IDENTITIES IN TRANSITION: THE FORMER

SOVIET UNION AFTER THE COLLAPSE OF REAL

SOCIALISM

by Cristina Carpinelli

CESPI - FEBRUARY 2004

 Identities in Transition: the Fsu Countries After the Collapse of Real
Socialism
Cristina Carpinelli1

The social global scenario of the last decade distinguishes itself because
of growing inequality. Instead of seeing poverty diminish, we are
witnessing a growing social gap. Even when overall living standards rise,
poverty can also increase if societies become more unequal.
Global macroeconomic forces, and in particular the rise in interests
rates, debt crises, and the pressure for deregulation, privatization and
liberalization generally since 1980, have all contributed to a pervasive rise
in economic inequalities within Countries of the world.
Over the past decades extensive macroeconomic conditions have been
attached to the provision of development aid and loans as well as for the
cancellation of debt with disastrous consequences for social development.
Policies imposed by IMF and World Bank on developing Countries (or
on Countries in financial difficulties) of liberalization and privatization
(with the adoption of structural adjustment programmes) have increased
inequalities, not diminished them, impacting most severely on
communities and families with least access to decent work and the means
to a sustainable livelihood.
For the majority of the people living in poverty, of which a
disproportionate number are women and children, agriculture and fishery
provide the only viable livelihood for themselves and their families.
Economic reforms imposed on developing Countries (or on Countries in
financial difficulties) have promoted export-oriented production,
particularly of primary products for which world prices have dramatically
declined, and an increased control over agriculture and fishery by
corporate interests. The result has been increased impoverishment for
large sections of developing Country societies for whom there are no
alternative options.
For many low income Countries aid is the most important source of
finance for development. For these Countries it is also the only real source
of investment for the basic social infrastructure that is vital for assuring
the welfare and well being of its people and for effectively addressing
poverty. Aid will only be effective when it is sustainable and predictable,
1 She is a member of Scientific Commitee of International Problems Study Center - Sesto San
Giovanni (Milan - Italy). Cristina Carpinelli has taken care of translations of soviet texts,
particularly on the soviet society and sociology. She wrote many articles and essays on the
transition of the Fsu from a planned economic system to a free market one. She wrote also some
books: “Soviet society in the years of the perestrojka” (1991), “Women and family in Soviet
Russia” (1998), “Women and poverty in Russia under El’cin administration” (2004), “Russia in
pieces” (2008).

Pag. 1
contributing to the development strategies defined by a Nation itself. It
needs to be free from ties imposed by donors, which not only distort its
value but also prejudice a Nation’s commitment to development policies
imposed from outside. For many developing Countries their debt
servicing obligations undermines development. For this reason, it would
be necessary the complete cancellation of debts where not to do so would
undermine the Country’s economic recovery.
The withdrawal of the state and the privatization of service provision -
of health care, water, education - increasingly deny access to those unable
to pay for what constitutes a basic human rights. Major humanitarian
agencies (Ong) argues that IMF policies seek to keep inflation at very low
levels and do it blocking public spending on sanitation, education, ecc.,
paying only attention to strategies of macroeconomic stability and not to
strategies of human development.
Globalization and liberalization of trade, the corporatization of
agriculture, fishery and other forms of production should not be the
guiding frameworks for agriculture and fishery. Instead, sustainable local
livelihoods, food sovereignty, environment regeneration and social
concerns should be the guiding principles.
A reform of our international system of governance is long overdue. It
needs to be re-built so as to adhere to principles of justice and democracy.
The World Bank, IMF and WTO must be brought fully within the UN
system, with their roles being redefined. Their governing structures must
also be reformed to reflect changes in the global economy.

Women constitute the majority of the world’s poor and often carry the
social and economic burden of looking after the most vulnerable members
of the community, such as children, the elderly and the sick.
Economic reforms that dismantle social obligations of the state and
privatize public goods, impact disproportionately on women and deepen
gender inequality as women are pressed into filling the gap. At the same
time women constitute crucial active agents in any strategy to eradicate
poverty. Denying full and free access of women to the economic sectors
and labour market is not only a denial of their basic human rigths but is
also detrimental to a country’s economic development. Poverty cannot be
tackled successfully without ensuring equality of access to the means of
livelihood between women and men, and equity of opportunity. While
gender equality and equity are fundamental objectives in themselves, they
are also an essential pre-condition for eradicating poverty.
It’s imperative that the relationship between gender equity, poverty
eradication and the promotion of social justice are comprehensively
incorporated in future strategies.

Pag. 2
 The structural adjustment programmes (Sap) imposed by IMF to
transition Countries provided for:
- the passage from a planned economy to a free market one;
- liberalization of prices;
- reduction of public expenditure, including cuts on sanitation,
education and social services considered unproductive from
economic point of view;
- cuts on military expenditures;
- cancellation of benefits directed to the poorest people;
- privatization of public and state enterprises;
- restriction of access to credit;
- liberalization of trade;
- promotion of export-oriented production;
- removal of the barriers to private investments;
- deregulation of labour market.

The Saps have had a terrible effect on domestic politics of transition

Countries, above all in which of them they didn’t adopt politics of social
security.

The process of transition from a planned economy to a market one in the

Countries of the center-eastern Europe and in those of the former Soviet
Union represents an interesting experience of analysis and comparison for
people that are interested in the labour market and the systems of welfare.
More than twenty Countries have almost simultaneously introduced
radical transformations in the economy and reformed the mechanisms of
social protection. Such transformations have proved to be more painful
and variegated than initially anticipated. Negative phenomenons have
accompanied and still accompany the transition: extremely elevated and
persistent rates of unemployment, emerging acute inequalities in the
income distribution, sensitive increase of the poverty.
From the experience of the economies in transition, some important
lessons can also be drawn for the Countries of the western Europe,
included Italy. The transition, in fact, can be seen like an “extreme” form
of the processes of reform of the systems of social protection and the
labour market into action in the european Countries.
The politics of transformation adopted in the transition Countries have
been different. In the Countries of the center-eastern Europe has been paid
attention to the politics of protection to the unemployed (the “victims” of
the transition), as incentive for a rapid restructuring of the economy based
on the move of labour force from the old state sectors to the new private
sector. The adjustment of the economy has taken place, therefore, through
the unemployment. In the Fsu Countries, the adjustment has taken place
through a decrease in salaries and an high hidden unemployment.

Pag. 3
 The conclusion of some liberal economists is that in the Countries of the
center-eastern Europe, the governments have made the mistake to design
too generous politics of support to the unemployed and of social transfers,
above all, without temporal limits. The negative consequences have been
that there is still today an elevated and persistent unemployment, that a
too remarkable proportion of people have gone out from the labour force,
above all through the anticipated retirements, and that all this has actually
represented an obstacle to the economic recovery. Nevertheless, it could
be objected that in the Countries where the level of protection and support
to the unemployed has been negligible (Fsu Countries), the economic
performance and the process of restructuring have been disastrous.
In the Fsu Countries, the governments have not introduced a system of
protection for those people that had to leave the enterprises and the
sectors in decline. The absence of a “safety net” has represented a real
break on the economic growth, as the workers have preferred to maintain
the job also with very low salaries, rather than to enter the “pool” of the
unemployed.
Shortly, in the Countries of the center-eastern Europe as a whole wages
declined by less and unemployment increased by more than in the Fsu
Countries, with Bulgaria at the crossroads, because of the unfortunate
combination of the largest fall in wages and the biggest increase in
unemployment.
Another theme of big interest for those that are interested in the center-
eastern european Countries is the hypothesis of integration of these
Countries with Europe, that is their future entry in the European Union.
With regard to this, it will be important to well calculate which politics it
seems expedient to adopt in the “field” of the labour market and the
welfare state. In fact, to import politics into the Countries of the center-
eastern Europe that have produced break-downs in the EU Countries, it
would result even more harmful, because of the presence of very low
levels of income and a phase of extremely different development from that
of the EU Countries. The organisms of the EU should study, together with
the governments of the center-eastern european Countries, strategies in
the “field” of the labour market and the systems of social protection taking
account of the realities and the demands of those Countries, avoiding a
mechanic export of rules and politics that have also proved of doubtful
effectiveness in the EU Countries.

Terms of Reference

The transformation that the Fsu Countries have put in action, has been
indeed dramatic. The hinges on which were based the systems before the
transition have been completely dismantled. They can be summarized in a
few points:

Pag. 4
. 90% of the labour force was employed by state;
. labour income plus social transfers together accounted for over three-
quarters of total income;
. personal income tax was very low. Taxation had almost no distributive
impact;
. child benefits accounted for 3% of gross income, three times the level of
market economies;
. cash social transfers were distributed almost equally per head, rather
than being focused on the poor as in market economies;
. the social benefits were all regarded as entitlements which were
provided free or at minimum cost;
. the tax yield was based on “profits” of state enterprises, typical of a
socialist societies. On the contrary, in the market economies, it’s based on
personal income and expenditures (private consumptions);
. wages were somewhat more equally distributed than in market
economies, with differentials between manual and non-manual employees
being markedly lower. Overall, because taxation and social transfers were
broadly neutral, inequality was dominated by wage inequality;
. although average incomes and living standards pre-transition were low,
the scale of social transfers, consumer subsidies and the egalitarian wage
distribution meant that the incidence of poverty was also relatively low by
international standards, at between 5% and 10%, and it is likely that very
few people were in extreme poverty.

Nowadays, in the Fsu Countries, the attempts to create a “law-based

market economy” by reforms are failed, because the process has not
allowed the development of a gradual evolution through the legitimation
of political, legal and market institutions which provides the essential
framework for sustained growth and political stability.
As a result of a strategy of deregulation which failed to take account of
the absence of the key institutions of a “law-based market economy”, the
process has fostered and reinforced the demonetization, illegality and
criminalization of the economy in the transition Countries. The
disintegration of the Soviet Union and the pace of reform led to the
collapse of the old institutional framework before new institutions could
emerge. In the absence of appropriate institutions, deregulation and
privatization meant that those who controlled the key financial and
commercial intermediaries of the old system simply and quite literally
took the law into their own hands. The result has been the control of
economic activity by organizations which operate outside the law.
Restrictive fiscal and monetary policies led to the widespread
demonetization of the economy and the concentration of financial
resources in the hands of a limited number of powerful financial and
commercial organizations with strong political connections.

Pag. 5
 These phenomenons - that have eroded the legitimacy of state and
political and market institutions - have been fostered and reinforced not
only by the macroeconomic policies which have been pursued by national
governments, but also with the support of international financial
institutions (Imf, Wb). They have undermined the process toward a
democratic development and are now the major source of poverty and
social unrest, and the major barrier to economic recovery. The
development of a law-based monetized market economy is perhaps the
most fundamental and urgent task that the Fsu Countries have to face, and
one which requires much more serious attention. It has a direct influence
on poverty because the impact of the demonetization of the economy is
felt most directly by those who do not receive their wages and social
benefits and who face the breakdown of healthcare, education and the
whole social fabric.
In these Countries, between a quarter and a third of the population live
in persistent poverty, below a realistic subsistence level for a sustained
period of time. The total number of poor has risen from about 14 million in
East Europe and the Soviet Union before the transition, to about 168
million after the reform, an increase from 4% to about 45% of the
population. The poverty derives from low and unofficial wages and high
levels of open and hidden unemployment (together with shadow-
economy, irregular employment and second job) resulting from economic
transition. All this is reflected in a dramatic increase in inequality.
Households with dependent children or disabled members are the most
vulnerable, because of the low level of incomes and the erosion of their
real value, and of the lack of child and disability benefits. In Russia and
Belarus, the average wage is no longer sufficient to support two
individuals at the minimum subsistence level; in combination with the
erosion of child benefits, this means that actually a two average-wages
family with two dependent children will be living in poverty. In
Moldavia, only about 20% of wage earners (breadwinners) are earning
enough to support one dependent. With smaller intensity, this situation is
also verifiable in Ukraine. Dependency puts great strains on the traditional
households, leading parents to abandon their children (an estimated one
million children have been abandoned during the transition, of which
200,000 of them in Russian Federation). Child poverty is an emotive issue
but it is not a distinct issue - it arises because parents cannot earn enough
to support their children and child benefits are not sufficient to cover their
marginal cost (of children).
Similarly, the average pension has fallen below the subsistence
minimum. Poverty is a serious problem and it’s still rising in all the Fsu
Countries.
The primary source of social and industrial conflict and of political
opposition to reform is the low level of wages (also the endemic wage

Pag. 6
non-payment or wage arrears) but also the transformation of universalistic
social security sistems into private sistems of social insurance. Access to
health services, education and social services has been severely curtailed.
Suicide, alcohol abuse-related deaths and wide diffusion of the drug have
all risen sharply. The spread of “social diseases” (tuberculosis, syphilis,
diphtheria, and so on) is being compounded by the fact that there is often
a lack of awareness, education, infrastructure, and programmes
addressing the problems. A common demographic indicator of transition
Countries of the Fsu is the high male adult mortality (The high mortality
rate for working-age males has produced in Russia a new problem:
material support to children surviving their fathers. However, the
applicable type of pensions - survivor’s pension - represents 51% of the
minimum subsistence of a child, which no way can fully compensate for
the reduced family income) and the sharp fall in life expectancy for men
and women. Mortality, nuptiality and fertility trends are more or less
equal to those normally observed during wartime.
Mass destitution in these Countries (mainly in the rural areas) is only
being averted by receipt of social benefits, return to subsistence
agriculture (the use of the own plot of land to survive) and reliance on
family support networks which are under increasing strain.
During the transition many of the eastern and central european
Countries and those of the Fsu, have found themselves having to absorb
ethnic migrants. This obviously raises many concerns where poverty is at
issue. Many of migrants, escaping from armed conflict, have settled
illegally in the larger cities where they are confined to informal work,
where they tend to be paid low wages. There is also the problem of ethnic
minorities that are tipically multiply disadvantaged. They have larger
families and lower levels of education. They tend to live in the more
remote rural depressed regions and suffer from the removal of the former
mechanisms of regional distribution of resources. The phenomenons of the
migrant and national minorities are cause of open social conflicts with the
local population that, bearing a condition of deprivation, lives as a
“threat” the presence of extraneous on the “own” territory. One of the
assignments to face in the immediate is to evaluate the phenomenon as a
whole, trying to remove the causes of the underdevelopment of some
areas of the Fsu Countries and guaranteeing contemporarily the
integration through solidarity and cooperation, not surrendering to
xenophobic temptation to criminalize the emigrants and the minorities,
making them entirely appear as source of delinquency.
Changes in the labour market over the reform years should be
considered with the account of a rilevant transformation of social and
legal terms of employment which has found reflection in mass violations
of labour guarantees to employees. Violation of labour legislation is
mostly centered around the following areas of legal regulation: labour

Pag. 7
payment (voluntary setting of the wages and salaries rates, fines as an
administrative penalty amounting to 50% of the monthly wages), working
schedule (unlimited working hours without due compensation for
working overtime and on week-ends), dismissal procedures (without
dismissal wage, lack of protection against voluntary dismissal), social
guarantees (denial of a regular holiday and of payment of compensation
of temporary disability). These violations are more typical of private
enterprises than state ones and are more frequent in the “field” of casual
or temporary employment. On the top of all these violations, there is a
new labour code recently introduced in Russia (1 February 2002) that
“legalizes” child labour, forces pregnant women to work night shifts,
increases “on application of the worker” the lenght of the working day
from 8 to 12 hours (employers can to impose a 56-hour week without
overtime pay) and removes from the trade unions a lot of power to act
(while in the past workers could not be legally fired if the trade union
opposed it, the new code allowes bosses to fire at own will, to create black
list of active trade unionists, the use of replacement workers as the
employers like, the imposition of contracts short circuiting the collective
bargaining process, to conclude labour contracts by enterprises with the
syndical organizations that they prefer, and so on).
The new provisions of labour code have been considered by russian
government (abroad by Imf and World bank), as compared with the
former (adopted in 1972 when Russia was part of the Ussr and seen again
in some points under El’cin administration in 1995) notoriously employee-
protective labour code, like a “complex of measures that strike a better
balance between the interests of all types of employers and employees”.
The lives of many workers and poor people have been devastated by the
greed of big business, by imposed policies of privatization without any
social protection, the creation of alternative jobs before destroying public
sectors of employment and by the introduction of new measures
undermining basic rights held by workers and population as a whole for
decades.
All transition Countries of the Fsu have developed a dualistic labour
market in which good jobs in the new private sector go to the more highly
educated, skilled, younger and more flexible workers from the former
state sector, which increasingly functions, in conjunction with the long-
term unemployed, as a reserve of less-employable labour. There is a
strong possibility that market-led growth will increase poverty as
backward industry and agriculture are displaced and lay-off large
numbers of unemployable workers.
The unemployable workers aren’t a small section of the population.
Even in the most prosperous of the Center-eastern european economies,
they constitute a third of the labour force or more, many of whom have
little hope of finding a place in the new competitive economy. The

Pag. 8
experience of Poland, the only economy to have seen sustained growth, is
not so encouraging, with the poverty rate actually rising as inequality
increased. In this Country, the rate of unemployment is very high, faced
with the adoption of a relatively generous politics of welfare and with
relatively strong trade unions struggling to protect the social state. The
hungarian scenario is not very different. Here the restructuring of the
economy has been pursued with politics of social stabilization, that is of
opening to the new labour market and at the same time of support to the
social state. Nevertheless, poverty exists to a great extent, because of the
increase of the inequalities in the income distribution at a regional and
occupational level.
Many workers affected by the reform have little hope to find a job in the
new competitive market. In short, transition has create a “lost generation”
which has little prospect of benefiting from economic growth.
The limited net job creation in the new private sector which marked the
early stages of reform has gone into reserve since 1994, while employment
in the former state sector has continued to fall. Since 1989, in the former
centrally planned economies an estimated 26 million jobs have been lost
and registered unemployed has soared, from almost zero to more than 10
milion. High registered unemployment was particularly found in Poland
and Bulgaria. In other Countries (Ukraine), registered unemployment is
lower, because of tight eligibility conditions for benefit - those ineligible
for benefits are less likely to register as unemployed - and the very low
level of benefit. The size and eligibility conditions for unemployment
benefit make it impossible for the unemployed to survive for long without
alternative sources of income. But low wages and delays in the payment of
wages, mean that many of the employed are in a very similar position. In
many respects the unemployed have the time to seek alternative sources
of income.
In most of Countries of the center-eastern Europe and in those of the
Fsu, the share of the long-term unemployed (those who have been out of
work longer than one year) has continued to raise. Both individuals and
social systems have been ill equipped to deal with this situation. In the Fsu
Countries, such a situation is so compromised that many commentators,
even within the ranks of liberal economists, have seen an argument for
continuing to support jobs in unprofitable industry and agriculture, that
it’s better to keep people at work than to throw them on to the streets with
no prospect of supporting themselves. Enterprises function as the social
safety net at approximately the same cost as a real safety net but with less
social dislocation. However, the support of jobs should not be
indiscriminate and is better addressed through protectionist interventions,
for example in fiscal and trade policies, which are clearly limited in extent
and duration than through job and wage subsidies which are less
transparent and more subject to political manipulation.

Pag. 9
 The fall in both profits and wages in the Fsu Countries has undermined
the fiscal basis of the state budget and of the social and welfare state.
Governments have suffered a large decline in revenues, with little increase
in their ability to raise taxes. The erosion of pensions, child and disability
benefits, low-income family and single-mothers allowances, health,
education, housing and the inadequacy of unemployment insurance mean
that social and welfare state no longer functions as a universalistic system
which guarantees, first of all, that the principal high risk groups of
population will be protected from poverty.
To understand the importance of the role of social benefits, it’s
necessary to keep in mind that in the soviet-type societies, state policy
sought to erode the family as an economic unit, to replace family
obligations by obligations to the state. In terms of social policy this meant
that men and women were equally obliged to participate in social labour,
leading to female participation rates close to those of men, and that social
benefits provided income entitlements for all non-earning members of the
household: children, the sick, mothers of young children and the elderly.
This meant, in its turn, that the individual wage was precisely that, a wage
sufficient to meet the needs of the individual, and not a family wage
which supposed to meet the needs of the whole family.
This system of social policy had fundamental implications within family
that have remained intact also after the post-sovietism: many male wage-
earners still do not give their wives a penny of their pay packets, in a
moment in which family is assisting to the collapse of the government
system of social support and welfare.

The decade 1991-2001 has ruined the social fabric of the Fsu Countries,
destroying the old without building at the same time the new. The
treatment of wild liberalism without rules and counterweights that has
been made them didn't fit for realities with an unusual history and limits.
Countries that are at the meantime immense coffers of raw materials, of
wealths waiting to be exploited, but economic subjects not yet in degree to
operate in that open context that the westerners pretended, all and at once.
With the result that the most aggressive and more unscrupulous people,
the foreign multinational companies and the criminal transnational rackets
have prevailed.

Confronting dilemmas and looking for effective solutions

There are no simple solutions to the mentioned above problems, only

dilemmas which have to be evaluated in the real world in which they
arise. The central dilemma in the transition Countries is that the
preservation of those institutions and activities through which the low-
paid strata of population is currently able to survive is often in direct

Pag. 10
conflict with the development of a modern high-wage and high-
productivity economy. Correspondingly, measures which foster the
growth of the new economy erode the sustainability of the livelihoods of
the poor. For example, the free access to agricultural land is an extremely
flexible way of providing poverty relief and a way in which all families
can ensure a stable and secure supply of food. A share of food surplus is
usually transferred without charge to friends and relatives within
networks of reciprocity, or may be more directly bartered for services.
This is a legacy from the remote peasant past which was powerfully
reinforced in the soviet period when the private sale of goods and services
was illegal, so private produce and personal services were routinely
bartered.
Many workers have been forced for surviving to enter the cycle of the
natural economy. They spend their leisure time to work in the private
plots. At the same time, because the inputs are costless and producers
have minimal money incomes, commercial agriculture is unable to
compete in the market with private produce so that the persistence of this
form of production undermines the commercialization of agriculture. This
is the reason for which now the free availability of land is priority
accorded to land privatization by multilateral agencies interested to
commercialize on a large scale agriculture. The privatization of land to
foster the commercialization of agriculture can destroy the subsistence
agriculture through which the majority survive, while the persistence of
subsistence agriculture depresses prices and so is a serious barrier to the
development of a commercial agriculture.
Investment in modern production facilities will sweep away the old
low-wage labour-intensive producers which provide employment for
millions, while the persistence of low-wage producers depresses prices
and inhibits new investment. The professionalization of trade and services
with the development of small and medium businesses sweeps away the
street and shuttle traders whose casual employment provides vital income
for their families. But the persistence of low-paid, unregistered and
untaxed casual employment is a barrier to the professionalization of trade
and services.
In short, low wages keep people in work but inhibit new investment by
undercutting more efficient but higher wage producers and by limiting
the domestic market for their products. High wages encourage
productivity-increasing investment and expand the market but at the cost,
at least in the short run, of higher unemployment.
These conflicts cannot be resolved in favour of one or the other side of
the dilemma, but only within a dynamic context of gradual change. This
means that the problem can only be adressed by a broad and coherent
range of macro and micro economic and social policies and interventions
which will evolve over time as circumstances change.

Pag. 11
 In particular, in the short run, this means supporting livelihoods -
subsistence agriculture, petty trading, inefficient factories - which in the
long run are unsustainable. A right approach to the dilemma tries in fact
to balance the demands of marked-led growth with the needs of the
population as a whole. This balance involves political choices and for this
reason has to be achieved politically, within the democratic process and
through the help of participatory structures operating in the transition
Countries. An effective reform from above has to be supplemented by
pressure from below: the issues of democratization and empowerment are
not a luxury but are fundamental to economic reform in the interests of
people.
The implementation of strategies on a long period must obviously take
account of the scenario of world economy. There is little point in trying to
encourage the commercialization of agriculture while flooding the
transition Countries with subsidized food imports from the EU. There is
little point in modernizing the textile industries when domestic markets
are open to EU suppliers while the EU keeps out textile imports through
quotas. There is little point in trying to develop a law-based economy
while colluding in international financial and commercial transactions
with organizations which operate outside the law. New macro and
microeconomic approaches have to take into account the fact that the
economy of the Fsu Countries is largely demonetized and operating
outside the law, but they must not undermine the attempt to develop a
law-based competitive market economy and an efficient and
jurisdictionally acceptable legal system, allowing an open and at the same
time fair social and economic life.

The evaluation of alternative strategies and policies at all levels has to take
account of the institutional framework in which they are to be applied.

- Much has been made by many commentators of the barriers to labour

mobility presented by the traditional enterprise provision of welfare and
housing in the transition Countries, and this has been used as one of the
key arguments in favour of the privatization of welfare facilities or their
transfer to municipal authorities and in favour of personal insurance-
based benefits. However, the main result has been the collapse of the
whole structure of housing maintenance and administration and the
system of social and welfare support across the majority of the Fsu
Countries. In fact, labour throughout these transition Countries has
proved to be far more flexible and far more mobile. The opportunities for
and obstacles to mobility lying more in the existence of social networks
and family ties than in access to housing or welfare benefits. Moreover,
encouraging labour mobility only serves to increase the dualistic character
of the economy by reinforcing its regional dimension as the young, more

Pag. 12
educated, active and energetic people leave the countryside for the towns.
In other words, they leave the depressed regions for the booming capital,
denying the deprived regions of precisely the human resources on which
their regeneration depends.

- The rural population in the transition Countries has suffered the most
from the deterioration in the social infrastructure, in health care and from
the sharply increased cost and reduced provision of public transport.
Rural poverty is directly related to the reform strategy and reinforced by
the trade and agricultural policies of the EU. The withdrawal of subsidies
and the opening of agriculture to international competition has led to a
flood of heavily subsidized agricultural imports from the EU which has
markedly reduced prices of agricultural produce and, correspondingly,
agricultural wages. While this has made a very significant contribution to
reducing the cost of living for the urban population, it has been at the
expense of the livelihood of the rural population. Moreover, the collapse
of agricultural incomes has encouraged the flow of young and more
educated people to the towns in search of better salaries but has left low-
educated, manual, unskilled and low paid labour force in the countryside.

- The collapse of the old system and the disintegration of the Soviet Union
have removed the old system of income equalization between town and
country and among regions, allowing substantial inequalities to open up
on the basis of different resource endowments. The regional inequalities
have been considerably intensified by structural changes in the economy,
with the decline of agriculture and old heavy industries and the
reorientation of industry toward export markets.
The attainment of the balanced and sustainable, economic and social
progress, must foresee the struggle against territorial disparities, through
the individualization of measures directed to reduce the discrepancy
among the levels of development of the various regions.

- Another example of not well-directed politics derives from what is

euphemistically termed “cost recovery”, in relation to the expenditures
that the citizens bear of housing and municipal services or for domestic
energy supply (i.e. rents, expenditures on heating, housing maintenance,
ecc.). Local government spending on housing, municipal services and
energy has fallen and accordingly the investments, despite the transfer of
this competence from federal obligations to municipal authorities and the
transfer of a large proportion of the housing stock from enterprises to local
government. It is essential to establish the commercial viability of
municipal housing administration and the energy sector, above all in
heavily demonetized economies, like the Fsu Countries ones, where two-
thirds or more of the population do not have the money to pay such

Pag. 13
charges on a regular basis and can only do so at the expense of their own
essential subsistence needs (before the reforme, expenditures on housing,
fuel, energy, communal services, and so on, were totally subsidized by
state). The attempt of governments to introduce the “cost of recovery” has
turned out to be a “poll tax”.
As a result of the privatization of the housing stock, many poor
households have become owners of residential property which they
rented or sold, because they were not able to face maintenance and service
costs. There has been a substantial increase in homelessness, above all
among the older generation.

- Some NGOs pointed out that economic pressures in Russia did not give
women a choice: a monostructural industry and the three-shift pattern
with quotas for women left unemployment and night work as the only
alternatives. 70% of shift workers were women, a position which they
vigorously defend for family reasons. At the same time, the labour code,
seen again in 1995, categorically forbade the female night work (for
women with children under six years) that, in conditions of expansion of
labour market and of economic recovery, should be considered a right
principle. But not when more than 45% of the russian people live below
the poverty line. What politics the government adopted to solve a
situation that automatically excluded big part of the women from the
labour market? Instead of finding an accord with the enterprises to protect
the female work, the government has chosen the less complicated way:
with the approval of the new labour code “Putin”, it has again introduced
the female night work, also permitted to the pregnant women.

- Some reformers have proposed, on suggestion of the World Bank, that

the financing of the social security system ought to be based on a
insurance system. Insurance-based systems are administratively more
expensive and are much less equitable, but from the reformers point of
view the political advantage of linking contributions to benefits is that the
majority of the electorate at any one time will be net contributors, and so
more inclined to vote for reductions in contributions than increases in
benefits. Moreover, if the insurance system is private it makes the public’s
forced savings potentially available for investment, although there is no
guarantee that any such investment will be in the domestic economies.
However, such a reform is fraught with difficulties because in the
transition period people have to pay twice: once to support those
presently disadvantaged, who have no contribution record, and once
again to set aside their own contributions. The shift to a funded insurance-
based system is therefore necessarily associated in the short-run with
increases in personal contributions and with substantial cuts in the present
level of benefits. The compromise solution, that has not been taken in

Pag. 14
consideration by the reformers, is to propose a pay-as-you-go system
which provides minimal benefits supplemented with compulsory and/or
voluntary insurance-based top-ups.

- Someone has advised to reduce the bureaucratic and fiscal obstacles to

the establishment and viability of small and medium enterprise, but such
an obviuosly sensible reforme will erode the competitive advantage of
petty trading and self-employment, threatening to destroy a key
component of the livelihoods of millions of households.
It’s necessary to sustain the insertion of the less competitive workers and
the unemployed, through special courses of professional training financed
by state, in the small and medium enterprises, so that the last ones can
replace in the middle period the current livelihoods of the weakest
persons on the labour market.
The first priority of a pro-low-paid, insecurely employed, unemployed
and poor people approach is not “to make things worse”. It’s essential that
all strategic interventions toward a balance between the demands of
marked-led growth and the needs of the population as a whole are
assessed for their possible impact on the short-term sustainability of the
current livelihoods of these categories of population (who form the vast
majority in the Fsu Countries) not only in theory, but also in practice.

Employment and labour market

One of the problems prioritily to face is the development of social labour

market policies and practices designed to relieve the actual economic
status of the unemployed and the low-paid working people (particularly
of agricultural workers, manual workers in declining industries, lower-
grade clerical workers and unskilled manual workers) in the Fsu
Countries. Despite private-sector growth (reaching an estimated 50-70% of
measured economic activity), persistent structural problems cloud
economic recovery. Under these conditions, the informal economy is
taking root, and prospects for secure earnings remain dim in these
Countries. Significant unemployment is a relatively new phenomenon
after decades of central planning and policies of full employment. There
has also been a sharp drop in real wages and a substantial increase in
wage disparity. Even when GDP is recovering, employment levels and
real wages tend to lag behind. This creates pressure for households to
maintain two income, at a time when there are fewer jobs and less job
security.
The market-led growth will not automatically alleviate transition
depression in these Countries. Also in Poland, Hungary, Slovenia and
Slovakia, where there has been an economic recovery, there are no signs of
a reduction in poverty.

Pag. 15
 A large proportion of the working population in the Fsu Countries are
still in open, hidden (those working in state and former state enterprises
which have little long-term prospect of survival) or discouraged (the fairly
large number of people who have withdrawn from the labour force
because they have abandoned any hope of getting a job) unemployment,
in casual employment or still employed in low-paid jobs in decaying state
enterprises (about two-thirds of the poor, which have suffered
considerable reductions in income as the prices of retaining their jobs). The
phenomena of unpaid lay-offs (“administrative leave”), short-time and
part-time working have become pervasive. These expedients are often
adopted by employers as an alternative to redundancy, and as a way of
inducing people to leave voluntarily. Many more people are kept at work
because their wages are so low that employers have no incentive to
rationalize production or to invest to economize on labour. Many more are
working in jobs which would not be profitable on normal accounting
principles and which will be displaced once effective bankruptcy
procedures are in place. Depending on definitions, a greater or lesser
proportion of this huge labour reserve can be considered to be the “hidden
unemployed”, a category which merges with that of the low-paid. For this
reason alone it does not make sense to make a radical distinction between
low wages and unemployment as causes of poverty.
Only the younger, better educated and more flexible can expect to be
absorbed into better-paid employment as economic growth continues. In
modernizing markets, especially those with emerging knowledge-based
and service sectors, there are expanding economic opportunities, but they
are scarce and reserved for workers possessing the appropriate education
and skills. The scarce skills required by the market economy, when there is
an over-abundance of skilled and no-skilled manual labour, are
predominantly intellectual skills.
Of course, the growing inequality isn’t a stimulus to the rapid structural
change, which could liquidate transition crisis under certain conditions.
The falling incomes and growing inequality restrict the market and so
discourage investment in the development of new goods and services,
while poverty undermines the development process by depriving a
substantial proportion of the population of the resources which they need
to take place in the new economy. The fact that recovery has been most
rapid in the Countries in which wages have fallen the least and which the
growth of inequality has been the most limited is not a decisive argument
for the familiar argument that high wages encourage growth, since these
Countries enjoyed other advantages. But it’s difficult to resist the
argument that excessive wage flexibility in the Fsu Countries has not
simply led to widespread poverty and the degradation and
demoralization of a large section of the labour force, but has also inhibited
new investment and the razionalization of production, has exacerbated

Pag. 16
macroeconomic contraction and deprived the producers of new goods and
services of a potential market.
The Countries which have seen the greatest growth of inequality have
experienced the deepest crisis and have shown the fewest signs of
recovery. Moreover, widening disparities call into question how equitably
the fruits of economic growth will be shared. If the income distribution
were to remain unchanged or to improve, then economic recovery would
be expected to lead to a quite rapid reduction in the poverty headcount as
large numbers of people are lifted over the poverty threshold. On the
other hand, if recovery favours those who are already relatively
comfortable, then inequality may increase and poverty be unaffected by
recovery - the Fsu Countries scenario. In this scenario, low wages and
unemployment are in part a feature of the structural dislocation of the
transition economies, but the problem of poverty is at root an old-
fashioned macroeconomic problem of a generalized and persistent
deficiency of demand, with output and employment falling in virtually all
sectors of the economy. An urgent priority is the exploration of alternative
macroeconomic policies which can stimulate growth without an upsurge
of inflation.
It’s necessary to adopt active measures to secure the preservation and
creation of jobs in the short-run. If the market-led growth will be able to
solve the crisis, it can do it only in the very long term. And as an economic
thinker famously remarked, “in the long term we are all dead”. Moreover,
different policies - as compared with the current ones - need immediately
to adopt. First, to expand the service sector which had been “suppressed”
or forced during the period of the planned economy. It’s possible to
realize this expansion if a relatively high proportion of the population can
afford to buy such services, and this is, in its turn, possible if incomes are
sustained and the growth of inequality arrested by unfashionable
redistributive industrial and welfare policies. It seems also necessary to
leave many old structures and institutions in place and so to smooth the
transition. Hungary, for example, was marked by relatively high income
levels, a relative stability of state structures through the transition, a
reasonably well-adapted economic structure. Moreover, the guarantee of a
reliable economic and political stability has fostered the economic
relationships of this Country with the EU Countries. It adopted a less
radical strategy, but more successful. On the contrary, as a result of the
implementation of full radical programmes, other transition Countries
have experienced the longest and deepest depression in recorded history.
Different labour market policies are appropriate for different categories
of people. In general, in the transition Countries of the Fsu most
expenditure is on passive labour market policies: the payment of
unemployment benefit which is often very poorly targeted because of
administrative weaknesses and shortages and uneven distribution of

Pag. 17
resources. Spending on active labour market policies tends to be
concentrated on public works, wage subsidies (usually paid to employers)
for the protection or creation of jobs, with a relatively small amount being
spent on training.
Public works programmes and wage subsidies are widely derided as
expensive, poorly targeted and unproductive “make work” schemes, but
public works have a good record of providing jobs and work experience
for the low-skilled while contributing to the reconstruction of the decaying
state enterprises, even if they do not provide an effective transition into
employment. Where the targeting of unemployment benefit is poor and
resources are very limited, such workfare schemes provide an important
safety net. Wage subsidies are usually applied indiscriminately and
subject to political pressure, but there is a strong case for wage subsidies
for trainees and apprentices, where training programmes have collapsed.
Support for self-employment and labour-intensive small business start-
ups (petty traders, suppliers of domestic services, and so on) can play the
same role of developing skills and preserving jobs even they are not very
effective in job creation. The vast majority of those in self-employment or
setting up small business are motivated by the need to secure the survival
of their households, not to develop into larger businesses which can
provide work for others. For instance, private-sector agriculture has once
again become an important part of the economy. However, such work
often offers few prospects; many of these self-employed persons are
struggling to earn even a subsistence living, frequently by helping out on
small farms or family plots. The support for small business will improve
the incentives and capacities of the low-income strata of population to
engage in such kinds of petty economic activity, rather than or in addition
to those which have the most promising prospects. This might be through
the provision of the most basic material support, assistance with the
development of little cooperatives in several sectors.
The main problem with all such schemes is to ensure that they do not
simply provide or protect the jobs of the beneficiaries at the expense of
others, a problem which is best avoided by involving trade unions and
labour organizations in their design, implementation and monitoring. Of
course, such schemes will always be inferior to “real jobs”, but are
superior to prolonged unemployment. With proper organization, they
tend to be a much more economical and socially and psychologically
beneficial way of helping the unemployed poor than simply paying them
unemployment benefit. This is particularly the case when low wages for
the employed dictate that unemployment benefit should be
proportionately lower, trapping the unemployed in poverty. But, where
the unemployment benefits approach the level of minimum wages, that is
the case of the Fsu Countries, such schemes are appropriately targeted
also on those with lower wages. Under certain conditions, it’s better to

Pag. 18
have an integrated system of social assistance for the able-bodied
population, whether in or out of work, which in the immediate future can
only realistically be some kind of workfare system, rather than to increase
the unemployment benefits, with the risk that the already high quota of
the unemployment could again grow and forcing the unemployed into
dependence on state benefits and condemning him to the poverty trap.
Generally, macro-economic expansion and the strengthening of the legal
framework will create more and better-paid jobs. This will provide a
framework for assistance with training and retraining programmes
appropriate to the new jobs. But these programmes will be provided in
any case by employers if they face labour shortage and they will be
provided for those who do not need them because they are already well-
positioned in the labour-market. To help a low-income people such
programmes should be targeted on the hard to place, such as the long-
term unemployed or older workers or those, such a women and national
minorities, who face discrimination. They should be targeted to improve
competitive position in the labour market of these categories of
population.
Of course, all these are labour market policies functioning in the short
run. They are insufficient in the long-run, but now in the transition
economies, which have not yet fully developed the institutional
infrastructure of a market economy, they represent good alternative
strategies and policies.

The access to public services

Full citizenship demands not only an income but also access to health
care, social services, child and elderly care, education, transport, and so
on.
Widespread and relatively equitable access to basic education, health
care and social services is an inheritance from the soviet past, that has
been eroded during the difficult period of transition. The fall of the Fsu
Countries has repercussions on the deterioration in social indicators.
Because of its shrinking role and its declining revenues, the state has
relinquished much of its tight control over social issues, and a new
infrastructure - a partnership of personal, civil and public resources - has
yet to develop sufficiently.
The general pressure on education sistems and education resources has
undermined the quality of education and shifted more financial burdens
on to parents, even if by law, these Countries continue to guarantee free
school education. The family’s child education costs that formerly were
covered from the public consumption funds do also contribute to the
poverty since it is exactly in low-income and single-parent families that
such costs are now an unbearable burden. Besides, the difficult access to

Pag. 19
the education makes no competitive the children of these families, when
they will enter the labour market. For these families, elimination of public
consumption funds has also resulted in the growing medical costs. Their
relatively low remuneration precludes from getting access to quality
medical aid. In the Fsu Countries, many people suffer and die
unnecessarily because they cannot afford health care or essential
medicines. 16% of chronically poor families in Moldavia point to health
problems of their members as the main reason for the reduction of their
income.
For households with young children, adequate, accessible and
affordable child care is crucial to the effort to balance employment and
family responsibilities. The child care has changed during the transition.
The population of infants and young children is greately reduced; public
child care facilities are less available; child care fees have increased, and
mothers are forced to remain at home take caring of the children.
Maternity entitlements have remained relatively untouched. The good
intentions behind maternity and parental leave measures often go
unfulfilled in the new labour market. It is tipically women who must
adapt and take on more responsibilities in order to accomodate the new
circumstances. Thus, there is evidence that employers may be unwilling
and parents unable to take full advantage of the leaves. In Ukraine, 23% of
legally available maternity leaves went unused during the transition,
compared to 5% before the reform. In Russia, more than two-tirds of
women with higher education returned to work early from parental leave.
Enrolment rates in nurseries and kindergartens, the backbone of the
former child care system, have fallen. In Belarus and Moldavia, nurseries
have pratically ceased to exist.
The primacy of the family is being reasserted during the transition, a
good time to reset the balance among the roles of women, men and the
community in the raising of children. A wider range of accessible
childcare options is needed; family-friendly workplaces, particularly in the
private sector, must be developed, and men must be encouraged and
supported in taking a larger role in parenting. Ultimately, women and
men should be able to make the best choices for themselves as individuals
and families regarding the balance of work and children in their lives.
Also the material status of ritired is aggravated by the destruction of
free health care system which causes dramatic social deprivations. Despite
the rights to purchase medicine at a discount granted to the retired, this
social programme has not been backed up by the appropriate funding,
therefore, for most pensioners eligible for benefits this right proved to be
purely formal. Currently, the average pension allowance is a 2/3rds of a
retiree’s cost of living. Senior citizens whose pensions do not allow for
medical costs or social welfare find these services unaffordable and their
poverty level growing because of the deprivation. Many pensioners

Pag. 20
continue to work (even for extremely low wages) in order to supplement
the meagre pensions. So that their pensions are in effect a selective wage
subsidy, which risks dragging down the level of wages as a whole. The
solution adopted in Bulgaria is to deprive working pensioners of 30% of
their wage, although it’s not known what the impact of this policy has
been.
Public and social assistance

During the transition the Fsu Countries have been spending relatively
less on family allowances. Social assistance is not well-targeted, and above
all in Russia and Ukraine social assistance is actually regressive. Support
programmes have often shifted from universal coverage to targeted
coverage and, in some cases, have been eliminated altogether. It’s
necessary to ensure by increasing the level of benefits that the prime at-
risk categories of population (children, the elderly, the cronically sick and
disabled, single-parent families and single retirees) are guaranteed at least
a minimal subsistence income, and supplement this with unemployment
benefits and social assistance to protect the unemployed and the low-paid.
Meanwhile, it’s necessary to work for a more extensive rationalization of
the systems of social assistance and support for the unemployed (better
targeted) which will pay benefits only to those in proven need. In the Fsu
Countries, the revolt against the “new economic deal” is not only against
the perceived inadequacy of the sistems of social assistance unable
effectively to relieve poverty, but also against the injustice and corruption
in allocation of their provisions.
The system of government and private transfers must be improved
through targeted support to poor families (low-paid families,
monoparental families, ecc.) and enforcement of the already existing laws.
For istance, the very first component designed to cushion the material loss
suffered by the mother left with kids after separation is to review the
family legislation ensuring that the father pays child’s alimony in time and
in the amount needed to meet the child’s interests. This would, in its turn,
depend on the outcome for such issues as uncontrolled shadow-economy
incomes, unofficial employment, wage arrears and the level of
unemployment. Any increase in the alimony would also be dependent on
the overall pay levels and on the unemployment benefits.
In case of single-mother families, poverty factors include both low
individual income of the mother (often under the threshold of poverty)
and the insufficient amount of private and public transfers designed to
partly offset the absence of the second income source in the family
(children’s alimony following the divorce, pensions for the benefit of
children after the death of their father, single-mother allowances). As for
children’s benefits, their assessment basing on the minimum statutory
wages invariably devalues the already meager amounts since the statutory

Pag. 21
wage minimum has not be indexed for some time already. Moreover, the
income-based assessment of children’s alimony following the divorce does
not radically help since the amount remains the same while the eligible
income threshold stays rather high (two times the subsistence minimum).
It would be more appropriate to introduce a separate, supplementary
alimony that some Countries offer to support single-parent families.
An operative system of social welfare must ensure the wider
dissemination of information on welfare rights and an easier access to
those individuals whose indigence is rooted largely in the demographic
patterns (for instance, age). Currently, pensioners’ access to individual
social welfare is restricted by the applicable indigence criteria whereby in
most regions of the Fsu Countries the welfare assistance is available only
to those whose incomes are less than half the subsistence minimum. The
reference to the poverty line that equals half the subsistence level is being
accounted for by the high level of unofficial incomes which, if ignored,
could substantially enlarge the number of the poor. At the same time, for
poor, single pensioners of the older retirement ages, their pension benefits
are the only source of income. Should regional social security authorities
insist on an upward revaluation of pension incomes, it should be
differentiated depending on the family type.
Another component of the social policies aimed at reducing poverty
among more disadvantaged people should include a set of measures
designed to ensure these people with an adequate medical and social
services. These people seem currently to be particularly often
discriminated in their eligibility for free medical care. Two social policies
scenarios are possible here. One would set the priority for fee-based
medical care and social services. Under this scenario, the subsistence
minimum of people should allow for the actual requirements in medical
care and social services, so that the income be two or three times the
present one and people could, even with very tight budgets, afford paying
for the services in line with their typical actual consumption standards.
The other scenario would offer a system of institutional and financial
measures to provide for free (or mandatory insurance-based) medical care
for people in need of help. This second scenario seems less expensive and
more efficient, and it could be implemented in the draft law on minimum
statutory social guarantees.

The struggle against the poverty

Social assistance is certainly needed in every Country as the last resort,

whether that be provided in cash or in kind, but this cannot be the basis of
an anti-poverty strategy. An effective anti-poverty strategy has in the first
instance to distinguish those categories of the population who have the
potential to help themselves and those who do not. Two major directions

Pag. 22
may be distinguished within the system of social policy measures aimed at
preventing poverty:
a) measures of mission-oriented and well-directed social support of poor
categories of the population. Such a policy may achieve a desiderable
effect only if it’s pursued along with the measures aiming at rising the
nominal statutory wages worn away by inflation. With the growth of
official wages and salaries, insurance payments to government social
funds (the pension fund, employment fund, social benefits fund, ecc.) will
also go up, which will make it possible to increase pensions, benefits, and
so on. An increase in pensions will create objective prerequisites for
bringing down poverty among single pensioners. And since the women
are the majority of single pensioners, such an increase will reduce above
all the feminization of poverty, that is also a specific manifestation of
deprivation in the transition Countries;
b) macroeconomic changes targeted at bringing down the overall poverty
level of the employed. The growth of the official wages and salaries of
low-paid categories of workers may be achieved through revival of the
national production and redistribution of wages through lowering the
differentiation in labour payments. The rapid increase in the
differentiation of wage incomes is the principal source of increasing
inequality, primarily because the concentration of social transfers hasn’t
changed significantly, and the increased differentiation is very strongly
concentrated at the top and bottom of the income scale, with the middle-
income majority more or less keeping their share.
The differentiation of labour payments is growing at the highest space
within certain industries and enterprises. There has been a considerable
change in pay differentials within the state and former state sector. On the
one hand, differentials have widened substantially in favour of
managerial and professional employees in relation to manual workers. On
the other hand, pay in the formerly privileged military and engineering
sectors has fallen substantially while pay in the formerly benighted light
industry has risen relatively. The income dispersion in the new private
sector is much higher than that in the former state sector, so that
professional and managerial salaries are considerably higher, and the low-
paid are lower paid. Moreover, the new private sector is dominated by
business in the service sector and construction which employ large
numbers of unskilled casual workers. It’s only when privatization and
new business formation are associated with high levels of new productive
investment that we can expect it to begin to provide high-quality jobs
which can pay better wages. So far this has been confined primarily to
foreign investment and joint ventures. The problem is that these new
modern enterprises pay good wages but to relatively few workers and not
surprisingly select a narrow range of employees: young, well educated
with a strong commitment to work.

Pag. 23
 Taking advantage of extremely liberal institutional regulation of labour
relations the top managers strata is carrying out its strategy toward
uneven redistribution of income to its benefit. This process should be
stopped and it seems expedient to start it with the implementation of
programmes increasing the institutional supervision over the payment
and distribution of incomes through the adoption of 1) measures aimed at
eliminating the gap between the minimal wages and the subsistence
minimun amount (in the russian labour code recently adopted, is declared
that the minimum monthly wage must equal the official minimum
subsistence level). An increase in the minimum wage will also
considerably ease the task of developing an efficient social safety net
which is impeded at the moment by the fact that the lowest wages are far
below the subsistence minimum; 2) measures targeted to control the
income of top-managers; 3) measures of extrusion of non-money forms of
labour payment (even if the new russian labour code states that 20% of
the salary can be paid in kind, encouraging rather than limiting the
widespread practice of paying salary in kind instead of in monetary form).
Other measures - aimed at settling the shadow employment and
informal income which are a real break on the economic growth - are
those that bring down the tax burden related to wages and salaries and
the public consumption funds (programmes aimed at decreasing the
income tax rate for low-paid workers and legalizing the informal income
of the middle class strata of the population).
Actually, many employees are low-paid and are anyway subject to pay
the tax on income. The real wages are squeezed to the minimum, and
apart from that, subject to unbearably high deductions for the public
consumption funds. The population responds to the situation by tax
evasion through possibility to receive informal salaries that has become a
major priority in searching employment (all the employees working in the
“diffuse economy” - sector of small and medium enterprises - receive
unaccounted wages and salaries). The “effect” of tax evasion it also
concerns the new middle class strata. The greatest tax-evaders are top-
managers and big bureaucrats, which prefer the shadow incomes.
The general reform of the fiscal system provides benefits, but makes
them liable to personal income tax. Although many doubts have been
expressed about efficiency of relatively new systems of personal income
taxation, this approach has the advantage that “prima facie” everybody
receives the benefit as a right. Moreover, the extent of the leakage will give
the tax authorities a stronger incentive to make efforts to improve the
coverage and assessment of personal income taxation, which will
progressively improve the targeting of benefits as the tax system becomes
more efficient. The targeting of social benefits is much better improved by
making them liable to taxation through the developing system of personal
income taxation than by means-testing. Means-tested benefits are so

Pag. 24
poorly targeted and are bound to establish a poverty trap, the aim should
be to ensure that as few people as possible should fall into extreme
poverty. Although both are deficient, in the latter case it’s the poor who
are the victims of the deficiencies of the system.
However, it’s necessary to adopt contemporarily politics protecting the
low-income strata of the population. The tax pressure on the low-income
strata of the population could be raised through the following measures:
a) fiscal deductions for the low-income big families and cancellation of the
tax income which does not exceed the annual subsistence minimum; b)
expansion of tax benefits for children through the use of not only the
personified tax payment system, but also the family-based principle for
tax calculation.
It seems also reasonable to transfer the allocation of children’s
allowances to the wage mechanism, which will allow to economize on
administration of the allowances payment and will prevent delays and
non-payments of this social transfer.
Without a regressive scale for mandatory payments to public
consumption funds it does not seem possible to legalize the informal
income of the middle class strata of the population. With the current
system of deductions and payments, social benefits which are received
from the respective fund are actually not differentiated. Under the
situation the poor pay little (or nothing) due to the low income. The rich
do not pay at all for their income is concentrated in the informal sector.
The middle class strata can be split up into two groups: those who legalize
the greater part of the income and thus bear the maximum burden of tax
payment, and those who are searching for adaptation strategies oriented
to conceal the incomes. The use of a regressive scale will allow to decrease
the tax burden of the major taxpayers which, in its turn, will contribute to
the expansion of their (major taxpayers) social base.
The gender-based analysis of poverty levels of the population and
households has produced evidence of feminization of poverty in the Fsu
Countries. Female poverty shows extreme patterns in the form of stagnant
and exceptional poverty: the poorest among the poor.
The opposition of the feminization of poverty through a set of targeted
measures needs to have the following actions done:
a) measures conducive to better competitiveness of women on the labour
market through 1) industrial policies should be spearheaded not only
toward the mineral resources sector that is largely relying on male labour,
but also on the manufacturing industries that tend to concentrate female
jobs (light and food industries, ecc.); 2) the nomenclature of public works
should be revised to re-focus it from mostly male (road construction and
building) to more female labour: nursing and elderly care, child care, ecc.
The continued economic recovery is believed to result in the growth of
mostly male vacancies (in natural resources and engineering industries).

Pag. 25
At the same time, in education, which is a traditionally female
employment segment, vacancies decrease as a result of the demographic
slump. The public works programmes (road construction and heavy
municipal chores) are least of all designed to support women and even the
programmes of training are scarce and are almost fully intended for
managers, professionals, specialists, that are above all men.
b) realization of women’s professional potential. A set of social measures
here needs to provide for: 1) ensured access to childcare institutions, when
special services are offered at home or outside home; 2) a more
sophisticated household services industry that helps to create jobs for
women on the one hand, and allows working mothers to continue in the
job and take care of the household on the other; 3) introduction of specific
measures targeting socially disadvantages categories of mothers (single-
mothers, mothers of big families or incapacitated children) and designed
to have employment agencies offering retraining or encouraging
employers.
The industrialization of household services alone cannot help equalize
the time budgets for men and women, this being a single basic condition
for the full equality of opportunities on the labour market. However,
improved social infrastructure, together with other important issues of
female employment, could help bridge the gap between men and women
in terms of their realized social potential;
c) the growth of official wages and salaries of low paid categories of
employees, of which the women are the majority, and reduction in gender
inequality in labour payment. A gender pay gap is evident everywhere in
the world, and women are also earning less on average than men in the
Fsu Countries. Nevertheless, the gender difference in wages, because of
her size, is higher in the Fsu Countries than in the western Countries. This
is the effect of the significant growth in overall wage inequality and the
massive changes in the labour market during the transition.
Wage discrimination of men and women is manifested at several levels.
1) wages and salaries of women in all sectors, even with prevailing female
labour, are lower; 2) the differentiation of women’s wages and salaries
within a certain sector and at an inter-sectoral level is considerably lower
than that of men; 3) in male dominated sectors, women receive lower
wages and salaries, while in female dominated sectors men are better
paid; 4) if a woman works in a traditionally male dominated sector, her
chances to earn more are higher than those of a woman of the same
profession employed in the female dominated sector.
Women’s equal pay and equal employment opportunity are also
important for the well-being of children. Research in various Countries
has demonstrated that a rise in the share of women’s earned income is
beneficial for child welfare. In this regard, it is worth noting that the “net”
pay gap (part that cannot be attributed to differences in job or human-

Pag. 26
capital characteristics) appears to be significantly greater than the value of
public child/family allowances in the Fsu Countries.

The syndical role in the Fsu Countries

The affirming trade unions in the Fsu Countries must give up doing
improper functions like that of organizing the productive processes,
concentrating instead on the defensive function. The solution is surely
found in the use of a classical instrument that in West, especially in Italy,
has assumed a fundamental meaning for the realization of a defensive
function, but that in the Fsu Countries ever had a dominant role. It
concerns the collective bargaining that still today, although existing, it’s
weak, patchy and not widespread at all levels. It’s necessary to give new
contents to collective contracts, subtracting them from the ream of
meaningless papers and making them an effective and organic instrument
of the renewing syndical action. The trade union must become a social
subject having a big moral integrity; it must be a free and independent
organism from statal bodies, political parties, ecc. The central syndical
organisms must renounce to the impositions toward works committees,
leaving the faculty to last ones in defining at a local level their priorities. In
this way, the syndical works organisms become free in defining executive
policies to conduct inside the industries and enterprises. At the same time,
they assume the faculty to determine the structure and numerical
consistence of the staff of the superior organisms (district and regional)
and contribute into the appropriate seats to the choice of the decisions of
general character. A strong, independent and authoritative trade union,
able to take and defend the own position, becomes today a reality
expected by all the workers. Especially now when many legislative
principles adopted in the Fsu Countries are found in sharp contrast with
the interests of working class (in Kazakhstan the new labour code enacts
the prohibition of strike, and in Belarus the labour contracts of the new
entrants are only on a temporary basis).
An important footstep toward the law-based state is represented from a
great diffusion of juridical training to the syndical cadres. To this respect
would be opportune to organize courses of juridical training on several
matters like employment, pensions, house, ecc. The contractual initiative
of the trade union becomes more and more articulated and complex: next
to the traditional problems of the defence of workplace, more high and
more correlated labour payments to the inflationary processes, more
careful (to people needs) solution of the social problems, more active
participation to the business politics which are currently the more
discussed issues at the negotial tables, there are other ones also important
and now often submitted to the syndical debate. They are: house (endless
source of social tensions), public diet, health and safety of workers,

Pag. 27
ecological defence and environmental recovery, more effective and
articulated professional training. It can be found a common point of
arguments between East and West Europe on some emergent problems
like environmental pollution, link between economy and criminal world
and exclusion of wide social areas from the circuits of guarantee.
The syndical reform in the Fsu Countries must not only concern greatest
autonomy and the internal restructuring of the trade union. It also must
operate for “remodelling” the mentality of the worker accustomed in the
past to a purely formal adhesion (although total) to the trade union. A
characteristic feature of social partnership in these Countries today is a
considerable differentiation of forms and methods of interaction: from
active position of the trade unions on protection of employees’ rights and
quite developed forms of social dialogue at enterprises to full absence of
any consideration to the employees’ interests and rejection of trade
unionism in any form. Of no less importance is the fact that social
dialogue up to now has failed to become the main principle of regulation
of social and labour relations. The role of the trade union is to also
promote an understanding of democracy and of a system of “social
partnership” aimed at achieving an optimum balance of interests among
the different subjects within the social partnership system (employers,
employees, state, trade unions, government and the society as a whole).
This understanding has to hold in due consideration the different ways
performed by partner Countries: specific character of the emerging social
partnership in the Fsu Countries stems from the fact that it’s developing
on the background of traditions and values totally different from those
that were forming the basis for the development of social dialogue
between capital and labour in the Countries of advanced market
economies. The transition from the state-run economy to a market one
changed the very nature and character of all relations within the post-
soviet societies (including social and labour relations).
The syndical reform must take place together with the process of
general democracy carried out in these Countries. At the same time, the
trade union must collaborate with all recently born democratic
movements, with all the informal associations that have a progressive
position, to lend every required support to them and to realize joint
demonstrations. The trade unions establish more and more intense
relations with the enterprises, institutions and local administrations,
starting complex political exchanges with the parties, corporate bodies of
development and socio-economic promotion. With the introduction of the
free market in the transition Countries, the problem of its regulation has
arised. The free market can only develop in a democratic way in the
presence of complex and elaborate juridical norms regulating it.
Nowadays we need not only enterprise-managers but also trade union-
managers, that is to say experts knowing how to plan out and lead a

Pag. 28
collective bargaining, looking for lines of compatibility between the
interests of the workers and the economic restrictions imposed by the
market. In the Fsu Countries, trade unions retain considerable rights to
represent their members and monitoring the activity of employers, but
barely exercise these rights. For example, the problem of low wages has to
be confronted through a combination of legislative means and
strengthening the role of trade unions as representatives of their members.
The trade unions can regain authority and respect only through facts
and concrete initiatives, directed to the satisfaction of the true needs of the
workers. What happened in the regions of Astrakhan’ and Yasnogorsk, in
Komi (the Federal Atomic Center) and in the Uralis, it is to show the
importance of the role of the renewing trade union and of the high
consideration of which it can enjoys among workers when it really fights
to protect their rights. During the last years, in these regions, strikes,
occupations of factories, legal actions against the top management,
highway blockades and mass meetings have been organized. Disputies
have been won for the payment of wage arrears, the increase in salaries,
the reinstatement of workers illegally dismissed, for a stop to the failure of
the factories, etc. These facts show that a foreground role is up to the
regional and district syndical structures.
The dedication of the trade unions toward a most scientific analysis of
the public opinion and a deepest study of the organization, retributive,
sanitary, housing, environmental issues and toward a more human
politics, all this will facilitate in a decisive way the so expected turning
point in activity and above all in the outcomes of trade unions themselves.

The gender dimension in the Fsu Countries

The transition period in the Fsu Countries, starting in the late 1980s and
continuing up through the present day, has been accompanied by
significant changes in women’s political, economic, and social status.
Whereas much research and media attention during the transition period
has focused on privatization and the development of a pluralistic political
system, both of these realms tend to be populated by a predominantly
male cast of characters, and as a result, the effects of the transition period
on women remain largely hidden from view. To accelerate genuine
development, gender issues need to be better integrated into the political
and public agenda. The key areas for the implementation of “affirmative
actions” in favour of women are:

a) economic status. For several years, the former socialist Countries have
been undergoing a transition from a centrally planned economy to a more
market-oriented economic system. From a woman’s perspective, the
process of transition to the free market has been accompanied by several

Pag. 29
disruptive and negative trends. The first of these trends is an increase in
unemployment. Under the socialist regimes, the specter of unemployment
was essentially unknown; the constitutions declared a “right to work” and
enforced this right with severe penalties for those who found themselves
jobless. Now unemployment has become a household word, particularly
for women, who make up the vast majority of registered unemployed. The
current growth of unemployment is shocking for women in the Fsu
Countries, who under former rules had maintained an extremely high
labour force participation rate: around 90 percent. The new trend toward
pushing women out of the labour force is particularly hard for single
mothers with dependent children; their salary is the sole source of family
income. Women over thirty-five with young children are increasingly
hard-pressed to find work. Not only they have on the job and hiring
discrimination increased, but also the social welfare infrastructure
undergirding mothers’ employment has been severely cut. In a society
where fathers rarely take a large role in child care, women especially are
left stunned by the rapid decline in availability of child care and other
benefits, such as children’s camps, all of which melted away with the
collapse of the soviet social welfare system. By 1994, as more and more
single parent families slipped below the poverty line, government officials
began to refer to the feminization of poverty.
There are two fundamental reasons for the disproportionately high
numbers of women among the unemployed. First, one can point to a well-
entrenched system of vertical and horizontal occupational segregation by
sex. Women predominate in certain industrial branches, including some of
those hardest hit by the changes in the economic system and the collapse
of the former socialist Countries, such as light industry, especially textiles.
The salaries are decreased in the military-industrial complex (with almost
all male), while they are increased in the light industry (where female
labour force generally is prevailing). Nevertheless, in the last case, when
jobs are available, the priority of assumption is granted to men that have
the tendency in the time to replace women.
A second reason for women’s unemployment has deeper roots but has
been exacerbated by the privatization process. Now responsible for the
profitability of their enterprises, employers prefer not to hire women
knowing that women hold full responsibility for taking care of the family,
including frequently sick children and aging parents. Also, women are the
beneficiaries of maternity leave and other associated benefits. These facts
and policies encourage the commonly held assumption among employers
that women constitute a less desirable and productive workforce since
their family responsibilities encroach on their work time. Thus women
face the double-edged sword of the “double burden”; they are fully
expected to take care of the family yet discriminated against at work for
this very reason.

Pag. 30
 Economic discrimination against women is hardly new, but it seems to
be on the rise in the transition Countries. For decades, women have
tended to work in branches of industry with low pay and low prestige.
Despite an overall higher level of education than men, working women
are clustered in lower skill categories. Women rarely attain the level of
managers or industrial directors and their average pay is lower than men’s
one.
A second important trend affecting women adversely is a tremendous
drop in the provision of public child care. This is one result concomitant to
the process of structural readjustment, which entails a separation of the
social welfare sphere from the industrial enterprise. Factories are shutting
down childcare centers at unprecedented rates: many child care centers
were closed, while others were privatized, placing them out of financial
reach for many families. The effect of this combination has been to push
women back to the home.
What’s more, to make matters worse, most poverty indicators including
those not based solely on income but on the satisfaction of basic needs,
are based on household surveys that consider the family as a unit and
assume that all members of a household share equality the income and
resources available, independent of their age and gender. This results in
underestimating the number of women living in poverty, since many of
them are not able to satisfy their basic needs even when living in
households above the poverty line.
It should be said that women, along with men, now have opportunities
to open small businesses and to enter the private sector. However, without
enjoying the advantages of industrial directors, who were able to privatize
their enterprises when the new economic rules came into play, women
have had a harder time than men getting bank loans and credit and have
few role models in the business sphere. Furthermore, the private sector
offers a limited range of jobs for women. These are frequently secretarial
jobs for young women with foreign language or computer skills.

b) political status. Real decision-making power of women was especially

located within the several structures of the communist party. But most of
the female deputies were “mass representatives”, including several
prototypical “milkmaid heroines of socialist labour”; in other words, token
women who overfulfilled the economic plan and were present for
essentially decorative and propaganda purposes. At present, with the
passage from a quota-based political system to a free election-based one,
the women’s participation is drastically decreased. There is a widespread
feeling among people that women’s place is in the home, not in politics.
This is substantiated by both national public opinion polls and anecdotal
evidence.

Pag. 31
c) socio-cultural status. Social attitudes toward women and women’s roles
in the transition Countries are frequently essentialist in nature and often
openly sexist. Discrimination against women on the basis of sex forms the
background to women’s sociocultural status. The widespread opinion that
women should be at home raising the children, rather than working
outside the home for a salary is a typical role stereotype persisting despite
the fact that under current economic conditions most families require two
salaries in order to meet the minimum living standards. It should be noted
that according to the current constitutions of the mentioned above
Countries, there is no discrimination against women. Men and women
have equal rights and freedoms and equal opportunities to realize them.
The lack of legal culture makes this principle, though a very progressive
formulation, essentially meaningless. Given the weakness of the legal
systems and the lack of a mechanism to enforce antidiscrimination
legislation, the declaration of equal rights and opportunities for both sexes
remains in effect only on paper. Job advertisements, for instance, openly
exhibit discrimination on the basis of both sex and age, inviting
applications exclusively from men in some cases. It isn’t unheard of to
encounter an advertisement that states, “Seeking attractive woman, with
european features, under 35, and without hang-ups.The latter phrase is
even abbreviated as w/c (without complexes) and signifies either sex work
or that the woman in question should be willing to put up with advances
by bosses, clients, etc.; an institutionalized form of sexual harassment.
The proliferation of beauty contests and pornography in Countries
where for decades laws forbade the propagandizement of the cult of
violence and pornography are seen by some women as downright
oppressive and by others as simply a phase, during which the forbidden
fruit of pornography has become a commonplace presence in both the
public and private realm. Pornographic materials are sold in underground
street crossings and naked-woman wallet calendars are a staple in many
taxicabs. The transformation of women’s bodies into “objects of
consumption” extends to television and printed advertisements, where
women appear in traditionally feminine poses and seem to exist in order
to serve men and please the male eye. The diffusion of these images does
have an effect on women and on women’s self-image, not to mention on
the ideas and stereotypes that men and women develop about women’s
capacities and proper social roles. Numerous stereotypes about women,
including very sexist expressions, continue to have currency today.
Women are trying to fight discrimination and realize themselves as full-
fledged members of society, through organizing. Beginning in the early
1990s, a large number of women’s groups sprang up, forming a nascent
women’s movement. Women started to speak honestly in public about
their lives and, along with a variety of organizations, a several number of
women’s groups emerged. They met other foreign women’s movements

Pag. 32
and became transfixed by the goal of acquiring funding for travel to the
Fourth World Conference on Women, held in Beijing in September.
As it has been said, women’s economic, political, and sociocultural
status in the mentioned above Countries has suffered in many ways
during the transition period. At present, the trend is toward pushing
women out of the workplace and depriving them of their right to choose
whether or not to work outside the home. Women are increasingly
excluded from certain professions and are becoming more economically
dependent. They are showered with sexist images and confronted by
unsympathetic male politicians. For the masses of women (and people in
general), the economic conditions of life are immiserating and the political
conditions frustrating-even scary. However, the impoverished but
enthusiastic women’s movement has emerged in its variety of forms with
a great deal of potential for improving women’s status overall. Both the
more feminist groups (by challenging stereotypes and promoting
feminism) and the more pragmatic groups (by bringing women together,
expressly to better women’s situation) present the possibility of new
definitions of what it means to be a woman, as well as a radical challenge
to male power.
An important priority to realize, it concerns the building of a “network”
with several groups and female associations of the transition Countries,
and create a system of communication and constant exchange of
experiences about gender dimension, above all with the western european
Countries.

The social networks and civil empowerment

People need not only incentives, money and material resources, but also
social support. Social networks are vital resources.
Traditional networks based on reciprocity survived from pre-
revolutionary peasant society through the socialist period, but are now
coming under increasing pressure with the growth of inequality which
undermines reciprocity. Not nearly enough is known about the role of
such social networks or the conditions under which they thrive, but one
feature inherited from the previous period is that they tend to be narrow,
confined to relatives and close friends, and so do not provide a strong
basis for the development of community and civic organizations. Close
inter-family ties to some extent compensate for the lack of government
social support to families with kids. They support families with “private
transfers” rendered in cash, in kind or in service.
But this phenomenon today tends to grow and transform in line with
the social changes in the society. The social isolation of the family is
complemented by her civil and political isolation, which prevents her
from defending and pressing for own interests. Democracy and good

Pag. 33
government start at the bottom, so that initiatives to reform institutions
from above need to be complemented by measures to encourage
participation from below by supporting the development of effective
participatory communities, movements, informal organizations and civic
structures at the base so that they can press for the social and civil rights.
All these organisms can play an important part in supporting family by
providing advice, aid and representation for those persons whose rights
have been violated.

The technology as a strategy for democratizazion

The role of technology in the revolutions that led to the collapse of

Countries of the former soviet coalition has been widely acknowledged.
Indeed, it has been asserted that the socialist collapse could be called the
“first foreign policy victory of the information age”. Many believe that we
are in the midst of another revolution, a so called “information
revolution”, in which technology has a role to play in the ongoing process
of democratization. The information revolution is changing the balance of
power between the state and the other social actors. New technologies
have allowed activists in grass-roots organizations of all types to mobilize
virtual communities and shine a spotlight upon issues of social and public
interest, circumventing state control and connecting directly with
international media channels. Access to new information and
communication technologies is an important component in the
transformation of post-soviet societies to democracy by allowing citizens
unprecedented opportunities for free speech and political and social
advocacy. Specifically, technology is thought to enhance democratization
in the following way: it can help identify and publicize abuses or issues of
public social concern, aid in the mobilization of interested and affected
citizens upon specific issues across great distances, improve and simplify
coordination of actions by citizens and organizations. For better or for
worse, the information age has arrived in the Countries in transition, and
there is a perceived need to rush to exploit the opportunities it promises.
A lot of people have internet access today. An internet surfer can now
click on to a plethora of web sites and take contacts directly with several
organizations and activists. Access to new technology can be a strategy for
developing and strengthening the networks. These networks can
contribute to third-sector development by allowing groups to freely
communicate with one another, with government, syndical organizations
and the media, and with international community.
Technology has helped build connectivity between organizations and
transformed communication and information exchange, thereby helping
to sustain a relatively small and geographically dispersed movements or
groups. Of course, technology on its own is not a panacea, and access to it

Pag. 34
doesn’t mean to alter completely a way in which organizations, groups
and other social actors interact or engage with their community.
Generally, technology works best for movements, groups and
organizations with a clear mission, target audience and defined goals:
movements, groups, organizations that do not meet this criteria are
unlikely to reap the benefits that technology has to offer. Anyway, the
ones utilizing technology at a limited level may benefit in terms of
increased communication between existing organizations as well as access
to more information. It is clear that technology as a strategy for
democratization must be an effective tool specifically tailored to the
diffusion and knowledge of needs of the individuals and the organizations
that by technology can lace useful links of international solidarity and
struggles on common goals. To this respect interesting is the joint
experience - using internet and e-mail - of russian workers and mexican
ones. They decided to link their struggles as an important groundbreaking
move. It comes in the spirit of the global anti-capitalist protests that were
held in Seattle, Washington, Prague and elsewhere: “We need a
globalization of our own struggle - the struggle of workers and poor
people, uniting beyond national boundaries, fighting to ensure that there
will be a best world future». Another experiences are those of the
international movement of support to the protest actions organized in
Russia against the labour code “Putin” and the struggle of Ontario
(Canada) workers, facing a new labour legislation similar in many respects
to the new russian one.

Environmental safeguard and nuclear safety

A theme to face with a certain urgency concerns the promotion of

economic alternatives which would contribute to the development of
environmentally safe (eco-compatible) livelihoods. This is possible
developing at the same time a culture of environmental justice that differs
from traditional ecological philosophies in that it seeks to combine a
concern for the natural world with a consciousness of the presence of a
large ethnic and class discrimination. In numerous towns, hundreds of
workers and their families who live in the industrial settlements have over
the years fallen victim to rampant industrial pollution, to cancer, lung
diseases and sulphur poisoning. Throughout the world, poor and minority
communities (particularly low-income communities) bear a
disproportionately large burden of toxic contamination, and suffer the
health problems and stigmatization that result from it. Pollution and other
environmental problems have soared, while adequate medical care is now
a luxury reserved for the rich.
Particular importance must be granted to the institutional
strengthening, to the legislation and environmental education in the Fsu

Pag. 35
Countries, as well as to the start of the cooperation as regards the struggle
against the pollution and the disastrous ecological conditions of the
industry and the nuclear centers in a transfrontier picture.
As concerns the nuclear safety, an important footstep by the Fsu
Countries will be their ratification of the international Convention on
nuclear safety and their adhesion to the amendments of the Convention
adopted in London in 1993, forbidding the unloading of radioactive
refusals, as well as their adhesion to the Convention adopted in Vienna on
civil responsibility as regards the nuclear damages. Particularly, it’s
necessary to adopt a regulation that foresees the amelioration of the safety
of industrial fittings, including the amelioration in a very short time of the
mostly risky fittings, in the perspective, at the same time, of their as soon
as possible closing. Therefore, all the measures about the preparation of
the operations of fittings dismantlement must be activated without
neglecting the inherent aspects to the fuel cycle and the management of
the refusals. The attainment of an elevated nuclear safety level and a good
management of the pipe-lines are all essential elements to the prevention
of the nuclear catastrophes. The damages following the Chernobyl nuclear
explosion in April 1986 in Belarus are incalculable. The impact of
Chernobyl still affects all aspects of life in the afflict regions, as well in the
Country as a whole. The United Nations has recognized the Chernobyl
explosion as a disaster both global and regional in natural trascending
boundaries and unprecedented in its radio-ecological consequences.

The widening of the European Union to East

The future of the EU depends on its ulterior widening. The idea to open
the doors of the Union to Countries of the central and oriental Europe,
besides Cyprus and Malta, has constituted, after the year 1989 and the fall
of the wall in Berlin, the answer to necessity reorganizing on democratic
bases, aimed at cooperation and economic development, the relations
among all Countries of the european Continent.
In the picture of the definition of the new strategic assignments of the
Nato and its widening to East, the Union owes to also define the picture of
its relationships with some Fsu Countries, particularly with Russia and
Ukraine.
The European Union has taken the first binding decisions on the
widening during the vertex of Copenaghen in 1993, fixing the
fundamental criteria to realize the adhesion of the new members. These
criteria substantially foresee the attainment of suitable standards in the
field of the democratic institutions and the affirmation of the law-based
state, the modernization of the economic structures and the market ones,
the ability to assume the complex of norms that already regulate the
relations of current members States of the Union. This is the reason for

Pag. 36
which the widening can be defined like an evolutionary, global and
inclusive process articulating in different tappes in relation to ripening
tempi of each candidates Countries.
The process of integration must be stimulated sustaining the effort that
each partner Country must do to conform at the necessary levels to start a
real negotiation. But it’s important to take account that every Country has
traditions and different levels of development, avoiding in this way that
run-up toward the objectives of the adhesion has negative effects,
especially on the social sphere. The integration will be possible only if the
reasons for the social cohesion and solidarity among the whole members
States will be safeguard.
The widening to East of Europe is an important opportunity,
particularly as concerns the development of the programmes of
transfrontier cooperation. The EU must start with Russia and Ukraine an
open and profitable dialogue, such as to constitute a first footstep toward
the future unity of the whole Continent. It must to establish a solid and
lasting relationship with these Countries to promote the process of
democratic and economic reforms, strengthen the respect of the human
rights, consolidate peace, stability and security, so that to avoid new
divisions in Europe and fully integrate these Countries in the community
of the free and democratic Nations.

Globalization and cooperation

It’s important to make sure that laws and social-political and ecological
activities of partner Countries have a human face, and facilitate the
liquidation of all forms of oppression, exploitation, discrimination and
violence from their models of development toward the establishment of
new civilized relations. The possibilities for their realization demands
intense attention. Here particular attention is due in order to define the
problems of employment, labour, social security, development of social
dialogue, realization of the idea of social justice, equality and equal
opportunity for all citizens, in particular for those that are found in a deep
crisis after the implementation of neo-liberalism and privatization in their
former socialist Countries. A no less importance have these issues in the
western european Countries, especially now with the progressive change
of social, political and market relations due to process of globalization. It
drives toward the integration of national economies and the uniform and
comprehensive development of new life models, involving both eastern
european Countries and western european Ones. From here the necessity
to elaborate common strategies, monitoring the modern processes that
occur in the economy, politics, ecology and public social life, in order to
assure that there will be a stable and sustained growth, and an even
distribution of the resources. In this context, it’s important the

Pag. 37
strengthening of the role of the NGOs, like instruments for a real
participation of the civil society in the cooperation to the development.
The generating actions of income, like the microcredit, the development of
the small enterprise and in general the recognition of the popular
economy as a motor of the local development, are also fundamental. The
role of the NGOs must be strengthened in the initiatives of education to
the development and of promotion of the equitable commerce based on
solidariety. It’s necessary to simplify and to make more transparent the
access of the decentralized and not government subjects to the
instruments of international cooperation.
The globalization, the evolution of the financial markets and the rapid
technological progress have involved important transformations in the
national and regional productive structures and in the labour
organization. All this has not only had positive results, since the
unemployment and the social exclusion have now become structural
problems for the whole planet, the inequalities have grown more marked
and the discrepancy between the North and the South of the world has not
stopped becoming larger. About 1/4 of the inhabitants of the world still
live today in extreme poverty, either material that human, conducting the
own existence in absolutely precarious conditions from the point of view
of the sanitary assistance, of the personal safety, of the schooling, of the
social inclusion.
Moreover, wars, armed conflicts, violations of the human rights,
corruption and misgovernment require an approach of preventive type
that calls for an active and full involvement of international community. In
a more and more interdependent world, only the commitment and the
effort of international community can allow to face in an effective way the
problem of a sustainable, participatory and balanced socio-economic
progress centered on the human needs.

International security

The explosion of new ethnic, religious or nationalistic conflicts,

remaining or accentuating of economic unbalances at world level, the
danger of environmental catastrophes and of serious humanitarian crises,
all this imposes the necessity of common international politics aimed at
maintaining peace and stability in the world.
At first, it’s necessary to sustain and consolidate the right to security,
keeping track of the new international reality and inspiring to the
democratic principles with respect to a balanced geopolitical world
representation based on mutual solidarity. The principles of peaceful
coexistence have won broad international recognition and have been
incorporated into scores of several international instruments, but each step
along the road to more durable peace has taken and does take a lot of

Pag. 38
efforts. It calls for intense and joint struggle against the international
terrorism that has become especially active now, but it also calls for the
construction of relationships and links of international cooperation on
common strategic goals that overcomes the logic of the opposed blocks
even more monstrous today, because it would be founded not only on the
ideological hate but also on the ethnic, religious and nationalistic one.
The need for peace and security is of particular importance today when
the international tension is markedly increasing after the events of 11
september and with the worsening of the situation in the Middle East.
After the 11 September, the russian President has changed his political line
toward the appeasement with America - his Country is entering the
“western living- room” of the international geopolitics - despite russian
Parliament, the Duma, has not supported his choice (only 15% of deputies
supported presidential line) and continues to put obstacles in it. Within
the euromediterranean politics, a fundamental strategic importance must
have the active, political and economic support to the process of peace in
Middle East taking account of the accords undersigned by Israelis and
Palestinians.
The war and violence are still an usual method of social, political and
ideological confrontation and Countries have weapons that can destroy
human civilization and all life on our planet. The efforts of Countries, the
activities of governments and organized political forces should now all be
directed toward preventing acts of international terrorism and a nuclear
catastrophe with negotiations on all matters concerning the limitation and
reduction of armaments, and for the application of various accords or
stipulated conventions, like that of Ottawa about the complete elimination
of the terrestrial anti-man mines.
With the agreement signed by Russia and Nato in Rome, the United
States and Russia have not - contrary to conventional wisdom - ended the
cold war, which in a formal way concluded more than a decade ago with
the demise of the Soviet Union. Actually, the summit marks the beginning
of serious joint efforts to deal with legacies of the cold war - thousands
more nuclear weapons that needed for reliable deterrence, and Nato as an
exclusive military alliance with Russia as an outsider - that threatened to
become obstacles to practical cooperation. The american and russian
leaderships must now begin work on the meaningful agenda: defeating
global terrorism, preventing proliferation of weapons of mass destruction,
involving Russia into international economy, to give up its citizens a stake
in building a democratic and prosperous future, with the appointment by
the same Country to carry out to the obligations as concerns the
liberalization of the commercial politics. Finally settling crises outside
Russia’s and Nato’s zone responsability. Above all, that concerned the
India-Pakistan crisis and the situation in Central Asia. Of course,
anchoring Russia, or other Countries of former soviet coalition, in

Pag. 39
international organizations makes sense only if the rules, norms and laws
governing those organizations are then applied to Russia. This to date has
not been the case, and the international community has therefore missed
an opportunity to make the demand for the protection of rights inside
Russia a priority. There is a cost to this inaction for international security,
especially with regard to the ongoing war in Chechnya. The way in which
the russian forces have conducted their anti-terror campaign in Chechnya
is profoundly counterproductive; this is not a clean campaign but one
freighted with serious abuses that have alienated the local population and
made them more susceptible to the appeal of extremism. Big agricultural
lands are now mined. This is the reason for which the economy in
Chechnya is reduced at the level of pure survival and the society has lost
its stability.

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