Capitalism after communism: The triumph of neoliberalism, nationalist reaction and waiting for the leftist wave

Abstract

Was neoliberal capitalism the only possible development path in Eastern Europe after the collapse of real socialism? How did the restoration of capitalism in the former Eastern bloc affect the economic and political situation in the world? Is the support of workers and lower classes for right-wing populists that has been observed in Eastern Europe for the past 30 years since the fall of the Berlin Wall a permanent phenomenon? By asking these questions, the authors point out that the offensive of the far right began in Europe before the 2015 migration crisis and the 2008 financial crisis, and that it coincided with the weakening of leftist workers’ parties. This process began in the 1990s after the collapse of the Eastern bloc. What can stop this process and change the situation? The solution is to show that another model is still possible: greater egalitarianism, democracy and the rule of law. This sociopolitical alternative, however, must simultaneously oppose two powerful forces: neoliberal capitalism and nationalist populism.

From syndicalist rebellion to neoliberal capitalism

In 2020, 40 years will have passed since the creation of Solidarity the largest labour movement in the history of Eastern Europe after World War II. In 2006, however, David Ost (2006) announced and showed the scale of Solidarity’s defeat. What was intended to be a protective umbrella for the construction of capitalism in Poland after 1989, under the new conditions, had helped to replace the language of class with the language of the religious right in the public space. At about the same time, Tadeusz Kowalik (2004), one of the most outstanding economic critics of the neoliberal transformation in Poland and Eastern Europe, described the capitalism created in this part of the world as ‘oligarchic and corrupt’ (characterised by the strong influence of 19th-century social relations on working conditions and social security). Nevertheless, it is worth asking the question again: why did Eastern and Central Europe choose the worst possible path after the collapse of ‘real socialism’? This question refers in particular to the connection between the neoliberalism imposed in the first period of transformation and the right-wing populism and nationalism now dominant in this part of the world 30 years after the fall of the Eastern bloc.

The question is particularly intriguing if we remember that the Solidarity created by workers (which heralded the changes that took place in the entire Eastern European region in 1989) had, between 1980 and 1981, been a social movement with a strongly syndicalist orientation postulating the idea of workers’ self-management (Żuk, 2019). What happened in the autumn of 1989 not only undermined that ideal of Solidarity, but also went against the commitments made in the Polish Round Table Agreements concluded between the communist authorities and the Solidarity opposition of spring 1989. The essence of these agreements was to allow the opposition to co-govern and share responsibility for economic and political reforms as part of the failing socialist system. There was no mention of ‘market reforms’ in these agreements, much less of ‘capitalist transformation’. As one of the supporters of ownership transformation in Poland wrote,

… [T]he economic section of the ‘round table’ agreement was unsatisfactory from the point of view of opening the door to quick ownership transformation. The main reason was the left-leaning and trade unionist orientation of the Solidarity delegation during these negotiations, which was reluctant to accept the idea of a real market and capitalist economy, and preferred rather the idea of so-called ‘social ownership’ and ‘democratic planning. (Dąbrowski, 1991: 317)

A few months later, however, the former opposition abandoned the socio-economic orientation in favour of shock therapy, or – as Grzegorz Kołodko put it – ‘shock without therapy’ (Kołodko and Nuti, 1997: 33). In practice, this meant ‘the introduction of a primitive form of capitalism, with high unemployment, a large and persistent extent of social exclusion, and very high inequalities of income and wealth’ (Kowalik, 2009: 19). Developments in Poland were important because they determined the dominant model of economic transformation in the entire Eastern European region. On the other hand, the collapse of Soviet influence in the Eastern bloc, like its previous ascendancy, shaped social relations on a European and international scale. Claus Offe (1996) showed this Eastern influence on the shaping of social policy in the West using the example of the two divided German states. In West Germany, important elements of welfare state policy served to reduce leftist political influence and radical social demands, that were treated as manifestations of hostile forces from behind the Iron Curtain. In this way, the Cold War conditions and emotions triggered by the lurking threat from the East allowed the left and trade unions in the West to achieve many more of their goals, but without access to power. In this sense, some of the successes of the Western left emerged from the adaptive tactics of its opponents – the liberal and conservative right tried to outperform their competitors on the left in the field of social policy in order to prevent the Eastern bloc from building up political support in the West.

The disappearance of external pressure in the 1990s enabled the dismantling of many social gains and redistributive mechanisms in Western countries. These processes occurred even faster in Eastern European countries. The thirtieth anniversary of the onset of these transformations that took place in the 1980s and 1990s is a good occasion to look at the achievements of the Eastern European transformation changed and the means by which it was effected.

As Naomi Klein (2007) emphasises, the conditions prevailing in the late 1980s in Poland (debt, general confusion caused by the collapse of the old system) created the conditions for reforms developed in accordance with the economic doctrine of the Chicago School, for all of Eastern Europe. Poland’s foreign debt created a dependence on refinancing by Western banks and multilateral agencies, including the new European Bank for Reconstruction and Development that was especially set up to support market-friendly development in post-Communist countries. (Shields, 2020). The gains for Western companies in Eastern Europe were higher than those in Latin America. Eastern Europe offered large, unsatisfied and absorbent consumer markets, as well as thousands of state-owned enterprises that could be privatised.

In this context, the entire Eastern European region was untouched by Western capitalism, with the exception of the foreign borrowing that had financed attempts to acquire Western technology, in the final years of Communism. The new political elites that emerged in Eastern Europe after the fall of the Berlin Wall were persuaded that their adoption of market fundamentalism without any reservations in social and political practice would not only secure rapid economic progress, but would also generate the Western finance to manage foreign debts and the foreign direct investment needed to rehabilitate Eastern Europe’s investment-starved industries. Even representatives of the World Bank and the International Monetary Fund (IMF) were surprised that they were able so easily to impose austerity measures on the public and proceeding to rapid privatisation of the public sector. Michael Bruno, head of the IMF experts, even expressed his surprise at this lack of resistance from the new elite, and that the Polish government chose the most extreme of the variants presented by the IMF. When implementing the concept of a ‘Big Bang’ in Poland, which was then repeated in other Eastern bloc countries, Bruno was aware of the specific political circumstances for the implementation of neoliberal economic concepts, as well as the new power elite’s naivety and lack of knowledge about its real costs:

[T]he argument for a big bang beginning may rest on a special political opportunity, as in Poland. But there may also be an inter-temporal political trade-off: overly costly programs might lead to political reversal at a later stage, as ‘adjustment fatigue’ sets in or social aspirations, such as employment opportunities and living standards, are frustrated. Have policymakers sufficiently considered these questions at the inception stage of the program? It is not clear whether there were any illusions about the length of time it would take the Eastern European economies to attain competitive market structure, private ownership, and a properly functioning financial system of a typical Western economy. But there seems to have been over optimism at the onset of the programs about the speed of the supply response and other behavioral responses that could come in the wake of a drastic change in the economic environment. (Bruno, 1992: 753)

Bruno also honestly explained the lack of inhibition in implementing the abrupt measures at that time by saying that with distortions as big as they were and the new government’s initial high credibility, it may have been just as well to ‘chop off the dog’s tail all at once’ (Bruno, 1992: 760). With political support from governments convinced that financial resources would flow in proportion to the scale of market reforms, the tail of the dog was chopped off all at once, and even its legs were shortened without thinking too much about the future consequences.

The pacification of a social, economic and political alternative

In order for a political climate conducive to systemic transformation to last as long as possible, it was necessary to neutralise those who lost the most in these changes: the employee environment. The same circles, whose protests led to the fall of communism, in the early 1990s became the biggest threat to the introduced changes. Workers were again considered a ‘dangerous class’. Former Solidarity leaders who now found themselves in government had no reason to make the trade union, which was legally active after 1989, strong again. Weak and less numerous union structures were more pliable. It was no longer active citizens and radical workers that were supposed to changing reality, but market mechanisms and private property. The tactic was simple: keep employees dormant for as long as possible and market social reality as soon as possible (Ost, 2006). However, while dispersed and confused workers, even those subjected to the new propaganda, retained their rebellious potential, there was little trace of the former critical and radical intelligentsia. The middle classes under Communism, where university professors shared with coal-miners and steel-workers their position at the top of the salary range, had seen their living standards fall behind those of professional classes in the West. Those middle classes became the principal beneficiaries of the new political order. Under the new conditions, most of the intelligentsia turned into either followers of the new market utopia, or even officers of the new order. When stating that the systemic changes shaped bycapitalism in Poland, over 20 years previously, had been based on great inequalities, Ryszard Bugaj, an economist and former opposition activist, recently claimed that the condition for shaping this model was the far-reaching alienation of elites. This alienation applied not only to the political and economic elites, but also to the media, cultural and scientific ones (Bugaj, 2016).

The participation of cultural and scientific elites in the neoliberal transformation was important because, in addition to changes in the social structure at the macro level and in the labour market structure, it also involved victory in the sphere of social ideas and images. The privatisation of workplaces, the change in the employment structure, the individualisation of social relations and the marketisation of the logic of collective life facilitated this task (Żuk, 2017a). Any criticism of the new order was defined as being inspired by nostalgia for communism and the old order to which no one wanted to return. In this sense, the spectre of communism, socialism or any leftist idea was used to frighten society and legitimise the new order. Just as the bogey of communism facilitated the creation of a more social and human face of capitalism in Western Europe during the Cold War, so the same bogey served as an excuse for the rapid introduction of the most drastic capitalist solutions during the neoliberal transformation in Eastern Europe.

Hence, it is correct to say that ‘post-socialist capitalism has been built by the winners of transition using the “ghost” of communism in order to discipline the workforce into giving up social justice claims’ (Chelcea and Druţǎ, 2016: 525). The concept of socialism functioned as a negative reference. According to the new ideology, only ‘the orphans left after socialism’, social groups that could not adapt to the new conditions, and anti-democratic individuals, as well as naïve persons and claimants could sympathise with it. In Poland, the term ‘homo sovieticus’ was particularly popular. It was popularised by Fr. Józef Tischner (1992), who used this term to refer to ‘a communist client enslaved by the communist system’. He or she was fed on ‘the goods communism offered him or her, such as work, participation in power and self-esteem. Homo sovieticus owed them to communism and so became addicted to communism’ (Tischner, 1992). In this context, it is apt to use the term ‘zombie socialism’ as a scarecrow which referred to the communist past and was thus supposed to discourage any leftist ideas in Eastern Europe. The spirit of ‘zombie socialism’ was created for propaganda purposes and its popularisation undeniably facilitated the building of capitalism in the entire Eastern European region:

Zombie socialism has had since the early 1990s – with different intensities in different historical moments in each country – constitutive capacities for the allocation of wealth, social dumping, and the reduction of support for redistributive policies. Despite its temporal and geographic variation, it tended to occupy a central place in the entire post-socialist period and it has represented the local flavor of post-socialist neoliberalism. (Chelcea and Druţǎ, 2016: 526)

This narrative was not only meant to deter people from any leftist ideas, but also to identify a liberal state with democracy, a market society with democratic order and, finally, capitalism with democracy (Żuk, 2003). This identification took place in Eastern Europe despite the lengthy discussions that took place in social sciences. In this context, it is worth recalling the opinion of Norberto Bobbio, who pointed out that a liberal state is not necessarily democratic: history has shown that this kind of state was established even in periods when only the possessing classes were in power. The extension of electoral rights has even led to a crisis of the classic liberal state (Bobbio, 1990). Emerging reality has become increasingly non-alternative and closed in economic, political and ideological dimensions.

Consequently, the capitalism emerging in Eastern Europe was more ‘capitalist’ than its counterpart in the West. Moreover, it did not encounter any serious resistance. Under the new conditions, trade unions remained weak, workers adopted the attitude of ‘limited consent’ (‘yes to capitalism, but without layoffs in our company’; ‘the market economy is acceptable, but with full employment’, etc) (Gardawski, 1996). ‘An entrepreneur’ and ‘a man of success’ became role models. Under these conditions, even the left gave up its traditional ideals and its main dream was to be ‘accepted’ in the political salons of the new power elite (Żuk, 2017b). Nevertheless, it was neglected for a long time as a force which ‘was allowed less’ and had to atone for its past sins. ‘The left is allowed less because it is associated with the Polish People’s Republic, treated as a serious disease like scarlet fever and put into quarantine’ (Milewicz, 2000) – this slogan was coined by the new Polish ruling elites in the 1990s. Formulated and disseminated by liberal circles, it was a reference point for any thought critical of market orthodoxy. For a long time, it kept in check left-wing politicians, who were more concerned about being socially and politically legitimised by the new elites than about defending their own principles and having social support.

A similar process, though in a slightly different style, took place in Western Europe, where the left was deprived of a comprehensive socio-political alternative and began to follow, as Tadeusz Kowalik (2003) put it, ‘the third way to the centre’. Blair’s or Schroeder’s politics were no longer about introducing redistributive measures to reduce social inequalities, but about supporting ‘work incentives’, as economic coercion in its new packaging was called (e.g. the concept of ‘workfare’). In this way, workers, the popular classes and all those who did not belong to the people of capitalist success became more and more alone and politically homeless.

Abandoning the language of social criticism and social classes

Economic and political changes not only produced new social relations, but also formed a new language to describe and recreate social reality. Not only were individual words and terms that could be accused of links with communism (e.g. ‘working class’, ‘social classes’, ‘class conflict’) removed from public debates in Eastern Europe, but entire areas of social reflection that alluded in any way to the ideas of egalitarianism were either ignored or treated as an anachronism. This phenomenon not only concerned the sphere of politics and the media but also, in the first period of transformation, the social sciences (Żuk, 2008). The concept of class only appeared in the context of the new hero of collective imagination which was the middle class (Ost, 2015b). Public space was filled with neoliberal newspeak, which was based on the apotheosis of phrases such as ‘private property’, ‘free market’ and ‘reform’. Reducing language to a series of slogans not only blurred the image of social reality but, above all, was designed to make it difficult to practise any social criticism or to propagate ideas that undermined the prevailing economic and political logic. While some words and concepts were to be completely forgotten, others were given new meaning.

‘Reform’ was one such word that underwent neoliberal colonisation and was used to justify all programmes dismantling state-provided welfare in Eastern Europe. As Alain Bihr (2007) rightly emphasised, throughout the 19th and 20th centuries, the word ‘reform’ meant modifications of capitalist productive and class relations in order to improve the fate and quality of life of the people’s classes. This often happened under pressure from strikes and mass protests, but the reforms always resulted in ‘civilising’ and limiting the capitalist rules of the game. The neoliberal revolution that took place in Eastern Europe gave this concept a new meaning. Reforms became synonymous with all anti-employee and activities dismantling state-provided welfare (e.g. ‘pension system reform’, ‘reduction of public expenditure’, ‘health care commercialisation and reform’, ‘making labour relations flexible’, etc). This new usage not only took away the old gains of the labour environment, but also was designed to establish that only the implementation of neoliberal solutions would bring living standards up to their Western European levels. Such a reversion to 19th-century patterns of employee relations was presented as a manifestation of ‘modernisation’ and ‘rationalisation of economic policy’.

The fact that the concept of ‘social class’ was put in the museum of anachronisms also revived the old framework for building collective identity – ‘class’ was replaced by ‘nation’. Before this happened, however, in the first period of transformation, the liberals tried to propagate the slogan of ‘society open to all’ (Ost, 2015a). This slogan was supposed to suggest that ‘formal equality’ (in the legal and administrative aspect) creates a ‘majority class’. This idealised and sacred middle class was to become a messiah for setting directions for new development (Pluciński, 2010, 2020) to which everyone can belong thanks to their own hard work and enterprise. Thus, in fact, liberals quietly assumed that class society had come to an end along with the ‘end of history’ proclaimed by Fukuyama (1992). They believed that this happened thanks to the activities of the market and the liberal state rather than Marx’s dialectic. Those who were pushed out of the market and the liberal state to the periphery and deprived of social security were no longer allowed to use the language of class criticism. They had the category of the nation at their disposal. They did not know any other social categories. The replacement of ‘class’ with the concept of ‘nation’, however, had serious political consequences throughout the Eastern European region. These two competing words not only build alternative narratives, but create completely different diagnoses and set different social, cultural and political goals:

According to one, the world is changing to your disadvantage because of economic policies favoring elites, requiring changes in public and workplace policy. The other contends that the problem is political elites not representing the nation, of which you are an upstanding citizen, and that such enemies ought to be punished. With ‘normality’ pushed and ‘class’ shunned, ‘nation’ had a free ride as the cry around which to galvanize critics. (Ost, 2015a: 544)

The path to the nationalist reaction to the neoliberal transformation was opened in the 1990s and fully developed in the first decade of the 21st century.

A shift of the people’s classes’ sympathies: From the left to the populist right

However, the process of workers’ transition under the wings of the populist and nationalist right which took place in Eastern Europe was nothing original. Didier Eribon (2009) aptly described the transformation of French workers from being firm voters and supporters of the communist party into voters for the National Front. Eribon admitted that this might seem paradoxical, but he interpreted the workers’ support for the National Front as the last resort for the people’s classes, who wanted to preserve their collective identity and dignity, trampled even by those who had once defended them. This attempt to affirm one’s own identity, however, changed the way the personal pronoun ‘we’ was built. Namely, this time ‘we’ was to be built based on national identity and refer to French people who were opposed to ‘strangers’ rather than to workers who were opposed to the bourgeoisie and capitalists (Eribon, 2009). In this way, right-wing demagogues attempted to drive a wedge between the working class and the progressive part of the educated middle class who had maintained a tactical and political alliance in both Western and Eastern Europe for decades. In Eastern Europe, this alliance was rather perceived as cooperation between the radical intelligentsia and the industrial working class. The concept of the ‘middle class’ under the conditions of the Eastern European transformation was meant to emphasise the end of this alliance: freeing from the ‘utopian’ and ‘radical’ orientation of the intelligentsia focused on changing social reality and emphasising the market, depoliticised and individualistic orientation of the ‘middle class’. The professional liberated from the economic tyranny of the egalitarian policies pursued by under Communism and aspiring now to the standard of living of Western professionals became the new hero of the collective imagination. This moved the ‘middle class’ towards the ‘elite’ of the new order in the political system. The people and the working class were left alone with their problems. Moreover, they were also deprived of the class language. Instead, national references appeared in opposition to the ‘globalised elite’.

The opposition between the popular classes and the ‘elites’ acquired a national and racial dimension. From this perspective, the elites became cosmopolitan, favouring the global market and the transfer of labour force in the form of migrant workers.

This mechanism occurred in Eastern Europe particularly after 2010, when neoliberal practices were already the cause of social fatigue which the left failed to manage – at that time, there was widespread opposition to the idea of accepting the refugee quotas defined by the European Union (EU). Anti-immigrant sentiments occurred not only in Poland and Hungary ruled by right-wing populists, but also in other countries of the region (Czech Republic, Slovakia and Romania) (Trauner, 2016). Just as in France and Great Britain, where Brexit gained the support of part of the lower classes, who were lost and left alone (Mckenzie, 2017) or terrified by competition from immigrants (Gomez Arana et al., 2019; Virdee and McGeever, 2018), so also in Eastern Europe right-wing populism built its strength based on those who felt that they did not benefit from the neoliberal transformation. The campaign of hate against immigrants combined with the promise of social support allowed the right-wing nationalist Law and Justice (PiS) party to gain independent power in Poland in 2015 (Żuk and Żuk, 2018). In the following years, this mixture of nationalism, political authoritarianism and social rhetoric addressed to the people’s classes strengthened right-wing populism among workers in Poland. During the 2019 European Parliament elections, which PiS also won with 45% of votes, the percentage of workers voting for PiS was 70% (Gazeta Wyborcza, 2019).

Nationalist slogans were most popular among workers in small towns, where trade unions were weak and the prosperity promised by the neoliberal transformation was absent. PiS could count on the greatest support there. Therefore,

for this group, nationalism is not just identity with a swagger, but a concrete economic appeal: We will build industry at home, we will renovate the places liberalism bypassed, and we will not allow Poles to be treated as neocolonial subjects. (Ost, 2018: 122)

Professional groups having fairly strong employee organisations, such as nurses or teachers, already came into conflict with the PiS government and saw that social policy was only a slogan of right-wing populists.

Although the crisis of the global economic system certainly accelerated the development of the populist right in the world (Chowdhury and Żuk, 2018), Van der Linden (2018) indicates that the offensive of the far right had begun earlier, in the 1990s, and had coincided with a decline in the importance of left-wing workers’ parties. It can be added that this also coincided – and it was no accident – with the collapse of the Eastern bloc and communism which was a political fright for some and hope for others.

Van der Linden draws attention to a number of other changes that influenced the development of a climate favourable for the extreme and populist right. He lists working-class fragmentation and the relocation of a large proportion of jobs from industry to the service sector where wages were worse and union organisation was more difficult, accumulation of good jobs in large cities and the limiting of social security and of opportunities for economic promotion and for raising the social status of residents of small cities and provinces, and the breaking down of social cohesion and of the web of trust-based reciprocal obligations that address the anxieties of working families (Van der Linden, 2018). These changes were also accompanied by the effects of globalisation and cultural changes, which seemed to be a threat to traditional workers’ environments. Together, they limited social security and a sense of control over one’s own life, thus creating space (particularly in the context of the crisis of the left) for the development of the populist right.

There is now growing evidence that limiting social security and ‘pruning’ the welfare state has created amenable conditions for the development of the populist right in Europe (Swank and Betz, 2003). Similarly, Donald Trump owed his victory in the United States 2016 presidential election in part to support for the Republican Party from a significant proportion of workers (Davis, 2017). In Australia, people with a more pessimistic view of the economy, worried about social security, precarious employment and competition from immigrants have a greater propensity to give political support to right-wing populists from the One Nation Party (Wood et al., 2018).

Although there have been various explanations of the process of transition of the lower classes and petit-bourgeois to the populist right and the nationalist reaction of some parts of the working class to global changes (Rydgren, 2012), the generally repeated thesis is that employment conditions deteriorate along with neoliberalisation and, consequently, disintegrating workers’ communities lose not only their economic status, but also their dignity. In such circumstances, they seek political power that will restore their self-respect (Winlow et al., 2016). Would this process have been possible on such a scale before the fall of the communist system? Claus Offe (1996) writes that without the collapse of the Eastern bloc, the Gulf War would not have been possible. Would the Iraq War, the bombing of Libya, or the construction of the Guantanamo Bay detention camp in Cuba, in which people were imprisoned without judicial proceedings, have been possible? Finally, did Russia support the extreme right in Europe (Shekhovtsov, 2017) during the times of the ‘Eastern bloc’ as it does today (to weaken the EU) or did it support more progressive forces? These rhetorical questions illustrate the way in which right-wing forces all over the world have been emboldened by the fall of Communism.

In the context of Eastern Europe, it can clearly be said, while the nationalist reaction to neoliberalism has become a universal mechanism and the search for ‘external enemies’ has become, as in Poland and Hungary, a practised way to relieve political tensions and legitimise the ruling power (Fabry, 2019), a change in socio-economic policy may be the fastest way to regain control from right-wing populist regimes (Bugarič, 2019). However, parties such as PiS in Poland do not have competition from the economic left, as the existing left focuses on cultural and identity issues, such as women’s rights and sexual minorities, leaving economic matters to the right-wing hegemony. These right-wing parties may therefore use social narrative, pretending that they implement leftist redistributive policy, and combine this with national solidarity attitudes hostile to foreigners, lesbian, gay, bisexual and transgender (LGBT) communities and the ‘cultural West’. They may also treat the legal opposition as representatives of ‘rotten elites’ embroiled in anti-national conspiracies, and easily neutralise progressive economic criticism. In the media-political spectacle of right-wing populists, they play the role of the defenders of the people. All other parties or political tendencies are described as representatives of the ‘elite’ or defenders of the ‘old’ (transformational) order.

It is not true that both Kaczyński and Orban actively participated in the implementation of the neoliberal transformation. Today, they only instrumentally use those who have not benefitted from this transformation to build their political base. They rely on a simple pattern. On the one hand, they threaten the less-educated and poorer part of society with foreign national and cultural patterns which they portray as a threat to any remaining sense of security and control over people’s own lives in this unstable order: refugees and LGBT communities, for example, are depicted as undermining traditional values (Żuk and Żuk, 2019). On the other hand, they promise social assistance and ‘real democracy’ even while introducing authoritarian rule. Sooner or later, however, the moment comes when ‘real democracy for the people’ shows its true face – that of the police order. ‘Social assistance’ also turns out to be limited because, at some point, the state budget lacks funds that have been allocated to needs that are more relevant from the perspective of populists, such as police pay increases and extension of the repression apparatus or the army.

At this critical moment, the lower classes must see that there is another alternative: the one that combines greater egalitarianism with democracy and the rule of law. This socio-political alternative, however, must simultaneously oppose two powerful forces: neoliberal capitalism and nationalist populism.

Leftist egalitarianism or barbarism

The Eastern bloc could no longer be preserved as a political competitor, on the one hand, and as part of the same economic world system on the other hand. The Eastern bloc could not compete with the West on the criteria set by the capitalist system: economic efficiency and superior military force, while confined to Eastern Europe (Derluguian, 2013). The East lost this competition. Thirty years after the collapse of state socialism, there is something in the world system that John Bellamy Foster (2019) refers to as ‘absolute capitalism’: ‘The neoliberal Leviathan is a state that increasingly has a single function and follows a single market logic – and in those terms alone it is absolute and represents an absolutist capitalism’. This system, of course, has numerous contradictions and is constantly torn apart by crises (economic, political, ecological, social).

Immanuel Wallerstein goes so far as to argue that this is a transition period before the emergence of a completely new system. Because the current form of capitalism does not allow capitalists to have unlimited capital accumulation for various reasons (limited natural resources, no new ‘virgin’ areas to exploit, rising production costs) (Wallerstein, 2013). What can this new order be like? To put it simply, there are two alternatives on the horizon. One of them is a system that ‘retains the basic features of the present system: hierarchy, exploitation, and polarisation’ (Wallerstein, 2013: 33), but in an even worse version, creating a close connection between economic exploitation and political tyranny. The other alternative is a relatively egalitarian, democratic and ecologically sustainable system.

Foster (2019) indicates a similar alternative: either the neoliberal drive to absolute capitalism, which leads the world to global annihilation, or a ‘long ecological revolution from below aimed at safeguarding the earth and creating a world of substantive equality, ecological sustainability, and satisfaction of communal needs’ (Foster, 2019).

What model will emerge depends, as usual, on the people who create history, although they do not always affect the circumstances in which they act. The political struggle for a future order has already begun. As history has shown, various bottom-up activities that build social resistance to the political and economic framework imposed by the prevailing order are part of the measures taken to develop a more egalitarian and democratic society. In the context of Europe, transnational cooperation between labour and social movements is important (Bieler and Salyga, 2020). This will allow for the implementation of true European integration connecting the East and the West not only at the system-technocratic level but, above all, at the socio-civic level. Can the EU become a testing ground for developing a new, more democratic and egalitarian order that can be an inspiration for other regions of the world? For now, neoliberalism and the accompanying nationalism seem to be the biggest threat to the EU. As Hubert Gabrisch (2020) writes,

a lack of financial regulations on cross-border capital flows, a lack of appropriate fiscal risk-sharing instruments at the union level, and a lack of transfer payments contributed to aggravate the severity of the economic downturn in the euro periphery and delayed the recovery of the entire area.

However, will the EU remain only an area of the common market and reproduction of neoliberal principles? The experience of past centuries indicates that progress in Europe has always occurred when social criticism and grassroots progressive social movements emerged and combined. Under the new conditions, this rebellious and adventurous soul of Europe must find a way to combine the traditions of the emancipatory movements of Eastern Europe with the tradition of struggles for social and egalitarian order that have been taking place in Western Europe since the beginning of capitalism. The combination of freedom and equality and bringing these values onto the banner of civic Europe can help the EU survive and make the old continent once again a global inspiration for all those who value the principles of democracy and global justice (Bauman, 2004). This requires, however, an intellectual, cultural, economic and political breakthrough. Right-wing populists are well aware what spreads fear throughout societies, but they do not give any real solutions to eliminate this sense of social insecurity, because right-wing populism is based on recreating history and present difficulties as threatening conspiracies. This explosive mine, created from social inequalities and the resulting social frustrations, needs to be disarmed. The fall of the Eastern bloc ended the 20th century. It is time to start a progressive chapter in the 21st century. This special issue of The Economic and Labour Relations Review is a small contribution to this new chapter.