Democratising Capitalism? The Political Economy of Post-Communist Transformations in Romania, 1989-2001 by Liliana Pop (review)

Abstract

382 SEER, 85, 2, 2007 one might expect, Poland's newest entrepreneurs tend to be people with strongpersonalmotivation or some historyof family initiativeand prosperity. They also tend to support capitalism,privatization,democracy and Poland's entryto the EuropeanUnion. Some entrepreneurshave yet to grow out of the practices that were necessary for survivalduring Communist times, namely, informalityof contracts and corruption, but ethical standardsare rising, in part as a result of the work of the professionalbodies that have developed since I989. The authors make substantialuse of factor analysis and regression, and relatetheir findingsto wider sociologicaldebates. To this extent, Open for Businessprobably makes a contribution to the sociology of the post-Communist transformationof Centraland EasternEurope. However, the readeris offered little information about the scale, nature and structure of the enterprises whose founders were interviewed, or about the extent to which they are typical of Poland's entrepreneurialclass as a whole. Chapter six's regional analysis of factors likely to affect the emergence of entrepreneurshipis too limited to add significantlyto our understandingof the topic;and only a small proportionof the informationcollected in the interviewsappearsto have been presented.To this extent, the book will be of much less interestto economists and political scientists,let alone politicians and journalists, for all of whom relevance is claimed in the Preface, than it might otherwisehave been. Arbroath ANDREwH. DAwsON Pop, Liliana. Democratising Capitalism? ThePoliticalEconomy of Post-Communist Transformations in Romania, I989-200I. Europein Change.Manchester University Press, Manchester and New York, 2oo6. Xii +208 pp. Notes. Glossaryand biographies.Appendices. Bibliography.Index. ?55.?0. THIS is a timely work of revisionism. Liliana Pop challenges the view that post-I989 Romania witnessed state capture by former Communist officials allied to elements in the formerintelligenceservices.Her book, demonstrably based on a PhD thesis,showshow a new systemof open politicsand competitive economics emerged after I989. She characterizesthe events of 1989 as a genuine popular revolt and wastes no time with explanations purportingto show that well-placed elements in the Communist system used them as a springboardto remain dominant forces in the pluralistcontext. She insistson the Communist regime's 'considerablecontribution to the modernisation of the country' (p. I7). The successorregime under Ion Iliescu was an independent actor 'concerned to protect the interest of consumers' (p. 79) despite events like the unmentioned Caritas pyramid banking scandal. Iliescu's's National Salvation Front was very much a victim of the successiverampages by coal-minersin I990 and I99I which led to a period of renewed isolationfor the country.The slow pace of reformwas due not so much to decisionstaken by Iliescu and his circle but to 'structuralconstraints'and especially to the role of transnationalagencies with free-marketagendas. Nicolae Vtacaroiu, Iliescu'sprime ministerfrom I992 to I996 at last receivessome vindicationfor REVIEWS 383 his policy of 'economic gradualism' which is compared favourably to the IMF-inspired'shocktherapyof I997' that appearsto have blighted the record of the only government opposed to Iliescu in office before 2004. Insteadof overlookingthe distributionof stateassetson an informalbasisto political insiders,Dr Pop should have graspedthe nettle and argued that this form of crude redistributionof public goods encouraged the growth of a new authentic capitalist class. She reminded us that no serious commitment to reform was likely from bureaucratsunless 'they can maintain and enhance their life chances' (p. 2I). This was true for the 'undergroundelite', her pithy termfor the secretpolice, and it is perhapsa blessingthat a professionalgroup that had attracted some of the brightest graduates in the I970S and ig8os moved into capitalism with such alacrity in the early I99os. There were spectacular banking failures which caused the state losses of $4.i billion in missingcreditsbetween 1992 and 2004, but Dr Pop points out that corruption was a feature of transitionsin all of the former satellite states. She is instead criticalof the privatizationrecord of the centre-rightgovernmentsof the late I99Os. Radu Sarbu, head of the state privatizationagency of the time is the only person in the book whom she describesas 'currentlyunder investigation' for dealings during his period in office (p. I55). It is perhaps time for Iliescu's post-Communiststo be seen in a balanced light. Ion Iliescu 'was an advocate for moderationin politicalcompetition, supportedthe rulesof democracyand sought to act as a facilitatorfor inter-partycooperation during...