Anti-corruption as the “New language” of the neo-liberal order in Albania
The neo-liberal order implemented in Albania following the collapse of communism in 1991 consisted of two mutually supporting elements: a neo-liberal development model that saw the market as the engine of development and the state as a potential hindrance, combined with a deeply asymmetric relationship between Albania on the one hand and the international institutions such as IMF, the World Bank, and the European Union on the other. This was a Political regime that emphasized that in Albania development would essentially come from the outside for that the main concern for the Albanian politics was to open up to international trade and become attractive to international investors. Political development and democratization would come through closer association with the European Union, which would monitor its institution and its politics. In short, the neo-liberal order was a combination of a neoliberal development ideology and a relationship of dependency. The main arguments in the international discourse that served to institute a neo-liberal order in Albania can be summarized in three interrelated ways;
First, by blaming corruption as the major obstacle to economic development, it diverted criticism from the shortcoming of the neo-liberal development already in place in Albania. This, in turn facilitated the re-introduction of neo-liberal policies as anti-corruption measures insofar as corruption was articulated as a symptom of the public sector.
Second, international discourse on corruption reproduced the asymmetric relationship between Albania and the international institutions. Such an asymmetric relationship implied that in order to get rid of corruption, Albania had to undergo a reformation process that brought its legislation and its institutions closer to international requirements. These reforms sought, amidst other things, to better integrate Albania into the global market and make it more attractive to international capital, thus buttressing the existing neo-liberal order.
Third, in the international discourse anti-corruption was gradually transformed into an empty signifier that brought together into a chain of equivalence various demands that against corruption were articulated as complementary rather than contradictory > Anti-corruption as an empty signifier served to articulate a neo-liberal order that was free of internal contradiction, where more market, more globalization, more democracy were complementary rather than contradictory processes.
In order to understand the neoliberal development model that was implemented in Albania following the collapse of communism, it is first important to understand what as Foucault argued “the problem of neo-liberalism was not how to cut out or contrive a free space of the market within an already given political society, as in the liberalism of Adam Smith and the eighteenth century”, instead in neoliberal discourse the market become the organizing principle for the state in itself. Therefore the term “neoliberal” is commonly used to identify a range of governmental projects aiming “to corporatize or privatize public sector institution, to expand the sphere of competition and market like interaction (Hindess, 2005, p 1390). In short, neoliberalism does not mean simply less state intervention, since in order to create new markets in areas such as health and education more state intervention is often required. Neoliberalism implies the creation of the new markets along with the penetration of market logic in those areas where new markets cannot be created.
When it comes to specific economic policies anti-corruption meant more deregulation, less state intervention, free trade, privatization and liberalization. The World Bank in its first anti-corruption policy stated that: ”Deregulation and the expansion of markets are powerful tools for controlling corruption, and the bank will continue to encourage governments to pursue these goals wherever feasible”. Specific economic policies that the world bank recommended in order to fight corruption included, lowering tariffs and other barriers to international trade, reducing regulation, introducing competitive credit markets, eliminating price controls, cutting subsidies to state enterprise and privatizing government assets (world bank 1997). Along the same lines, the US Agency for international development (USAID) would argue that from an institutional perspective “the more activities public officials control or regulate, the more opportunities exist for corruption”. Hence the key policy recommendation was to limit the state authority through privatization, which removed government from economic activity. The above policies were recommended by international institutions and implemented by the Albanian government to combat corruption in the country. Minimizing state interventions: de-monopolizing and the continuation of state property privatization against the threat of corruption, a neo-liberal order of governance was instituted and legitimized.
The anti-corruption philosophy of the government and international institutions both reflected and legitimized the neo-liberal development that saw economy liberalization and free trade as the sources of economic development and state intervention as an obstacle. In this neo-liberal philosophy the state was the source of corruption, for theoretically at least, there could be no corruption without a state and i’ts public administration. Therefore reducing corruption would mean the expansion of the private sphere. In other words; the Albanian government was quite eager to comply with international anti-corruption initiatives, especially coming from international institutions such as the World Bank. The World Bank. On the other hand was quite eager to portray such initiatives as originated locally.
Following the same logic, the new economic system would be the opposite of the communist one. If Albanian communism had centralized the economy, abolished private property, brought everything under state ownership, replaced the market with planning, and closed the economy to foreign investment, the new economic system would be the very opposite: state assets would be privatized, the local market would be open to the international market and investment the state would withdraw completely and the market would be given free reign. By 1997 Albania had undergone one of the most radical neoliberal treatments of shock therapy of the region (Clunies-Ross and Sudar, 1998, pp. 7-30). In part, this attested to the strength of the Anti-Communist discourse that legitimized a neo-liberal economic order as the opposite of the communist system.
Once it came into power in 1992, The Democratic Party began to implement a fully-fledged neoliberal program based on economic liberalization, monetarist policies, massif and rapid privatization, and the opening up of the local market to foreign capital, often referred to as “shock therapy”. During the period 1992-1996, Albania become the “shining star” of the IMF and the World Bank, the success story of the Balkans. By 1997 however, the Albanian state and economy crashed in a financial meltdown following the collapse of numerous pyramid schemes were most of the population lost their savings, and then we had rebellion, the state collapsed in apocalyptic proportions, were not only money were lost but also lives.
(The Albanian Civil Unrest of 1997, also known as the Albanian rebellion, Albanian unrest or the Pyramid crisis, was a period of civil disorder in Albania in 1997, sparked by Ponzi scheme failures. The government was toppled and more than 2, 000 people were killed. )
LIFE AFTER THE COLLAPSE
The collapse of the pyramid schemes and consequent break down of the social order in Albania in 1997 was a disturbing event for international institutions such as the World Bank and the IMF, which up to that point had flaunted Albania as the success story of their neoliberal reforms. However, while the IMF and the World Bank extensively credited their neo-liberal reforms as the source of Albania’s impressive post-socialist economic performance, they viewed the sudden collapse of its economy as the result of the “Albanians” mistaken notion of capitalism, as the head of the World Bank office in Tirana put it in his analysis of the Albanian pyramid schemes “money unfortunately, does not grow on trees”. This was apparently what Albanian people believed and what made them put their savings in the pyramid schemes. Far from seeing the 1997 collapse as even remotely related to any of the World Bank and IMF policies that the Albanian government eagerly embraced during 1992-1997 period, the World Bank saw the crises as internal to Albanian society itself. Since the fate of a society depends, in the end, on the strength of its institutions, its public sector, and its civil society, it should not be surprising that Albania had tremendous problems (Elbirt 1997). International institutions that shaped the economic reforms in Albania had nothing to do with its fate.
One of the main lessons which the World Bank drew from 1997 financial collapse of the State of Albania was that “the root cause of the crisis…was an extremely weak state which was itself the outcome of a fragmented society with stronger allegiances to family clans that joint citizenship (World Bank, 1998, p II). The 1997 financial collapse according to the World Bank country assistance strategy in 1998 was, amongst other things, due to the fact that: “The Albanian people have not yet developed strong loyalties to a nation state. Clannish allegiances remain more important than the trust and participation in a public system and public institutions. The distrust of the Albanian people of their state become evident in the massive destruction of public property in 1997”
It is very odd indeed to have cultural explanations, which ignore economic policies, coming from an institution filled with economist, such as the World Bank. The “anthropological” observation that society was fragmented due to cultural factors such as “lack of allegiance to joint citizenship” completely ignored the simple fact that the Albanian state had practically abandoned its citizens following its fiscal and monetary policies which severely curtailed salaries, pensions, and unemployment benefits. Equally strange was the observation that it was weak loyalty to the nation state that caused the violent reaction of the Albanian mobs against state institutions in 1997, which ignored the fact that the Albanian government refused to guarantee their savings-an action that was applauded as a courageous stand by the IMF since it averted inflation and avoided a deepening of the budget deficit. The 1997 financial crisis was after all a consequence of Albanian idiosyncrasies.
Corruption was one of the elements of the “Albanian idiosyncrasy” that was used to provide an explanation of the 1997 financial collapse.
Leslie Holmes (2006 p 24) has argued, the high levels of corruption in the post-communist world would be attributed in part to the spread of neoliberalism, due to its “focuses on ends over means, flexibility, competition, free trade and reducing the role of the state”, at an empirical level, by legitimizing and implementing a neo-liberal order anti-corruption strategies might have given rise to certain pathologies of the neoliberal development model, such as state captured or increased bribery, contributing thus to higher levels of corruption. More specifically, the corruption discourse that emerged in the Albanian political scene during that period served to legitimize and institute a neoliberal order. International and local actors, by portraying corruption as the main cause of almost every Albanian failure, could blame every political, economic and social failure on corruption rather than on any of the neoliberal development policies that the Albanian government implemented since the collapse of the communist regime.
When it comes to corruption levels, almost all the observers agreed that the anti-corruption programs in Albania failed to reduce, let alone eliminate corruption. Steves and Rousso (2003, p33) found that despite “extremely high level of activity across virtually all areas of possible anti-corruption programming, Albania is the only country in which both state capture and administrative corruption have increased. Anderson and Gray (2006, p9) argued that as far as corruption was concerned “Albania remain(ed) the worst performer among all transition countries”. 1998-2005, the period of most intense anti-corruption reforms, corruption in Albania actually grew, during that period Albania seem to enjoy some of the most successful anti-corruption programs in the region and growing levels of corruption. The World Bank argued in 2006 that as far as anti-corruption was concerned Albania had “some of the best public administration institution in the region, PACO (project against corruption and organized crime) declared Albania so successful that it used them as model for PACO impact report, an anti-corruption model for the entire south-eastern European region (Carlbom and Wikstrom 2006, p14)
This was not the “corruption paradox” this was the Neoliberal capitalism paradoxes.
The articulation of corruption in international discourse shared a number of common features with the articulation of corruption in Albanian discourses. The idea that corruption meant using one’s public position to become rich, or to enrich those close to power, was common both in anti-communist and anti-authoritarian discourses. In a similar fashion, the idea that corruption was due to weak institution, and that its elimination called for reforms that improved existing legislative and institutional framework was quite well articulated in the transition discourse where corruption was expected to end with the completion of transition reform.
However the similarities should not blind us to the specificity of the dominant articulation of corruption in the international discourse. The corruption that appeared in international discourse from 1998 onwards differed from the corruption that appeared in the local discourse in Albania after the fall of communism in the early 1990. First in international discourse, corruption become increasingly fixed in its content as abuse of public office for private gain: it no longer functioned as a floating signifier that qualified various other phenomena. In this respect international intervention introduced a discourse of corruption as such=a story where corruption was the main protagonist, and not a supporting actor (floating signifier) as in the local discourse. The second difference between international and local articulation of corruption, is that in the international discourse, corruption was articulated primarily as a cause rather than a consequence. As we already saw above, most international institutions identified corruption as a major obstacle that Albania faced. In this way corruption began to enjoy a certain objectivity as an obstacle, and a certain subjectivity as a threat. Corruption did certain thing: it discouraged international investment, it blocked EU integration, it hindered development, id undermined democracy, it even victimized people. For example, a 2005 corruption surveyed, financed by USAID, contained a section called “corruption victimization, in which a victimization index was produced by asking people how often they had to pay bribes to public officials. This was different from the articulation of corruption in local discourse during the period 1990-1997 where corruption was primary a consequence.
Corruption in the early 1990, come to signify a number of different phenomena in the Albanian public sphere. Initially corruption stood for the moral and material degradation of the communist nomenclature that was perceived to indulge in luxury and immoral pleasures amidst the growing misery of the population. Later, as prices and markets were liberalized, corruption also came to stand for speculation in the market, for unfair profit, or for the unfair enrichment of the few amidst the poverty of the many. As a growing number of public officials were using their positions to get rich through bribes, corruption also stood for bribery and the abuse of public office for private gain. Finally as the collapse of communism and the institution of the neoliberal order brought about a significant increase in crime and illegal activity, corruption as a signifier also began to designate crime and criminal activity in general.
Following the same logic, a report that reviewed international donor anti-corruption efforts in Albania pointed out that: ”the corruption problem has been made worse by cultural aspects, in the vacoom created by the collapse of communism, traditional clan based dependencies have had their resurgence”(Mathiesen 2004, p4). In international discourse, corruption in Albania was in part due to the fact corruption was not strongly condemned by the society “there is a tendency to accept the existence of corruption in society because it helps achieve practical ends”(OECD 2002). From 1998 onwards, corruption increasingly appeared in parliamentary discussions as the major cause of every failure Albania faced, weather moral, political, economic, or social. Therefore, instead of critically examining neoliberal policy recommendations, the focus shifted towards the elimination of corruption. This in turn transformed neoliberal policies into anti-corruption measures, since corruption was articulated as a consequence of too much state intervention and discretion. The international discourse on corruption, by portraying Albania as corrupt in all his aspects, institution, politics and society , necessitated the intervention of the international community which had both the moral standing, the resources and the knowledge needed to rescue Albania from corruption.
In conclusion my argument does not imply that corruption was an empty threat invented by international institutions or local actors in order to further their agenda. Bribery, state capture, nepotism, lack of justice, lack of meritocracy, growing inequality, abuse of office for private gain, and a number of other negative phenomena were very present in Albania. They were real problems that Albanian citizens faced and which local politicians, along with international institutions, often genuinely sought to tackle. Their articulation under a specific definition of corruption, their identification as a cause rather than a consequence of Albania’s political and economic failures, their articulation as inherent to the Albanian condition rather than as consequences of given economic and political regime, however, were not due to self-evident empirical reality. These articulations were discursive constructions that served a very specific neoliberal political agenda.
The corruption discourse that emerged in the Albanian political scene served to sustain neoliberal order in three interrelated ways. First, by articulating corruption as primarily a consequence of a corrupt political leadership, it succeeded in shifting criticism away from policies and toward politicians. Therefore the economic failure of Albania could not associated with any of the policies that such leadership had carried out in its embrace of the neoliberal development model. Instead, the economic failures of Albania could be traced to the greed and corruption of the ruling politicians who were stealing from the Albanian people. Second, insofar as corruption become a feature of the public sector, anti-corruption could call for more neoliberal policies such as free trade, further privatization, and the reduction of the role of the state in economy, as well as the reduction of public sector in general, finally, by focusing on the necessity to fight corruption the Albanian corruption discourse could subsume alternative articulations of corruption that destabilized the existing neoliberal order. The corruption discourse that dominated the Albanian political scene after 1990 made it very difficult to conceptualize a development model different from the neoliberal one. Alternative developmental models that emphasized state intervention in the economy in order to encourage economic growth through industrialization, protectionist measures, and the state orientation of the capital investment, would seem completely unrealistic in this “brave new world” of anti-communism discourse, and the new language of the “shock doctrine” made it impossible for this ideas to go through.
This is not a tale from the past, it is in fact our everyday life in Albania, after this new language that promoted neoliberal policies as the only solution we find ourselves with different political parties that share the same neoliberal ideology. After 30 years implementing this economic policies, we are still one of the poorest countries in Europe, but in difference from 30 years ago today we don’t have even the slightest perspective of change. As Antonio Gramsci would have put it: “The crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum a great variety of morbid symptoms appear.”