The bank that likes to say 'only on condition . . . '

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The Independent Online
'Conditionality' is one of those blue-suited words which loaf along the corridors of our lives. It is less fat and faceless than 'subsidiarity', but still alarming to meet. Stripped to its underpants, 'conditionality' means that the rich countries will only help the poor countries on condition that they have plural parliamentary democracy and a market economy.

Boris Yeltsin had conditionality forced on him at the Munich G7 summit last week when the West made its half-promises to help him. Trying to be tactful, President Bush avoided the deadly word itself. But our Foreign Secretary, Douglas Hurd, uses it freely about Africa. Originally an American idea, it has already induced many African states to attempt multi-party democracy. But it is also applied in Europe. One of the proudest boasts of the new European Bank for Reconstruction and Development, set up after the 1989 revolutions to help the recovery of the post-Communist states, is that it has conditionality written into its constitution.

Chapter One of the 1990 agreement setting up the EBRD reads: 'In contributing to economic progress and reconstruction, the purpose of the Bank shall be to foster the transition towards open, market-oriented economies and to promote private and entrepreneurial initiative in Central and Eastern European countries committed (my italics) to and applying the principles of multi- party democracy, pluralism and market economics.'

I believe that the 'conditionality clause' is a mistake which may have tragic consequences. Eastern and central Europe in the next 10 years will not be a neat, black-and-white place, chequered into nice Western democracies and horrid reactionary dictatorships. Alarming things are going to happen, and also confusing things that will be hard to fit into Western political categories. Every kind of pot is bubbling already: nationalism, class hatred, paranoia, bankruptcy, and superstition. The cooks dancing round the pots are almost entirely inexperienced. Their recipe books, printed in Reagan's America or Thatcher's Britain, are not much use.

How serious will it be if the government of Hungary or Czechoslovakia or Poland departs from the democratic rules? Given the social and economic pressures that they are under, such breakdowns and departures are highly probable. Naturally, it will be very serious indeed if some dictator or one-party junta fills the prisons, empties the parliament and closes newspapers or universities. But it is far more likely that such breakdowns of democracy will not be that serious - or at least not as serious as they may look.

There are two quite different ways of looking at political systems. One - the Anglo-American way - is to assume that rot spreads up from the bottom. There may be mass unemployment, student revolt and arson in the black suburbs, but as long as the Supreme Court gives balanced judgments and MPs obey the Speaker's ruling, everything is still all right. The other view, more Greek or Polish, is that rot spreads downwards. At the top are generals preening their feathers, oligarchs feathering their nests, presidents and premiers dismissing one another in the name of the Motherland. But all is still well as long as ordinary, decent people - the sort who seldom pay taxes and pretend not to notice the more absurd laws floating down from above - continue to work hard, to show solidarity to one another in rough times, to organise good schooling, to build up the strength and wisdom of their country.

In the first view, the supreme civic duty is to prevent plebeian disorder from unsettling the state. In the second, the supreme duty is to prevent state disorder from infecting the world of work, family, money, and enlightenment. In his sparkling book of essays Europe, Europe, the German poet Hans Magnus Enzensberger worked out a concept of 'Italianisation' which might (he thought) be the approaching future of Europe. As the term suggests, it is about the second view of society: a national community whose economic success and social progress has largely been achieved in spite of government rather than because of it. The superstructure's parties and personalities are respected as a ladder of patronage. But its laws and judgements are scarcely respected at all.

Italy is not exactly a model for the future. As Enzensberger recognised, the human price for the silliness and irrelevance of central government is paid by hundreds of thousands of 'losers' cared for by nobody. Yet the Italian example does show how dangerous it may be to judge a whole country by its parliamentary behaviour. The West - and institutions such as the European Bank for Reconstruction and Development - may soon find themselves making that dangerous judgement.

The political melodrama in Warsaw over recent weeks shows that Polish political life is in trouble. Radek Sikorski, an energetic young man of white- hot anti-Communist zeal, has written (comically and misleadingly) in the Spectator of how he resigned after 100 days as deputy defence minister. He and his colleagues burst into office convinced that Poland and President Walesa were in the grip of unreformed Communist spooks and bureaucrats, conspiring to wean Poland from Western influence and restore her to the 'Eastern option'. After a few weeks spent sacking everyone in sight, Radek and his colleagues were sacked themselves by Walesa. He attributes this to Communist machination, and warns: 'We lost this round, but there will be another.'

No doubt there will. But what is the 'Eastern option' supposed to mean, when the Soviet Union is dead and buried and Russia is gasping in intensive care? Where is this Red menace at home, or have some Poles developed a new anti-Communism without Communists to rival Poland's haunting anti- Semitism without Jews?

The point is that Polish democracy is heading for bad times. Tempers are short; the constitution is designed for deadlocks; there are 135 political parties. Imperious personalities, whether Lech Walesa or Radek Sikorski, fly at each other like fighting-cocks. The next few years may well bring suspensions of parliament, fits of rule by decree, the arrest of opposition journalists, conceivably the banning of political parties which get in a government's way.

If this happens, the tripwire of conditionality will pull. The West will declare that Poland has abandoned democracy: loans will be frozen, credits denied and joint ventures cancelled. Poland's slow progress towards full European Community membership will be blocked.

My argument is that this would be a disaster, a great injustice and a misperception. Poland is actually heading towards an 'Italian' pattern. The political surface is chaotic, as it often has been in Polish history. But under that surface non-political Poles - buying, selling and creating new industries - have transformed the whole economic and social texture of their country in the last three years. The signs are that traffic accidents in democracy, though superficially painful, would not affect that transformation, and would soon be cleared away.

There have been blunders, and much human and financial waste. But the story of 'real' Poland since 1989 is a success story. If Western analysis cannot recognise a healthy society underneath a sick political system, then we will never understand the Europe in which we are going to have to live.

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