na-tionalisms of the 19th century between an urban and a rural nationalism, thus, find a correspondence during the interwar period, when neo-liberals stood against peasan-tists. The neo-liberal (urban) economic nationalism clearly dominated the interwar period. Its representatives were – in one way or another – related to the so called “liberal oli-garchy”: A relatively few number of formerly small boyars, headed by the Bratianu family, controlled all major industrial enterprises in Moldavia and Walachia, the transport system (especially the C.F.R. – Romanian Railway Agency) and significant parts of the banking sector. The urban (liberal) form of economic nationalism progres-sively transformed former ideas of political liberalism into an admiration of authori-tarian regimes. And the claim for educative tariffs à la Friedrich List turned into eco-nomic dirigism, preparing Romania’s integration into the German large space econ-omy. But their anti-democratic argumentation was not just a mean to stabilize the liberal’s power, but an unavoidable consequence of modernization itself. Alexander Gerschenkron3 once underlined the enormous risks of a retarded industrialization in connection with a significant agrarian overpopulation. Every effort to further the mo-dernization of society would provoke conflicts with the rural masses. Thus, to break these blockages logically includes a repression of the majority of the electorate and the democratic ideal becomes obsolete. The rural form of economic nationalism was overtaken by the peasantist movement and transformed into a combination between Russian Marxism (narodniki), an altering economic liberalism, an altering political liberalism (compared with Western Europe) and the traditional Romanian village culture. It represented the third wave of national mobilization, integrating local influentials, such as village professors, priests or disad- 2 Hitchins, Keith: Desavasirea natiunii romane [The completion of the Romanian nation], In Hit-

chins / Deletant, note 1, p. 308. 3 Gerschenkron, Alexander: Economic backwardness in historical perspective, New York: Praeger

1965, p. 18.


vantaged intellectuals, who were threatened by an increasing academic unemploy-ment, into the national movement.4 Especially after 1926, when the Taranist Party united with the National Party, these people became a serious concurrence for the lib-eral elite. Their social basis were said to be the Romanian peasant masses, which ac-counted - at this time - to 80% of the whole population. Thus, peasantism might be seen as a first form of a Romanian mass nationalism, but differs profoundly from the classical form of economic nationalism described above. The starting point of the peasantist visionary argumentation was the so called tradi-tional peasant family economy, which was profoundly described by the Russian economist Alexander Chayanov5. Virgil Madgearu, using Chayanov as his scientific basis, claimed that this agrarian economy was totally different from the capitalist economy, not knowing crucial terms such as profit, wage labor or rent. Although, threatened by the capitalist transformation peasants succeeded to resist against the threats of capitalism, using cooperatives or by intensification of their cultivation methods.6 With the help of these peasant family units the construction of an alterna-tive societal model called “peasant democracy” should be possible. Its economy should be characterized by collective work, collective property and a rural democ-racy.7 The peasantist combination between a cultural concept of “nation”, mostly based on profession and religion, and the demand for Romania’s federalization might have calmed down many ethnic conflicts. But after their failure to manage the Great De-pression and their establishment within the Romanian party system, the National Pea-santists progressively lost their voters. The misery of the 1930-ies caused the fourth and last wave of national mobilization, integrating the rural poors into the national movement. Statistics indicate a growing awareness of political processes among the rural masses. As a result, the government bonus8 vanished until 19379, causing an

4 Ließ, Rudolf Otto: Rumänische Bauernparteien, in: Gollwitzer, Heinz (ed.): Europäische Bau-

ernparteien im 20. Jahrhundert, Stuttgart / New York: Fischer Verlag 1977, pp. 437 - 466 : 447f. 5 Chayanov, Alexandr V.: Die Lehre von der bäuerlichen Wirtschaft, Berlin: Verlag Wirtschaft

und Finanzen 1923 (facsimile). 6 Madgearu, Virgil: Agrarianism, Capitalism, Imperialism. Contributii la studiul evolutiei sociale

romanesti [Agrarianism, Capitalism, Imperialism. Contributions to the study of the Romanian social evolution], Bucharest: 1936, pp. 59 – 82.

7 Zane, Gheorghe: Taransimul si organizarea Statului roman [Peasantism and public organization], in: Sbarna: note 22, pp. 171- 174.

8 Romanian political practice was characterized by an inverse election process. The king appointed a government, whose first act was to organize new elections. The government - until the late 1930ies - could be sure to win the elections, because the inexperienced peasant masses trusted the king and - therefore - any possible government. Further on, the winning party usually gained more than 40% of the votes, a percentage that granted 50% of all parliamentary seats plus the respective rest of the chairs. In that way, every efficient opposition was marginalized by an abso-lute an overwhelming majority.


extreme political instability, because these newly “awakened” people were not at all attracted by traditional parties. Now the fascists tried to revitalize their “genuine” na-tional culture against an upper class, to which now the peasantists belonged, too. Fascism united the Romanian national movement for the first time, a fact that helps to explain its renewed importance after the breakdown of communism. Accordingly, the academic debates, concentrating on the failure of the young nation to catch up eco-nomically with the West, converged after the Great Depression. Both, the academic and public press commented the failure of democratic institutions in a way that en-couraged the establishment first of the dictatorship of Carol II. (1938) and later of the military one of general Antonescu (1940). Together with democracy, capitalism was given up as a promising way towards modernization in large circles of Romanian in-tellectuals - an argumentation that facilitated the integration of Romania into the Ger-man large space economy. The polarization of the Romanian (economic) nationalism ceased to exist together with the state’s loss of economic and political independence.

9 Maner, Hans-Christian: Parlamentarismus in Rumänien (1930 - 1940). Demokratie im autoritä-

ren Umfeld, München: Südost-Institut 1997, p. 52.

37

Flux and Reflux: Interwar and Postwar Structuralist Theories of Development in Romania and Latin America Joseph L. Love, Illinois, USA

Summary: The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 71-86. A wide variety of development theories appeared in Romania during the interwar years, most aiming at the transformation of a low-income peasant society into a mod-ern industrial nation. Among the most influential was the structuralist contribution of Mihail Manoilescu. His trade-as-exploitation thesis had 19th-century roots, especially in the work of Alexandru Xenopol, and his theory of corporatism postdated his major economic ideas, which focused primarily on strategic dirigisme rather than corporatist economic organization. Manoilescu’s political and economic ideas were widely discussed in Iberia and Latin America, and according to some writers (Romanian and non-Romanian), his eco-nomic theses laid the foundation for the structuralist theses of Raul Prebisch, the Ar-gentine Director of the U.N. Economic Commission for Latin America, and subse-quently Director of the U.N. Conference on Trade and Development. Prebisch’s ideas on trade and industrialization were indeed similar to the Romanian’s, but markedly different on several critical points. One of these was Prebisch’s belief that the terms of trade of raw-materials-exporting (agrarian) countries tended to deteriorate over time, while Manoilescu held that trade exploitation was instantaneous. Manoilescu’s ideas were rediscovered and propagated by economists of the Ceausescu regime, who emphasized the former’s structuralist contribution to Third World eco-nomics, ignoring his corporatism and support of the Nazi Grossraumwirtschaft. When these economists discovered Prebisch and other Latin American structuralists (notably the Brazilian Celso Furtado and his thesis of dependency), they emphasized the simi-larity of the Manoilescu and Prebisch theories: The Romanian’s works were not only alleged to be the fons et origo of the Latin American school, but Manoilescu was also given credit for the thesis of deteriorating terms of trade--rechristened the “Prebisch-Manoilescu effect”--despite the fact that the notion played no role in the Romanian´s work. Thus were Latin American structuralism and dependency appropriated and in-digenized to meet the ideological and propaganda requirements of Ceausescu’s Ro-mania, a “developing socialist country” whose leader saw it at the ideological fore-front of the Third World.

39

Economy and Nationalism in Yugoslavia Žarko Lazarević, Ljubljana, Slovenia:

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 265-277. Economy has always been a useful tool in political fights and also a means of national and political differentiation. A close relationship between the economy and national-ism can also be found in the Yugoslav nations, who have generally lived in nationally-mixed countries up to the early 1990s. Emancipation of the Yugoslav nations as inde-pendent ethnic entities was also accompanied by economic emancipation. The ideal which they all strived for was to become a culturally, politically and economically emancipated nation. There was a general conviction that only a nation with its own economic institutions and an appropriate material basis can also successfully assert its political will. This was a precondition for a nation not to remain only a cultural phe-nomenon and to overcome a danger of being reduced to a mere folklore curiosity. Before the formation of the Yugoslav state, the nations developed separately. Slove-nia, Croatia, Vojvodina and Bosnia were part of the Habsburg community of nations. Serbia and Montenegro were independent monarchies, where the state promoted de-velopment of national economy, which was to support the political emancipation that had been achieved by obtaining the statehood. In the second half of the 19th century, the South Slavic nations within the Habsburg Monarchy took a decisive step on their path to national emancipation. The cultural emancipation automatically grew into a political one, and the economic emancipation was an important part of the same proc-ess, based on establishing of the first national economic institutions. The leaders of the nationalist movements soon realised that the economic factor was an important lever of political struggle. Calls for national/political differentiation thus appeared also in the economic field, underpinned by the goals of political strengthening of Slovenian, Croatian and Serbian nations. The calls for national differentiation in the economy and, in turn, building of separate systems of "national-political" economic institutions meant closing of national communities within their strictly national boundaries not only in the cultural and political areas but also the economic one. And cooperative movement thus proved to be the right tool, as it allowed the synergy of two elements, the social-economic and the national-political one. In the conditions of growing commercialisation and individualisation, cooperative movement which rested on mutuality gave their members a feeling of security. Besides, cooperatives gave the impression of equality, democracy and closeness to the common people. Although with the emergence of the Yugoslav state the circumstances changed, eco-nomic nationalism continued. The continuity existed on both levels, the level of the state and the national communities. Accumulation of the national capital and protec-


tion of the national interests in the economy were the main principles underlying the Yugoslav economic policy. And the national interest overlapped with the Yugoslav state/nationality. It led to the processes of “Yugoslavisation” of economic subjects. Strengthening of the national capital/interests, of course, went at the expense of the consumers, which was most clearly expressed in the change of relative prices. In the new, protectionist environment, the industrial prices rose out of every proportion compared with the agricultural ones. The national character of the cooperative movement remained equally important. It was a continuation of the conditions form before the First World War. The only dif-ference was that the cooperative leaders from Belgrade tried to centralise all Serbian cooperatives exclusively on the basis of Serbian nationality. This included also the Serbian cooperative organisations in Croatia and Vojvodina. And this centralisation did not mean that only the economic aspects mattered. Far from that. In Croatia and Bosnia, the role and purpose of Serbian parallel economic organisations, i.e. coopera-tives and joint stock companies, remained the same. And the same goes for the Croa-tian cooperative movement, which was also associated at the level of the state, regard-less of the regional or internal administrative borders. Somewhere in-between the Ser-bian and Croatian economic institutions, there was a parallel world of Muslim economic institutions in Bosnia. The continuity of the established networks of na-tional economic institutions was to assure, apart from economic effects, also the soli-darity and homogenisation of the Serbian, Croatian and Muslim nations in Yugosla-via. After the Second World War the communist regime brought about numerous changes in Yugoslavia. It was the path of ownership and structural transformation of the econ-omy, establishing of a new economic system, and introducing of the new centralised state economic interventionism with adequate administrative apparatus. The post-war Yugoslavia introduced a protectionist and partly autarchic concept of economic de-velopment, upgraded by the central planning model and reallocation of investment funds according to the Soviet model. Also this model, however, was led by the wish for strengthening the economic potentials and was generally only a continuation of the pre-war model of economic strengthening of domestic capital and entrepreneurship. While before the war, the protectionist development model rested on the construct of one nation, the communists based it on the notion of one working class. The working class became the connective tissue of the diverse Yugoslav nations. What is common to both models is the denial of the national element in politics and the economy. However, this method failed to assure long-term stability also in the communist Yugoslavia. In the multi-national state, this policy inevitably led to political and eco-nomic conflicts with a clear national connotation. The story from before the Second World War was repeated. The pre-war centralist/unitarian model failed because of the feelings of deprivation and exploitation. The pre-war conflict between the autono-mous and centralist systems took on new dimensions after the war. It became also the conflict between the advocates of market reforms and greater political and economic openness and those who wanted to preserve the centralist autarchic economic system.


Also the divisions were very similar to those from before the war. The politicians from more developed republics (Slovenia and Croatia) advocated, apart from decen-tralisation, also a kind of “market socialism” with a diminished role of the state and increased responsibility of companies for their own efficiency. In other parts of Yugo-slavia, however, political leaders still favoured the strong role of the state in promot-ing economic development. Yugoslavia found itself in a paradox situation: although the mechanisms for realloca-tion of funds for large investment to less-developed regions were in place for decades after the war, regional disparities only deepened. At the same time, also the develop-ment lag behind the northern and western neighbouring countries widened. The fact is that all the republics felt economically deprived. Everyone spoke of exploitation and of others becoming rich at their expense. In developed republics, this frustration was caused by the outflow of funds through or even pass the fiscal system and by lagging behind the more developed neighbourhood. In less developed regions, the frustrations stemmed from lower level of economic and social development, predominantly one-sided economic structure and insufficient competitiveness on the internal and foreign markets. This has been a constant feature before and after the Second World War.

43

The Soviet Lithuanian Nomenclature in the trap of economic nationalism Saulius Grybkauskas, Vilnius, Lithuania

Abstract The contribution has been printed in Helga Schultz, Eduard Kubů (Hg.): Economic nationalism in East Central Europe: 19th and 20th Centuries, Berlin: Berliner Wissen-schafts-Verlag 2006, pp. 279-293. In this article economic nationalism is treated not as cultural phenomena, but as a ra-tional and pragmatic means for the Lithuanian nomenclature to remain in power and to expand their economic domination. The theoretical framework of this article is based on Rogers Brubaker’s outline of the Soviet nationality policy. According to Brubaker the Soviet regime institutionalised nationality on the one hand, but on the other the regime sought to exhaust political expressions of nationalism21. The eco-nomic autarkic tendencies among the elites of the Soviet republics is believed to be a by-product of the institutionalisation of nationalism. Forced industrialisation and interests of nomenclature. After Stalin’s death the no-menclature sought a fast industrialisation of Lithuania. The development of heavy industry i.e. machine manufacturing and machine electrical engineering trade was to become the republic’s guarantee of economic success. Industrialisation had to help solve political-ideological and social problems. Until the seventies there was an ample labour force. Thus solving the social problem of unemployment was the goal of indus-trial development and this improved nomenclature’s standing among the public. The creation of the Lithuanian working class was also important politic goal. This was an important moment in the legitimisation of the leaders of the Lithuanian Communist Party as the vanguard of the Lithuanian working class. The neighbouring republics of Latvia and Estonia were more industrialised and this factor helped the Lithuanian nomenclature in requesting investments. During discus-sions between the soviet Lithuanian government and Centre, “republic” usual ap-pealed to the problematic social situation of the republic’s deficient level in compari-son to the neighbouring republics when playing the „investment game” in the USSR. For example, the Lithuanian planning committee in 1965 criticised USSR planning committee prepared the „Baltic Scheme”: „The scheme lacks suggestions how to eliminate the gap between the Lithuanian SSR and the other Baltic States Republics and the average of the USSR economic indexes.”22

21 Brubaker, Rogers: Nationalism reframed. Nationhood and national question in the New Europe,

Cambridge: Cambridge University Press, 1997, pp. 25, 29. 22 Lithuanian SSR gosplan vice-chairman A. Belopetravichius script of 26th February, 1965 to

USSR gosplan, LCSA, collection R-755, file 2, document 5096p. 24.


From the point of economic nationalism it is interesting not only to investigate the inter-republic competition but also to envisage a particular „historic tension”, when it was compared to the interwar economy in Lithuania. The Lithuanian planning com-mittee proposed to create big enterprises, not small agricultural factories, alluding to „the backwardness of bourgeois Lithuania”.23 The suggestion of economic backward-ness in „bourgeois Lithuania” was often repeated. It should not simply be understood as an expression of Soviet propaganda, because the success of industrialisation raised nationalistic euphoria among the Lithuanian nomenclature and technocracy. The re-membrance of the underdevelopment of „bourgeois Lithuania” among the nomencla-ture and the technocracy enables us to envisage a parallel with the thesis on the con-nection between nationalism and Marxism. According to Smith, a sense of late mod-ernisation, or as in the case of Lithuania industrialisation, was combined with urbanisation and the promises of Marxism to speed development, determined ideo-logical sympathies towards Marxist nationalism.24 The expression of communist na-tionalism was to be observed among groups of the Lithuanian nomenclature and tech-nocracy. From the end of sixties the republic authority tried not to receive, but limit the invest-ments in heavy industry, especially in the big cities. The reason for such variation is not found in the change of economical conjuncture, but in the centralised administra-tion of the economy. As a result of the Kosygin reform in 1965 the administration of heavy industry was transferred to common Union ministries and the republics were not interested in using their limited labour resources in the development of industrial branches, which were not subordinate to the republic. The neighbouring Latvian and Estonian republics illustrated the undesirable effects of large-scale migration from the Russian core of the Empire. The growing immigration could cause unrest among the Lithuanians and nationalistic acts, dangerous for the nomenclature’s political destiny. The migration was intended „to scour out” the Lithuanian nomenclature’s base as it voiced new compulsory Russian co-optation in to republic nomenclature stratum. The lack of natural resources helped the Lithuanian nomenclature to limit the heavy industry that was subordinated to whole Soviet Union. The republic territory was not rich in natural resources, i.e. ironstone and other metals that were required for heavy industry. The republic’s nature was beneficial to the development of industry, which after the reform was controlled by the union-republican and republican branches, i.e. the construction, wood processing, food and light industry. It became a handy pretext for the nomenclature to affirm its own administrative objectives in the context of the USSR’s economic principle of benefit. Substantially this principle in its economic logic was close to Leonid Brezhnev’s phrase „the economy should be economical”. Talks on „the more rational usage of local resources” rang true in the context of the Soviet system logic. It involved the concept of the economic benefit of the whole

23 Ibidem, p. 25. 24 Smith, Anthony D.: Nationalism in the Twentieth Century, New York : New York University

Press, 1979


USSR, which is why it was politically safe for the Lithuanian nomenclature, as no-body could incriminate them for being „local”. Conversely, having investment objec-tives lined up, the union ministry couldn’t declare that it was profitable to make in-vestments in the republic because ideologically it would be an incorrect proposition, conceding that some of republics were of a higher industrial standard than others. Having economical autarkic objectives the Lithuanian nomenclature used a large spectrum of arguments that consisted of supremacy resolutions, the republic’s author-ity over juridical acts, individual economic initiatives and economic development programs. These conditionally used measures could be divided into „two levels”. The higher mentioned the respect to the law, the lower problems of realisation. The Com-munist Party Central Committee of the Soviet Union and USSR cabinet council reso-lution of the October 1965 was often used by the Lithuanian nomenclature. The reso-lution gave the republics the possibility of reconsidering plans, which were compiled for the factories that were under the control of union ministries. Additional they get the right to make proposals to the USSR’s cabinet council and to the union state plan-ning committee25. Although the words „to make proposals” sound very limited, in reality it allowed for a wide variety of tasks. The union institutions had a high arbi-trage function in the Soviet economic system and these proposals were parallel to the republic’s authority demands on the union ministries to adjust their investment plans. The use of this right was not terminative. It was important to reason the legitimacy of these proposals with the ministry and the USSR’s supreme power because it was the only presentation of the proposals. Generally a lower level- explanation was used for this. The lack of labour force in the republic or the full employment of the construc-tion organisations, which would have been able to organise the building or expansion of factory requested by the ministry, formed the republic’s cliché of negative answers to the plans of the union ministries. The other arguments and programs of soviet Lithuanian government was the city development scheme (created in 1964), incorpo-ration of the union’s factories into the territorial associations. At the same time another initiative that contained the passions of economical national-ism was presented - wish to produce „Lithuanian products”. The importance of the „Lithuanian product” was clear from the memoirs on their „victories” in producing marketable small diagonal televisions „Šilelis” or refrigerators. Archival sources also point to failures, in which the republic did not manage to convince the union authority of the advantages of manufacturing the final product in Lithuania. The authority in the Lithuanian SSR made every effort to convince Moscow of the benefits of motorcycle production in Šiauliai in 1978.26 Seemingly in this way the Soviet republic wanted to compensate the „Lithuanian car” production objective, which was not realised during

25 The resolution of CC CPSU and USSR council cabinet of 4th October 1965: Решения партии и

правительства по хозяйственным вопросам 1917-1967, Москва 1968, B.5, p. 685. 26 Lithuanian SSR council cabinet script of 22nd of February, 1978, LCSA, collection R-754, file 4,

document 10005, p. 115.


the sixties. However, the resolutions and persuasions did not help and Lithuania did not manage to take over moped production from Lvov in the Ukraine.

The endeavour to eliminate nationalism In trying to achieve its autarkic aims the Lithuanian nomenclature could not rely on national mobilisation. W. Kemp stated: „ They were obviously not interested in rock-ing the boat…”27. The republic authority, which during Stalin and Khruschev era had escaped the cadre cleansing, had to evaluate the political danger of nationalistic manifestations to its political destiny. That is why the aim of the Lithuanian nomenclature was to eliminate nationalism, not to escalate it. In achieving this purpose they not only invoked author-ity but also violence mechanism i.e. co-optation, party penalties and KGB repressions. However, nationalism became the propaganda of the economic victories of the whole USSR and the Lithuanian nation, thus the formation of the loyal identity among the Lithuanian workers occurred. The countenance of the Lithuanian nomenclature au-thority legitimisation among the citizens was based on the frequent proclamation that it was only with the help of the „friendly nations” of the USSR that the Soviet Lithua-nian republic was able to improve from a backward agricultural country into one of the leading republics with a developed industry. The leader of Soviet Lithuania An-tanas Sniečkus wrote in 1968: „During the era of Soviet authority Lithuania became a well developed industrial country […] The creation of the strong and technically perfect modern-day industry is a huge victory of the Lithuanian nation.”28 Cadre politics was very important way for the Lithuanian nomenclature to maintain legitimate authority among the republic’s citizens. It was characterised by the pur-poseful sustaining of the national technocracy and by its push towards the leading po-sitions. Algirdas Brazauskas writes in his memoirs, that supervisors from Moscow were full of complaints if 97 directors from 100 were of Lithuanian nationality.29 Al-though nowadays attempts are made to show this national cadre politics as an element of national identity, we may still find pragmatic aims. Lithuanians became factory managers because of their cultural affinity and the hope that they would take the eco-nomic interests of the republic into consideration. The career of the Lithuanian tech-nocracy helped to form an identity among engineers and workers that was beneficial for the nomenclature. There are lots facts and evidence from former factory directors that the party authority offered help in improving their career and in return they had to agree to become the party members. Suddenly the career of the Lithuanian engineer 27 Kemp, Walter: Nationalism and communism in Eastern Europe and the Soviet Union: a basic

contradiction? Basingstoke: Macmillan, 1999, p. 164. 28 Sniečkus Antanas: Pramonės gamybos efektyvumas – naujų laimėjimų pagrindas [The efficiency

of industry production – the base new victories], in: Liaudies ūkis 1968/2, p. 33. 29 Brazauskas, Algirdas: Lietuviškos skyrybos [The Lithuanian divorce]: Vilnius 1992, , p. 113.


who became member of the party would take off. Factory workers and engineers, as the members of a social group, had to see a reflection of themselves in the behaviour of their manager.30 Co-operation with the technocracy had to become the way of pro-gress for engineers and workers. Loyalty was shown as pragmatic alternative to „na-tionalistic escapades”, if one complained about the Soviet system it was injurious to his career and social prestige. Repressive measures were explained to those, who did not submit to the rules of co-optation, which were suggested by the nomenclature and those, who expressed national unrest.

30 Coicaud, Jean-Marc: Legitimacy and politics: a contribution to the study of political right and

political responsibility, Cambridge: Cambridge university press, 2002, p. 31.

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