Maria Titizian
Vice President, Socialist International
ARF-Dashnaktsutyun, Armenian socialist party

IUSY BSAC Leaders’ Conference
“Committed to making changes”
4 – 6 December, 2009, Kiev, Ukraine

The problem with strengthening social democracy in the region is the deficit or absence of democracy itself primarily in the post-Soviet republics, including some in the Black Sea region.

In order to strengthen democracy in the region we need credible and constructive policies, a strategic vision and a push for a deeper multilateral cooperation with Europe, concurrently with the Eastern Partnership program.

The growing polarization between the rich and the poor, the drastic reduction of economic growth, rampant corruption, falling birth rates, monopolies, oligopolies. . . . These are challenges we have to confront if we want our countries to prosper.

At the Socialist International’s Council meeting in Santo Domingo, November 23-24, a declaration on Securing Democracy and Reaffirming People’s Rights was adopted, which called for among other things, the following:

– The full respect for democratically elected authorities, and international support in order that they may fulfill their constitutional mandate
– The respect for other legally established democratic forms of participation
– The respect for individual and collective freedoms, including freedom of the press
– The separation of powers, legislative, executive and the judiciary
– The independence of the judicial system
– The alternation of power by means of free, honest and transparent elections, based on a majority rule and taking into account minorities’ rights
– The right to a decent standard of living, to education, to health and to housing
– The right to respect cultural identities

It is important to remember that the basis and aims of democracy are the creation of favourable conditions for the preservation of human dignity and flourishing of the community. To fulfill this fundamental function, economic and social rights must be taken into account, which are inseparable from an equal distribution of wealth: the right to food, clothing, health, drinking water, education and full development within their own cultures.

In effect, a democracy without this content, which is inbuilt in the fundamental human rights, is nothing but an illusion of freedom.

Our commitment is to advance the cause of democracy in the world, to contribute to the spread of democratic governance based on the system of norms and guarantees of a substantial democracy. A democracy for citizens with political, human, social, economic, cultural and environmental rights.

We wish to work for the consolidation of democracies in countries that have recently arrived at such a political system, favouring active and efficient policies of international cooperation.

The Socialist International strives to deepen partnerships with progressive forces, particularly in the Black Sea Region and the CIS states to advance a more democratic global governance, for resolving conflicts, for securing a more sustainable world and for making democracy work for all. Strong democratic institutions must be put into place to ensure the avoidance of any military conflicts.

Countries of the former Soviet Union have much of their recent history in common – a centralized planned economy and a totalitarian political regime. These conditions left a deep imprint on the psychology, values, and political, social, and economic systems of these countries, and that can still be felt almost 20 years after the collapse of the soviet system.
While most countries in Central and Eastern Europe have been relatively successful in confronting issues of social justice, freedom of speech, and protection of human rights, post-Soviet countries are still tackling crippling problems such as a lack of democratic values and political and economic instability.

The end of the Cold War and the disintegration of the Soviet Union have not brought the desirable peace and stability in the Black Sea Region. Moreover, the growth of conflict and tension on both the state and interstate level is palpable. These are expressed in the most dangerous way as well, that of military threats.

We have witnessed armed conflicts in the post-Soviet space: in Nagorno Karabagh, in Georgia (Abkhazia and South Ossetia), in Moldova (Transdnestr), in Russia (Chechnya), and the most recent war between Georgia and Russia. The historically established mistrust in relationships (between Greece and Turkey, Russia and Ukraine, for example) are simmering under the surface.

Regardless of these unresolved conflicts, we must strive for greater cooperation between the countries directly involved in these conflicts. As a region it is imperative to encourage greater dialogue as a prescription to avoid future conflicts.

“No one is born a good citizen; no nation is born a democracy. Rather, both are processes that continue to evolve over a lifetime. Young people must be included from birth. A society that cuts itself off from its youth severs its lifeline.”
Kofi Annan

Two major “flashpoints” of Europe – the Caucasus and the Balkans – exert direct influence on the Black Sea region’s security. The influence of one more extremely restless area – Central Asia – also effects the situation.

An important yardstick of how ingrained are democratic values in a society and how effective are democratic institutions in general, is how effective civilian control over the armed forces is. In a developed democratic society, civilian control over the armed forces not only guarantees a more disciplined and accountable military, but also excludes the military’s involvement in a country’s internal affairs.

The fine line between business interests and politics in the region is invisible. Business and politics go hand in hand. Businesspeople have made their fortunes and maintained direct involvement in the political life of the countries in this region.

A few weeks ago, an oligarch in Armenia, leader of the Prosperous Armenia party, a member of the ruling coalition with four ministerial posts in the country’s government told reporters that the Armenian economy had not been monopolized by a handful of oligarchs and went on to say that only those people who have everything and don’t need to make money should be involved in politics.

These political and corporate elites – Oligarchs – far from freeing the market from the state have simply merged, trading favours to secure the right to appropriate precious resources previously held in the public domain. Its main characteristics are huge transfers of public wealth to private hands, often accompanied by exploding debt, an ever-widening chasm between the rich and poor.

The fall of the Soviet Union cleared the way for the fire-sale privatization or smash-and-grab capitalism that created the region’s notorious oligarchs.

After the collapse in 1991, while some European nations proposed an economic re-organization model which would have allowed for greater aid, and some greater state control over currency, investment and development decisions, the U.S.- led by economists like Milton Friedman and the Chicago School – backed proposals for swift and harsh economic re-organization plans protecting the interests of lenders, creditors, and foreign investors at the expense of local investors, workers and communities. The U.S. model was adopted, and as a result transnational investors – mostly American – were able to escalate their levels of economic penetration and control.

Milton Friedman’s policy trinity – the elimination of the public sphere, total liberation for corporations and skeletal social spending – were the cornerstones of the Chicago School policies. In every country where Chicago school policies have been applied for the past three decades, what has emerged is a powerful ruling alliance between a few very large corporations and a class of mostly wealthy politicians – with hazy and ever-shifting lines between the two groups. And this is what we are witnessing here in our region.

The financial collapse of 2008 does not signal the end of capitalism but it does mark the end neo-liberalism and monetarism, however, policy-makers around the world will continue to implement old recipes and will helplessly watch their loss of control over events…That is why the emergence of social democrats in the region is so desperately needed.

In the midst of this ever-changing reality on the ground, is it possible that we will see new paradigms in policy-making? Can we reconcile markets and social justice? Can we create a new social model for the region on the remnants of the soviet and then neo-liberal systems? Can the left forces integrate economic and political norms and values into a coherent project for society? And the very basic question for the region, is can we strengthen democratic institutions?

And this is where we are experiencing difficulties. If we take the South Caucasus, the SI does not have a partner party in Georgia, and the Social Democratic Party of Azerbaijan is very weak, therefore our party has no regional partners with which to work to help strengthen social democratic institutions regionally.

Let me give you some examples of what is taking place in Armenia under the leadership of the country’s neo-liberal prime minister… From here we can draw comparisons to other countries in the region and we will see the same patterns taking place.

1. Starting in January 2011, the government of Armenia will privatize pension plans. Mandatory retirement contributions now go into a public pension pillar; however in a year’s time all those born after 1970 will have to be part of a privatized pension plan. The change is understood to be a way for the government to finance the country’s capital markets.
The focus of any pension system should be the well-being of senior citizens. The purpose of a pension system should not be to promote and generate the financial markets of the country.

The Armenian government’s decision comes at a time when other countries – like Argentina, Italy, and Chile – are moving away from private pension funds. The priority of the pension system should be the well-being of retirees, which the privatized system cannot guarantee especially in times of financial crisis.

2. The rise of monopolies are strangling local industry and national production. Lucrative business opportunities have been monopolized by a small number of families. Conservatives will argue that as markets are no longer domestic but global; companies need to be large to compete in the world market even if they are dominating the domestic market. But proper anti-trust laws which focus on the conduct of these monopolies, i.e. to make sure that the company, even if it is controlling 90 percent of the domestic market, is not abusing its market power and is not artificially reducing the quantity of goods available and is not artificially raising prices.

Today, the ARF-Dashnaktsutyun socialist party in Armenia has introduced a new draft antitrust regulatory legislation, which is waiting to be heard in the National Assembly. Among other things, it calls for the merging of the existing State Commission for the Protection of Economic Competition and the Public Services Regulatory Commission to create a single anti-trust commission.

Unfortunately these commissions in the past have proven to be ineffective. Recently the president of the State Commission for the Protection of Economic Competition said, “I promise that the price of sugar will not go up.” When asked how he knew or how he could guarantee maintaining the price of sugar, he said that he had spoken with the importer of sugar to the country and the importer (who obviously has a monopoly on sugar imports) had promised he wouldn’t raise prices. That’s one form of regulating, I suppose.
Poverty, authoritarian rule, ethnic conflict, deregulation, cuts to social spending, impunity…

In order to strengthen social democracy, we need regional and international cooperation. We must guarantee basic human rights, freedom of speech, the elimination of an atmosphere of fear and distrust, strengthen civil society to serve as a counter-balance to the growing authoritarian rule we are witnessing in the region. Only through the institution of unwavering democratic ideals can we hope to raise social consciousness.

Regional cooperation is necessary and the EU has a great role to play in this respect. The EU becomes stronger if it is surrounded by other democracies. This, in turn, produces a more stable Europe. Consequently, the EU has a function with respect to the taking root of democratic values in Central and Eastern Europe, the Mediterranean countries and the Middle East, as well as in the Black Sea states.

For our part, we have to find the moral fortitude and courage to address our domestic problems and to find solutions and only then can we form regional social democratic alliances to help the establishment of social justice.

George Bernard Shaw once said, “Democracy is a system guaranteeing that we are no better governed than we deserve.” I hope that by being active, responsible citizens of our respective countries, by ceaselessly fighting for the entrenchment of democratic institutions, we can be better governed. Only democratic governments have succeeded in achieving a high level of governance which in turn tends to legitimate social needs of the people.

Democracy is never secure once and for all – it must perpetually be renewed and kept alive and, you, the young leaders of this region must consolidate your energies, you must continually pressure your respective governments, you must strive for solidarity, for the equal and fair distribution of wealth, for social cohesion, protection and justice. You must demand accountability. Your voices must be heard above the din of rhetoric. You are the generation that must issue a call to action for a lasting and meaningful peace, for the establishment of social democracy and only then can we ensure equality, freedom and justice for all our peoples.