Lectures Economic Empowerment in empires and nationstates East Central Europe from the 19th century to today

When looking at transitions from imperial to post-imperial rule, scholars have tended to look either at ruptures or at direct continuities of structures, laws, relationships, etc. I want to suggest a different approach. I believe we need to study more closely how political projects of a hugely different nature interact with one another across the divide of state collapse — and how this dynamic interaction raises expectations across long stretches of time. With a focus on East Central Europe, I would therefore like to present a specific, hopefully original narrative, but I also want to propose a research agenda.

Published in the printed edition of Baltic Worlds BW 2021:4, pp 7-13
Published on balticworlds.com on January 23, 2022

When I mulled over the topic of this year’s CBEES conference “With and After Empire: Enduring Pasts Across the Local and the Global”, the one book that came to my mind was Svetlana Alexievich’s Secondhand Time.

I was given this book as a gift when I was a doctoral student, and it completely transformed the way I viewed history. More than any book I had read on memory cultures or national memory, it gave me a sense of how the lives of people in today’s world are shaped by expectations that were raised in a state that collapsed thirty years ago: the Soviet Union.

When looking at transitions from imperial to post-imperial rule, scholars have tended to look either at ruptures or at direct continuities of structures, laws, relationships, etc. I want to suggest a different approach. I believe we need to study more closely how political projects of a hugely different nature interact with one another across the divide of state collapse — and how this dynamic interaction raises expectations across long stretches of time. With a focus on East Central Europe, I would therefore like to present a specific, hopefully original narrative, but I also want to propose a research agenda.

On July 10, 1941, five Gestapo men arrived in the Polish town of Jedwabne to hold talks with the local authorities. When one of the Gestapo men asked what should be done with the Jews, the answer was unanimous: all Jews had to be killed. The Gestapo suggested letting one Jewish family from each profession live. Yet the local carpenter responded that the Polish townspeople had enough craftsmen of their own, and repeated: all Jews had to be killed. Later that day, the Poles of Jedwabne herded 300 local Jews into a barn and set it on fire.

The Gestapo’s proposal and its resolute rejection by the local population are marginal details from Jan Tomasz Gross’s influential book Neighbors. But I believe it is at the heart of today’s conflicts over the interpretation of the Holocaust in Eastern Europe — and especially of local collaboration. The idea that the Poles of Jedwabne no longer needed Jewish carpenters, merchants or doctors was closely connected to agendas that transcended historical ruptures and the collapse and creation of states. They were based on the idea that something had been taken from the Poles, Lithuanians, Slovaks, Ukrainians, etc., and this something had to be reclaimed — in this case by murdering their Jewish neighbors.

This something that had allegedly been taken, I argue, is economic agency, meaning the control that an individual has over those kinds of economic matters that are important for them to lead a self-determined life. Efforts to restore this lost economic agency I refer to here as projects of national economic empowerment. Proponents of economic empowerment claim that specific groups had seized the economic agency of the core national group at some point in the past. To remedy this, they seek to enhance the economic agency of the core national group by taking it from those who had unfairly seized it. You can see here that the underlying concepts of these projects are highly moralistic, with strong undertones of justice, legitimacy, and fairness.

The title of my talk mentions East Central Europe, and I would like to offer a few words here about what I think holds this region together. First: It is located between Germany and Russia, and much of its modern history was shaped by the relationship between these two countries. Second: As John Connelly has stated in his brilliant new book From Peoples into Nations, it is a region in which the legitimacy of independent statehood was particularly ferociously challenged. Third, and this is where projects of economic empowerment come into play: Across the region, social divides were largely congruent with ethnic divides. Polish noblemen ruled over Ukrainian peasants, Baltic Germans over Estonians and Latvians. A large share of the townspeople were Jewish, which distinguished them from the surrounding Christian population.

This meant that relationships between different ethnic groups were often characterized by a power gradient. Some groups felt they were hopelessly at the mercy of other groups, who seemed to concentrate economic agency in their hands. However, we need to bear in mind that economic agency is not really an empirically measurable quantity. It is subjective, self-contradictory, and ultimately a social construct. An example is the symbiotic relationship of Christian peasants and Jewish merchants in the 19^th century. Both parties depended on each other in commercial matters to such a degree that they felt they were both at the bottom end of a binary hierarchy.

This is the main context that we need to know if we want to understand how projects of national economic empowerment — i.e. political projects to redistribute economic agency in the multi-ethnic tapestry of East Central Europe — emerged, and how they shaped and continue to shape the region. In this keynote lecture, I want to re-read East Central European history through the lens of economic empowerment and thus offer a historical narrative that transcends historical ruptures and brings the policies of different political regimes that are usually regarded as being of an entirely different nature into a common frame.

As we have critically ascertained at this conference, the historiography of East Central Europe is predominantly structured along the lines of the ruptures between empires and nation states. Yet notions of historical rupture stand in the way of making sense of the transformative impact of projects of economic empowerment. I would go as far as to say that states and societies in modern East Central Europe were shaped by a mutual interplay: a mutual interplay of raising expectations of economic empowerment on the one hand and, on the other hand, of societal demands for these expectations to be fulfilled. These expectations, raised for the first time in the decades before the First World War, survived the collapse of empires, but also the destruction of states from 1939 to 1941, and the disintegration of the Eastern Bloc fifty years later. This is why economic empowerment has been largely ignored by scholarship: It unfolded its transformative power rather steadily over an extended period of time. All states in modern East Central Europe have pursued policies of economic empowerment, at least for some time, and many throughout the entire 20^th and 21^st centuries, transcending regime changes. They changed property patterns, created new social classes, marginalized minorities, and built ethnocentric institutions. The only way we can understand how these projects changed states and societies, and why they have become entrenched as almost “natural” policies in today’s East Central Europe, is to reconstruct their trajectories across historical ruptures.

I will first explain how the idea that certain national groups had to be economically empowered emerged in the first place. I will then try to answer the question of whether projects of economic empowerment were successful. I will conclude with some thoughts on how economic empowerment raised societal expectations across the historical divide between empires and nation states, which continue to structure politics to this day.

How did the idea of economic empowerment emerge?

So how did the idea of economic empowerment emerge? Its origin can be found in the national movements that emerged in the 19^th century in the Russian, Austro-Hungarian and German Empire. These movements painted national history as a history of a gradual loss of economic agency and, in consequence, of national sovereignty. The writings of Lithuanian historian and proto-nationalist Simonas Daukantas can serve as an example: Daukantas idealized the medieval Lithuanian Grand Duchy beyond recognition: In his historical vision, the Lithuanian-speaking population had supplied the world market with flax, timber, and hemp. After the Union of Lublin, Jews migrated to Lithuania from Poland and seized trade for themselves: “Ever since this time, the estates fell into the Jew’s clutches, and thus these estates turned into simple farmyards.” National activists following Daukantas, such as Petras Vileišis, turned this narrative of a loss of economic agency to “foreign” groups into a political agenda:

Since that time, the country lies as if wrapped in nappies [….] But even here, panic has caught hold of them. As they sense themselves how much harm they have caused for the country, they wonder what may happen once people open their eyes, once they want to expel the Jews from their land [….]

Across East Central Europe, from Bessarabia to Poland, from the Czech lands to Estonia, the “restoration” of economic agency became a key component of national movements. At the basis of projects of economic empowerment was the assumption that the “core nation” is socially and economically “backward”, making it susceptible to exploitation from both within and without. Thus, strengthening the nation meant strengthening the peasantry which, in turn, required their social stratification if they were to compete with other ethnic groups. Economic agency was thus portrayed almost as a zero-sum game, in which strengthening one group could only be achieved at the expense of another.

We can see here a historical trajectory that is paradigmatic of the 19^th century imagination of nationalists under imperial rule: This trajectory pointed towards the supersession of “foreign” middlemen, their replacement by a new merchant class of “one’s own”, and thus the restoration of a non-political form of national sovereignty. Through rural and consumer cooperatives, nationalists attempted to deliberately — but ultimately unsuccessfully — shift norms of trade, which, they suggested, favored “foreign” economic actors.

Were projects of economic empowerment successful?

This brings me to my second question: Were projects of economic empowerment successful? To answer this question, we need to know more about how economic empowerment actually took place. We would intuitively assume that projects of national economic empowerment were primarily implemented by national activists and by governments of nation states. Yet what is striking is that some of the most sweeping projects were carried out by empires. The Russian Empire’s policies of “Russification” aimed to strengthen peasants in East Central Europe versus the non-Russian nobility. “Russification” thus de facto strengthened the Ukrainian, Lithuanian and Belarusian peasantry, socio-economically. Later, the rationale behind Soviet class-based policies of enforced collectivization and urbanization was strikingly similar. Such imperial projects interacted closely with the more obvious ethnocentric economic policies of the interwar and post-Cold War nation states.

Let me first explain how economic empowerment was put into practice, using specific cases: A prime example of economic empowerment is land reform. Agrarian reform in the western borderlands of the Russian Empire began with the abolition of serfdom and gathered pace in the early 20^th century with the reforms of Piotr Stolypin. In many ways, the ethnocentric land reforms of the interwar period, which mainly expropriated the German and Polish-speaking nobility across East Central Europe, would have been difficult to imagine without the reforms of land ownership and village structures that were implemented before 1914. The interwar agrarian reformers added the historical imaginary: Land reform was conceptualized as the return of land to the core nationalities — land that had been taken from them by medieval crusaders, agents of Polonization, or imperial colonists. Land reforms dramatically changed the structure of land ownership across East Central Europe, taking land from minorities and transferring it to members of the core nationalities.

To name some further examples: State banks acquired and redistributed struggling businesses formerly belonging to national minorities, and minorities were removed from the management boards of enterprises. Minorities who had become refugees during the First World War were prevented from resettling in their former homes, which significantly decreased their presence in the urban population. Agricultural universities were established with the objective of creating a new national political, administrative, and economic elite. All these measures were legitimized by the claim that they restored a natural equilibrium that had been shattered by “foreign” imperial rule.

So were these projects of economic empowerment successful? Did the core nationalities have more economic agency as a consequence of them? There is no easy answer. Although this is almost impossible to quantify, we can say with certainty that Poles, Lithuanians, Latvians, etc. did not have a larger share in their respective national economies at the end of the 1930s than they had had in 1918. Why was this so? Who concentrated economic agency, if it had been taken from the minorities, but not ‘restored’ to the majority nationality? The answer is that it rested with the state. And the reasons for this are found in the specific nature of the interwar international system.

This is where the second characteristic of East Central Europe, noted by Michael Connelly, comes into play: the contested nature of independent statehood. The catastrophe of the First World War, the collapse of states, and the ensuing economic chaos caused by the war and territorial fragmentation profoundly changed the subjectivities of Europeans towards the pessimistic. If we look at diverse historical sources, we can discern that Europeans before and even during the First World War had expected states to become larger, economies to be more efficient, liberalism to continue, meaning people would become better off.

Yet with the end of the war, the collapse of empires and the enormous scope of the interwar economic slump, this outlook changed. Instead of merging into larger states, Europe seemed to have disintegrated into splinters. Many doubted the viability of the “small” states that had appeared on the map and expected a future violent revision of the territorial order. We tend to assume that territorial revisionism was a movement that mainly flowed from the disgruntled vanquished of the First World War, such as Germany and Hungary. But as I have shown in my recent book, there was a much broader acceptance across Europe that the post-1918 territorial order needed to change — and was bound to change.

Many expected that the states of East Central Europe, from Estonia across Poland to Czechoslovakia, were bound to fail as they had been deprived of the economic networks, markets, and hinterlands that the collapsed empires had offered them. Not only did they expect these states to be doomed, but they also considered them historical aberrations that obstructed Europe’s path towards stability, power, and wealth. This paralyzed international politics and financial and commodity flows to East Central Europe, which put an incredible strain on the new states. This meant that the empowerment of the state took precedent over the empowerment of the nation and led to the conflation of both. Integrated and unified states became the primary economic actors and were portrayed as the protectors of their nations’ economic agency.

But it was not only pessimistic views towards the East Central European states that were to blame here — the economic chaos of the post-1918 years also played a decisive role. Right after the war, international trade was seen as a guarantor of a recovery of the pre-war liberal order and also as a catalyst for the formation of an indigenous merchant class in East Central Europe. However, international trade was also increasingly regarded as a form of exploitation that eroded the new states’ recently gained sovereignty. This was mainly attributable to the competition between Germany, France, and Britain, who sought compensation for markets lost during the war and undertook aggressive trading ventures in East Central Europe. The East Central European governments responded by monopolizing large segments of trade. Ironically, in doing so, they foiled their own projects of economically empowering the core nations. This is most conspicuous in the case of Poland, where proponents of economic nationalism could draw on the support of highly regarded economists who promoted strong states, characterized by integration and unity, and thus lent the so-called “statism” scientific legitimacy. The Polish state therefore became the definitive economic actor, ultimately marginalizing merchants regardless of whether they belonged to a minority or to the ethnically Polish “core nation”. The construction of the port of Gdynia and of the coal trunk line from Silesia to the Baltic Sea was celebrated as constituting the emancipation of Polish foreign trade.

We see a crucial shift in economic empowerment here. Previously, minorities had been regarded as the greatest threat to the nation’s economic agency. But now they had been eclipsed by international capitalism, which threatened national sovereignty itself. In fear of this, the governments of East Central Europe accepted damaging tariffs and trade wars, fearing that the consequences of letting down their economic guard would lead to even worse results. As Yugoslav foreign minister Vojislav Marinković warned the League of Nations: ”No prediction of catastrophe following upon a Customs war could daunt us …. We have in any case to choose between one of two catastrophes — the catastrophe of the present and that of the future.” Thus, by delegitimizing liberalism, the First World War and the Great Depression caused a significant change in East Central European nationalism. Proponents of economic empowerment abandoned the project of expanding the economic agency of the nation by empowering the individual and replaced it with a conflation of the nation and the state.

Yet does this mean that the project of economic empowerment failed? I would argue no: Although the members of the core nations may not objectively have had more economic agency, many of them certainly felt like they did. People had come to self-identify with the nation state, which they regarded as the guardian of their economic interests. But what happens when the state disappears? This is what I will try to answer in the final section of this lecture.

How does economic empowerment raise national expectations?

Large parts of the majority nationalities did not experience the interwar period as a period of declining commercial agency. Governments were highly effective in involving citizens of the core nationalities in state-run trade efforts, giving them a stake in the national economy. Propaganda portrayed the existence of the state and the economic empowerment of the core nations as inextricably intertwined. The 1929 national exhibition PeWuKa (Powszechna Wystawa Krajowa) in Poznan is a prime example: It celebrated the final integration of a unified Polish market from the three partition areas and the union of the state and its new commercial class. In a similar vein, the creation of the Central Industrial District (Centralny Okręg Przemysłowy) in the 1930s was portrayed not only as a project of industrial rationalization, but as an instrument to integrate the nation as an economic actor. Cooperatives are another case in point. Despite their limited economic success, membership of them brought considerable social prestige. And the list goes on: In response to “foreign exploitation”, several East Central Europe governments created classes of state-employed purchasing agents, of whom the highest loyalty towards the nation was expected. A product of vocational training in cooperatives and of newly established national universities, they internalized norms of economic activity that radically differed from those of “traditional” merchants.

The experience of losing “one’s own state” in 1939/40, which Timothy Snyder has posited as crucial for ethnic violence and collaboration in the Holocaust in East Central Europe, had particular implications for these groups who felt they have gained an increased stake in the national economy. For them, the state had become the lynchpin of any social and economic activity. The Sovietization of the economy was thus experienced as a power grab of those groups who had traditionally been conceptualized as the enemies of empowerment — first and foremost Jews. This is crucial if we want to understand what took place in Jedwabne — why the town’s Polish inhabitants decided that not only some, but all Jews should be killed on the grounds that they could not fulfil any economic function that the Poles could not fulfil themselves. Accordingly, we find staggering accounts at the end of the Second World War that interpreted the Holocaust — not yet fully aware of its extent — as a continuation of this long-term struggle for economic empowerment, as in the case of Polish writer Jerzy Braun:

Today there is no place for Jews in small towns and villages. Over the past six years (finally!), a Polish third estate has emerged which did not exist before. It completely took over trade, supplies, mediation and local crafts in the provinces [….] Those young peasant sons and former peasant proletarians who once worked for the Jews are determined, persistent, greedy, deprived of all moral scruples in trade, and superior to Jews in terms of their courage, initiative and flexibility. Those masses […] will not relinquish what they have conquered. There is no force which could remove them.

As a consequence of the impossibility of reconciling the monstrosity of the Holocaust with national narratives, economic empowerment as a core aspect of nationalism disappeared from nationalist discourse and largely also from national historiography. While national movements and politicians had promoted the appropriation of trade, the competition with minorities and the influx of peasants into cities, the unfathomable dimension of the Holocaust made it impossible to celebrate the realization of this project during the Second World War as a historical achievement. Interpretations such as those of Jerzy Braun disappeared, once the scope of the murder of Eastern European Jews became clear. Even today, there is no conceivable narrative that could bring projects of economic empowerment and the Holocaust into a common frame. This has led to the one-dimensional master narratives that posit rescuers of Jews against murderers of Jews, which dominate in East Central Europe and leave little space for nuance.

Ironically, after the Holocaust, Stalinist policies provided the second catalyst for national economic empowerment. This may sound provocative or even immoral. Of course, I do not mean to say that the Holocaust or Stalinism were what nationalists would have wanted. But if we want to understand why — among the resistance that undoubtedly existed — there was a significant number of East Central Europeans who adopted an affirmative attitude towards Hitler and Stalin during and after the Second World War, we must acknowledge how similar the objectives of ethnic cleansing and of certain forms of coerced urbanization and modernization were to the expectations raised by national activists and especially the interwar nation states. Violeta Davoliūtė has brilliantly shown the enthusiasm of Lithuanian writers as they witnessed how ethnic Lithuanians were quite forcibly resettled from rural areas to become workers in Vilnius, which now became an ethnically Lithuanian city. Similarly, ethnic cleansing in the Ukrainian-Polish border region was greeted by many Poles and Ukrainians alike.

I would like to conclude by presenting some ideas on how I believe projects of economic empowerment during the collapse and creation of states have shaped contemporary politics and societal expectations in East Central Europe. While the end of the Cold War raised hopes that the differences between Europe’s East and West would disappear, it is clear that today there is an increasing sense of a deepening divide between an increasingly populist eastern and a besieged, but still liberal western part of the continent.

Surveys reveal that support for economic nationalism is particularly high in East Central Europe, with a significant part of the population demanding restrictions on imports, on foreign land purchases and on worker immigration that is far higher than the European average. Yet ethnic minorities, which form much smaller shares in East Central European populations as a consequence of the Second World War, are no longer seen as the main threat to the core nation’s economic agency. Rather, in today’s nationalist discourses, and in striking resemblance to the interwar period, they have been replaced with post-Communist liberal elites, international finance, and Brussels. We see this most obviously in the rhetoric of populist governments. Two examples shall suffice here. When Viktor Orbán reported his government’s economic successes to the Hungarian Chamber of Commerce in 2017, he laid out the path ahead:

[…] we need a national banking system that is in Hungarian hands. It doesn’t need to be state-owned, but what matters is that it should be in Hungarian ownership. And when there is trouble, it should not seek to relocate funds elsewhere, but should seek to retreat here and protect and maintain its positions here.

Just last summer, when Jarosław Kaczyński looked back at the achievements of the PiS party, he framed its years of rule as a fierce struggle to restore economic agency — which had been taken by liberal elites, the EU, and international business — to the Polish state and nation:

We wanted a general change. The process we undertook had to and did go through battles: against total opposition and pressure from outside, from other countries that wanted to see Poland helpless in the face of external enemies. Some have called this, though perhaps this is an exaggeration, post-colonialism. This is why the entire history of these five or six years is a history of struggle.

Regarded as the most existential internal threat to the European Union, the solutions proposed to deal with populism rather helplessly focus on the promotion of the EU’s alleged core values, such as tolerance, pluralism, progressivity, and the rule of law. Yet to understand the success of populism, we need to understand why populist parties win elections. While this electoral success is usually attributed to the vague appeal of a nationalist, chauvinist rhetoric, I believe it is the social and economic policies of these parties — enshrined in the term “Orbanomics” in the case of Hungary — that explain why these parties not only gain power, but also why they are so effective at staying in power. They are highly successful in meeting the expectations raised in East Central Europe for more than a century, across different regimes, and by very different sets of historical actors and institutions.≈

Note: This text is a slightly revised version of the keynote lecture delivered by Klaus Richer at the CBEES’ Annual Conference ““With and After Empire: Enduring Pasts Across the Local and the Global”, organized online between November 25–26, 2021.

References

1. 
   Svetlana Alexiechiv, Secondhand Time: The Last of the Soviets. (New York: Random House, 2016).
2. Jan Tomasz Gross. Neighbors: The Destruction of the Jewish Community in Jedwabne, Poland. (New York: Penguin Books, 2002).
3. John Connelly. From Peoples into Nations: A History of Eastern Europe. (Princeton: Princeton University Press, 2020).
4. Simonas Daukantas (Jokyb’s Łaukys), Budą Senowęs–Letuwiū Kalnienù ir Zámajtiù. Ìszraszzę Pagał Senowęs Rasztù, (St. Petersburg, 1845), 191—92.
5. Petras Vileišis (Ramojis), Musų Žydai ir kaip nuo anų turime gintiesi [Our Jews and how we have to defend ourselves against them], (Tilsit 1886), 93.
6. Klaus Richter, Fragmentation in East Central Europe: Poland and the Baltics, 1915—1929. (Oxford: Oxford University Press, 2020).
7. Speech of Vojislav Marinković. League of Nations. Commission of Enquiry for European Union. Minutes of the Second Session of the Commission. February 16, 1931, League of Nations Archive, C.144.M.45.1931.VII
8. Jerzy Braun in July 1945, cited in Jan Tomasz Gross, Golden Harvest (New York, 2012), 107.
9. Violeta Davoliūtė, The Making and Breaking of Soviet Lithuania: Memory and Modernity in the Wake of War. (London: Routledge, 2013).
10. Prime Minister Viktor Orbán’s speech at the Hungarian Chamber of Commerce and Industry’s ceremony to mark the start of the 2017 business year. February 28, 2017. Available at: https://miniszterelnok.hu/prime-minister-viktor-orbans-speech-at-the-hungarian-chamber-of-commerce-and-industrys-ceremony-to-mark-the-start-of-the-2017-business-year/
11. “Jarosław Kaczyński na kongresie PiS o porażkach rządów Zjednoczonej Prawicy” [Jarosław Kaczyński at the PiS congress on the failures of the government of the United Right] Onet Wiadomości. July 3, 2021. Available at:  https://wiadomosci.onet.pl/kraj/przemowienie-jaroslawa-kaczynskiego-na-kongresie-pis/s5x86nt

Klaus Richter