This is the second week that LeftEast features texts prepared by the working-groups of the Balkan Forum. This week’s text addresses the exploration of economic alternatives in the region. The Balkan Forum’s Working Group on Economic Alternatives was composed of: Petra Rodik, Vladimir Cvijanović, Primož Krašovec, Vladimir Unkovski – Korica, Milan Medić (coordinator).
The global economic crisis, which began with the collapse of the U.S. real estate market in 2007-2008, was reflected unevenly in the Balkans, but had similar end results. Growth in the region prior to the crisis had been founded on the inflow of foreign capital, which was financed by the overvaluation of domestic currencies, so that borrowing would be cheaper. This resulted in the domestic economies becoming progressively less competitive, due to the technological gap with the developed countries. The weakening of the competitiveness and the purchasing power of the Balkan countries was covered for some time by further borrowing, leading to the even greater unsustainability of the rising debt. The results were similar everywhere: the privatisation of state and public property, often at prices below market value, for the purpose of filling the budget or further concessions to strategic investors; the growth of a comprador bourgeoisie and the mafia, with a resulting and disastrous corruptive influence on the state apparatus; socialisation of private debt and budget cuts, de-industrialisation and the destruction of the welfare state, the concentration of wealth and power in the hands of a very small number of people drawn from the already mentioned comprador bourgeoisie, alongside the impoverishment of the rest of the population, and the deepening economic and political dependence of the Balkan countries and the strengthening of repressive governments. (1)
Today it is quite clear that the welfare state as it existed roughly three decades after the Second World War in America, Western Europe and the Balkans no longer exists. On the other hand, the volatility of economic cycles as well as income inequality have increased dramatically. Extensive research by Stockhammer (2) indicates that the main reasons for an increase in global income inequality are financialisation, globalization and the retreat of the welfare state. The problem arises in connection to the unemployment of workers with lower qualifications, (3) but also youth unemployment and long term unemployment. All these trends are visible in the Balkans. The economic crisis, which in many countries of the Balkans has continued since 2008, thus represents a constant pressure on workers and the budgets of ordinary citizens of these crisis-hit countries. That deepens the crisis, because aggregate demand fails to achieve growth. On the other hand, pressures also increase on the environment, which is being irreversibly plundered, making the sustainability of the prevailing socio-economic model even more questionable over the long term.
Banks as the cause of the deepening crisis
The banking sector represents a particular problem and the main instrument for conducting unsustainable economic, and thus social and political, trends in the Balkan countries. Banking operations in the region proved to be extremely socially irresponsible and require serious thinking about alternatives. Foreign banks that control the largest share in the financial markets of the Balkan countries entered into the region during the process of privatisation expecting a high rate of profit. A key factor in the entry of foreign banks into the market were high interest rates, and the expectation of credit expansion. (4) Unfortunately the dominant banking trends were visible even in the few remaining domestic banks in the region. Domestic banks, though they represent only a marginal share in the overall financial market, imitated the profit-oriented policies of the major foreign-owned banks and additionally contributed to the crisis. Thus, the region found itself in a situation without any real banking alternative that would focus on investment for development in the real sector, strengthening competitiveness and production, and thus creating new jobs.
Instead of investing in production and jobs, the deficiencies of legislative regulation and the policies of central banks allowed for the emergence of very risky loan products to citizens. The risk created by these loan products came into the full light of day only with the outbreak of the crisis. One of the most drastic examples of risky banking products was the long-term (particularly the residential property) loan indexed to the Swiss franc. (5) In Croatia alone, loans pegged to the Swiss Frank CHF (launched in 2004, but withdrawn from the market in 2008) covered over 40% of long-term lending by 2012. The sudden appreciation of the CHF exchange rate since 2009 resulted in an increase in monthly instalments, which affected about 125,000 households in Croatia. The increase in value of CHF peaked in summer 2011, which put the value of CHF on average at 50 percent above the level of the exchange rate in the years when these loans were raised. Local research clearly shows that for the greatest number of indebted citizens (35%) somewhere between 50 and 75 percent of monthly income is spent on servicing this loan, while 32 percent of respondents spend over 75% of monthly income for the same purpose. For a third of respondents, the payment exceeded their monthly income at least once during the period of the servicing of their debt. The rate grew between one and two thousand kuna for a majority of respondents; for people who have a mortgage in CHF the spending rate on all loans in CHF increased by 2012 by 50.94 percent. (6)
The final and perhaps most important problem is the structural problem of the neoliberal concept of economic governance. As this model is the basis for post-socialist transition in the Balkan countries, its contradictions have been fully exposed only with the onset of the crisis.
According to the classic capitalist business model, workers do not participate either in the management of the company or in the ownership structures of the company, and certainly not in the distribution of profits that the company generates. It is believed that they are freely exchanging their capacity to work for a wage. Thus, for instance, despite the growing economic crisis in the U.S., the average chief executive officer (CEO) of U.S. financial institutions had 520 times the income of the average employee in these same institutions in 2008. (7)
However, even in traditional countries in the “capitalist West” emergent issues raised by the new economic crisis have shaken the faith in this traditional concept of a typical capitalist enterprise, because the system has proved that even the owners (shareholders) do not participate directly in the decision-making process. It became clear that the undemocratic model of appointment of directors and management leads to unexpected consequences. Studies show that such a model often results in bringing irresponsible, incompetent, and sometimes even socio-pathological individuals at the highest managerial positions in companies. (8) The economic model that aims only to increase profits for shareholders directly stimulates the progression of people who are prepared to offer shareholders a profit regardless of the means. It is quite clear that such a system, based on ignoring all social and ethical norms, inevitably creates social and economic chaos. The unsustainability of the capitalist economic model is evidenced by continuously generated economic and political inequality with increasing elimination of basic human and labor rights, already fully reflected in the transition countries of the Balkans, especially in times of crisis. The problem of the capitalist model is not just of a transient or technical nature, but is a consequence of the deep internal contradictions of the capitalist system that is based on deep-rooted inequality, which inevitably tends towards socio – economic collapse.
Alternatives – new and old models of getting out of the crisis
In the Balkan region, after the withdrawal of foreign capital and the destructive intervention of foreign creditor institutions, there has been an increase in resistance to government measures across the region and the public affirmation of a “really existing” alternative or alternative movements. An especially heated battle is being fought in the private sector, where de-industrialisation facilitates various forms of employee resistance like employee ownership, self-management, or the coalescence of worker protests. (9) However, resistance is also developing outside the private sector, in the public sector and in the struggle for the commons. It includes a variety of initiatives: trade union struggle for the defense of the welfare state; (10) student struggle against commercialisation of education, (11) social struggle for the preservation of public spaces, (12) or the struggle for the rights of oppressed groups in the retraditionalised periphery. While these struggles had before been isolated, the logic of an all-embracing crisis has forced the resistance to increasing political generalisation, where the highest level of struggle was expressed on the streets rather than the workplaces, which in turn also strengthened the workers’ struggle, in a process that Gal Kim called the “birth of the people.” (13) In the Balkans, the culmination of the movement was without a doubt the threat that the movement would actually assume political power with the break-through of SYRIZA in the Greek elections in summer 2012 which opened up the possibility of a left government. At the centre of the economic programme of SYRIZA was the invitation to the official conference for the cancellation of the debt of the European South and massive investments in the real economy, a program that was modelled on the Marshall Plan. (14)
Despite the similarities in the crisis tendencies in the Balkans, similar modes of resistance, a similar cultural-historical heritage, and new forms of grassroots cooperation facilitated by new technologies, especially communications, the fact is that the role of the world market had an atomising effect on trade between the region’s countries or has even encouraged intra-regional conflict. Slovenia is the only former Yugoslav republic that has investments and outsourced production in the rest of the region, and it managed to do this only at the expense of its own workforce, and in response to the crisis. All other countries have a balanced trade, which is largely focused on the EU, either directly as is the case with Croatia or indirectly via the free trade agreement, CEFTA. (15)
In considering options on the way forward in the Balkans, the question is raised of whether we can learn how to exit the crisis by looking at Latin America today. The grassroots radicalisation of politics there, beginning with the Argentine uprising in the early 2000s, and its experiments with self-management and the refusal to repay foreign debts, and continuing up to the present struggle for the unity of the continent, led by Venezuela, Bolivia and Ecuador, the leading left governments established after the popular uprisings against the right-wing coup attempts in Venezuela in 2002, and then in Bolivia and Ecuador 2006 could be examples that show promise also for the development of mass resistance in the Balkans. (16) The idea of regional unity and institutions that would accomplish this goal are varied and complex. The dynamo is the ALBA (the Bolivarian Alliance for the peoples of our America), an association that brings together the most radical countries of the continent, and which provides for the creation of a common currency and closer economic cooperation, and Banco del Sur (Bank South), which opened the way for a common fiscal instrument in the region, which the European Central Bank, for instance, is not. The idea is for ALBA to create, within regional trade alliances, such as MERCOSUR, the climate for regional cooperation against the U.S. zone of free trade, and thus, by protecting the region from the stronger economies, to create a larger market.
At the same time, the Banco del Sur is the agent of counter-cyclical measures that protect the region from speculative attacks and provide monetary sovereignty, fighting against the outflow of capital due to the growing share of Western banks in the regional financial structure, and investing in the economy and inter-regional infrastructure projects with the aim of full employment and the reduction of regional disparities. (17) Such a project would, in the concrete situation in the Balkans, pave the way for new emancipatory practices. But unlike Latin America, where the existence of oil and other strategic resources which were required by a growing Chinese industry allowed for the funding of social reforms and “oil diplomacy” without a frontal attack on the private ownership of the means of production, in the Balkans it seems that a programme for the redistribution of wealth would be impossible without direct confrontation with big business (capital). Moreover, the link between market competition and regional tensions in the Balkans is even sharper. This means that every crisis in the Balkans is potentially hotter, and at the same time transition towards regional cooperation and economic recovery is all the more difficult because of the need to include the national question in the allocation of scarce resources.
Economic democracy as a possible exit route
This is why economic democracy appears like a politically realistic concept, which does not require the overthrow of capitalism or a sudden revolutionary “event”, but rather the expansion of the area of freedom and political power of workers as employees within the framework of the capitalist mode of production. In this sense, economic democracy, if it is based on workers’ power and autonomy, can be interpreted as a counter to the concepts of democracy of small private owners, which prevailed in the eighties and nineties, during the high tide of neoliberalism. Today, when the ideological hegemony of neoliberalism is loosened, – because of the theoretical inability to predict and interpret the crisis and the economic and social devastation caused by the way in which the crisis was handled – a view of the economy from the perspective of the market and the consumer is no longer dominant.
The consumer’s view was one of the ways of rationalising and legitimising the privatisation of public institutions and services – in the place of the rigid, and, in relation to the needs of the users of public services, the insensitive, heartless bureaucracy, privatization was promised to bring entrepreneurial spirit to these institutions and manufacture new managers, who would no longer work with bureaucratic inertia but a desire for profit, and enable “consumers” of public services (patients, students, the poor, pensioners) greater choice and greater “value for money”.
We can immediately notice a certain non sequitur in the above line of argument. While it is admittedly true that many public institutions tend toward bureaucratic heartlessness and detachment from the real needs and wishes of its customers, which was the reason for so much criticism of the welfare state from the left and right in the sixties and seventies, it does not follow that privatisation is the automatic cure. That would be the case if we took as the main reason for the alienation of these institutions their ownership by the state, while, in fact – if we leave aside the rather superficial and shallow “argument” of the state as “bad manager” – we are dealing with a much deeper and more complex problem, which we can, for now, only sketch. Specifically, public institutions, as well as private firms, are an integral part of capitalist society as a whole and are thus more similar and more connected with the private sector than is assumed in the simplified propaganda for privatisation, which is dominated by a Manichean view of the public and the private.
Public institution and social welfare are not immune to the general context of capitalism, although they do not enter the market and are not organized as capitalist companies. Although they are sometimes portrayed as unnecessary and economically irrational “squanderers of public resources”, their role in the reproduction of the labor force makes these institutions important for the smooth functioning of capitalism. The general capitalist social context reduces human development to the reproduction of labor power as a commodity. This is the origin of the specific type of alienation of many public welfare institutions – they are not bureaucratically incompetent or corrupt due to their management or due to a lack of entrepreneurial spirit, but because of their economic purpose. This means that their goal is not and, at least under capitalism, should not be, autonomous social development, which is based on social needs, but rather the “expanded reproduction” of labour, which is dictated by the general socio-economic imperative of maximizing profits through the exploitation of labour. Although using different methods – the former bureaucratic planning, which is based on statistical approximations, and the second “hit and miss” market strategies – public institutions and private companies are similar in their indifference to human needs. With the neoliberal privatisation of social institutions it is becoming increasingly obvious that a change of legal status from public to private does not change much regarding this structural alienation from real human needs. However, privatisations has changed something else – working conditions and the mode of delivery of social services. What “in theory” should lead to greater sovereignty and consumer satisfaction (which is, if we judge by the results of the effect of large privatisation wave in Europe in the eighties and nineties of the 20th century, at the very least a questionable assertion), leads in practice to a deterioration of working conditions for workers in the public sector, to their de-professionalisation and proletarianisation, increases in the pace and intensity of work, its precariousness etc. Ideological propaganda about consumer democracy in the heroic era of neoliberalism were actually camouflage for an attack on workers’ rights in the public sector. The democracy of small private owners as well as consumers, at least in the context of neoliberal capitalism, stands in direct opposition to economic democracy or workers’ democracy.
Recent discussion of economic democracy is therefore a welcome refreshment since it implies returning to the question of democracy and workers’ autonomy in a debate in which consumer perspectives have (too) long dominated. But even the consumer perspective is not irrelevant, it is just that the way in which it presents itself in neoliberal ideology (and economic theory) is wrong. In fact, worker and consumer democracy are inextricably linked and their theory, to be adequate, must necessarily address the structural separation of workers from consumers (and vice versa), as well as one of the main problems of the capitalist mode of the economy – production for profit, not for human needs. So, regardless of whether there are workers’ councils and whether the workers themselves control production, they are still separated from consumers and communicate with them only through the mediation of the market. Therefore, one of the great challenges of political strategy, based on economic democracy, is how to bring production and consumption closer and how to find new ways of synchronising social production with social needs and of replacing, over the long term, the capitalist market.
The deep economic and social crisis that the existing socio-economic system created suggests the need for questioning the basic assumptions of the model of “democratic capitalism.” The question arises of how compatible the concepts of democracy and capitalism in fact are, i.e., whether democracy is possible under the conditions of an economic system that is based on the preferential value of capital in relation to the value of work, and (consequently) the concept of private ownership which excludes workers from ownership and decision-making, and is focused on the increase in the profit of capital owners alone. Many companies, basing themselves on the principles of increasing employee satisfaction and improvement of the working environment, are trying to introduce profit-sharing incentives to motivate workers. Although still incomplete, these measures represent the first step in the direction of democratization of companies, because they open the possibility of participation of employees in the realised profit of the company, although not yet in the ownership structure and decision-making process.
Employees and consumer own(ed) companies
The most famous example of this model is originally an American model of employee buyouts – ESOP (Employee Stock Ownership Plan), which is widespread in other market economies. In the Balkan post-socialist countries, there are examples of successfully implemented ESOP models of employee shareholding, which have saved the companies from deliberate destruction or hostile takeovers and ensured recapitalisation and job preservation (Uljanik Pula, Zagreb Kraš). The most famous Serbian attempt to introduce employee shareholding in a company is Jugoremedija, while the most famous Croatian example is an employee shareholding company ITAS Prvomajska, which is also an example that is not carried out by a model of gradual buyouts according to ESOP, but through the bankruptcy process with realignment where workers become exclusive business owners. Despite the positive developments when applying ESOP, the control component of such models for employee shareholding, which would give employees a say in making business decisions, is still relatively negligible. (18) However, this very fact encourages the further development of the model through the introduction of other systems of democratic control of the company.
Besides the aforementioned models of employee shareholding, there are other forms of business organisations where there are attempts to distribute management rights and democratic ownership structures to a large number of company employees. The traditional form that is often used in doing so is the concept of cooperatives. Coops set democratic management as one of the key goals. However, the cooperative system in the post-transitional context of the Balkans is not a very popular model, especially in the business circles of the region, where the mere mention of cooperative system provokes deep suspicion. Thus the transition societies of the Balkans are not in step with European and world experiences in the usage of the cooperative model of self-organisation of producers and consumers. The ideas of economic democracy started in the early cooperative socialist movement and remains alive until this day. These ideas developed consistently through various forms of democratic cooperative enterprises over a period of 150 years. Therefore workers’ and consumers’ cooperatives remain a particularly interesting form of cooperative businesses.
They represent one of the earliest forms of self-organisation of workers from the era of the First Industrial Revolution, representing an alternative to the classical capitalist ‘work for wages’ approach. By the standards of the International Cooperative Alliance, one of the goals of workers ‘cooperatives is “the creation and maintenance of employment with the creation of wealth in order to improve the life quality of members (cooperatives), to protect the dignity of work, allow self-management and encourage the development of local communities.” Despite the fact that there are different approaches to self-organisation of workers’ cooperatives, many of them tend to introduce more democratic forms of participation of the employees in the company management. But aside from the democratic encouragement of workers’ participation in the decision-making process, these businesses are focused on increasing the quality of life for all members of the local community, not only focusing on making profits for the few owners of the capital. This approach shows an extreme resistance to the adverse effects of the global economic crisis. Indicators from Spain show that in times of the worst economic crisis, the Spanish working cooperatives increased the number of their employees by 7.2% in the last quarter of 2011. (19) That is the reason why so many workers’ coops successfully operate and grow within the capitalist system and market economy. The most famous example is the Basque federation of workers’ cooperatives Mondragon, which employs over 90,000 employees and operates with an annual revenue of over 14 billion EUR. The trend of establishing workers’ cooperatives is particularly present in the Mediterranean countries (Italy, France); Anglo Saxon countries (USA, Canada, UK) and countries of Latin America, with emphasis on Venezuela and Bolivia, where workers’ cooperatives are part of official government policy.
The second most common form of organizing cooperative business represents cooperative enterprises that are owned by their consumers. These companies are owned by their clients. The particular goal of this form of democratic enterprise is to increase the quality of services, while reducing the cost of services and goods offered by the company. According to the International Cooperative Alliance, more than 100 million people work in the consumer cooperatives, which is 20% more employees than in the multinational companies. The oldest and largest consumer cooperative in the world is the British system – The Co-operative Group, which offers a wide range of services and employs over 120,000 workers and the ownership structure makes over 7 million people in the UK customers of this enterprise. In the Netherlands, housing cooperatives own 40% of the total housing stock. In Switzerland, New Zealand and Singapore consumer cooperatives generate over 50% of sales through their own home ware retailers. (20) It is very important to note that the hybrid form of consumers’-workers’ (employees’) management is very common in the case of consumer cooperatives. In such a management model, all beneficiaries (including employees) participate in the democratic strategic decision-making and profit-sharing, while daily business operational decisions are made by the employees themselves.
Democratization of the work process and the responsibility towards community
Many enterprises owned by employees and consumers implement other forms of humanisation of the working process through attempts to diminish the division of labour. Many democratic enterprises, regardless of the legal form of registration, apply the rotation of employees to various jobs (Suma Whole foods) or rotation of workers within the same production facility (Mondragon).
However it must be emphasised that the democratic management of enterprises should not be reduced merely to the cooperative form of business registration. Britain’s biggest retail chain company John Lewis Partnership, with over 70,000 employees, is registered as a classic holding company, owned by a trust for all the employees, while working for the company. The largest employees’ owned enterprise in the United States is also a supermarket chain company Publix, which employs more than 120,000 employees, and is also registered as a joint stock company.
The relatively new concept of social entrepreneurship is especially notable in this respect. Some European countries have already adopted specific legislation with an adequate form for the registration of social enterprises (e.g. Italian law on social cooperatives from 1991, or British registration form CIC – Community Interest Company of 2005). (21) Social enterprises are businesses that are structured not only to maximise profit but also to achieve economic, social and the environmental objectives that benefit the community within which they operate. Examples of such enterprises exist throughout the world and generally show that such economic structures are significantly more resistant to the effects of the economic crisis. Because they are not only profit-driven, they operate successfully in situations in which traditional structured companies had difficulty. The first significant social enterprises in the post-socialist countries in the Balkans are in Slovenia and Croatia. The leading group of social enterprises in Croatia is represented by Act Group, a consortium of seven social enterprises, mainly cooperatives operating in Međimurje County, while the leading Slovenian social entrepreneurs are gathered in the Slovenian Social Entrepreneurship Forum. The importance of social entrepreneurship is recognised by the EU, (22) which already has over 2 million social enterprises that employ over 11 million people. The modest Croatian and Slovenian attempts in this direction, as well as the European experience, certainly point to social entrepreneurship as a concept through which the Balkans’ untapped economic resources can be put back into the function of corporate social responsibility in the region.
In the field of financial services, one of the alternatives to short-term oriented and socially irresponsible banking are ethical banks (social banks). Instead of a single bottom-line logic, which takes into account only financial profitability, these banks take into account the triple bottom-line logic in which, besides profit, social and environmental consequences of business are taken into account. (23) These forms of financial institutions are increasingly the main source of financing for democratic enterprises and social entrepreneurship. Classic commercial banks finance projects under the assumption of creating their own profits. By doing social business through commercial banks, part of the social capital of the company ends in the profit-oriented commercial banks. To avoid this, there is a trend of establishing ethical banks that are inherently social enterprises. The model offers the possibility of ownership and management rights to its customers (depositors) with the most favorable financing terms, and by doing so covers only their real costs and risks. Companies financed under these conditions are competitive in the market and more sensitive to the needs of their clients. In addition, the ethical banks often finance and develop projects that are useful to society. Profits from such projects are reinvested in new communal projects. This model usually helps social/ethical banks to improve their business and to expand their capacities even in the periods of economic depression. Examples of ethical banks in Europe are: Triodos and Robobank in the Netherlands, the Caja Laboral Popular in Spain Cooperativa, Banca Etica in Italy and many other ethical and alternative banks assembled in the alliances of European Federation of Ethical and Alternative Banks (FEBE). The first post-socialist Balkan initiatives for the establishment of these banks already exist in Croatia and Slovenia. Only the future will show whether they will be successful under the conditions of “Comprador Capitalism” that prevail in the region.
Macroeconomic measures that support democratic economy
Models of economic democracy should be combined with macro-economic regulation to ensure their complementarity and institutional sustainability. Potential solutions can be found in three main measures, although they should be combined with others to make their effects complete. (24) These are: a minimum guaranteed social income, reduction of working time and the write-off of debts.
The minimum guaranteed social income appears as a measure that corresponds to the negative socio-economic effects of modern capitalism expressed through two moments. The first concerns the great instability of the economic developments that cause unemployment, unequal distribution of income and the precariousness of workers. The unequal distribution of income, combined with the increasing dependence on the financial markets, either through the realisation of capital income today or through pensions, which are entrusted to pension funds that invest in the equity markets, means that aggregate demand cannot continually increase, as was the case in the period of mass production (Fordism). This has negative implications on economic growth that in the current framework serves as an inseparable component of development, but also as the basis of legitimacy of the prevailing economic and political systems. Another element of the explanation concerns the dependence of people on income from work due to the existence of the underlying security or, in Marxist terms, exploitation. In this context, the minimum guaranteed social income has a dimension of justice, not only because it provides the material basis for life, but also because today, due to the nature of production, which is primarily intangible and based on knowledge, it serves as a monetary award for socially recognised work, of which our very existence consists. (25) A minimal guaranteed social income has several characteristics, which can be subdivided into the following: it is guaranteed to everyone and it does not serve as a substitute on the social protection measures which should exist. Furthermore, it is compatible with other initiatives aimed at radical change of the system, as is the reduction of working hours.
Reducing working hours should provide benefits to the environment, people and economy. In short, people would thus change their consumption habits and work more from home, which means a smaller ecological imprint and greater environmental benefit. The measure would affect the arrangement of working hours among those who currently are employed and those who are not, and would also change the family arrangement of ‘paid’ and ‘unpaid’ working hours, which brings more equality in society. The economy would experience an increase in the productivity of workers, who would be oriented towards having less debt through loans for consumerist purposes, and the state budget would endure less pressure that it currently experience, due to the high external and public debt, which is a significant issue. (26) These measures significantly alter the pillars of the capitalist system. If the system is characterised by the domination of private property and exchange based on the market, as well as the ‘indirect’ forcing of workers to work for a salary, then, clearly, the measures introduced above create a more humane system. This allows greater voluntary production for people’s own needs and the needs of others, or the production of common goods, which are not governed by any market or governmental control. But today it is necessary to do even more than that, due to the imminent collapse because of the constant increase of exploitation of national resources, expressed through a concept called environmental footprint. (27) Additional measures, concerning the social level, include a radical shift in fiscal (progressive taxation, cap and share among similar programs for income redistribution and penalising excessive exploitation of natural resources) and monetary policy (with full banking reserves that will restore the social control over the creation of money).
Finally, in order for the Balkan countries to manage to throw off the burden of underdevelopment and overthrow debt bondage, the “real existing” alternative movements in the Balkans can only survive by rejecting the logic of competition and networking on an equal basis. In economic policy that must include, as a key process, the progressive overcoming of both the state and market models. It is necessary to work towards a socially-planned economy, in which the starting assumption is that we are social beings who depend on wider processes. In this sense, it is necessary to recognize and accept that the goal by which success should be measured is the creation of public property, which could be defined as “the right of ownership of those affected by the usage of given economic resources, proportional to the degree to which they are affected by the same.” (28) On this assumption it is possible to develop a wider plan for the economy, in which the political and economic factors, and therefore democracy, are the essential preconditions. Precisely the requirement to refuse to pay the debt and to systematically undermine the influence of the international market on the regional economy through fiscal and monetary union, capital controls and international taxation of financial transactions, with full employment, would be the first necessary steps towards the gradual elimination of the competitive logic of the capitalist world market and the creation of a truly free association of producers worldwide.
The development of the above mentioned components plus an active support for the development of democratic, social and environmentally responsible businesses are extremely important factors in the development of society. They ensure that development occurs according to principles which ensure a fair distribution of created value and its orientation to the projects of the utmost importance to the community. The common thread that links the thought behind these alternatives or “new” approaches to economic organisation can be defined as a systematic attempt at overhauling the relationship of labour and capital within the company. (29) This is an attempt to change the power relations and expand the steering rights from the current narrow group of corporate shareholders, the owners of capital, to the wider circle of those who participate in the creation of surplus value through the production process, like the employees, customers, consumers, and members of the wider community. It should be mentioned that changes in the economic relations, aimed at ensuring full economic participation, also open up the possibility of achieving full political participation. (30) That is why this process plays a more important role than just an economic one, because at the same time it contributes to the democratisation of social relationships more generally, starting from the democratisation of production relations.
- Friedman, J. and Schady N. (2009), ‘How Many More Infants Are Likely to Die in Africa as a Result of Global Financial Crisis’, The World Bank, Policy Research Working Paper 5023, August 2009, i.
- Živković, A. (2011), ‘Bankrot Evropske Unije: ili kako izaći iz Evro- dezintegracije’, Zarez, XIII/322, str. 28-30
- Stockhammer, E. (2013), ‘Why have wage shares fallen? A panel analysis of the determinants of functional income distribution’, Conditions of Work and Employment Series No. 5, Geneva: International Labour Office.
- Orsi, C. (2009), ‘Knowledge-based Society, Peer Production and the Common Good’, Capital & Class, 33: 31-51.
- Kraft, E. (2003), Strane banke u Hrvatskoj: iz druge perspektive. Za- greb: HNB; Ćetković, P. (2011), ‘Credit Growth and Instability in Balkan Countries: The Role of Foreign Banks’, Research on Money and Finance (27)
- Placements associated with CHF are primarily spread from Austria and Germany, in 2004; it has particularly increased in Hungary and Poland. Structure of investments related to CHF shows that in Europe in 2007, 70% of placements related to CHF were concerning housing loans. Brown, M., Peter, M. and Wehrmüller, S. (2009) ‘Swiss Franc Lending in Europe’, Zurich: Swiss National Bank, p. 6
- Rodik, P. (2012), Kreditna zaduženost i pad životnog standarda, Zagreb: Franak Association, http://www.scribd.com/doc/ 1129986 30/Istra%C5%BEivanje-kreditnih-du%C5%BEnika [Accessed on 30 July 2014]
- ‘Corporate Democracy is a Myth’, The Ichan Report, www.ichan- report.com/report/2008/06/corporate-democ.html Accessed on 30 July 2014]
- Babiak, P., and Hare, R. D. (2007), Snakes in Suits: When Psychopats Go to Work, New York: Harper Collins Publishers.
- For the former Yugoslav region, see Nebojsa Popov, ed. (2011), Mesto pod suncem: Radničke borbe u Srbiji danas, Belgrade: Official Gazette; Pokret za slobodu (2011), Deindustrijalizacija i radnički ot- por: borbe i inicijative za očuvanje radnih mesta u periodu tranzicije, Belgrade: Movement for Freedom; ‘Deindustrijalizacija Zagreba: kontekst i učinci’, H-Alter, 15 November 2012, http://www.h-alter. org/vijesti/hrvatska/deindustrijalizacija-zagreba-kontekst -i-ucinci [Accessed 30 July 2014]
- See Bernard, S. and Unkovski-Korica, V., ‘Crashing The Yugo: FIAT’s turn in the Driver’s Seat’, Inchiesta, 15.01.2012, http://www. inchiestaonline.it/osservatorio-internazionale/serbia-crashing- the- yugo/ [Accessed on 30 July 2014]
- Kurepa, T. et al. (2007), Borba za znanje: studentski protest – student protests in 2006, Belgrade: CAD.
- Jadžić, M. (2011) ‘Prostor, urbanizam, politika u postsocijalis- tičkom gradu’, Jugolink, no. 1, p. 70-84.
- Kirn, G. ‘O ustaničkom pokretu u Sloveniji: mase prave povijest’ , 19 decembar 2012, www.marks21.info. [Accessed on 30 July 2014]
- Alexis Tsipras, public speech in London, 16 June 2013, http://left. gr/news/syriza-london-public-talk-alexis-tsipras [Accessed on 30 July 2014]
- Živković, A. (2014), ‘Evropska integracija pre evropske inte- gracije: o poreklu sadašnjih dužničkih kriza u bivšoj Jugoslaviji’, in Ćurković, S. and Kostanić, M., eds, Kriza eurointegracija – lijeve perspektive s periferije, Zagreb: Center for Labor Studies.
- Katz, C. ‘Latin America’s New ‘Left’ Governments’, International Socialism Journal, 27 June 2005, http://www.isj.org. uk/?id=124 [Accessed on 30 July 2014] and Katz, C., ‘Our Chavez’, Internation- al Viewpoint, 22 March 2013, http://internationalviewpoint.org/ spip.php?article 2929 [Accessed on 30 July 2014]
- Marshall, W. and Rochon, L. (2009), ‘Financing Economic Development in Latin America: the Banco del Sur’, Journal of Post Keynesian Economics, 32 (2), 185-198.
- Menke, J. D. and Buxton, D. C. (2010), ‘The Origin and History of the ESOP and Its Future Role as a Business Succession Tool’, Journal of Financial Service Professionals, May 2010.
- Kelly, N., ‘Spanish cooperatives see an increase in Employment of up to 31%’, The Co-operative News, 2012.
- International Cooperative Alliance, ‘Statistical Information on the Co-operative Movement’, 2012
- Petričević, Teodor, ‘O društvenoj ekonomiji i društvenom po- duzetništvu’, in Poduzetništvo u službi zajednice: Zbornik tekstova o društvenom poduzetništvu, Zagreb: Nacionalna zaklada za razvoj civilnog društva.
- See ‘Social Economy’, http://ec.europa.eu/enterprise/policies/ sme/promoting-entrepreneurship/social-economy/index_en. htm [Accessed on 30 July 2014]
- De Clerck, F. (2009), ‘Ethical banking’, in Zsolnai, L. (ed.), Ethical Prospects – Economy, Society, and Environment, Berlin, Heidelberg and New York: Springer, 209-227.
- Orsi, C. (2009), ‘Knowledge-based Society, Peer Production and the Common Good’, Capital & Class, 33: 31-51.
- Vercellone, C. (ed) (2007), Kognitivni kapitalizam: Znanje i financi- je u postfordističkom razdoblju, Zagreb: Politička kultura.
- Fumagalli, A. (2000), ‘Ten Propositions on Basic Income’, http:// www.bin-italia.org/article.php?id=1293 [Accessed on 30 July 2014]
- NEF (The New Economics Foundation) (2010), 21 Hours: Why a Shorter Working Week Can Help Us All To Flourish in the 21st Century, London: New Economics Foundation.
- Meadows, D., Randers, J. and D. Meadows, D. (2004), Limits to Growth: The 30-Year Update, London: Earthscan
- See review articles in Historical Materialism 15 (2007) 173–232.