Socialist Persistence, Economic Crisis, and Emergence of Social Dialogue

Elitist Extrication from State Socialism

In the 1970s and 1980s, Bulgaria, which arguably had the strongest economy and one of the least liberalized political regimes in Eastern Europe, avoided the ferment against state socialism that troubled other countries in the region. Bulgaria was the only socialist state whose regime never succumbed to the temptation to deviate from Soviet directives in any policy dimension — political, economic, or cultural; domestic or foreign (Brown 1970; Bell 1986; Rothschild and Wingfield 2000: 211—17). Bulgaria's unstrained relationship with the Soviet Union had favored its specialization within the Council for Mutual Economic Assistance (CMEA) in high-tech industries such as computers, electronics, transport, and nuclear energy, and it had eventually earned a reputation as the “Eastern European Japan” and the “Japan of the Balkans” (Ramet 1991: 12). From 1976 through 1980, Bulgaria's rate of growth in national income was 6.1 percent, compared with 1.6 percent in Poland, 3.7 percent in Czechoslovakia, and 3.2 percent in Hungary. Its foreign debt of $6 billion in late 1988 was smaller than that of any other Soviet bloc country. In contrast, Poland owed $32 billion to Western countries and $5 billion in transferable rubles to the CMEA states as of late 1987, and was compelled to use 67 percent of its export earnings to service these debts (Ramet 1991: 15).

Regional Social Dialogue in Bulgaria

To reduce their overwhelming involvement in the resolution of locally based social problems and protests, in 1990 the Bulgarian national social partners negotiated the development of social dialogue at the regional level. Tripartite regional agreements were to be signed, replicating the national General Agreement in its major areas. Regional tripartite bodies were to be established with the task of monitoring the implementation of the regional agreements.

The first regional tripartite agreement and tripartite forum emerged in early 1990 in the small city of Razlog.1 Created spontaneously to combat social tension resulting from the collapse of the city's major employer — an electronics company — which caused unemployment in the region to rocket 50 percent, the Razlog forum involved extensive participation of upper-level ministerial and union structures.2 Similar forums followed in other regions.

A regional tripartite commission typically included representatives of the local government (the mayor or deputy-mayor), local unions (Podkrepa CL and CITUB), and the local employers' structures. Initially, the lack of regional structures in both Podkrepa and some of the employers' organizations retarded the development of regional social dialogue. Thus, while the Statute of the National Tripartite Commission recommended the formation of regional commissions in 242 of the 273 municipalities in Bulgaria, by the end of 1991 only about fifty municipal tripartite commissions had been established.

Sectoral Tripartism in Bulgaria

Sectoral tripartism in Bulgaria emerged as an integral part of national social dialogue, and stretched to the company level as well. In January 1991, to reduce the overwhelming, dense direct involvement of the state and the national social partners in the resolution of local problems, the social partners negotiated with the Agreement for Preservation of Social Peace the development of social dialogue at lower sectoral and regional levels, to complement the activities of the National Standing Tripartite Commission for Coordination of Interests (created in January 1991). Based on the Agreement for Preservation of Social Peace and the statute of this commission, a special government decree required all sectoral ministries and local government structures to initiate the creation of sectoral and regional sub-commissions for coordination of interests. The new Labor Code of 1993 mandated the creation of tripartite bodies for social dialogue in all industries and branches of the national economy, and the development of collective bargaining at the enterprise level and at sectoral and industry levels. Tripartite sectoral agreements then began to be signed in each sectoral ministry, and by the end of 1994, sectoral tripartite forums were functioning at each ministry. At some bigger ministries, such as the Ministry of Industry, more than one tripartite body was created, each dealing with issues of its subsector.

On the Transformation Track: Varieties of Capitalism and Tripartite Coordination

With the collapse of state socialism in 1989, the formerly communist countries of Eastern Europe initiated dramatic changes in their political and economic settings and state-society relations, in an attempt to claim a new place in a world characterized by globalization and increased regional integration within three economic blocs: the United States, Europe, and Japan/Asia. Ten years after the dramatic breakthrough of 1989, the nations of Central and Eastern Europe (hereafter CEE) are actively preparing for membership in the European Union (EU). Accession negotiations for the “fast-track” countries (Poland, Hungary, the Czech Republic, Slovenia, and Estonia) started in spring 1998, and those for the “slow-track” countries (Bulgaria, Slovakia, Romania, Latvia, and Lithuania) opened in February 2000.

The accelerated preparations for accession to full EU membership are cause for reflection on some old questions and consideration of some completely new ones. What is the direction of change in CEE, and what conditions frame and shape emerging capitalism in the region? Have the legacies of state socialism and postcommunist transformation brought into being a new form of capitalism? Alternatively, under the pressures of increased globalization and regional integration, could the nations of CEE be moving toward already established capitalist variants?

Negotiated Extrication from State Socialism

Unlike the other postcommunist countries, Poland had a history of prolonged and painful resistance to the communist regime. While other countries experienced only occasional eruptions of mass discontent and attempts to radically reform the system, Poland was regularly shaken by such events. In 1956, 1968, 1970, 1976, and, especially, 1980—81, the rationales for Polish communism were challenged by the masses and, increasingly, also by reformist elites. The roots of Poland's pioneering exit from state socialism should be sought in the legacy of these numerous initiatives of a united civil society (Kolankiewicz and Lewis 1988; Poznanski 1996; Ekiert 1998). Poland's extremely strong, unitary, and politically militant civil society was able to weaken the whole Soviet bloc in the 1980s and provide other countries in the region with a path-breaking example of how to effect the peaceful collapse of a communist regime.

The events of 1980–81 broadened the cracks within the Soviet empire. Especially after Gorbachev initiated a process of liberalization in the form of glasnost and perestroika in 1985, the Soviet empire could no longer be propped up by military means, and Solidarity could fully realize the opportunities stemming from the corporatist concessions of 1981. Initially, however, in accordance with the requirements of the 1982 Trade Union Act, the official All-Poland Trade Union Alliance (OPZZ) emerged between 1982 and 1984, while Solidarity remained underground.

In the aftermath of the 1989 breakthrough, two important trends, one harking to the past and one to the future, shaped the emerging new relationship between a politically discredited state and a politically disillusioned, economically choked working society.

First, a confused history of almost half a century cast its long shadow. The year 1989 marked the collapse of the “dictatorship of labor” and the outpouring of decades-old worker aspirations for greater input in enterprise and upper-level governance that erupted in spectacular worker protests against the party-state. The corporatist-like links between a reforming state and the working society that began to develop after 1989 were historically facilitated by these worker aspirations.

Introduction

World War II left Europe in economic devastation and ruins, both East and West. The immediate postwar years set the stage for the development, however, of two distinct types of corporatism in Western and Eastern Europe. In the West, the postwar settlements among labor, business, and the state embraced a new, nonfascist, democratic brand of corporatism. They established the foundations of a comprehensive social system that peaked in the 1970s, producing remarkable economic miracles on the basis of internal social cohesion and solidarity. In the East, the postwar years of transition to state socialism also encompassed significant adjustments and compromises between society and the state.