Eastern Europe's neoliberal disaster provides a warning for the Arab spring

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Rather than help enhance democracy and reduce corruption, following western advice on privatisation does the exact opposite

Neil Clark
guardian.co.uk, Sunday 20 May 2012

"I wonder if David Cameron spent any time in eastern Europe in the 1990s.

Judging from his recent remarks about the Arab spring and international aid, the British prime minister seems to believe that having a more "open" and "free", ie privately owned, economy is the key to both economic development and a successful transition from one-party rule.

The evidence from the former communist countries gives lie to that neoliberal viewpoint. In a recent study entitled Mass Privatisation, State Capacity, and Economic Growth in Post-Communist Countries, published in American Sociological Review, sociologists from the universities of Cambridge and Harvard claim to have established a "direct link" between the mass privatisation programmes followed by around half the countries of the region – enthusiastically urged upon them by western economists and western financial institutions – and the "economic failure and corruption that followed". The more closely the countries followed western advice, and the more they privatised, the worse things became......."