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

The idea to support democracy and pluralism is a very good one. But that has nothing to do with using NED funds to bolster leftist groups in Poland while the center and center-right groups receive no funds at all.39

A KPN spokesman further complained:

The groups that emerged from the Communist Party and its allies and Solidarity have enormous resources and maintain an almost complete monopoly in the media while independent political parties that enjoy increasing popular support are denied resources or equal access to the media.… Leaving all the American assistance in the hand of one political orientation is not acceptable. It is as if in the United States all finances for political campaigns were given only to the Democratic Party, which would allocate or promise to allocate some money for the Republican Party.40

The pattern of providing funding to explicitly political parties and groups continued farther east. Between 1992 and 1997, USAID awarded NDI and NRI a combined sum of $17.4 million to conduct programs in Russia. From 1990 to 1992, these organizations used about $956,000 in NED funds to help the anticommunist Democratic Russia Movement establish a printing facility and disseminate literature. NDI and NRI also conducted civic education and grassroots organizing programs for Russians at the national and local levels. According to USAID, the purpose of the grants was to help reformist political parties strengthen their organizations and their role in elections, parliament, and local government.41

These cases reflect a larger pattern: in general, donors assisted Central and Eastern European groups associated with people whom the West identified with programs of market reform (such as that of Finance Minister Leszek Balcerowicz in Poland, where the most vocal alternatives to the Balcerowicz program were postcommunist or nationalistic populist programs). In other words, economic agendas appear to have been the decisive factor in many aid decisions said to be about democracy, pluralism, or civil society.

Significant differences characterized the structures within which aid was distributed in Central Europe, as compared with Russia. To begin with, although reform-oriented groups in Central Europe garnered much of the aid, they did not have a monopoly on it, in contrast to the Russian “clan” that we will observe in detail in chapter 4. Moreover, very different institutional and legal frameworks developed in the 1990s in Russia as compared, for example, with Poland, where there is little evidence of criminal mafia infiltration in the political establishment, as there is in Russia. 42 Polish recipients generally operated in a more transparent and accountable way, and their primary motivation was largely to build a political base, not self-enrichment, in contrast to some Russian recipients.

Still, citizens in Central Europe and Russia raised many of the same concerns, albeit often with different intensity. Although, from a donor’s point of view, one can understand the homily that “helping someone is better than helping no one,” the meddling in local politics that the “help” sometimes created puts the wisdom of this belief in doubt. Support of one group to the exclusion of others built up certain elites—indeed, helped to crystallize some in the first place. The groups with enough clout and Western contacts to get foreign money gained steadily, while others with just as much indigenous support but less visibility in the West—and, thus, less foreign monetary support—lost ground.

Arguably, this reality had both positive and negative aspects: On one hand, those supported by the West were sometimes the people best equipped to be leaders and make critical decisions. On the other hand, resentment was stirred up among those outside the networks—especially among those who would likely have been in leadership positions if people had been chosen primarily on the basis of expertise. This concentration on a select few contributed to resentment especially because the few beneficiaries tended to distribute money and favors based on group loyalties and obligations. For donors to overcome this dilemma would have required in-depth knowledge of the histories and politics of local groups—expertise they seldom sought or appreciated the value of.

Once again, then, Western donors seemed to be caught in a paradox: To achieve their stated reform goals (in this case, of pluralism, civil society, and democracy), they selected and promoted specific political parties and groups. But this strategy seemed more likely to help narrow, rather than to widen, the range of participation.

LEFT-OUT LOCALITIES

Throughout the region, the groups favored by most donors were typically located in large cities such as Budapest, Warsaw, Kraków, Gdańsk, and Prague, particularly in the immediate post-1989 aftermath. In the rush to move funds quickly in the first years of the aid effort, donors concentrated on cities that were centers of government, even when their projects had no link to government. Donors hoped that funds would “filter down” to the localities. However, without accountability and incentives for dispersal, funds typically stayed at the center.

Many local leaders, who had heard about and were eager to accept the massive foreign aid that was said to be on its way, did not view this development favorably. Tadeusz Wrona, mayor of the Polish city of Częstochowa, declared in April 1991 that foreign aid “should go to big towns and counties, not to [the] Warsaw government.… If it goes to Warsaw, nothing will get to us.… If there’s to be real help from the West, you have to strengthen the counties. Because if the county goes bankrupt, we’ll have to go back to the old centralized system.” Nevertheless, prosperity was not far away, although not often as a result of foreign aid: During the 1990s, markets and business infrastructure developed very quickly in certain cities and areas (as described in chapter 5), including Częstochowa. The effects of these changes were soon felt in many of the smallest of towns and communities in Poland.

Some donors succeeded at providing decentralized aid. Germany, which shares borders with Poland and the Czech Republic and also is active in Hungary, took advantage of its proximity, knowledge of these countries, and issues of mutual interest to develop links and projects in an attempt to achieve influence in Central Europe. Much of Germany’s aid to Central Europe went directly to the localities. In this model, aid flowed from one land (region) to another land with an emphasis on cross-border initiatives, especially between Germany and Poland. The point of departure, the delivery mechanisms, and the targets all were decentralized.43 This land to land approach has earned a reputation for facilitating valuable cross-border cooperation in commercial and cultural exchange in many areas44 and also has been employed farther east.

By the mid-1990s, the United States and the EU targeted much more aid to the localities. These donors invested in some projects, several of which dealt with business and infrastructure development (described in chapter 5), that effectively tapped into local knowledge and worked with the localities. Between 1994 and 1998, the EU committed 18 percent of all PHARE monies to cross-border cooperation between recipient countries and their adjacent EU neighbors and to addressing the development problems that they may face.45 However, the instruction that might be gleaned from any effective projects was little considered farther east.

PARLOR POLITICS

A look at aid distribution in Central and Eastern Europe helps to explain why understanding the dynamics of the individual countries was so important and what happened when donors overlooked them.