Janine Wedel - Collision and Collusion - The Strange Case of Western Aid to Eastern Europe

While bilateral donors such as the United States provided grants directly to NGOs in the region (albeit often using Western NGOs as their intermediaries), the EU’s PHARE program worked through agreements negotiated with the governments and coordination units of the host countries. (In both cases, though, government bureaucracies provided relatively little oversight.) Two main initiatives in Central Europe have emerged from the PHARE program since 1991: “social dialogue” and “civil society.” Social dialogue activities were designed to bolster NGOs in the region by providing information, legal services, training, and grants for projects, while under the civil society program, PHARE has supported locally administered NGOs with funds (typically totaling between 100,000 to 200,000 ECU, roughly $119,000 to $261,0006) administered through the EU delegations in the region. In addition to these initiatives, PHARE has financed NGOs working in social welfare areas through grants administered by the labor ministries in Hungary and Poland as well as financed cooperation and exchange between higher education institutions in nations of the European Union and those of Central Europe.7 By the beginning of 1998, the EU’s PHARE program had contributed nearly 158 million ECU (roughly $194 million8) to support civil society, including NGOs and democracy development in Central and Eastern Europe.9

Yet despite lip service to democracy building throughout the aid effort, as of 1999, the United States had devoted only about 17 percent of its Central and Eastern European aid expenditures to democracy assistance.10 With regard to Russia, the share of democracy assistance was approximately two percent as of 1999.11 Similarly, the EU’s democracy program to Central and Eastern Europe and the former Soviet Union comprised only about one percent of its assistance budget.12

Private donors made an equal—if not greater—contribution to democracy assistance than governments. The collapse of communism galvanized more than 60 European and North American foundations, most of which had not previously been active internationally.13 The Hungarian American financier George Soros, who began philanthropic involvement in the region before 1989, undertook a huge effort. The “Soros network,” as it is sometimes called by insiders, consists of country-specific foundations, network programs, and short-term initiatives.14 Soros has spent more in the region than any other foundation and some bilateral donors.15

But, as with privatization efforts, it would be difficult, if not impossible, for any donor—public or private—to create democratic pluralism from the outside. As anthropologist Steven Sampson has observed, “NGOs in Eastern Europe are unique in that they are specific products of the communist and postcommunist political cultures, on the one hand, while being overtly influenced—if not totally financed—by foreign actors on the other.”16 Foreign financing in the form of grants meant that choices had to be made about just who the appropriate grantees were. Donors were profoundly ill equipped to make these choices. They were easily outdone by Central and Eastern Europeans skilled in the necessary arts of self-presentation and preservation through their experiences under communism.

Just who were these brokers? In Poland and Hungary, many were members of long-standing elite groups who had survived by asserting themselves against a stifling state. Where the state had tolerated pockets of “independent activity” beyond its control, tight-knit groups formed “small circles of freedom” and even pushed the limits of state tolerance in both economic and political arenas. Before 1989 in Poland, for example, many Solidarity activists had redefined reform by redirecting their efforts from political to economic activity and preaching a new philosophy: form a club or lobby to do what needs doing and finance it through entrepreneurial activities. Some people who had previously exchanged underground leaflets at private gatherings turned to trading software and financial schemes. These small circles provided identity, intimacy, trust, and pooled resources, all vital for both political and economic sustenance. Much Western assistance to Central Europe after 1989 was built on the backbone of these energized elites; they cultivated international contacts and set up NGOs and “foundations” to receive Western funds.17 In addition to these established groups, a new class of economically active young adults came into their own in the 1990s. Although, as individuals, some played brokerage roles, they generally were not major beneficiaries of Western aid.

If a few groups had built their base on oases of “independent activity,” and younger participants were forging new ground, others in the region had survived and thrived by planting themselves firmly within the Communist Party apparatus and state. Many visible new businessmen were former nomenklatura operatives; some also set up “foundations.” Further east, in Russia and Ukraine, many intermediaries favored by the West were former communists. As anthropologist Sampson has described, many of these people in the recipient countries learned very quickly how to manipulate and maneuver the new orbit of opportunities:

One sign of the transition is that some individuals who were very good at the “wooden language” of socialism have now mastered the jargon of democracy programmes, project management, capacity building and other catch-phrases such as “transparency” and “empowerment.” Such individuals serve as brokers in the unequal relationship between the west and the east. Like brokers everywhere, they manipulate resources and thrive off the maintenance of barriers. The forum for such activity is the world of projects, and civil society development is part of this world.18

The established groups, regardless of their role under communism, served as gatekeepers for aid from the West. They had carte blanche to put their irons into all fires simultaneously—policy, government, business, politics, and foundations. And so a handful of brokers made decisions and amassed resources on a large scale, by local standards, and Western funding tended to reinforce their success.

The trouble with this is that the choices the donors made were inevitably problematic, especially given one powerful and persistent communist legacy: the pivotal role of the state and its strong, centralized bureaucracy.19 After the collapse of communism, the agendas of the donors and the new leaders of Central and Eastern Europe came together: The donors could secure the demise of the discredited communists and fill the postcommunist power vacuum where it existed;20 the leaders could leverage the aid to consolidate their positions, just as the communists had controlled state resources. This confluence helped to create a paradoxical path for aid to take: The central role of the state under communism smoothed the way for the donors by providing a model that persisted beyond its collapse. And so demons from the past came to haunt aid programs intended to help establish democracy and civil society, just as they had privatization.

AGENDAS IN COMMUNISM’S AFTERMATH

During the period of euphoria and excitement immediately following the collapse of communism, local access to the West was the way to get ahead. One of the many places this could be seen in the spring of 1990 in the newly independent Poland was at the Polish Council of Ministers, a cabinet-level office. There, dozens of Poles were attending a “training for democracy” workshop set up for the leaders of the region’s new political parties and put on by visiting American political consultants and media pollsters.

Aleksander Hall, the minister responsible for political parties, opened the workshop. Soft-spoken and looking uncomfortable in a suit with trousers hanging over the tops of his shoes, he welcomed the guests. The leaders of the “political parties” graciously, deferentially, and profusely thanked the Westerners for coming to teach democracy. “We have so much to learn from you,” said one. The consultants were equally elated to meet the maiden leaders of Poland. The leaders of so many political parties—35—had taken the time to attend the workshop. What a coup! The consultants exulted over the death of communism and said how grateful they were to have this rare opportunity to assist Poland. Listening dutifully, the Poles were treated to an explanation of the importance of fliers and mass mailings in a session entitled “How to Use the Post Office in a Political Campaign”—in a country where one of the greatest political landslides in its history had just been accomplished without the post office, which was notorious for taking days to deliver a letter across town or for simply losing it.