Monday, April 27, 2009

A failing state, yes, Somalia, no...

A commentator to an earlier post wrote something that needs an extensive answer:

It is ridiculous to speak of a failed state in the current situation. What has happened is simply an economic crisis. Granted, the country has gone from unique prosperity to hardship in a few months but this can in no way be considered teh failure of the State.
The economy wasn't dealt with properly and didn't diversify enough. It is incredible to turn this into some sort of failed state. Even more unbelievable is to compare Latvia to lawless countries like those in latin america or in Africa.
There is no sense whatsoever in being so gloomy and announcing the end of the world when the national economy is facing problems. Latvia isn't the first to have difficulties or to be bankrupt, nor will it be the last.

First, I made it clear that state failure in Latvia was different from that in Africa. It is not a lawless area with khat-chewing gangs roaming the streets in "technicals" and probably never will be (no khat, bootleg vodka, maybe). The state has a) dramatically failed to take adequate notice of warnings of the impending crisis and failed to take measures to prevent and alleviate it (what is being done now is burning down the barn to spite the horse running off to the woods) b) it has also failed to gain, and has probably completely lost the trust of its electorate and population. 49 % of young people in high schools or university (of some 1300 queried) see no future in Latvia and say they will move to work or continue their studies in a foreign country. This is the choice of governance issue I have written about earlier. There is no real choice to replace the current elite in Latvia, not in the timespan in which a number of irreversible events in the process of economic collapse and social degeneration will take place.
To be sure, there is a global economic crisis, trigger to a greater or lesser extent by policy mistakes in a number of large economies (in the US, stimulating the proliferation of subprime mortgages), but exacerbated by misgoverance in Latvia -- unshakeable political arrogance, corruption, cronyism. The present government is simply a hapless fall-guy, for whom it is too late to take any action to prevent an inevitable collapse of the state budget during the summer, a devaluation of the lat, dramatic levels of unemployment (even with the state printing money) and stagflation throughout most of the next decade, even as Europe and the rest of the world recover and Latvia's workforce migrates to work and live in better managed states and economies.

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